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    Segmenting, Positioning and Targeting Markets

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    Frances Mae Dagano
    Market segmentation involves dividing a total heterogeneous market into homogeneous subgroups. It allows companies to better understand customer needs and allocate resources accurately. Effective segmentation ensures segments are responsive to different marketing mixes by being homogeneous within and heterogeneous between. Some common bases for segmenting consumer markets include geography, demographics, psychographics, benefits sought, and usage rate. The segmentation process involves selecting a market, choosing bases, selecting descriptors, profiling and analyzing segments, and selecting target markets. Targeting involves choosing specific segments to focus marketing efforts on. Common targeting strategies are undifferentiated, differentiated, and concentrated. Positioning positions a product in consumers' minds relative to attributes, user, associations, problem solved, and competitors. Per

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    Segmenting, Positioning and Targeting Markets

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    Frances Mae Dagano
    20 views39 pages
    Market segmentation involves dividing a total heterogeneous market into homogeneous subgroups. It allows companies to better understand customer needs and allocate resources accurately. Effective segmentation ensures segments are responsive to different marketing mixes by being homogeneous within and heterogeneous between. Some common bases for segmenting consumer markets include geography, demographics, psychographics, benefits sought, and usage rate. The segmentation process involves selecting a market, choosing bases, selecting descriptors, profiling and analyzing segments, and selecting target markets. Targeting involves choosing specific segments to focus marketing efforts on. Common targeting strategies are undifferentiated, differentiated, and concentrated. Positioning positions a product in consumers' minds relative to attributes, user, associations, problem solved, and competitors. Per

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    Market segmentation involves dividing a total heterogeneous market into homogeneous subgroups. It allows companies to better understand customer needs and allocate resources accurately. Effective segmentation ensures segments are responsive to different marketing mixes by being homogeneous within and heterogeneous between. Some common bases for segmenting consumer markets include geography, demographics, psychographics, benefits sought, and usage rate. The segmentation process involves selecting a market, choosing bases, selecting descriptors, profiling and analyzing segments, and selecting target markets. Targeting involves choosing specific segments to focus marketing efforts on. Common targeting strategies are undifferentiated, differentiated, and concentrated. Positioning positions a product in consumers' minds relative to attributes, user, associations, problem solved, and competitors. Per

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    © All Rights Reserved
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    20 views39 pages

    Segmenting, Positioning and Targeting Markets

    Uploaded by

    Frances Mae Dagano
    Market segmentation involves dividing a total heterogeneous market into homogeneous subgroups. It allows companies to better understand customer needs and allocate resources accurately. Effective segmentation ensures segments are responsive to different marketing mixes by being homogeneous within and heterogeneous between. Some common bases for segmenting consumer markets include geography, demographics, psychographics, benefits sought, and usage rate. The segmentation process involves selecting a market, choosing bases, selecting descriptors, profiling and analyzing segments, and selecting target markets. Targeting involves choosing specific segments to focus marketing efforts on. Common targeting strategies are undifferentiated, differentiated, and concentrated. Positioning positions a product in consumers' minds relative to attributes, user, associations, problem solved, and competitors. Per

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    Segmenting , Positioning

    and Targeting
    Markets
    What are Markets?

    • Market: people or institutions with


    sufficient purchasing power, authority,
    and willingness to buy
    • Types of Markets
    Requirements of a Markets

     Need
     Ability
    +  Willingness
     Authority
    Role of Market Segmentation
     Segmentation – the process of dividing something into
    parts or segments

     Market Segmentation: division of the total market into


    smaller, relatively homogeneous groups

     Why?

     Levels – Mass, Segment, and Niche


    Why segment?

    Most Most
    efficient effective
    Many Groups
    of One
    One Mass
    Market
    The Importance of Market
    Segmentation

     Markets have a variety of product


    needs and preferences.

     Marketers can better define


    customer needs.

     Decision makers can define objectives


    and allocate resources more
    accurately.
    No Market Segmentation
    Segmented by Gender
    Segmented by Age
    Segmentation Process
    • Marketers follow two methods to determine
    the bases on which to identify markets:
    – Segments are predefined by managers
    based on their observation of the
    behavioral and demographic
    characteristics of likely users
    – Segments are defined by asking
    customers which attributes are important
    and then clustering the responses
    Criteria for Effective Segmentation
    Responsiveness

    Accessibility

    Measurability /
    Identifiability

    Substantiality
    Most important point
     In relation to responsiveness to different marketing mixes,
    segments must be:
     Homogeneous within
     Heterogeneous between
    LO4 Bases for Segmenting Consumer
    Markets

    Characteristics of individuals,
    groups, or organizations used to
    divide a total market into segments.
    (variables)
    LO4
    Bases for Segmentation
    Geography

