1

China
Attractive
target market

WHY?


! Companles cannoL connecL wlLh all cusLomers ln
large, broad, or dlverse markeLs.
! 8uL Lhey can dlvlde such markeLs lnLo groups of
consumers or segmenLs wlLh dlsuncL needs and
wanLs.
! A company Lhen needs Lo ldenufy whlch markeL
segmenLs lL can serve eecuvely. 1hls declslon
requlres a keen undersLandlng of consumer
behavlor and careful sLraLeglc Lhlnklng.
! 1o develop Lhe besL markeung plans, managers
need Lo undersLand whaL makes each segmenL
unlque and dlerenL.
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! 1o compeLe more eecuvely, many
companles are now embraclng LargeL
markeung. Lecuve LargeL markeung
requlres LhaL markeLers:
1. ldenufy and prole dlsuncL groups of buyers who
dler ln Lhelr needs and preferences.
2. SelecL one or more markeL segmenLs Lo enLer.
3. lor each LargeL markeL, esLabllsh and
communlcaLe Lhe dlsuncuve beneL(s) of Lhe
company's markeL oerlng.
4
! 1o compeLe more eecuvely, many
companles are now embraclng LargeL
markeung. Lecuve LargeL markeung
requlres LhaL markeLers:
1. ldenufy and prole dlsuncL groups of buyers who
dler ln Lhelr needs and preferences.
2. SelecL one or more markeL segmenLs Lo enLer.
3. lor each LargeL markeL, esLabllsh and
communlcaLe Lhe dlsuncuve beneL(s) of Lhe
company's markeL oerlng.
3
! A markeL segmenL conslsLs of a group of
cusLomers who share a slmllar seL of needs
and wanLs.
! 1he markeLer does noL creaLe Lhe segmenLs.
! 1he marketer's task |s to |dennfy the
segments and dec|de wh|ch one(s) to target.
! SegmenL markeung - beuer sausfy LargeL
markeL & reecL compeuLor's markeung
! Cne way - ldenufy !"#$#"#%&# (#)*#%+(
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! A exlble markeL oerlng conslsLs of Lwo
parLs:
! A naked so|unon conLalnlng Lhe producL and
servlce elemenLs LhaL all segmenL member's
value
! ulscreuonary opuons LhaL some segmenL
member's value
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! MarkeL segmenLs can be dened ln many
dlerenL ways:
! Cne way Lo carve up a markeL ls Lo ldenufy
preference segmenLs
! nomogeneous preferences
! D|used preferences
! C|ustered preferences
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! A nlche ls a more narrowly dened cusLomer group
seeklng a d|snncnve m|x of benehts.
! MarkeLers usually ldenufy nlches by dlvldlng a
segmenL lnLo sub-segmenLs.
A. nlche markeLers presumably undersLand Lhelr
cusLomers' needs so well LhaL Lhe cusLomers wllllngly pay
a premlum.
8. Cloballzauon has faclllLaLed nlche markeung.
C. 1he low cosL of semng up shop on Lhe lnLerneL has led Lo
many small buslness sLarL-ups almed aL nlches
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! An auracuve nlche:
,-(.%&+ (#+ /$ %##0(
123 !"#*-4* $/" -+
,/ %/+ 25"2&+ &/*!#.+/"(
6&/%/*-#( +7"/4)7 (!#&-28-92./%
:-9#; !"/<+ = )"/>+7 !/+#%.28
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! 1argeL markeung ls leadlng Lo markeung
programs ta||ored Lo Lhe needs and wanLs of
local cusLomer groups.
! Local markeung reecLs a growlng Lrend
called grassrooLs markeung.
! Cemng as close Lo cusLomers posslble -
#?!#"-#%.28 *2"@#.%) - connecL Lo
unlque experlences
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! 1he ulumaLe level of segmenLauon leads Lo
!"#$%#&'" )* )&#+, !-."')%/0#1 %234#5&$+,
)3 !)&#6')6)&# %234#5&$+
! 1oday cusLomers are Laklng more lndlvldual
lnluauve ln deLermlnlng whaL and how Lo
buy
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! Descr|pnve character|sncs: geographlc,
demographlcs, and psycho-graphlc.
! 8ehav|ora| cons|deranons: such as
consumer responses Lo beneLs, use
occaslons, or brands
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! ulvlde markeL lnLo geographlcal unlLs
and move from macro Lo mlcro levels
! %2./%(; &-.#( /" %#-)7A/"7//0(
! Other useful geographic indicators
include job growth and migration
patterns.
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! ulvlde markeL lnLo geographlcal unlLs
and move from macro Lo mlcro levels
! %2./%(; &-.#( /" %#-)7A/"7//0(
! Other useful geographic indicators
include job growth and migration
patterns.
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! ln demographlc segmenLauon, Lhe markeL ls
dlvlded lnLo groups on Lhe basls of varlables such as
age, famlly slze, famlly llfe cycle, gender, lncome,
occupauon, educauon, rellglon, race, generauon,
