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SEGMENTING and

TARGETING

DIVIDE AND RULE

Dilbert Comic Strip


Is segmenting markets a
good marketing thing?

Slide 9-25

HLL expands Pears soap to


kids segment
Himalaya Herbal Healthcare
serves a growing
niche market(FMHG)
Taking women on a ride
(Bajaj Wave DTS-i)
Titan Edge the worlds slimmest
watch; Nebula in solid gold and
precious stones; the Gold and Steel
collection; Raga 9 to 5 for the
woman achiever; Flip Indias first
Titan Watches: Time to and only reversible watch with two
tap the potential of
movements and dial faces; and
different segments
Fastrack in the sporty casual
category.

What segments are being targeted?


Nokia cell phones
Company has divided its customers into different segments based
on their involvement levels ,product usage, income level and
lifestyle
Product offerings under four broad heads: Live, Connect, Achieve
and Explore.
"While the 'Connect' category phones would appeal to someone
whose requirements are very simple and basic, the N-series
multimedia phones would fall under the 'Explore' category,
In the Indian context, the 1,100 range of phones would fit under the
'Connect' category where the emphasis is on the phones being
simple and user friendly.
Similarly, the Nokia E-series instruments have been classified for
the 'Achieve' users for whom the phone is far more than just
something you use to make calls.

Soft drink preferencessome segmentation


variables

Preferred taste: Cola, lime, no taste, natural juice,


ice tea
Calorie/taste tradeoff: taste more important,
some importance of both, will sacrifice taste for
low calories
Usage occasion: Multi-pack for home; single
can/bottle; fountain drink
Price sensitivity/brand loyalty: Willingness to pay
more for brand
Some combined

segments:
1.Price sensitive, non-brand loyal
,cola-taste, full-flavor segment, multipack
2.Price insensitive, cola taste, brand
loyal, low calorie, multi-pack

Market Segmentation
Division of the total market into
smaller, relatively homogeneous
groups
No single marketing mix can satisfy
everyone. Therefore, separate
marketing mixes should be used for
different market segments.

Steps in Market Segmentation,


Targeting, and Positioning

Step 1. Market
Segmentation
Bases for Segmenting Consumer Markets
Geographic
Nations, states,
regions or cities

Demographic
Age, gender,
family size and
life cycle,
or
income

Psychographic
Social class, lifestyle,
or personality

Behavioral
Occasions, benefits,
uses, or responses

Step 1. Market
Segmentation
Levels of Market Segmentation
Mass
Mass Marketing
Marketing

Same
Sameproduct
productto
toall
allconsumers
consumers
(no
(nosegmentation)
segmentation)

Segment
Segment Marketing
Marketing

Different
Differentproducts
productsto
toone
oneor
ormore
moresegments
segments
(some
(somesegmentation)
segmentation)

Niche
Niche Marketing
Marketing

Different
Differentproducts
productsto
tosubgroups
subgroupswithin
withinsegments
segments
((more
moresegmentation)
segmentation)

Micromarketing
Micromarketing

Products
Productsto
tosuit
suitthe
thetastes
tastesof
ofindividuals
individualsor
orlocations
locations
(complete
(completesegmentation)
segmentation)

Response-based
segmentation:
Putting the horse before
the cart

Urban India is getting saturated. In


the cities, everyone who can afford a
television has one. If you want to
maintain high growth, you have to
penetrate into rural India.
- K. Ramachandran, Chief Executive
Philips Electronics India

Step 1. Market
Segmentation
Requirements for Effective Segmentation
Measurable
Measurable
Accessible
Accessible

Size, purchasing power, profiles


of segments can be measured.
Segments must be effectively
reached and served.

Substantial
Substantial

Segments must be large or


profitable enough to serve.

Differential
Differential

Segments must respond


differently to different marketing mix
elements & actions.

Actionable
Actionable

Must be able to attract and serve


the segments.

Step 2. Market
Targeting
Evaluating Market Segments

Segment Size and Growth


Analyze sales, growth rates and expected profitability.

Segment Structural Attractiveness


Consider effects of: Competitors, Availability of
Substitute Products and, the Power of Buyers & Suppliers.

Company Objectives and Resources


Company skills & resources relative to the segment(s).
Look for Competitive Advantages.

Five patterns for target market


selection

FIGURE 9-5 Selecting a target market for


your fast-food restaurant next to an urban
university (target market is shaded)

Slide 9-32

FIGURE 9-6 Advertising actions to reach


specific student segments

Slide 9-36

FIGURE 9-A Market-product grid showing


the size of markets for pillows for three
different segments of sleepers

Task
What segments are being targeted?
Reebok
Mc Donalds
You can please some people all of the
time
and all people some of the time, but
you
cannot please all people all of the
time.

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