Segmentation, Targeting, &

Positioning
 Segmentation, Targeting, &
Positioning
• The marketing program of the firm
depends on how the marketer
identifies the potential customer ,
profiles them , targets them and
positions his offering in the mind of
the customer
• These concepts are studied under
STP.
 Segmentation, Targeting, &
Positioning
• Segmentation – How one can classify or
group the heterogeneous market into
homogenous market.
• Targeting – involves including decisions
encompassing which market(s) to
enter out of the available market
segment alternatives.
• Positioning – It’s about the customer
perception about the brand as being
different from the other brands on
specific dimension including product
attributes.
 Segmentation
• Thus segmentation consists of taking
the total heterogeneous market
for a product and dividing into
several sub-markets or segments.
• Routine example of
mousetrap..segmented according
to rural and urban areas . Income
category and need based
segmentation.
 Advantages of
Segmentation
1.Allows a marketer to take
heterogeneous market, consisting of
customers with diverse needs, wants
and behavior.
2.It also helps in better understanding of
the competitive situation in each of
the segment.
3.It not only helps in identification of
customers with substantial similarity
but also helps in profiling them and
their need structure so that the
marketer can develop an appropriate
 Market segmentation &
product differentiation
• Market segmentation – it is a process
of dividing a market into groups of
segments having similar wants.
• Segments may differ also in their
needs for
information,reassurance,technical
support, service promotion
,distribution etc.
 Market segmentation &
product differentiation
• The marketer can create the product
differentiation by bringing a
difference in the physical product
itself.
• E.g.Gillete shaving gel as compare to
cake soap or liquid.
• Dominos pizza – thirty minutes
delivery process as compare to
other brands.
• Ujala compare to Robin blue.
 Bases for market
segmentation
• Geographic segmentation –
segmentation on the basis of nation
, states and regions.
• E.g. – Amul first marketed in Gujrat
later on the company went for a
national launch.
• For e.g. certain product is famous in
South India or North India then it
can be again divided into zones ,
villages , cities , climate etc.
 Bases for market
segmentation
• Demographic Segmentation – it
includes factors like age ,gender ,
family size , family life cycle ,
income , occupation , education ,
marital status , religion , generation
, nationality , language and social
class.
• E.g.Lakme , TVS scooty , diamond
jwellery.
• Eg. Shaving creams , Bikes , Fair &
 Bases for market
segmentation
• Psychographic Segmentation – Is the
study of lifestyle of individuals.
• Lifestyle is a person’s entire way of
living.
• It reflects the person’s living as a
combination of his actions ,
interests , and opinions.
• Fashion industry (clubs) , women's in
rural area.
 Bases for market
segmentation
• Behavioral Segmentation – In this case , the
market is divided on the basis of purchase
decision and product or brand usage
made by consumers.
• Who influence the purchase decision
• E.g.- Hospital industry is divided into six
parts like –
• Most modern hospitals – Escort heart and
research center , Batra hospitals and
research center, these hospitals (purchase
managers) are constantly on the look for
new instruments to become more
efficient.
 Bases for market
segmentation
• Autonomous Hospitals –
• For e.g. – In all India institute of
medical sciences , the purchase
decision is of specialist doctors or
the head of the concerned
departments.
• Government Hospitals –
• For e.g. – KEM Hospital –here the
medical superintendent and the
financial controller influence the
purchase decision.
 Bases for market
segmentation
• Medium size private hospitals –
Hinduja , Hiranandani hospital the
final choice is by Medical Director is
final.
• Nursing homes – To get these
hospitals recognized by the
ministry of health, they go for
quality , low price and after sales
service. Doctors approved
generally.
• Freelancing Anesthetist – These
 Bases for market
segmentation
• Marketers segment the market on
different basis like –
• Volume segmentation – In this case
quantity purchased is the basis for
segmentation. It attempts to
identify frequent users of a product
category or brand.
• For e.g. – Cigarettes , wine and
personal care categories.
 Bases for market
segmentation
• Brand user segmentation – The
marketer tries to identify the user
characteristics on the basis of
brand usage as brand users , brand
triers and non-users.
• For e.g. – Cadbury by Amitabh
Bacchan , Hrithik Roshan for John
Player.
 Bases for market
segmentation
• Situation Segmentation – Many
marketers are happy with
identifying the segments and
profiling the segments in context
with how customers are
experiencing the brand and what is
their ultimate way of using the
brand.
• For e.g. – A person may select a
simple hotel when travelling alone
Patterns of Market Segment
• E.g.- Ice cream buyers..
• Clustered Preferences – three
segments like one who want to
take center position to attract all
the people(groups)
• Another is to participate in a large
market segment
• Develop several brands in different
segment
•
Patterns of Market Segment
• Homogeneous Preferences – A
market where all the consumers
have roughly the same preferences.
• Diffused Preferences – consumers
preferences may be scattered
throughout the space , indicating
that consumers vary greatly in the
preference.
 Market segmentation
Strategy
• Customer’s differences in preferences
for brand appear to exist.
• These differences can be identified and
matched with customer groups.
• The marketing program can help in
reaching segments with certain
preferences.
• The segments have enough demand
potential to justify their selection as a
target markets.
• The segments are sufficiently stable to
allow adequate lead-time for the
design and implementation of a
 Market segmentation
process
•
•
•
• Form the Profile the Evaluate
Target
• Segment segment

