Presentation Transcript

Market Segmentation, Targeting and Positioning :

1 Market Segmentation, Targeting and Positioning
Benefits of Segmentation :
2 Effective use of resources Gain a focus Create Value for a target market Posit
ioning Benefits of Segmentation
Steps in Market Segmentation, Targeting, and Positioning :
3 Steps in Market Segmentation, Targeting, and Positioning Market Segmentation 1
. Identify bases for segmenting the market 2. Develop segment profiles Market Ta
rgeting 3. Develop measure of segment attractiveness 4. Select target segments M
arket Positioning 5. Develop positioning for target segments 6. Develop a market
ing mix for each segment
Levels of Market Segmentation :
4 Levels of Market Segmentation Through Market Segmentation, Companies Divide La
rge, Heterogeneous Markets into Smaller Segments that Can be Reached More Effici
ently And Effectively With Products and Services That Match Their Unique Needs.
Mass Marketing Same product to all consumers (no segmentation, i. e. a commodity
) Segment Marketing Different products to one or more segments (some segmentatio
n, i.e. Marriott)
Slide 5:
5 Most cos. Are turning to micromarketing at 1 of the 4 levels 1.Segments2.Niche
s 3.Locals4.Individuals Step 1. Market Segmentation
1. Segment marketing :
6 1. Segment marketing ~ consists of a group of customers who share a similar set
of needs & wants Flexible market offering even in segments 100% needs are not s
ame. ~ consists of 2 parts - Naked solution products and services that all membe
rs of the segment values Discretionary options that some segment members value.
E.g.- automobile industry basic model is same but for A.C., power steering, powe
r window buyer has to pay extra price. Airline industry economy class & business
class (better facility, better menu)
Cont Segment marketing :
7 Cont Segment marketing 1 way is to identify preference segments Homogeneous pref
erence all consumers have roughly the same preference Diffused preference consum
ers vary greatly in their preferences Clustered preference natural market segmen
ts emerge from groups of consumers with shared preferences
2. Niche marketing :
8 2. Niche marketing Group of customers seeking a distinctive mix of benefits wh
o are ready to pay extra premium Niche = segment ÷ * sub-segments E.g.- washing de
tergents ÷ * hard & gentle washers. Surf excel for tough stains (hard on clothes)
& Ezee from godrej for delicate clothes. Itchgaurd for itching sensation Crack (
Paras Pharmaceuticals) cream for prevention and treatment of cracks. Astha, sans
kar, QTV focus on religion & spiritualism Magazines on sports, automobiles, arch
itecture, home decoration
3. Local marketing :
9 3. Local marketing Marketing programs tailored to the needs & wants of local c
ustomer groups in trading areas, neighborhoods, etc. This trend is called grassr
oots marketing. Nationalized marketing as wasteful marketing as it fails to addr
ess local needs. E.g.- Kerala have banks that have NRI branches. Spiderman 3 was
released in 5 different languages in India including Bhojpuri.
4.Individual marketing :
10 4.Individual marketing Ultimate segmentation segments of 1 or customized mark
eting or one-to-one marketing. Customerization empowers the consumers to design
the product or service offering of their choice. Customization raises the cost o
f goods. Customer cannot cancel the product once the company has started working
on the product. Paint companies have started doing this Asian Paints, Nerolac,
Berger Paints. E.g. Arvind mills launched Ruff n Tuff Jeans, branded ready-to-sti
tch
Geographic Segmentation :
11 Geographic Segmentation Divides the market Into Different Groups Based on: Re
gion south India, North, Western Region, East City metro cities, cities with pop
ulation more than 1 million Rural & Semi urban areas villages, towns with popula
tion more than 5000 or 10,000, semi urban areas
Demographic Segmentation :
12 Demographic Segmentation Dividing the market into groups based on variables s
uch as: Age under 6 years, 6-11 yrs, 12-19 yrs, 20-34 yrs .. Gender male, female F
amily size young-single; young-married-no children; young-married-youngest child
under 6;older-married-with children; single Income low income group (upto 40,000
p.a.), middle income group (80,000 1,20,000 p.a.), high income group (>1,60,000
p.a.) Occupation unskilled worker, skilled worker, shop owner, businessman/indus
trialist, junior/ senior officer, junior/ senior executive. Education illiterate
, upto 5 class, SSC/HSC, non-graduate, graduate/postgraduate (general), graduate
/postgraduate (professional)
Psychographic Segmentation :
13 Psychographic Segmentation Divides Buyers Into Different Groups Based on: Soc
ioeconomic Classification a combination of education & occupation of the chief w
age earner of the household to classify buyers in the urban area. This divides m
arket into 8 categories A1,A2,B1,B2,C,D,E1,E2. (A1 highest purchasing potential,
E2 the lowest) Lifestyle culture oriented, sports oriented Personality compulsi
ve (habitual, irrational), gregarious (social, outgoing), authoritarian (demandi
ng, rigid), ambitious (striving)
Behavioral Segmentation :
14 Behavioral Segmentation Dividing the market into groups based on variables su
ch as: Occasions Archies and hallmark cards, Monaco at tea time. Benefits shampo
o for hair conditioning, cleaning, hair fall defense, dandruff control User stat
us customers are either nonusers, ex-users, potential users, first-time users &
regular users
Slide 15:
15 Usage rate into light, medium or heavy users. E.g. cell phone service provide
rs provide low tariff for entry level users to attract them. Loyalty status eith
er hard core loyals - loyal to 1 brand split loyals loyal to 2-3 brands shifting
loyals shift loyalty from 1 brand to another Switchers no loyalty to any brand
Slide 16:
16 Buyer Readiness stage Unaware about the product Some are Aware Some are Infor
med Some are Interested Some Desire the product Some intend to buy the product
Step 2. Market TargetingSegments must respond differently to different marketing
mix elements & programs Requirements for effective segmentation :
17 Step 2. Market TargetingSegments must respond differently to different market
ing mix elements & programs Requirements for effective segmentation Size, purcha
sing power, profiles of segments can be measured. Segments can be effectively re
ached and served. Segments are large or profitable enough to serve. Measurable A
ccessible Substantial Actionable Effective programs can be designed to attract a
nd serve the segments.