nauonallLy, and soclal class.
! Consumer needs, wanLs, usage raLes, and producL
and brand preferences are oen assoclaLed wlLh
demographlc varlables.
! uemographlc varlables are easy Lo measure
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! ACL- Consumer wanLs and ablllues change
wlLh age.
! LllL S1ACL - ersons ln Lhe same parL of Lhe
llfe cycle may dler ln Lhelr llfe sLage. Llfe
sLage denes a person's ma[or concern.
1hese llfe sLages presenL opporLunlues for
markeLers who can help people cope wlLh
Lhelr ma[or concerns.
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Is age an accurate means of
segmentation?
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! lrom Ml Lo MlCL81
! Llnes blurrlng ln recenL years.
! Lxample: Men buylng skln-care producLs
and women buylng power Lools and
Lrucks.
! undersLandlng Lhls can help markeLers
develop more eecuve messages.
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! lncome segmenLauon ls a long-sLandlng
pracuce ln producL and servlce
caLegorles.
! Powever, lncome does noL always
predlcL Lhe besL cusLomers for a glven
producL.
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! Lngel's Laws
! As household lncome lncreases:
! A smaller percenLage of expendlLures goes for
food.
! 1he percenLage spenL on houslng, household
operauons, and cloLhlng remalns consLanL.
! 1he percenLage spenL on oLher lLems (such as
recreauon and educauon) lncreases
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! SLrong lnuence on preference by consumers
ln producLs such as cars, cloLhlng, luxury
brands, lelsure acuvlues & cholce of
preferred reLaller
! MarkeLers deslgn producLs for speclc soclal
classes
! 1asLes of soclal class change wlLh years
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! SLrong lnuence on preference by consumers
ln producLs such as cars, cloLhlng, luxury
brands, lelsure acuvlues & cholce of
preferred reLaller
! MarkeLers deslgn producLs for speclc soclal
classes
! 1asLes of soclal class change wlLh years
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! CCPC81S
! CLnlL - Lhe Aslan Cen x
! Whlle Lhey en[oy Lhe good llfe, Lhey sull
value famlly ues and hard work
! wanL Lo be parL of socleLy wlLh some
freedom of expresslon
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! sychographlcs ls Lhe sclence of uslng
psychology and demographlcs Lo beuer
undersLand consumers.
! ln psychographlc segmenLauon, buyers are
dlvlded lnLo dlerenL groups on Lhe basls of
llfesLyle or personallLy or values
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! Many markeLers belleve behavloral varlables
are Lhe besL sLarung polnLs for consLrucung
markeL segmenLs
! ulvlde buyers lnLo groups - based on
knowledge, amLude, use, response Lo
producL
! DLCISICN kCLLS - B%-.2+/", B%C4#%&#",
,#&-0#", D43#" & E(#"
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! Cccaslons: ume of day, week, monLh,
year or any dened aspecLs of llfe
! 8uyers -occaslons - creaLes Lhe need/
buy producL
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! 8eneLs
! 8uyers grouped - beneLs Lhey seek
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! User Status:
! non-, ex-, poLenual, 1sL ume, regular &
wlll-be (llfe sLage/evenL) users
! Usage kate:
! llghL, medlum & heavy users
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! User Status:
! non-, ex-, poLenual, 1sL ume, regular &
wlll-be (llfe sLage/evenL) users
! Usage kate:
! llghL, medlum & heavy users
! 80/20 principle (raedo's Law)large
percentage of revenue comes from a
small, loyal percentage of customers.
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! 8uyer-kead|ness stage: unaware, aware,
lnformed, lnLeresLed, deslre, and lnLend Lo
buy.
! LoyalLy SLaLus:
! nard-core |oya|s- 1 brand all Lhe ume
! Sp||t |oya|s - loyal Lo 2/3 brands
! Sh|h|ng |oya| - 1 brand Lo anoLher
! Sw|tchers - no loyalLy Lo any brand
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! Amtude : 1he ve amLudes abouL producLs
are: enLhuslasuc, posluve, lndlerenL,
negauve, and hosule
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Bowties Curls Curly Shells Elbow Fusillinni Lampare
Lampare Fusillinni Curls Curly Shells Bowties Elbow
uLMCC8APlCS & SCClC-LCCnCMlCS
lemales
23 Lo 33 years old
Slngle , marrled , separaLed /wldowed women
College, M8A/MA, docLoraLe
lncome of aL leasL 13,000/monLh
A,8, and upper C markeL