 Market segmentation
process
• Forming Market segments – Two
approaches are followed –
1.Build up – for B2B or industrial
buyers e.g. trade india.com
2.Break down - B2C or individual.
For e.g. – cars , personal care products

etc.
•
 Market segmentation
process
• Profile segments – marketing
managers can profile segments by
taking into account a different
descriptive variables.
• Profiling helps to large identifiable
groups within a market.
• For e.g. By taking into consideration
the needs of the buyer, identifying
product or service should be given.
 Market segmentation
process
• Evaluate market segments – What is
expected from each segment
should be evaluated..
• For e.g. – Itc products.
• Select Target markets – helps the
marketer to correctly identify the
markets and the group of target
customers for whom the
product/services are produced.
• E.g.-woodland shoes , cellular phones
,pepsi , titan ,Bata , Mahindra &
Criteria for effective market
segmentation

Ac
ti
on
al ab
ti le
t an
s
S ub

ct
Distin
ive
M
Acc
ess I d ee a s u
ibl nti rab
e fia le
ble
Criteria for effective market
segmentation
• Clear
differences in
cti ve
Distin consumer
preferences
for a product
must exist.
Criteria for effective market
segmentation
• Difference
preferences
M
Ide easu
nti rab for a product
fia le
ble must be
identifiable
and capable
of being
related to
measurable
variables.
Criteria for effective market
segmentation
• The proposed
market
ti
a l segment
a n
Su
b st must have
enough size
and
purchasing
power to be
profitable.
 Criteria for effective market
segmentation
• Companies
• Actionable
must be able
to respond to
difference
preferences
with an
appropriate
marketing
mix.
Criteria for effective market
segmentation
• The proposed
Acc
ess
ibl
market
e
segment
must be
readily
accessible
and
reachable
with market
programs.
 Target Market
• Depending on the available
resources ,experience and
competency of the marketer and
time available the marketer will
decide which market to target.
• In this stage the marketing manager
evaluates different market
opportunities and decides how
many and which one to target. This
is called as target marketing
 Target Market
• The marketing manager should look
at five factors for evaluating each
segment .They are-
1.Segment size &
2.Segment worthiness
3.Segment measurability
4.Segment attractiveness
5.Segment accessibility.
6.
 Types of target marketing
strategies
• The product market coverage
strategies are broadly classified as
–
1.Undifferentiated or mass marketing
strategy
2.Concentrated marketing strategy
3.Differentiated marketing strategy
 Types of target marketing
strategies
1.Undifferentiated or mass marketing
strategy
• Here the marketing manager ignores
the idea of segment characteristics
and differences and develops a
unified marketing program for the
entire market.
• This strategy keeps overall cost low
and makes it easier to manage.
• E.g. commodity market (whole sale
 Types of target marketing
strategies
2. Concentrated marketing strategy –


