Chapter 8: Identifying Market Segments and Targets

Jesus Martin A. Generoso, Jr.Ateneo School of Medicine and Public

Health

May 12, 2010

Top 10 Concepts

Source: Kotler, P.. Marketing Management. 13th ed.

Outline Segment marketing Niche marketing Local marketing Individual marketing Geographical segmentation

Source: Kotler, P.. Marketing Management. 13th ed.

Outline Demographical segmentation Psychodemographic segmentation Behavioral segmentation Segmenting, Evaluating, and

Selecting Market Segments Segment-by-segment invasion plan

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 1:

Segment Marketing

Market segment customers with similar needs and

wants

With flexible market offerings Naked solution Discretionary options

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 1:

Segment Marketing - examples Kotler: Seimens Electrical Apparatus

Division – metal clad boxes

Local: Cebu Pacific

Medical: additional expenses for patient rooms at TMC

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 2:

Niche Marketing Niche

narrower than a segment

Customers have a distinct set of needs

Customers are willing to pay a premium

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 2:

Niche Marketing - examples

Kotler: Enterprise car rental

Local: Jusi Barong Tagalog producers

Medical: superspecialized medical practitioners

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 3:

Local Marketing Tailor-fit to local customer groups

“grassroots marketing” getting as close and personally

relevant

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 3:

Local Marketing - examples

Kotler: Citibank, Nike

Local: Get Blued

Medical: American Eye sponsoring Efren “Bata” Reyes

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 4:

Individual Marketing ultimate level of segmentation

Customized marketing or one-to-one marketing

Customerization – people can design the product they way they want it

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 4:

Individual Marketing - examples Kotler: JackRabbit, SBR MultiSports,

and Signature custom bike shops

Local: PCXpress – PC/laptop custom assemblies

Medical: personalized physical rehabilitation regimens

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 5:

Geographical Segmentation Market is divided into different

geographical units nations, states, regions, counties,

cities, or neighborhoods

Company operates in one, two, or all

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 5:

Geographical Segmentation - examples

Kotler: Hilton Hotels

Local: McSpaghetti

Medical: Hilot, Ayurveda

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 6:

Demographic Segmentation age, family size, family life cycle,

gender, income, occupation, education, religion, race, generation, nationality, and social class

estimate market size and the media that should be used

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 6:

Demographic Segmentation - examples Kotler: Crest and Colgate

Local: Hapee toothpaste

Medical: TMC teen hub

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 7:

Psychographic Segmentation

psychology and demographics to understand consumers

Consumers are grouped by psychological/personality traits, lifestyle, or values

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 7:

Psychographic Segmentation - examples

Kotler: Transport Canada

Local: CityLand - condominium vendors

Medical: psychological rehabilitation for drug addicts

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 8:

Behavioral Segmentation

People divided by their knowledge, attitude toward, use, or response to a product

Decision roles - Initiator, Influencer, Decider, Buyer, User

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 8:

Behavioral Segmentation

Behavioral variables occasions, benefits,

user status, usage, buyer-readiness stage, loyalty

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 8:

Behavioral Segmentation - examples

Kotler: Ocean Spray Cranberries Inc.

Local: Red Ribbon cakes

Medical: TMC Cardiac Awareness Week

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 9:

Segmenting, Evaluating, and Selecting Market Segments

Segmenting – 5 criteria Measurable Substantial Accessible Differentiable Actionable

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 9:

Segmenting, Evaluating, and Selecting Market Segments

Single-segmentSingle-segmentconcentrationconcentration

P1

P2

P3

M1 M2 M3 SelectiveSelective

specializationspecializationM1 M2 M3

P1

P2

P3

ProductProductspecializationspecialization

M1 M2 M3 P1

P2

P3

Source: Kotler, P.. Marketing Management. 13th ed.

M1 M2 M3

Full marketFull marketcoveragecoverage

P1

P2

P3

MarketMarketspecializationspecialization

M1 M2 M3 P1

P2

P3

Concept 9:

Segmenting, Evaluating, and Selecting Market Segments - examples

Kotler: Volkswagen, Porsche

Local: Islander slippers

Medical: American Eye Center

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 10:

Segment-by-segment invasion plan Company enters 1 segment at a

time

Kept a secret from other competitors

Source: Kotler, P.. Marketing Management. 13th ed.

Concept 10:

Segment-by-segment invasion plan - examples Kotler: PepsiCo, Toyota

Local: Bench

Medical: The Medical City, interventional cardiologists

Source: Kotler, P.. Marketing Management. 13th ed.

Chapter 8: Identifying Market Segments and Targets

Jesus Martin A. Generoso, Jr.Ateneo School of Medicine and Public

Health

May 12, 2010

Top 10 Concepts

Source: Kotler, P.. Marketing Management. 13th ed.