IDENTIFYING MARKET SEGMENTS AND TARGETS

IDENTIFYING MARKET SEGMENTS AND TARGETS

CHAPTER 9

• What Market Segmentation Means Market segments Product differentiation

• Segmentation: Linking Needs to Action

WHY SEGMENT MARKETS?

Market segmentation links market need to an Market segmentation links market need to an organization’s marketing programorganization’s marketing program

• What Market Segmentation Means• How Reebok’s Segmentation Strategy Developed

• Using Market-Product Grids

WHY SEGMENT MARKETS?

Market-product Grid: How Reebok shoes reach segments of customersMarket-product Grid: How Reebok shoes reach segments of customers

• When to Segment Markets• One Product and Multiple Market Segments

• Multiple Products and Multiple Market Segments

• Segments of One: Mass Customization

• The Segmentation Trade Off: CRM versus synergies

WHY SEGMENT MARKETS?

The process of segmenting and targeting The process of segmenting and targeting markets involves five key stepsmarkets involves five key steps

STEPS IN SEGMENTING AND TARGETING MARKETS

• Form Prospective Buyers into Segments• Criteria to Use in Forming the Segments

Potential for increased profit and ROI Similarity of needs of potential buyers in a segment Difference of needs of buyers among segments Feasibility of a marketing action reaching segment Simplicity and cost of assigning buyers to markets

• Ways to Segment Consumer Markets Usage rate 80/20 rule

STEPS IN SEGMENTING AND TARGETING MARKETS

Segmentation Segmentation variables and variables and breakdowns breakdowns for U.S. for U.S. consumer consumer marketsmarkets

Segmentation variables and breakdowns for U.S. Segmentation variables and breakdowns for U.S. organizational marketsorganizational markets

• Form Products to Be Sold into Groups

• Develop a Market-Product Grid and Estimate Size of Markets

STEPS IN SEGMENTING AND TARGETING MARKETS

• Select Target Markets• Criteria to Use in Picking the Target Segments

Market size Expected growth Competitive position Cost of reaching the segment Compatibility with objectives and resources

• Choose the Segments

• Take Marketing Actions to Reach Target Markets• Your Wendy’s Segmentation Strategy

• Apple’s Ever-Changing Segmentation Strategy

STEPS IN SEGMENTING AND TARGETING MARKETS

• Developing Cross-Tabulations• Pairing the Questions

• Forming Cross-Tabulations

• Interpreting Cross-Tabulations

• Value of Cross-Tabulations

ANALYZING MARKET SEGMENTS USING CROSS-TABULATIONS

• Two Approaches to Product Positioning Head-to-head positioning Differentiation positioning

POSITIONING THE PRODUCT