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Marketing 11Marketing 11Chapter 6 Chapter 6 Market Segmentation and Market Segmentation and Target marketingTarget marketing

Lesson 3: Lesson 3: Market Segmentation Strategiespp. 150-159pp. 150-159

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Market Segmentation Market Segmentation StrategiesStrategies

MarketDifferentiation

NicheMarketing

Operate in many segments, with many products with unique marketing strategies.

All resources aimed at a distinct segment.

Market Integration

A company expands from a segment to embrace other similar segments

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Market DifferentiationMarket Differentiation

QTG Canada (Quaker Tropicana Gatorade) is a market differentiator

Targeting several market segments with several different products and marketing plans

Different marketing strategies for each product and segment

Not putting all eggs in one basket – very beneficial!

Cost of differentiation can be high (spreading resources thinly) – must evaluate potential revenues carefully against costs!

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Niche MarketingNiche Marketing1.1. The niche is sufficiently large and has The niche is sufficiently large and has

enough purchasing power to be profitable.enough purchasing power to be profitable.2.2. It is of negligible interest to major It is of negligible interest to major

competitors so that there is little threat competitors so that there is little threat from these firms.from these firms.

3.3. The firm has the required skills and The firm has the required skills and resources to serve the segment effectively.resources to serve the segment effectively.

4.4. The firm can defend itself from an The firm can defend itself from an attacking competitor.attacking competitor.

TSN (The Sports Network) is a market nicher.

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Market IntegrationMarket IntegrationExpand from a single segment into other similar segments

Why choose a market integration strategy?1. The needs of consumers change

2. New competition enters a particular segment

3. Products and markets reach the maturity stage of the product life cycle and are threatened by new, innovative products

• Wal-Mart adds groceries

• Loblaw’s and other supermarkets add pharmacies

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PositioningPositioning

“The place a brand occupies in the customer’s mind in relation to competing products.”

Positioning involves a 2-Step Process:

1. Develop and market a product that meets needs of target market.

2. Create appropriate appeals to differentiate the product in the customer’s mind.

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Positioning StrategiesPositioning Strategies

1. Head-on

2. Brand Leadership

3. Product Differentiation

4. Innovation

5. Lifestyle

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RepositioningRepositioning

“Changing the placea product occupiesin the consumer’smind.”

Repositioning is due to:1. The activity of a direct

competitor.

2. The preferences of a target market change.

Cadillac reinvented itself. It’s no longer grandpa’s car!

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Any Questions?Any Questions?

Assignment:Assignment:•Read p. 150-159Read p. 150-159•Complete WSH 6.3Complete WSH 6.3