Evaluating & Selecting Market Segments :
18 Evaluating & Selecting Market Segments
Slide 19:
19 Single segment concentration
Slide 20:
20 Single segment concentration M&M farm equipment division concentrates on trac
tors; Zodiac concentrates on formal shirts; hospitals for cancer care, heart spe
cialty, etc. Firm gains a strong knowledge of the segments needs. Firm enjoys op
erating economies through specializing its production, distribution, & promotion
. Risks competitor may attack the segment. E.g. Polaroid cameras and Digital cam
eras.
Slide 21:
21 Selective specialization
Slide 22:
22 Product specialization
Slide 23:
23 2. Selective specialization cater to no. of segments. No synergy between segm
ents but each promises, but each gives profit. This strategy diversifies the fir
m s risk. 3. Product specialization firm makes a product and sells it to many diff
erent segments. E.g. micro scope to government, universities, commercial laborat
ories. Risk the product may be replaced by entirely new technology
Slide 24:
24 Market specialization
Slide 25:
25 4. Market specialization firm concentrates on serving many needs of a particu
lar customer group. E.g. computer manufacturer provides all the equipments for t
he computer lab. Gains strong reputation in serving the customer group. Risk cus
tomer group may suffer from budget cuts.
Slide 26:
26 Full market coverage
Slide 27:
27 5. Full market coverage firm attempts to serve all customer groups with all t
he products they might need. In two ways Undifferentiated marketing covers whole
market with 1 offer Relies mass distribution and advertising. Narrow product li
nes keeps down the cost of R&D, production, inventory, transportation, marketing
research, advertising and product management. Co. can turn lower cost into lowe
r prices to win price sensitive segments.
Slide 28:
28 2. Differentiated marketing operates in several market segments and designs d
ifferent products for each segment. Increases the cost of business. Smith Kline
Beecham launched Aquafresh toothpaste Johnson & Johnson baby shampoo + adults.
Step 2. Market TargetingMarket Coverage Strategies :
29 Segment 1 Segment 2 Segment 3 Segment 1 Segment 2 Segment 3 Company Marketing
Mix Company Marketing Mix Company Marketing Mix 1 Company Marketing Mix 2 Compa
ny Marketing Mix 3 Market A. Undifferentiated Marketing B. Differentiated Market
ing C. Concentrated Marketing Step 2. Market TargetingMarket Coverage Strategies
Choosing a market-coverage strategy :
30 Choosing a market-coverage strategy Company resources Degree of product homog
eneity Market homogeneity Competitors strategies
Step 3: Positioning for Competitive Advantage :
31 Product s Position - the way the product is defined by consumers on important a
ttributes - the place the product occupies in consumers minds relative to competi
ng products. Marketers must: Plan positions to give their products the greatest
advantage in selected target markets Step 3: Positioning for Competitive Advanta
ge
Positioning Strategies :
32 Positioning Strategies Positioning by specific product attributes Positioning
by benefits Positioning for user category Positioning for usage occasion Positi
oning against another competitors Positioning against another product class
Slide 33:
33 Step 1. Identifying Possible Competitive Advantages: Competitive Differentiat
ion. Step 2. Selecting the Right Competitive Advantage: Unique Selling Propositi
on (USP). Step 3. Communicating and Delivering the Chosen Position. Steps to Cho
osing and Implementing a Positioning Strategy
Product Differentiation :
34 Product Differentiation Physical attributes Service differentiation Personnel
differentiation Location Image differentiation
Which differences to promote? :
35 Which differences to promote? Important to customers Distinctive Superior Com
municable to customers Preemptive Affordable Profitable
Perceptual Map :
36 Positioning map of service level versus price. Source: Lovelock, Services Mar
keting, Prentice Hall Perceptual Map
Perceptual Map :
37 Perceptual Map