Appendix to Part 1

Consumer Behaviour and

Marketing Strategy

Consumer Behaviour
Canadian Edition
Schiffman/Kanuk/Das
Copyright 2006
Pearson Education Canada Inc.

Steps in Developing a
Marketing Strategy
Segment the Market
Choose a Target Market
Decide on a
Position for the Product
Develop a Suitable
Marketing Mix
Find Ways to Satisfy
And Retain Customers
Copyright 2006 Pearson Education Canada Inc.

Appendix-2

Market Segmentation
The process of dividing a potential market
into distinct subsets of consumers and
selecting one or more segments as a target
market to be reached with a distinct
marketing mix.

Copyright 2006 Pearson Education Canada Inc.

Appendix-3

Best Customer Segmentation

High

High

Current Share

Hi Highs
(stroke)

Low Highs
(chase)

Hi Lows
(tickle)

Lo Lows
(starve)

Low

Consumption

Low

Copyright 2006 Pearson Education Canada Inc.

Appendix-4

Purposes of Segmentation
Studies

To discover the needs of specific

consumer groups to develop specialized
products to satisfy specific group needs
(e.g., Centrum http://www.centrum.ca)
To guide the repositioning of a product
(e.g., Nintendo http://www.nintendo.ca)
To identify the most appropriate media for
advertising (e.g., People and Teen
People)
Copyright 2006 Pearson Education Canada Inc.

Appendix-5

Bases for Segmentation

Geographic Segmentation
Demographic Segmentation
Psychological Segmentation
Psychographic Segmentation
Socio-cultural Segmentation
Use-Related Segmentation
Usage-Situation Segmentation
Benefit Segmentation
Hybrid Segmentation Approaches

Copyright 2006 Pearson Education Canada Inc.

Appendix-6

(continued)

Copyright 2006 Pearson Education Canada Inc.

Appendix-7

Figure A-2 (continued)

(continued)

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Appendix-8

Figure A-2 (continued)

Copyright 2006 Pearson Education Canada Inc.

Appendix-9

Geographic Segmentation
The division of a total potential market into
smaller subgroups on the basis of
geographic variables (e.g., region, province,
or city).

Copyright 2006 Pearson Education Canada Inc.

Appendix-10

Demographic Segmentation

Age

Sex

Marital Status

Income, Education, and Occupation

Copyright 2006 Pearson Education Canada Inc.

Appendix-11

Marital Status

Households as a consuming unit

Singles
Divorced
Single parents
Dual-income married

Copyright 2006 Pearson Education Canada Inc.

Appendix-12

Psychological Segmentation

Motivations
Personality
Perceptions
Learning
Attitudes

Copyright 2006 Pearson Education Canada Inc.

Appendix-13

AIOs

Psychographic (lifestyle) variables that

focus on activities, interests, and opinions.

Copyright 2006 Pearson Education Canada Inc.

Appendix-14

Copyright 2006 Pearson Education Canada Inc.

Appendix-15

Socio-cultural Segmentation

Family Life Cycle

Social Class
Culture, Subculture, and Cross-Culture

Copyright 2006 Pearson Education Canada Inc.

Appendix-16

Family Life Cycle

Phases families go through in their formation,

growth, and final dissolution

Bachelorhood
Honeymooners
Parenthood
Post-parenthood
Dissolution

Explicit basis: marital status, family status

Implicit basis: age, income, employment
Copyright 2006 Pearson Education Canada Inc.

Appendix-17

Use-Related Segmentation

Rate of Usage
Heavy vs. Light
Convert light users to medium or heavy users
By identifying new uses for the product

Attempt to satisfy heavy users well

By making sure the product continues to meet
their needs
continued

Copyright 2006 Pearson Education Canada Inc.

Appendix-18

Use-Related Segmentation

Awareness Status
Aware vs. Unaware
Convert unaware to aware

Brand Loyalty
Brand Loyal vs. Brand Switchers
Satisfy and reward brand loyal users
By providing rewards for continued usage

Copyright 2006 Pearson Education Canada Inc.

Appendix-19

Usage-Situation Segmentation

Segmenting on the basis of special

occasions or situations
Example Statements:
Whenever I do well in a course, I treat myself with ------.
When Im away on business, I try to stay at a suites
hotel.
I always take a bottle of French wine when I am
invited to a friends house for dinner
Copyright 2006 Pearson Education Canada Inc.

Appendix-20

Benefit Segmentation

Segmenting on the basis of the most

important and meaningful benefit
Crest Cavity prevention
Sensodyne Gentle on sensitive teeth
Topol removal of tobacco stains

Copyright 2006 Pearson Education Canada Inc.

Appendix-21

Hybrid Segmentation Approaches

Psychographic-Demographic Profiles
Geodemographic Segmentation
SRI Consulting Groups Values and
Lifestyle System (VALSTM)

Copyright 2006 Pearson Education Canada Inc.

Appendix-22

Copyright 2006 Pearson Education Canada Inc.

Appendix-23

Criteria For Effective Targeting of

Market Segments

Identification
Sufficiency
Stability
Accessibility

Copyright 2006 Pearson Education Canada Inc.

Appendix-24

Segmentation Strategies

Concentrated Marketing
focusing on one target market alone
Suitable for small or new companies

Differentiated Marketing
Focusing on several segments at the same
time
Suitable for financially strong companies with
a several offerings in a product category
continued

Copyright 2006 Pearson Education Canada Inc.

Appendix-25

Segmentation Strategies

Counter-segmentation Strategy
Merging two or more segments into one larger
segment
When target markets do not warrant separate
strategies anymore
When consumer needs become more similar
over a period

Copyright 2006 Pearson Education Canada Inc.

Appendix-26