Transcript Lecture 13-Segmentation, Targeting and Positioning

MGT-519
STRATEGIC MARKETING
AAMER SIDDIQI
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LECTURE 13
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RE-CAP
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Introduction to STP
STP Model
Definition of Segmentation
3 Approaches to Marketing in STP
Variables For Segmentation
Effective Segmentation
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TARGETING
• In the next step, we decide to target one or more segments
• Our choice should generally depend on several factors.
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First, what is the existing level of competition
How good at serving customer needs are they?
The greater the numbers and
Better they are able to meet customer needs
The more difficult it will be for another business to also be a
success
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TARGETING
• Secondly, how large is the segment,
• How can we expect it to grow?
• A downside to a large, rapidly growing segment is that it tends
to attract competition
Thirdly, do we have strengths as a company that will help us
appeal particularly to one group of consumers?
• Firms may already have an established reputation.
• Fourthly, are we able to actual communicate with the
segment?
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• Example: McDonald’s has a great reputation for fast,
consistent quality, family friendly food, it would be difficult to
convince consumers that McDonald’s now offers gourmet
food. Thus, McDonalds would probably be better off targeting
families in search of consistent quality food in nice, clean
restaurants. This is the first important lesson in targeting –
most firms CANNOT meet ALL market needs.
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TARGET MARKETING
• Target marketing is thus defined as
“the identification of the market segments that are identified
as being the most likely purchasers of a company’s products”.
• Specifically, the advantages of target marketing are:
• Marketing opportunities and unfilled ‘gaps’ in a market may
be more accurately appraised and identified
• Such gaps can be real (e.g. sweet, strong, harsh or mild)
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TARGET MARKETING (CONT’D)
• They can be illusionary in terms of the way people want to
view the product (e.g. happy, aloof, silly or moody).
• Product attributes can fulfil criteria or
• These attributes might well have to be implanted in the minds
of customers through an appropriate advertising message
2. Market and product appeals through manipulation of the
marketing mix can be more delicately tuned to the needs of the
potential customer.
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TARGET MARKETING (CONT’D)
3. Marketing effort can be concentrated on the market segment(s)
• which offer the greatest potential for the company to achieve
its goals
• The goals can be to maximise profit potential or
• To secure the best long-term position for the product or
• Any other appropriate goal.
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POSITIONING
• Product positioning is the next important step in developing
an effective marketing strategy After segmentation and
market targeting.
• Product positioning refers to the way in which an
organisation sets itself apart in the market and
• How its products and services are perceived by the target
market as a whole
• This incorporates the concept of all stakeholders of the
company
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POSITIONING (CONT’D)
• An organisation must have a form of differential advantage
• Enables to compete successfully in a target market
• Porter’s work we know that this has to take one of three formats
– cost leadership
– differentiation
– Focus
• Positioning is about communication of the overall value proposition
such that
– it creates and
– maintains
• Giving a clear message to customers
• Creates a distinctive and
• ideally unique, place in the market for
the organisation
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POSITIONING EFFECTIVELY
• Effective positioning: • The basic value proposition offered must be relevant to the
target market
• Must be differentiated from the competition
• Must be sustainable
• Communicated clearly to the market.
• This aspect fits more closely with differentiation as a generic
strategic option and
• Helps to explain the proliferation of brands, products and
services
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MAIN ELEMENTS OF POSITIONING
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MAIN ELEMENTS OF POSITIONING
• A key element of establishing a sustainable market position is
differentiation at
– product
– brand or
– corporate level
• The differentiating variable may be
– actual - based on the physical attributes and features of the product,
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– perceived - based on the image of the product or the supplier;
• Differentiation may occur with different elements of the
marketing mix
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MAIN ELEMENTS OF POSITIONING
• It may involve attributes which give customers more benefits
than the competition;
• It may for example, stem from a unique brand image or
superior service
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SUMMARY
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Targeting
Target Marketing
Positioning
Positioning Effectively
Main Elements Of Positioning
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THANKYOU
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