Segmentation , Targeting and Positioning

by

Target Marketing
Target marketing requires

marketers to take three major steps:

Identify and profile distinct

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groups of buyers who differ in their needs and preferences (MARKET SEGMENTATION). Select one or more market segments to enter (MARKET TARGETING). For each target segment, establish and communicate the key distinctive benefit(s) of the companys market offering (MARKET POSITIONING).

Segmentation
Bases for Segmenting Consumer

Markets
Geographic Segmentation
Many companies today are localizing

their products , advertising, promotions and sales efforts to fit the needs of individual regions, cities, and even neighborhood (tapal, pizza hut, KFC)
Demographic Segmentation
Most popular bases because consumer

needs, wants and usage rates often vary closely with demographic patterns. They are easier to measure than most other types of variables

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Segmentation
Age and Life Cycle Stage Gender Income

Psychographic

Segmentation
Lifestyle

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Time-constrained Money-constrained Social Class o Personality Characteristics (hip and trendy, rebellious, sincere, exciting, competent,

Segmentation
Behavioral Segmentation (dividing up

market on the basis of knowledge, attitudes, uses or responses to a product.

Occasions

Orange juice is often consumed at breakfast Valentines, Fathers Day, Mothers Day, Ramzan, Eid Benefits Sought User Status Market share leaders focus on attracting potential users, whereas smaller firms focus on attracting current users away from the market leader

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Segmentation
Usage Rate

Loyalty Status
Multiple Segmentation

Geodemographic

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Criteria for Effective Segmentation

Effective Segmentation
Measurable
Substantial Accessible Differentiable (responds

differently to different marketing mix elements) Actionable (Effective programs can be designed for attracting and serving the segments)
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Market Targeting
Market segmentation

reveals the firms market segment opportunities. Now the firm will evaluate the various segments
Size and Growth Segment Structural

Attractiveness Objective and Resources

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Market Targeting
Selecting Segments
Undifferentiated Marketing Ignore market segments, one offer, focus on common need will appeal to largest number of buyers
Differentiated Marketing

(Segmented Marketing)
Targeting several segments and

designing separate offers for each. Lux , lifebuoy Bright, Bonus, Bonus Tri Star Capri , Opel Toyota , Lexus
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Market Targeting
Developing a stronger position

within several segments creates more total sales than undifferentiated marketing across all segments. But also increases cost of doing business
Niche or Concentrated

Marketing
Going for large share of small

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segment rather than small share of large market Advantages: Better adaptation, less competitors Example: Soap for people with Acne or any rear disease, BMW

Market Targeting
Micro Marketing Tailoring products and marketing programs to suit the tastes of specific individuals and locations. LOCAL Marketing Tailoring to the needs of local customer groups Ex: Cities, Neighborhood, Local Stores (Makro) INDIVIDUAL Marketing Tailoring to the needs of individual customers Car, Suit, Candies
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Market Targeting
Choosing A Target Marketing Strategy
Following factors are considered when

choosing a target marketing strategy Company Resources Degree of Product Variability Product Life Cycle Stage Market Variability Competitors Marketing Strategies
Socially Responsible Target Marketing
Smart Targeting help companies and

customers as well. Targeting kids. Spill over of adult products to kids section. Targeting kids may be good.

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Positioning for Competitive Advantage

Products positioning:
The way the product is defined by

consumers on important attributes, The place the product occupies in the minds of the consumer relative to competitors products.
The impression, perception of

product
(Colgate- Cavity) (Lux Beauty)

(Dettol Antibacterial) (Head & Shoulders Dandruff) (Suzuki economy car) (Mercedes Luxury 4-13 Car) (Porsche Performance)

Perceptual Map
Perception of ones brand with competing brand on

important buying dimensions.

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4

Price

1 0 0 1 2 3 4 5

Luxury
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Performance

Choosing a Positioning Strategy

Some firms find it easy to choose their

positioning strategy (for ex: quality) but in many cases , two or more firms will go after the same position. Thus a company will have to find other ways to set itself apart.
Three steps of positioning task are
Identifying possible competitive

advantages Choosing the right competitive advantages Selecting an over all positioning strategy

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Choosing a Positioning Strategy

Identifying Possible Competitive Advantages
Finding competitive advantages Positioning can not be based on empty promises A company may differentiate on the basis of

Product Line (little variation, highly differentiated) (features, performance, style) Service Differentiation (Speedy, convenient, careful) (Easy paisa, TCS, Dominos) Channel Differentiation (Direct Channel) (Dell) People Differentiation (Trained, Competent, Courteous, Friendly) Image Differentiation (Brand Image)Image must be supported by every thing the company says or does.

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Choosing a Positioning Strategy

Choosing The Right

Competitive Advantages
How many differences to

promote One (USP) More than one Which Differences to promote Important Distinctive Superior Communicable Preemptive Affordable 4-17 Profitable

Selecting an Over All Positioning Strategy

Consumer typically choose

products and services that give them the greatest value Value Proposition: The full positioning of a brand the full mix of benefits upon which it is positioned.
Mercedes value proposition

hinges on luxury but also includes reliability, roominess, styling, safety

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Communicating and Delivering the Chosen Position

Positioning the company calls for

concrete actions.
Designing the marketing mix involves

working out the tactical marketing details fo the positioning strategy.

Establishing a positioning takes time,

but can be destroyed very quickly

A products position should evolve

gradually (not abruptly) as it adapts to the ever changing marketing environment.

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GOOD NEWS !

Quiz

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