target marketing & research design principles of marketing week 08
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TARGET MARKETING & RESEARCH DESIGNPRINCIPLES OF MARKETING WEEK 08
LEARNING OBJECTIVES
• Market Segmentation• Target Marketing• Research Design• Survey Design• Homework
MARKET SEGMENTATION
Concept of Market Segmentation
• Partitioning a market that is characterized by heterogeneity in consumers’ response to the marketing mix into more homogeneous submarkets.
• Process of dividing a large market into smaller target markets, or customer groups with similar needs and/or desires.
MARGET SEGMENTATIONGENERAL PRODUCT-SPECIFIC
OBSERVABLE
LATENT
Observable features of physical and social environment (esp. demographics)
Behavioral characteristics (user status, loyalty, status, usage rate
Usage Situations
Values, lifestyles, and psychographics, personality variables
AwarenessAttitude (belief evaluations)Intentions
MARKET SEGMENTATION
Market Segmentation
Segmentable market variables are:
• Demographic• Benefits Sought• Geographic• Situation• Psychographic• Behavior / Usage
MARKET SEGMENTATION
Market Segmentation
• Demographic• Age• Income Level• Family• Education• Ethnicity
• Examples?
MARKET SEGMENTATION
Market Segmentation
• Geographic• When an organization localizes its marketing efforts to
accommodate the unique needs of specific geographic regions
• Examples?
MARKET SEGMENTATION
Market Segmentation
• Psychographic• Grouping customers together based on social class,
lifestyles, and psychological characteristics (attitudes, interests, opinions)
• Examples?
MARKET SEGMENTATION
Market Segmentation
• Benefits Sought• Segments based on the benefits that consumers desire
from using a specific product.
• Examples?
MARKET SEGMENTATION
Market Segmentation
• Situation• Purchase situation or occasion
• Impacted by Physical and Social surroundings, Time to make a purchase, task definition, pre-purchase attitude.
• Examples?
MARKET SEGMENTATION
Market Segmentation
• Behavior / Usage• Markets can be segmented by how often or how heavily
consumers use a specific product.
• Examples?
MARKET SEGMENTATION
In Class Exercise
• Go to the websites for Crest and Colgate and study what types of toothpastes they offer to appeal to different market segments.
• Use this information or any other information that you can find to come up with a list of variables that companies use to segment the toothpaste market.
MARKET SEGMENTATION
Segmentation Bases
• Behavioral Characteristics / Usage Situations• Toothpaste Category Users
• Other brand loyals• Other brand switchers• Heavy users• Light users• Potential users
• Awareness / Attitude / Intentions• Attitudinal Segmentation
• Consider plus and minuses of each brand
MARKET SEGMENTATIONVALS 2
• A method of classifying consumers on the basis of two dimensions:
• Self orientation (primary motivation)• Ideals (principle oriented consumers)
• Those who are guided in their choices by abstract, idealized criteria (quality, integrity, tradition)
• Achievement (status oriented consumers)• Those who are guided in their choices by the expected
reactions, concerns, and desires of groups to which they belong or aspire to belong.
• Self-Expression (action oriented people)• Those who are guided in their choices by a desire for
social or physical activity, variety, and risk taking.
MARKET SEGMENTATION
VALS 2
• A method of classifying consumers on the basis of two dimensions:
• Resources• Refers to the full range of psychological, physical,
demographic, and material means and capacities people have to draw upon • (age, education, income, self-confidence, energy,
intellectualism, novelty seeking, innovativeness, impulsiveness, etc.)
MARKET SEGMENTATIONSegmentation Scheme for Toothpastes
Sensories
Sociables
Worriers
Independents
principal benefit
flavor, product appearance
brightness of teeth
decay prevention
low price
behavioral characteristics
users of spear-mint flavor
smokers heavy users heavy users
demographics children teens, young
adults large families men
psycho-graphics
high self-involvement, hedonistic
high sociability, active
hypochondriac, conservative
high autonomy, value-oriented
MARKET SEGMENTATIONData Sources for Segmentation
• Simmons Market Research Bureau• Product usage by category, demographics, media
behavior, psychographics
• Mediamark Research
MARKET SEGMENTATION
Segmentation Criteria
• Differentiable: Market response is homogeneous within segments and heterogeneous between segments
• Indentifiable: Individuals can be assigned to a segment based on a meaningful profile of segment characteristics
• Stable: Segments and segment membership do not change in the short run
• Measurable: The size and purchasing power of relevant segments can be determined.
• Actionable: The company is able to develop a marketing mix that will appeal to the members of a given segment.
• Accessible: Members of a segment can be reached with the appropriate marketing mix.
