Segmentation, Targeting, and Positioning

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Segmentation, Targeting, and Positioning
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Market Segmentation,Targeting, and Positioning
Market Segmentation 1. Identify bases for
segmenting the market 2. Develop segment profiles
Market Targeting 3. Develop measure of
segment attractiveness 4. Select target segments
Market Positioning 5. Develop positioning for
target segments 6. Develop a marketing mix
for each segment
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Market SegmentationBases for Segmenting Consumer
Markets
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Market Segmentation Geographic Segmentation
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Market SegmentationDemographic Segmentation

• Dividing the market into groups based on
  variables such as
• Age
• Gender
• Family size or life cycle
• Income
• Occupation
• Education
• Religion
• Race
• Generation
• Nationality

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Market Segmentation Psychographic Segmentation

• Dividing buyers into different groups based on
• Social Class
• Lifestyle
• Personality characteristics

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Market Segmentation Behavioral Segmentation

• Dividing the market into groups based on
  variables such as
• Occasions
• Benefits Sought benefit segmentation
• User status
• Usage rate
• Loyalty status
• Readiness stage
• Attitude toward product

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Segmenting Business Markets

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Segmenting International Markets
Geographic Location
Factors Used to Segment International Markets
Economic Factors
Cultural Factors
Political and Legal Factors
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Effective Segmentation
Measurable
Substantial
Accessible
Differential
Actionable
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Market TargetingEvaluating Market Segments

• Segment Size and Growth
• Analyze current sales, growth rates and expected
  profitability for various segments.
• Segment Structural Attractiveness
• Consider effects of competitors, availability
  of substitute products and, the power of buyers
  suppliers.
• Company Objectives and Resources
• Company skills resources needed to succeed in
  that segment(s).
• Look for Competitive Advantages

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Step 2. Market TargetingSelecting Target Market
Segments

• A target market g consists of a set of buyers who
  share common needs or characteristics
• Target marketing g can be carried out at several
  different levels
• Mass marketing undifferentiated mktg
• Segmented marketing differentiated mktg
• Concentrated marketing niche marketing
• Micromarketing

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Step 2. Market Targeting Target Marketing
Strategies
Market
Company Marketing Mix
Company Marketing Mix 1
Segment 1
Company Marketing Mix 2
Segment 2
A. Undifferentiated Marketing
Segment 3
Company Marketing Mix 3
Segment 1
Company Marketing Mix
Segment 2
B. Differentiated Marketing
Segment 3
C. Concentrated Marketing
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Step 2. Market Targeting Target Marketing
Strategies
Mass Marketing undifferentiated mktg Same
product to all consumers (no segmentation)
Segmented Marketing differentiated
mktg Different products to one or more
segments (some segmentation)
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Step 2. Market Targeting Target Marketing
Strategies
Niche Marketing concentrated mktg Different
products to subgroups within segments
Micromarketing Products to suit the tastes of
individuals and locations (complete segmentation)
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Step 2. Market Targeting Target Marketing
Strategies (cont.)

• Characteristics of an attractive niche
• The customers in the niche have a distinct set of
  needs
• They will pay a premium to the firm best
  satisfying their needs
• The nicher has the required skills to serve the
  niche in a superior fashion
• The nicher gains certain economies through
  specialization
• The niche has sufficient size, profit and growth
  potential

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Step 2. Market TargetingChoosing a
Market-Coverage Strategy
Company Resources
Product Variability
Products Stage in the Life Cycle
Market Variability
Competitors Marketing Strategies
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Step 3. Positioning

• Positioning g the act of designing the companys
  offering and image to occupy a distinctive place
  in the target markets mind
• Products position g the way the product is
  defined by consumers on important attributes -
  the place the product occupies in consumers
  minds relative to competing products.
• Marketers must
• Plan positions to give their products the
  greatest advantage in selected target markets,
• Design marketing mixes to create these planned
  positions.

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Perceptual Map in Positioning (Example of Theme
Parks)
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Step 3. Choosing a Positioning Strategy
Step 1. Identifying Possible Competitive
Advantages
Step 2. Selecting the Right Competitive Advantage
Step 3. Communicating and Delivering the Chosen
Position
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Identifying Possible Competitive Advantages
(cont.)

• Key to winning and keeping customers is to
  understand their needs and buying processes
  better than competitors do and deliver more value
• Competitive advantage is an advantage over
  competitors gained by offering consumers greater
  value, either through lower prices or by
  providing more benefits, that justify competitive
  advantage

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Identifying Possible Competitive Advantages
(cont.)
Services Differentiation i.e. Delivery,
Installation, Repair Services, Customer
Training Services
Product Differentiation i.e. Features,
Performance, Style Design, or Attributes
Image Differentiation i.e. Symbols, Atmospheres,
Events
Personnel Differentiation i.e. Hiring, Training
Better People Than Competitors Do
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Product Differentiation
Form
Fea- tures
Perfor- mance
Quality
Conform- ance Quality
Dura- bility
Relia- bility
Repair- ability
Style
Design
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Services Differentiation
Ordering Ease
Installation
Customer Consulting
Delivery
Maintenance Repair
Customer Training
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Choosing the Right CompetitiveAdvantages
Important
Profitable
Distinctive
Criteria For Determining Which Differences To
Promote
Superior
Affordable
Communicable
Unique Selling Proposition
Preemptive
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Selecting an Overall Positioning Strategy
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Communicating and Delivering the Chosen Position

• Once position is chosen, company must take strong
  steps to deliver and communicate the desired
  position to target consumers.
• All the companys marketing mix must support the
  positioning strategy.
• Positioning strategy must be monitored and
  adapted over time to match changes in consumer
  needs and competitors strategies.