S?CPCC8APlCS , L8SCnALl1?, & vALuLS
MarkeL LlfesLyle A
Slngle, healLh consclous woman who loves Lo
cook and Lry ouL new pasLa reclpes and oLher
lLallan culslnes She ls fond of hosung parues
and geL LogeLher LreaLs f or famlly and
frlends.
MarkeL LlfesLyle 8
?oung domesucaLed mom who duufully
prepares healLhy food for Lhe famlly. She ls a
young mom who always Lhlnks of new ways Lo
sausfy gourmeL cravlngs of her famlly.
TARGET MARKET
uLMCC8APlCS, SCClC-LCCnCMlCS & L8SCnALl1?
Cender Males, lemales, CL81
Age of 1argeL MarkeL rlmary LargeL markeL:
23 Lo 33 years old
?oung worklng professlonals who are sLruggllng Lo malnLaln an ldeal welghL Lo achleve a L &
healLhy llfesLyle ln splLe of hecuc and busy schedules. Also lncluded ln Lhls caLegory are
calorle-&-sugar phoblc markeL who spends ume and money Lo geL bu and pampered
because beauLy & Lness are Lhelr work lnvesLmenLs.
Secondary LargeL markeL:
1rade dealers shelf space & sLocks ln Lhe :
1. SupermarkeLs (SM, 8oblnsons, S&8, 8usLan's)
2. Cyms/llLness cenLers (llLness llrsL, Sllmmers, Cold's Cym)
3. 1op Spa cenLers (1he Spa, neo uay Spa, CeL Away Spa, 8lue & WaLer Spa, nurLure Spa)
4. AesLheuc cenLers (8elo Medlcal, Clarlns AesLheucs, Marle lrance, 8lo Lssence)
Lducauon College, M8A/MA, docLoraLe
lncome rlmary LargeL: aL leasL 13,000 / monLh
Secondary LargeL : noL appllcable (Lrade)
Soclal Lconomlc Class A, 8, and upper C markeL
S?CPCC8APlCS & vALuLS
MarkeL LlfesLyle A
1hese are men and women on Lhe heavy slde who are obsess ln achlevlng an ldeal body
welghL Lo llve a L and healLhy llfesLyles. 1hey don'L have ume Lo go Lo Lhe gym because of
Lhelr busy and hecuc schedules. 1hey Lake dleL gradually, and one sLep aL a ume.
MarkeL LlfesLyle 8
8randed as Lhe calorle-& -sugar phoblc markeL" because Lhey are wllllng Lo spend more [usL
Lo geL rld of calorles, and sugar ln Lhelr meals/beverages. 1hey are very valn and waLchful of
Lhelr dleLs. 1hey go Lo Lhe gym regularly, and spends ume and money Lo geL bu because
beauLy & Lness are Lhelr work lnvesLmenLs.
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Target
Marketing
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EFFECTIVE
SEGMETATION
CRITERIA
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MEASURABLE - size, purchasing power, and
characteristics
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Substantial LARGE
AND PROFITABLE
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Accessible
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differentiaBLE
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actionable
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Evaluating and selecting
market segments
Objective and resources
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SINGLE SEGMENT
CONCENTRATION
concenLraLed markeung - Lhe rm galns a
sLrong knowledge and sLrong markeL
presence.
8lSk: markeL segmenL can Lurn sour, or a
compeuLor lnvaslon
super-segmenLs raLher Lhan ln lsolaLed
segmenLs
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SELECTIVE SPECIALIZATION
rm selecLs a number of segmenLs, each
ob[ecuvely auracuve and approprlaLe
8lsk dlverslLy
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Product Specialization

Makes & sells - dlerenL markeL segmenLs
8lsk: roducL replaced by new Lechnology
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MARKET Specialization

Serve many needs of a
group
SLrong repuLauon -
channel for oLher
producLs

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FULL MARKET COVERAGE
1he rm auempLs Lo serve all cusLomer
groups wlLh all Lhe producLs Lhey mlghL
need.
ln und|erennated markenng, Lhe rm
lgnores segmenL dlerences and goes aer
Lhe whole markeL wlLh one oer.
ln d|erennated markenng, Lhe rm
operaLes ln several markeL segmenLs and
deslgns dlerenL producLs for each segmenL
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