TARGET MARKETING
• Evaluation of the attractiveness of each market segment and selection of target segments
• Evaluation of market segments based on:• Market segment characteristics• Industry competition• Company objectives and resources
• Selection of target segments can result in:• Undifferentiated (mass) marketing• Differentiated marketing• Concentrated marketing
TARGET MARKETING
• Undifferentiated Marketing• An organization develops one strategy
appropriate for all members of the total market.
• Differentiated Marketing• An organization targets multiple market segments
and develops segment specific mixes.
• Concentrated Marketing• When an organization concentrates its
marketing efforts on a smaller segment of a larger market.
RESEARCH DESIGN
Conceptualization
• Developing a model that shows variables that will be studied and hypothesized relationships between the variables.
• Identify variables/construct to study• Specify hypotheses and relationships• Prepare a diagram that represents the relationship visually
RESEARCH DESIGN
Variables vs. Constructs
• Variables• An observable item that is directly measured in a research
study (gender, age, company name, number of employees, number of customers, amount spent, etc.)
• Construct• An unobservable concept measure indirectly by several
related variables by several related variables (service quality, satisfaction, materialism, best customer, etc.)
SURVEYS
Methodologies
• Person to Person Administered• In Home interview• Purchase Intercept• Mail Intercept
• Telephone Administered• Telephone interview• Computer assisted telephone interview• Automated telephone surveys
SURVEYS
Methodologies
• Self Administered• Mail Panel • Drop Off• Mail Survey
• Computer Assisted (Online)• Fax• Email• internet
SURVEYS
Selecting a Survey Method
• Consider the following:• Situational Characteristics
• Budget, completion time frame, quality, completeness of data, data precision
• Task Characteristics• Difficult, stimuli needed, large amount of information,
sensitive topics
• Respondent Characteristics• Diversity, incidence, participation
SURVEYS
Questionnaire Design
• A good questionnaire appears as easy to compose as a poem, but usually the result of long painstaking work.
• No real, hard and fast rules, only guidelines.
SURVEYS
Decisions
• What should be asked?• How should each question be phrased?• In what sequence should the questions be arranged?• What questionnaire layout will best serve the research
objectives?• How should it be pretested and revised?
SURVEYS
Screener and Filter Questions
SURVEYS
Screener and Filter Questions
SURVEYS
Screener and Filter Questions
SURVEYS
Skip Patterns
Use multiple visual
Elements to improve skip
pattern compliance
SURVEYS
Questionnaire Organization
• Logical flow• Usually go from general to specific• Ask sensitive questions later
SURVEYS
Questionnaire Organization
SURVEYS
Questionnaire OrganizationSelecting the first questionfor a questionnaire.
SURVEYS
Questionnaire Organization
SURVEYS
Questionnaire Organization
• Use of booklets• Color coding• Question numbering• Fitting questions on a page• Instructions (skip and otherwise)• Use of typeface and blank space• Precoding
SURVEYS
Questionnaire Design
• Place instruction exactly where needed and not a separate section at the beginning questionnaire.
SURVEYS
Questionnaire Design
• Maintain simplicity, regularity, and a consistent figure/ground format to make respondent’s task easier.
• Increase size and brightness of visual elements to emphasize order for reading questionnaire information.
• Emphasize words and phrases in questions consistently, but sparingly
• Change spacing and similarity to identify appropriate groupings of visual elements.
SURVEYS
Questionnaire Design
• Write special instructions as part of question, not as free standing entities.
SURVEYS
Questionnaire Design
• Answer Formats• Categories may be placed to the left or right of category
tables.
SURVEYS
Questionnaire Design
• Answer Formats• Place items with the same response categories in an item-
in-a series format.
SURVEYS
Questionnaire Design
• Answer Formats• Eliminate check-all-that-apply question format.
SURVEY
Questionnaire Design
HOMEWORKIn this week’s homework you will be expected to complete the following:
Target Market / Market Research
Describe your customer profile in detail including demographics, psychographics and geographic information about the target market in great detail.
HOMEWORKIn this week’s homework you will be expected to complete the following:
Questionnaire Design
Design a questionnaire based on class discussion and give it to 25 people before next week’s class.
Review answers and develop conclusions based on the data collected.
FINAL PROJECT SPECSThe final project is the culminating academic endeavor of the class’s research over the quarter.
It will provide you with the opportunity to explore a problem or issue of particular personal or professional interest and to address it in a thorough focused study and applied research.
This project should demonstrate your ability to synthesize and apply the knowledge and skills acquired through the class, and it should not only exemplify your ability to think critically, but should utilize the variety of research methods introduced to come to a cohesive and logical conclusion.
FINAL PROJECT SPECS» Sections
Executive Summary
Industry Analysis
Marketing Research
SWOTT Analysis
Hypothesis/Problem Statement/Purpose
Research Objectives
Limitations
Methodology
Sample Questionnaire
Data Analysis
Conclusions