Segmentation , Targeting and Segmentation , Targeting and PositioningPositioningbyby

Target MarketingTarget marketing requires

marketers to take three major steps:

Identify and profile distinct groups of buyers who differ in their needs and preferences (MARKET SEGMENTATION).

Select one or more market segments to enter (MARKET TARGETING).

For each target segment, establish and communicate the key distinctive benefit(s) of the company’s market offering (MARKET POSITIONING).

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Segmentation

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Bases for Segmenting Consumer MarketsGeographic Segmentation

Many companies today are localizing their products , advertising, promotions and sales efforts to fit the needs of individual regions, cities, and even neighborhood (tapal, pizza hut, KFC)

Demographic Segmentation Most popular bases because

consumer needs, wants and usage rates often vary closely with demographic patterns. They are easier to measure than most other types of variables

SegmentationAge and Life Cycle Stage GenderIncome

Psychographic SegmentationLifestyle

Time-constrainedMoney-constrained

Social Classo Personality Characteristics

(hip and trendy, rebellious, sincere, exciting, competent, sophisticated, rugged)

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SegmentationBehavioral Segmentation

(dividing up market on the basis of knowledge, attitudes, uses or responses to a product. Occasions

Orange juice is often consumed at breakfast

Valentines, Father’s Day, Mother’s Day, Ramzan, Eid

Benefits Sought User Status

Market share leaders focus on attracting potential users, whereas smaller firms focus on attracting current users away from the market leader

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SegmentationUsage Rate Loyalty Status

Multiple SegmentationGeodemographic

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Criteria for Effective Segmentation

Effective SegmentationMeasurableSubstantialAccessibleDifferentiable (responds

differently to different marketing mix elements)

Actionable (Effective programs can be designed for attracting and serving the segments)

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Market TargetingMarket segmentation

reveals the firm’s market segment opportunities.

Now the firm will evaluate the various segments Size and GrowthSegment Structural

AttractivenessObjective and Resources

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Market TargetingSelecting Segments

Undifferentiated MarketingIgnore market segments, one

offer, focus on common need will appeal to largest number of buyers

Differentiated Marketing (Segmented Marketing)Targeting several segments and

designing separate offers for each. Lux , lifebuoy Bright, Bonus, Bonus Tri StarCapri , OpelToyota , Lexus

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Market Targeting Developing a stronger position

within several segments creates more total sales than undifferentiated marketing across all segments.

But also increases cost of doing business

Niche or Concentrated Marketing

Going for large share of small segment rather than small share of large market

Advantages: Better adaptation, less competitors

Example: Soap for people with Acne or any rear disease, BMW

Highly profitable, but risky as well !!!!

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Market TargetingMicro Marketing

Tailoring products and marketing programs to suit the tastes of specific individuals and locations.

LOCAL MarketingTailoring to the needs of

local customer groups Ex: Cities, Neighborhood,

Local Stores (Makro)INDIVIDUAL Marketing

Tailoring to the needs of individual customers

Car, Suit, Candies

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Market TargetingChoosing A Target Marketing Strategy

Following factors are considered when choosing a target marketing strategy Company Resources Degree of Product Variability Product Life Cycle Stage Market Variability Competitors Marketing Strategies

Socially Responsible Target Marketing Smart Targeting help companies and

customers as well. Targeting kids. Spill over of adult

products to kids section. Targeting kids may be good.

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Positioning for Competitive Advantage

Products positioning: The way the product is defined by

consumers on important attributes, The place the product occupies in the minds of the consumer relative to competitors products.

The impression, perception of product

(Colgate- Cavity) (Lux – Beauty) (Dettol – Antibacterial) (Head & Shoulders – Dandruff) (Suzuki – economy car) (Mercedes – Luxury Car) (Porsche – Performance)

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Perceptual MapPerception of one’s brand with competing brand

on important buying dimensions.

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Price

Luxury Performance

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Choosing a Positioning Strategy

Some firms find it easy to choose their positioning strategy (for ex: quality) but in many cases , two or more firms will go after the same position. Thus a company will have to find other ways to set itself apart.

Three steps of positioning task are Identifying possible competitive

advantagesChoosing the right competitive

advantagesSelecting an over all positioning

strategy

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Choosing a Positioning Strategy

Identifying Possible Competitive Advantages Finding competitive advantages Positioning can not be based on empty promises A company may differentiate on the basis of

Product Line (little variation, highly differentiated) (features, performance, style)

Service Differentiation (Speedy, convenient, careful) (Easy paisa, TCS, Dominos)

Channel Differentiation (Direct Channel) (Dell) People Differentiation (Trained, Competent,

Courteous, Friendly) Image Differentiation (Brand Image)Image

must be supported by every thing the company says or does.

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Choosing a Positioning Strategy

Choosing The Right Competitive AdvantagesHow many differences to

promoteOne (USP)More than one

Which Differences to promote ImportantDistinctiveSuperiorCommunicablePreemptiveAffordable Profitable

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Selecting an Over All Positioning Strategy

Consumer typically choose products and services that give them the greatest value

Value Proposition: The full positioning of a brand – the full mix of benefits upon which it is positioned. Mercedes’ value proposition

hinges on luxury but also includes reliability, roominess, styling, safety

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Communicating and Delivering the Chosen Position

Positioning the company calls for concrete actions.

Designing the marketing mix involves working out the tactical marketing details fo the positioning strategy.

Establishing a positioning takes time, but can be destroyed very quickly

A products position should evolve gradually (not abruptly) as it adapts to the ever changing marketing environment.

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GOOD NEWS !

Quiz

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