Post on 20-Nov-2014
Focusing Marketing Strategy with Segmentation and Positioning
1. Know about defining generic markets and product-markets.
2. Know what market segmentation is and how to segment product-markets into submarkets.
3. Know three approaches to market-oriented strategy planning.
4. Know dimensions that may be useful for segmenting markets.
5. Know a seven-step approach to market segmentation that you can do yourself.
6. Know what positioning is and why it is useful.
At the end of this presentation, you should be able to:
Focusing Marketing Strategy with Segmentation and Positioning (Exhibit 4-1)
Segmentation• Defining markets• Dimensions to use• Identifying segments• Identifying segments to target• Segmentation approaches
Positioning• Understanding customer’s view• Positioning techniques• Evaluating segment preferences• Differentiating the marketing mix• Relationship between positioning & targeting
Focusing Marketing Strategy with Segmentation and Positioning
Taking Advantage of Opportunities
Product-Market Definition
Product-Market Definition
Naming Product Markets and Generic Markets
Customer Needs
Customer Needs
Customer Type
Customer Type
Geographic Area
Geographic Area
ProductType
ProductType
No Product Type in Generic Market Definition
What Is the Product-Market?
and
2. Segmenting markets and
selecting targets
2. Segmenting markets and
selecting targets
1. Naming broad product-markets1. Naming broad product-markets
Segmentation is a Two-Step Process
The Process of Narrowing Down to Target Markets
All customer needs
Some generic market
Homogeneous (narrow) product-
markets
Single target market
Multiple target
markets
Combined target
markets
Narrowing down to specific product-market
Segmenting into possible target markets
Selecting target marketing approach
One broad product-market
Broad product-market (or generic market) name goes here (The bicycle-riders product-market)
Submarket 1(Exercisers)
Submarket 2(Off-road
adventurers)
Submarket 3(Transportation riders)
Submarket 4(Socializers)
Submarket 5(Environmentalists)
Market Segmentation Defines Possible Target Markets
A. Product-market showingthree segments
Dependability dimension
Sta
tus
dim
ensi
onB. Product-market showing
six segments
How Far Should the Aggregating Go?
Segmenters and Combiners Aim at Specific Target Markets
The strategy
A combiner aims at two or more submarkets with the same marketing mix.
The Strategy
A segmenter develops a different marketing mix for each segment.
Strategy one
Strategy two
Strategy three
Single targetmarket approach
Multiple targetmarket approach
Segmenting vs. Combining
Combiners Try to Satisfy “Pretty Well”
Too Much Combining Is
Risky Segmenters Try to Satisfy “Very Well”
Segmenting May Produce Bigger Sales
Key IssuesKey Issues
Segment or Combine?
Profit Is the Balancing
Point
Benefits Sought
Benefits Sought
ThoughtsThoughts
NeedsNeeds
Rate of useRate of use
Purchase relationshipPurchase
relationshipBrand
familiarityBrand
familiarity
Kind of shoppingKind of
shopping
Type of problem-solving
Type of problem-solving
Information required
Information required
Behavioral dimensions for segmenting consumer markets
BehavioralSegmentingDimensions
BehavioralSegmentingDimensions
Ball Park franks appeal to this segment with older, attractive models and products addressing concerns about health and fat.
Haagen Dazs projects an elegant, indulgent, and special personality in this ad.
Region in a country
Region in a country
Region of world or country
Region of world or country
Size of citySize of city
Geographic Segmentation
Dimensions
Geographic Segmentation
Dimensions
Geographic dimensions for segmenting consumer markets
Demographic Segmentation Dimensions
Demographic Segmentation Dimensions
IncomeIncome
Gender or ageGender or age
Family size or family life cycle stage
Family size or family life cycle stage
Occupation or education
Occupation or education
Ethnicity or social class
Ethnicity or social class
Demographic dimensions for segmenting consumer markets
Income
Soft & Beautiful, a hair care products company, recognizes the many roles of women in its ads.
Tyson chicken developed “Tyson Time-Trimmers,” pre-cut, frozen chicken strips, to appeal to busy women and mothers.
Computer manufacturers have created computers to appeal to girls and boys.
Crayola introduced a new crayon which is washable and can be removed from a variety of surfaces.
Purchasing methods
Purchasing methods
Kind of relationship
Kind of relationship
Type of customer
Type of customer
Segmenting Dimensions
for Business Markets
Segmenting Dimensions
for Business Markets
DemographicsDemographics
Type of buying situation
Type of buying situation
Segmenting business markets
How customers will use the
product
How customers will use the
product
Business-to-Business Segmentation
OR
QualifyingDimensionsQualifying
Dimensions
• Relevant to including a customer type in a product-market
• Help identify “core benefits”
DeterminingDimensionsDeterminingDimensions
• Affect the customer’s purchase of a product or brand
• Can be further segmented
What Dimensions are used to Segment Markets?
Key IssuesKey Issues
Determining vs. Qualifying Dimensions
Different Dimensions For
Different Submarkets
Different Dimensions For
Different Submarkets
Determining Dimensions May Be Very Specific
Determining Dimensions May Be Very Specific
Determining Dimensions May
Change
Determining Dimensions May
Change
Qualifying Dimensions Are Important Too
Qualifying Dimensions Are Important Too
EthicalIssuesEthicalIssues ExploitationExploitation
Creates Unnecessary
Wants
Creates Unnecessary
Wants
Does HarmDoes Harm
Ethical Issues in Segmenting Markets
InternationalIssues
InternationalIssues
What Are the Relevant Segmenting Dimensions?
Psychographic Segmentation
2. Identify potentialcustomer needs
2. Identify potentialcustomer needs
7. Estimate size of eachproduct-market segments7. Estimate size of each
product-market segments
1. Select (name) the broad product-market
1. Select (name) the broad product-market
3. Form initial homogeneoussubmarkets
3. Form initial homogeneoussubmarkets
4. Identify determining dimensions
4. Identify determining dimensions
5. Name possibleproduct-markets
5. Name possibleproduct-markets
6. Evaluate product-marketsegments
6. Evaluate product-marketsegments
BestPracticeApproachforSegmentingProduct-Markets
BestPracticeApproachforSegmentingProduct-Markets
Segmenting Product Markets
ClusteringClustering
Customer DatabaseCustomer Database
Customer Relationship Management (CRM)
Customer Relationship Management (CRM)
More Sophisticated Techniques May Help in Segmenting
Cluster Analysis
Positioning
Sticks like quattro.
Sticks like quattro.
High moisturizing
low moisturizing
Nondeodorant Deodorant
ZestLever 2000
Safeguard
DialLifebuoy
Tone
Dove
LuxCoast
Lava
2
1
4
5
7
38
6
“Product Space” Representation of Positioning
Positioning and Advertising
1. Know about defining generic markets and product-markets.
2. Know what market segmentation is and how to segment product-markets into submarkets.
3. Know three approaches to market-oriented strategy planning.
4. Know dimensions that may be useful for segmenting markets.
5. Know a seven-step approach to market segmentation that you can do yourself.
6. Know what positioning is and why it is useful.
You should now be able to:
• Market• Generic market• Product market• Market
segmentation• Segmenting• Market segment• Single target market
approach• Multiple target
market approach• Combined target
market approach
• Combiners• Segmenters• Qualifying dimensions• Determining dimensions• Clustering techniques• Customer relationship
management (CRM)• Positioning
Key Terms