• The marketing manager decides to

enter into a select market segment
instead of all the available market
segment.
• It is an excellent strategy for small
manufacturers that can serve the
segments closely and cater the
needs.
• E.g. Jyothi laboratories brand of Ujala
predominant in south India and then a
national launch
 Types of target marketing
strategies
3. Differentiated marketing strategy –


• The main objective of offering a

differentiated marketing offer is to
cater to different segments and get
higher sales with a dominant
position in each of the segment.
• For e.g. – Maruti 800 for middle
class , Baleno and swift targeted for
upper middle class and Omni for
lower class or taxi operators.
 Positioning
• The marketing manager needs to
decide which segment to enter and
how to target that segment with a
product offer through selection of
market segment and target
marketing strategy.
• The challenge is to decide what
position the company wants it’s
products to occupy in the selected
segment.
 Positioning
• A product positioning is the definition
that a consumer gives to the product
on important attributes.
• Positioning is the act of developing the
company’s offerings and image to
occupy a distinct place in the minds of
the target market.
• The end result of positioning strategy is
a distinct value-a reason for which the
customer would buy the product.
 Positioning
• E.g. – Maggi Noodles , Dove soap ,
Vicks Vaporub etc.
 Product positioning VS. Brand
positioning
• In a commodity market hardly there
is a difference between a product
and brand positioning.
• Same with candles,iscense sticks etc.
• Product positioning brings us to the
idea of functional value whereas
• Brand positioning talks about some
thing above for which customer is
willing to pay.
 Product positioning VS. Brand
positioning
• Whirlpool vs.Samsung.
• When a new brand comes to the
market people start enquiring.
• E.g.Tata DOCOMO.
 Qualities of a successful
position
In context with Ujala-
• Relevance
• Distinctiveness
• Coherence
• Commitment
• Durability
• Clarity
• Courage
Another examples are Tata Nano , Dell

etc.
 The brand positioning
process
• Two categories –
•
•
• Do good Feel Good
 Margo Lux
 Dettol Dove
•
 The brand positioning
process
• Identify a set of possible competitive
advantage –
• Positioning process begins with
differentiating the product on actual
attributes so that customer will
receive the higher value.
• Reliance industries In
telecommunication – Launch a GSM
Technology with CDMA
• Company’s offering sholuld be
differentiated on the basis of product ,
 The brand positioning
process
• E.g – DHL position themselves as
reliable and firms with capabilities of
speedy and accurate delievery.
• Eureka Forbes and Amway are the
examples of channel differentiation
• To groom customers and tell them to
give the service is an example of
people differentiation
• Kodak – Red and yellow , Wipro – with
rainbow and the catch line ‘applying
Thought’is an image differentiation.
 The brand positioning
process
• Choose the right Competitive
advantage –
• The next step is to select a right
competitive advantage which is
most suitable for positioning the
brand.
• E.g. Samsung – Nano technology ,
biofresh.
 The brand positioning
process
• Select an overall positioning Strategy
– Consumers will buy the product or
service which give them highest
value.
• E.g. Raymonds , Kaya skin clinic ,
Dominos
 The brand positioning
process
• Communicate the message and
deliver the chosen position –
• Communicate to the target market
• E.g. Pepsi , coke , Rasna?
 The brand positioning
process
• Rasna is comparatively failure
product as compare to other cold
drinks..
• Horliks - Konkana sen
• Boost – Sachin tendulkar
• Postioned properly.
 Assignment
• Zhandu balm is available in the
market if company wants to plan to
reposition it what options are
available. Suggest at least three.