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The Market Segmentation Process. WTUC. http://www.4cconsulting.com/uploadedImages/Management_consultancy/Intelligence_and_strategy/Segmentation.jpg. Importance of Market Segmentation in Advertising. To find profitable market segments - PowerPoint PPT Presentation
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The Market Segmentation
Process
WTUC
http://www.4cconsulting.com/uploadedImages/Management_consultancy/Intelligence_and_strategy/Segmentation.jpg
Importance of Market Segmentation in Advertising
• To find profitable market segments
• Scan marketplace and see what various consumer segments need and want and how they might be better satisfied
http://attractionmarketing.com/images/ad-Verizon.jpg
2-Step Strategy
• Identifying groups of people (or organizations) with certain shared needs and characteristics within the broad markets for consumer of business products
• Aggregating (combining) these groups into larger market segments according to their mutual interest ion the product’s utility.
Applying the Strategy
Large market group
Pool them together into one aggregate target market
•These people share the same interests in relation to your product’s utility
Target market- which lays the foundation for developing the proper mix of marketing activities-including advertising
General Population of consumers
http://www.intomartgfk.nl/images/bg_logo.gif
• Markets consists of many segments
• A company differentiate products and marketing strategy for every segment
• Or simply concentrate on one segment
Types of Targets
• Marketing activities are aimed at a particular segment of the population
• Advertising is aimed at a particular group
Target market
Target audience
Types of Markets
Consumer Markets Business Markets
•Most advertising falls under consumer advertising•Ad directed at consumers or people who buy the product for their own or someone else’s personal use
•Companies use business advertising to reach people who buys good ad services for resale or for use in their own business or for manufacturing other products•Also known as BTB
Consumer Markets Business Markets
•Advertising professionals must understand how people act and think, and why they buy what they buy
•Over half of all marketing is BTB•Manufactured goods, raw materials, services for law firms, accountants, airlines, and advertising agencies•Need more specialized product knowledge
http://futuresightconsulting.com/assets/images/FSC_Focus_MarketTargetingAndProfiling.jpg
Finding the Right Niche
http://www.valicon.net/uploads/whowhatwhy_eng_popravki.gif
http://www.fivetwelvegroup.com/clientzone/uploads/images/FiveTwelve_Group_Segmentation_levels_v2.jpg
Behavioristic Segmentation
• User status
• Usage rate
• Purchase occasion
• Benefits sought
User-Status Variables1. Sole users- most brand loyal, require least amount of advertising an
d promotion
2. Semisole users- typically use Brand A but have an alternate selection if it is not available or if alternate is promoted with a discount
3. Discount users- semisole users of competing Brand B. They don’t buy Brand A at full price
4. Aware Nontriers- use competitive products in the category but haven’t taken a liking to Brand A. These people rarely offer potential
5. Trial/Rejectors- bought Brand A’s advertising but didn’t like the product. Only reformulation of Brand A will bring them back
6. Reportoire users- perceive two or more brands to have superior attributes and will buy at full price. Primary brand switchers and respond to persuasive advertising based on the fluctuating wants and desires
Usage-Rate (Volume) Variables
1. Light users
2. Medium users
3. Heavy users
http://pewsocialtrends.org/assets/images/94.gif
http://z.hubpages.com/u/517176_f260.jpg
Purchase-Occasion Variable
• Buyers are distinguished when they buy or use a product
• Air travelers- may fly for business or vacation• Purchase- affected by frequency of need
(regular/occasional), a fad (computer games), seasons (water skis, raincoats)
• Marketers who discovers common purchase occasions for a group has a potential target segment and can better determine when to run specials and when to promote certain product categories
Benefit-Sought Variable
• Benefits– High quality– Low price– Status– Sex appeal– Good taste– Health conscious– Symbolism- what the brand means to them or to their
friends or some reference group
• Switching occurs in response to different needs
http://ignitepartnership.com/blog/wp-content/uploads/personal%20brand%20pyramid.png
http://tomfishburne.typepad.com/tomfishburne/images/2008/02/10/080211attribute.jpg
What’s the User Benefit here?
High-Quality Benefit
What’s the User Benefit here?
Low Price benefit
What’s the User Benefit here?
Status Benefit
What’s the User Benefit here?
Status Benefit
What’s the User Benefit here?
Sex Appeal Benefit
What’s the User Benefit here?
Good Taste Benefit
What’s the User Benefit here?
Health Conscious Benefit
What’s the User Benefit here?
Brand Symbol Benefit
Geographic Segmentation
• Region
• Country size
• City size
• Specific locations
• Types of stores
http://www.census.gov/econ/census02/img/division.gif
Demographic Segmentation
• Sex
• Age
• Ethnicity
• Education
• Occupation
• Income
• And other quantifiable factors
http://www.insidefacebook.com/wp-content/uploads/2009/02/20090201fbdemobar.png
Geodemographics Segmentation
• Demographics combined with geographic segmentation
• People’s lives are influenced by their environment and ethnicity
https://www.dataexpress.vedaadvantage.com/newdesign/i/homepages/main_banner-landscape.jpg
Psychographic Segmentation
• Emotional appeal
• Cultural values
• Attitudes
• Personality
• Lifestyle – View people as individuals with feelings and
inclinations
http://www.media-studies.ca/articles/images/VALS.jpg
Basic principles or values
Tangible markers of success or accomplish-m
ents
Desire for experiences
or risk
Example: Company that markets high-end motorcycles
• A demographic profile might suggest that prospects are males between the ages of 30 and 50
• A psychographic profile could extend the analysis by noting that the best prospects are experiences: Men motivated by self-expressive needs who also have sufficient resources to buy an expensive bike
http://www-edc.eng.cam.ac.uk/betterdesign/images/rsz_marketsegintrotop__130.gif
http://www.clickz.com/_imgs/graphics/032608media-attitude.gif
What’s the psychographic element here?
What’s the psychographic element here?
http://www.marketsegmentation.com/images/ServiceBenefits.gif
http://www.consumerpsychologist.com/images/intro/consumer_behavior.png
Group discussion
• Hardee’s Thickburger
• Big, premium burgers
Hardee’s Ad: Who’s the Target Market?
Hardee’s Thickburger Target Market
• Young male demographic• ‘real’ men • Meets consumer taste
expectations• Trade on the notion of ‘male
identity’• Paris doesn’t have anything
to do with the burger• Caused buzz among male
demographic
Spicyparis.com’s traffic shot so high that it crashed the server
Another Hardee’s ad
• ‘We could’ve shown you some cowboy, sitting around a campfire, eating a Western Bacon Thickburger…but who’d wanna see that?”
• Hardee’s pays careful attention to the benefits sought by the target demographic and tailors its offering accordingly
• Crafts advertising messages that will grab attention of the young male fast-food eaters
Assignment 1 due Week 5
• Describe an ad that seems to be directed toward a specific target market segment. Define it using behavioristic, demographic, psychographic, and geographic variables.
• See page 91 to read Hardee’s ad example
• Print and submit on 3/16