1. Marketing: Segmentation, Targeting & Positioning

2. Objectives of the Chapter Identify the essential components of a market. Outline the role of market segmentation in developing a marketing strategy. Describe the criteria necessary for effective segmentation. Explain each of the four bases for segmenting consumer markets. Identify the steps in the market segmentation process. Discuss four basic strategies for reaching target markets. Summarize the types of positioning strategies. Explain the reasons for positioning and repositioning products. 3. Target Marketing Identify and profile distinct groups of buyers who differ in their needs and preferences. (Market Segmentation) Select one or more markets to enter. (Market Targeting) For each target segment, establish and communicate the key distinctive benefit(s) of the companys market offering. (Market Positioning) 4. Market Segmentation cannot be used in all cases. To be effective, segmentation must meet the following basic requirements. Measurable: Size, purchasing power, and profiles can be measured Accessible: Can be effectively reached and served (move in same places?) Substantial: Must be large or profitable enough (people taller than 10 feet not good) Differentiable: Two segments that react the same way are not actually separate segments Actionable: Effective programs can be designed for the segment, i.e. matches company capabilities Criteria for Effective Segmentation 5. Market Segmentation Market Segmentation refers to the process of creation of small groups (segments) within a large market to bring together consumers who have similar requirements, needs and interests. 6. Geographic Segmentation Dividing an overall market into homogeneous groups on The basis of their locations Does not ensure that all consumers in a location will make the same buying decision. Help in identifying some general patterns. 7. Demographic Segmentation Dividing consumer groups according to characteristics such as gender, age, income, occupation, education, household size, and stage in the family life cycle. 8. Segmenting by Gender 9. Segmenting by Gender 10. Segmenting by Age 11. Family Life Cycle Stages Segmentation 12. Segmenting by Household Type 13. Segmentation based on Income 14. Psychographic Segmentation Social class, lifestyle, or personality characteristics People in same demographic segment may have different psychographic characteristics and vice versa 15. Product Related Segmentation Can group consumers in terms of: Benefits Sought Usage Rate: 80 : 20 Principle Occasions Brand Loyalty 16. Target Marketing involves breaking a market into segments and then concentrating your marketing efforts on one or a few key segments. Strategies for reaching Target Markets are: Undifferentiated Marketing Differentiated Marketing Concentrated Marketing 17. Undifferentiated Marketing Focus on what is common in all buyers, appeal to that Mass distribution, mass marketing, etc Often difficult to compete with focused competitors Much More common in the past 18. Differentiated Marketing Target several segments and design separate offers for each. Claim developing a stronger position within several segments creates more. total sales than undifferentiated marketing across all segments. 19. Concentrated Marketing Firm goes after a large share of one or a few segments / niches Attractive when resources are limited 20. Market Positioning 21. Competitive Edge/Advantage or Unique Selling Proposition Product Features, performance, Price, style, design Consistency, durability, reliability, repairability Service Speedy, convenient, or careful delivery Installation, repair, customer training or consultation Channels Channel's coverage, expertise, and performance E.g. People Hiring and training better people than competitors do E.g. Image May affect decision e.g. when products / services otherwise look alike Requires creativity and hard work Image must be supported by everything the company does 22. Which differences to promote? Important highly valued benefit to customers Distinctive competitors do not offer, or company can offer it in a more distinctive way Superior difference is superior compared to customer alternatives to get the same benefit Communicable can be communicated, visible to buyers Pre-emptive competitors cannot easily copy Affordable buyers can afford to pay the difference Profitable difference can be introduced profitably 23. Keys to Successful Positioning 24. Repositioning: Strategies 25. Image Repositioning 26. Product Repositioning 27. Intangible Repositioning Skoda Rapid 2012 Skoda Rapid 2013 28. Tangible Repositioning 29. Thank You :)