    Demographics

    Psychographics

    Benefits Sought

    Usage Rate
    Segmenting Consumer Markets

    • Geographic Segmentation: Dividing


    an overall market into homogeneous
    groups on the basis of their locations

    Metropolitan Statistical
    Area (MSA)
    Segmenting Consumer Markets

    • Demographic segmentation: dividing


    consumer groups according to
    characteristics such as gender, age,
    income, occupation, education, ethnicity,
    household size, and stage in the family
    life cycle.
    Family Life Cycle

    Age

    Marital
    Children
    Status
    Psychographic Segmentation

    • Psychographic Segmentation: dividing a


    population into groups that have similar
    psychological characteristics, and lifestyles.

    • Lifestyle: people’s decisions about how to live


    their daily lives, including family, job, social, and
    consumer activities
    LO4
    Geodemographic Segmentation

    Segmenting potential customers into


    neighborhood lifestyle categories.
    Combines geographic, demographic,
    and psychographic segmentation.
    LO4
    Benefit Segmentation

    The process of grouping customers


    into market segments according to
    the benefits they seek from the
    product.
    Usage Rate Segmentation

    Dividing a market by the


    amount of product bought
    or consumed.
    Bases for Segmenting Business
    Markets
    Producers

    Resellers

    Government

    Institutions

    Company Buying
    Characteristics Processes
    LO6
    Steps in Segmenting Markets

    1 2 3 4 5 6
    Select Choose Select Profile Select Design,
    a market bases descriptors and target implement,
    for for analyze markets maintain
    study segmen- segments marketing
    tation mix

    Note that steps 5 and 6 are actually marketing activities that follow market segmentation (steps 1 through 4).
    Targeting

     Choosing one or more segments for which to design your


    marketing operations
    Identify the Appropriate Targeting Strategy

    Undifferentiated Strategy

    Differentiated

    Concentrated
    Undifferentiated Strategy

    Single
    Marketing
    Mix

    Organization
    Target Market
    Differentiated Strategy

    Marketing Mix 1

    Marketing Mix 2
    Organization

    Target Market
    Concentrated Strategy

    Single
    Marketing
    Mix

    Organization
    Target Market
    Cannibalization

    Cannibalization

    Situation that occurs when


    sales of a new product cut into
    sales of a firm’s existing
    products.
    STRATEGIES FOR REACHING
    TARGET MARKETS
    • No single, best choice strategy suits all
    firms
    • Determinants of a market-specific
    strategy:
    – Company resources
    – Product homogeneity
    – Competitors’ strategy
    One-to-One Marketing

    An individualized marketing method


    that utilizes customer information to
    build long-term, personalized, and
    profitable relationships with each
    customer.
    - ‘share of customer’
    Product Positioning

     Positioning starts with a product. A Piece of merchandise, a service, a


    company, an institution, or even a person... But positioning is not what
    you do to a product. Positioning is what you do to the mind of the
    prospect. That is, you position the product in the mind of the prospect.
    Al Ries and Jack Trout (1981)
    Positioning of
    Procter & Gamble
    Detergents
    Market
    Brand Positioning
    Share
    Tide Tough, powerful cleaning 31.1%
    Cheer Tough cleaning, color protection 8.2%
    Bold Detergent plus fabric softener 2.9%
    Gain Sunshine scent and odor-removing formula 2.6%
    Era Stain treatment and stain removal 2.2%
    Dash Value brand 1.8%
    Oxydol Bleach-boosted formula, whitening 1.4%
    Solo Detergent and fabric softener in liquid form 1.2%
    Dreft Outstanding cleaning for baby clothes, safe 1.0%
    LO9
    Ivory Snow Fabric & skin safety on baby clothes 0.7%
    Ariel Tough cleaner, aimed at Hispanic market 0.1%
    Product Positioning Dimensions
     Product Attributes / Differences / Benefits

     Product User / Usage

     By Association

     Problem Solution

     Against a Competitor / Away from Competitors


    Perceptual Mapping

    A means of displaying or graphing, in two


    or more dimensions, the location of
    products, brands, or groups of products in
    customers’ minds.
    Perceptual Maps
    Corolla Celica Avalon Camry
    Expensive

    Sporty Conservative

    Inexpensive
    Product Positioning using perceptual
    maps
    High moisturizing
    Zest
    Tone 7
    4
    Lever 2000
    Dove
    5 2

    Safeguard
    Coast
    Lux 8
    Nondeodorant 3 Deodorant

    1
    Dial
    Lifebuoy
    Lava
    6

    Low moisturizing
    Repositioning

    Changing consumers’
    perceptions of a brand in relation
    to competing brands.
    Positioning and Product Differentiation

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