301 7 segmentation close

8/8/2019 301 7 Segmentation Close

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7

Segmentation & TargetMarketing

Dr. Close


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F inding MarketsMarkets = people with needs/wants andthe ability and willingness to buyTypes of markets: Generic

People with broadly similar needs (social)Diverse ways of satisfying (restaurants, movies)

Products

Very similar needs (thirsty for soft drinks)Very close substitutes (Coke vs. Pepsi, and whatelse?)

Close substitutes or no?


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Pepsi vs Coke


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W hats the Difference?

Ma rket

Ma rket

Ma rketSegment

Ma rketSegment

MarketSegment a tion

MarketSegment a tion

People or organizations with needs or wantsand the ability and willingness to buy.

People or organizations with needs or wantsand the ability and willingness to buy.

A subgroup of people or organizations sharingone or more characteristics that cause them tohave similar product needs.

A subgroup of people or organizations sharingone or more characteristics that cause them tohave similar product needs.

The process of dividing a market intomeaningful, relatively similar, identifiablesegments or groups.

The process of dividing a market intomeaningful, relatively similar, identifiablesegments or groups.


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Market Segmentation

Dividing market into meaningful, similar groups(or aggregating those with similar needs)

Why is segmentation important?....Why is segmentation important?....Markets have a variety of product preferencesMarketers can better define customer needsDecision makers can define objectives andallocate resources more accurately


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Criteria for Segmentation

Subst a nti a lity

Identifi a bilitya nd M e a sur a bility

Accessibility

Responsiveness

Segment must be l a rge enough tow a rr a nt a speci a l m a rketing mix.

Segments must be identifi a ble a ndtheir size me a sur a ble.

M embers of t a rgeted segments mustbe re a ch a ble with m a rketing mix.

Unless segment responds to a m a rketing mix differently, no sep a r a te

tre a tment is needed.


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So, A Good Segment is

Homogenous within: members are similar Heterogeneous between: outsiders differ

(choose the best)Substantial: large enough for profit (Ned

F landers)

Operational: workable (identify thenaccess China)


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Demographic Segmentation:F

amily Life Cycle


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Psychographic Segmentation

Personality (cars)Motives (emotions)

Lifestyles (outdoor)Geodemographics (PRIZM)


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B enefit Segmentation

Group consumers via needs/wants (NOTby gender, age, lifestyle etc.)

W hat do you want from your cell phone?


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U sage Rate Segmentation

Group by amount/rate of consumptionF ormer apple users

Potential apple usersLight apple usersHeavy apple users

80/20 principle of demand


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6 Steps to Segment a Ma rket

Selecta m a rket

for study

Chooseb a ses

for segmen-

ta tion

Selectdescriptors

Profilea nd

a n a lyzesegments

Selectta rget

m a rkets

Design,implement,

m a int a inm a rketing

mix


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Strategies for Selecting Target

MarketsOptions U ndifferentiated Targeting

One market, one mix (plain toilet paper)

Any other examples? Concentrated Targeting

Multiple markets & mix for eachExamples include F ord, Lincoln, Mercury, and what else?

Multi-segment TargetingMultiple markets share mix (bad idea)Adv antages = Greater financial success; Economies of scaleDisa dv antages= High costs; Cannibalization


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Strategies for Selecting Target

MarketsOptions U ndifferentiated Targeting

One market, one mix (plain toilet paper)

Any other examples? Concentrated Targeting

Multiple markets & mix for eachExamples include F ord, Lincoln, Mercury, and what else?

Multi-segment TargetingMultiple markets share mix (bad idea)Example: network television and any more?


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One-to-One Marketing

Inform a tion-IntensiveInform a tion-Intensive

Long-TermLong-Term

One-to-OneMarketing is...

One-to-OneMarketing is...

Individu a lizedIndividu a lized Cost ReductionCost Reduction

Has a Goal ofHas a Goal of

Customer Loy a ltyCustomer Loy a lty

Incre a sed RevenueIncre a sed Revenue

Person a lizedPerson a lized

Customer RetentionCustomer Retention


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One-to-One Marketing

One-size-fits all marketing is lame.

Direct/personal marketing will grow to meetneeds of busy consumers.W e will be loyal to companies that have

earnedand reinforcedour loyalty.Mass-media approaches will decline as

technology allows better customer tracking.

TrendsTrends


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Marketing Strategy

Matching opportunity with resources andbusiness objectives

Goals:1. SCAEnduring superiority of a business

B EST: from many parts ( W al-Mart)

2.B

reakthrough opportunityConditions right for SCA


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Positioning

Developing a marketing mixto influence potentialcustomers overallperception of a brand,product line, or organizationin general.

How is W al-MartPositioned?


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AttributeAttribute

Price a nd Qu a lityPrice a nd Qu a lity

Use or Applic a tionUse or Applic a tion

Product User Product User

Product Cl a ssProduct Cl a ss

Competitor Competitor

EmotionEmotion

PositioningB ases


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LO 9 0.7%F abric & skin safety on baby clothesIvory Snow0.1%Tough cleaner, aimed at Hispanic market Ariel

1.0%Cleaning for baby clothes, safeDreft1.2%Detergent and fabric softener in liquid formSolo1.4%B leach-boosted formula, whiteningOxydol1.8%Value brandDash

2.2%Stain treatment and stain removalEra2.6%Sunshine scent, odor-removingGain2.9%Detergent plus fabric softener B old8.2%Tough cleaning, color protectionCheer

31.1%Tough, powerful cleaningTide

MarketShare

PositioningB rand

Positioning of Procter & Gamble

Detergents


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EffectivePositioning

1. Assess the positions occupied by

competing products2. Determine the dimensions underlying

these positions

3. Choose a market position wheremarketing efforts will have thegreatest impact


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Product

Differentiation

A positioning strategythat some firms use todistinguish their products from those of

competitors.

A re d istinctions real or A re d istinctions real or percei v e d ? percei v e d ?


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Perceptual

Mapping


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Daimler Chrysler:Do they need a reposition?(Changing consumers perceptions of a brand

in relation to competing brands)


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Summary

Generic vs product marketsSegmentation: Criteria

B ases for segmentingStrategies of segmentation(effective)Positioning/repositioning, bases

Any questions?

301 7 segmentation close

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