Transcript Chap 9 - ApnaGulshan.Com

Chapter 9
Identifying Market
Segments and Selecting
Target Markets
0
Objectives
• Learn how companies identify the
segments that make up a market.
• Understand the criteria companies use to
choose the most attractive market
segments.
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Target Marketing
• Target marketing requires marketers to take
three major steps:
– Market segmentation: Identifying and profiling distinct
groups of buyers who differ in their needs and
preferences.
– Market targeting: Selecting one or more market
segments to enter.
– Market positioning: Establishing and communicating
the key distinctive benefit(s) of the company’s market
offering to each target.
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Using Market Segmentation
• Mass marketing is losing popularity
• Micromarketing can be undertaken at four
levels:
– Segment marketing
– Niche marketing
– Local marketing
– Individual marketing
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Patterns of Preference Segments
• Three patterns of preference segments
are typically identified:
– Homogeneous preferences
– Diffused preferences
– Clustered preferences
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Using Market Segmentation
Needs-based Segmentation Process
1. Needs-based
segmentation
4. Segment
profitability
2. Segment
identification
5. Segment
positioning
3. Segment
attractiveness
6. Segment “acid
test”
7. Marketing-mix strategy
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Characteristics of Market Segments
• Useful market segments share certain
characteristics:
–Measurable
–Differentiable
–Substantial
–Actionable
–Accessible
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Segmenting Consumer Markets
Bases for Segmentation
• Geographic
• Demographic
• Nation or country
• State or region
• City or metro size
• Psychographic
• Density
• Behavioral
• Climate
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Segmenting Consumer Markets
Bases for Segmentation
• Geographic
• Demographic
• Age, race, gender
• Income, education
• Family size
• Family life cycle
• Occupation, education
• Psychographic
• Religion, nationality
• Behavioral
• Generation
• Social class
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Segmenting Consumer Markets
Bases for Segmentation
• Lifestyle
– Activities
• Geographic
• Demographic
• Psychographic
• Behavioral
– Interests
– Opinions
• Personality
• Core values
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Segmenting Consumer Markets
Bases for Segmentation
• Occasions
• Benefits
• Geographic
• User status
• Demographic
• Usage rate
• Psychographic
• Behavioral
• Loyalty status
• Buyer-readiness
• Attitude
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Segmenting Consumer Markets
• Multi-attribute segmentation via
geoclustering combines multiple variables to
identify smaller, better-defined target groups
– PRIZM Geoclustering system uses
demographic, geographic, lifestyle, and
behavioral characteristics
(Potential rating index by zip markets)
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Segmenting Business Markets
Bases for Segmentation
• Operating variables
• Situational factors
• Purchasing
• Personal
approaches
characteristics
 Demographic variables
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Segmenting Business Markets
• Rackman and Vincentis proposed a
segmentation scheme that classifies
business buyers into three groups:
– Price-oriented customers: best served via
transactional selling
– Solution-oriented customers: best served by
means of consultative selling
– Strategic-value customers: best served by
means of enterprise selling
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Market Targeting Strategies
• Evaluating and selecting market segments
requires assessing the segment’s overall
attractiveness in light of company’s
objectives and resources.
• Five patterns of target market selection can
then be considered.
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Patterns of Target Market Selection
• Single-segment
concentration
• Selective
specialization
• Product
specialization
• Market
specialization
Full market coverage
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Single-Segment Concentration
Selective Specialization
Product Specialization
P1
P2
P3
M1
M2
M3
Market Specialization
Full Market Coverage
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Market Targeting Strategies
• Targeting multiple segments may result in
cost economies
• Supersegment targeting may be appropriate
• Blocked markets often require
megamarketing countermeasures
• Be aware of ethical concerns
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