Session 12 mg 220 mba - 30 sep 10

MG 220 Marketing ManagementMBA 10

Fall 2010

Muhammad Talha Salam, Asst. [email protected]

Access it online: www.slideshare.net/talhasalam

Part 3: Connecting with Customers

> Market Targeting

Part 4: Building Strong Brands

> Overall review of Part 4

> Discussion on Case Studies

> Discussion on Term Project

Class Presentation | Session 12 | 29 Sep 2010


Market Targeting

• Marketers job is to identify segments and select which ones to target

• Segments are identified => Now selecting which ones to target

• More and more refinement helps identify smaller, more focused segments and

Better target them

MG 220 Marketing Management 2


Market TargetingEffective Segmentation Criteria

• Market segments must rate favorably on following criteria:

– Measurable• Size, purchasing power, characteristics can be measured easily

• It should not be vague

– Substantial• Large & profitable enough to serve

• Worth going after with a tailored marketing program/effort

– Accessible• Can be effectively reached and served

– Differentiable• Conceptually distinguishable

• Respond differently to different marketing-mix elements

– Actionable• Effective programs can be formulated for that particular segment



Market TargetingEvaluating and Selecting the Market Segments

• Evaluation process– Based on five criteria (mentioned previously)

– Vis-à-vis two factors:• Segment’s overall attractiveness

• Company’s objectives and resources

– A company must evaluate segments carefully by answering all criteria clearly and ensuring that it is favorable




• Selecting Market Segments– Selection is done based on evaluation of market segments

– Five different patterns are used:

1. Single-segment concentration

2. Selective Specialization

3. Product Specialization

4. Market Specialization

5. Full Market coverage

(illustrations ahead are in a grid pattern showing M-Market vs. P-Product)




1. Single-segment concentration– Pick only one segment

– Focus on it and achieve leadership and thus

– Have high returns of investment

Downside:

– Too much dependency implies increased risk

Generally:

– Companies tend to operate in more than one segment

– Helps diversify and absorb costs in a better way

– Concept of Supersegments: Segments sharing exploitable similarities: Companies try to operate in supersegments too




2. Selective Specialization– Pick different segments having no synergy

– Each is objectively attractive and appropriate

– Different approaches can be:• Different products in different markets (as in fig.)

• Different segments (totally isolated from each other)picked for one product




3. Product Specialization– Focus on one product

– Offered across all markets (segments)

– Too much focus on product alone

– What if product is replaced by a betterproduct or technology?

– Example: Kodak’s camera films




4. Market Specialization– Focus on one market

– Focus is on serving as many needs of that market

– Again, too much dependency on one area

– What if this market is not able to grow?

– Example: Institutes too much focused onaccounting market (CA, ACCA, CAT etc.) Had to diversify into finance programs (CFA, CISA)




5. Full Market Coverage– Serve all customer segments for all their needs

– Very hard to do. Generally large firms can do it only• E.g. Microsoft (software market)

– Two broad strategies/approaches:• Undifferentiated Marketing: Firm ignores segment

differences and offers one product to all

Coke’s 300 ml bottle example applies here

• Differentiated Marketing: Different products fordifferent segments – still covering all segments

Microsoft targeting different segments in software market differently




Managing Multiple Segments

• Using segment managers

• Each is responsible for growth and profitability of own segments

Differentiated Marketing Costs

• In differentiated marketing (targeting different segments with different products), higher sales are possible than undifferentiated marketing but costs are also increased.– Product modification costs

– Manufacturing costs

– Administrative costs

– Inventory costs

– Promotion costs

• Marketers need to understand the trade-off and be cautious of segmentation (particularly over-segmentation)



Market TargetingAdditional Considerations

Segment-by-Segment invasion plans

• Recommended: enter one segment at a time

• Add more with time

• Segment-by-segment invasion plans should be kept as confidential as possible

• Companies at times fail todevelop these plans

• How to enter blocked markets:Concept of megamarketing



Market TargetingAdditional Considerations

Updating Segmentation schemes

• Market segmentation analysis should be done periodically because business environment change

• How consumer attributes change and understanding of it helps update market segmentation

Ethical choice of market targets

• Ensuring that marketing efforts are not exploiting vulnerable groups in society

• OR promoting harmful products



Fall 2010




> Overall review: Part 4

Class Presentation | Session 13 | 29 Sep 2010



Chap 9: Creating Brand EquityWhat is Brand Equity?Building Brand EquityMeasuring Brand EquityManaging Brand EquityDevising a Branding Strategy

Chap 10: Crafting the Brand PositioningDeveloping and Creating a Positioning StrategyDifferentiation StrategiesProduct Life-cycle marketing strategiesMarket Evolution

Chap 11: Dealing with CompetitionCompetitive forcesIdentifying CompetitorsAnalyzing CompetitorsCompetitive Strategies for Market LeadersOther Competitive StrategiesBalancing Customer and Competitor Orientations



Discussion on Assignment/Case Studies

Assignment-I grading 3%

Re-formatting and re-submittal required

Individuals to discuss assignments on Saturday, Sep 30, 2010

7 x Case Studies to be covered

As assignments (1% each)Each case study to be read in depth

Analyzed

Key points noted

Solutions and options to problems identified

Research may be involved if so required

Assignment-II & III grading 2% + 3%



Discussion on Term Project

Team Project 10%Teams of 2-3 individuals each

Project Report

Team Presentation (15 mins)

6-weeks project beginning Oct 5,2010

4 x deliverables | 1 x presentation

Options:

Case Study (practices in market)

OR

Marketing Plan (new product – complete feasibility and detailed marketing plan)



Fall 2010




> What is Brand Equity?

> Building Brand Equity

> Measuring Brand Equity

> Managing Brand Equity

Class Presentation | Session 14 | 5 Oct 2010

Documents

Session 12 mg 220 mba - 30 sep 10