MARKET SEGMENTATION,

TARGETING AND POSITIONING

Learning Objectives:
•Learn the three steps of marketing, market
segmentation, target marketing, and market
positioning

•Understand the major bases for segmenting

consumer and business marketing strategy

•Know how companies identify attractive market

segments and choose market strategy

•Realize how companies position their products for

maximum competitive advantage in the market
place
STEPS:
- dividing a market into distinct groups with distinct
needs, characteristics, or behavior who might require
separate products or marketing mixes.
Major Segmentation Variables for Consumer Markets

DEMOGRAPHIC

 Age  Education
 Gender  Religion
 Family size  Race
 Family life cycle  Generation
 Income  Nationality
 Occupation
Major Segmentation Variables for Consumer Markets

PSYCHOGRAPHIC

Lower lowers, upper lowers, working class, middle class, upper

Social class middles, lower uppers, upper uppers

Lifestyle Achievers, strivers, survivors

Personality Compulsive, gregarious, authoritarian, ambitious

Major Segmentation Variables for Consumer Markets

BEHAVIORAL
Occasions Regular occasion, Special occasion

Benefits Quality, service, economy, convenience, speed

User status Nonuser, ex-user, potential user, first time user, regular user

Loyalty Status None, medium, strong, absolute

Readiness stage Unaware, aware, informed, interested, desirous, intending to buy

Attitude toward
Enthusiastic, positive, indifferent, negative, hostile
product
GEOGRAPHIC SEGMENTATION

• Calls for dividing the market

into different geographical
units such as nations, regions,
states, counties, cities, or even
neighborhoods
DEMOGRAPHIC SEGMENTATION

• Divides the market into groups

based on variables such as age,
sex, family size, family life
cycle, income, occupation,
education, religion, race and
nationality
AGE AND LIFE CYCLE SEGMENTATION

• Dividing a market into

different age and life cycle
groups
GENDER SEGMENTATION

• Dividing a market into

different groups based on
gender
Psychographic Segmentation
dividing a market into different
groups based on social class,
lifestyle or personality
characteristics
Behavioral Segmentation
 dividing a market into groups based on consumer
knowledge, attitude, use or response to a product

A.Occasions
buyers can be grouped according to occasions – when
they get the idea to buy, make their purchase or use
the purchased item
Occasion Segmentation
dividing the market into groups according to occasion
B. Benefits Sought
• a powerful form of segmentation is to group
buyers according to different benefits that they
seek from the product

Benefit Segmentation
requires finding the major benefits people look for
in the product class – the kinds of people who look
for each benefit and the major brand that deliver
each benefit
C. User Status
• Markets can be segmented into groups of non users, ex-
users, potential users, first-time users and regular users of
a product

D. Usage Rate
• markets can also be segmented into light, medium and
heavy product users
• Heavy Users
are often a small percentage of the market but account for
a high percentage of total consumption

E. Loyalty Status
• a market can also be segmented by consumer loyalty.
Consumers can be loyal to brands, stores and company
Requirements for Effective
Segementation
• Measurable: The size, purchasing power, and profiles of the
segments can be measured.

• Accessible: The market segments can be effectively reached

and served

• Substantial: The market segments are large or profitable

enough to serve.
Requirements for Effective
Segementation
• Differentiable: The segments are
conceptually distinguishable and
respond differently to different
marketing mix elements and
programs
• Actionable: Effective programs can be
designed for attracting and serving the
segments
Evaluating Market Segments

• Segment size and growth

• Segment structural attractiveness
• Company objectives and resources
Selecting Target Market Segments

Target Market
• consists of a set of buyers sharing common needs or characteristics that
the company decides to serve.
Target Marketing Strategies

Differentiated
Undifferentiated Concentrated
(segmented) Micromarketing
(mass) marketing (niche) marketing
marketing

Targeting broadly Targeting narrowly

1.Undifferentiated (mass) marketing

 A market-coverage strategy in which a firm decides to

ignore market segment differences and go after the
whole market with one offer.
 Focuses on what is common in the needs of consumers
rather than on what is different.
2. Differentiated (segmented) marketing

 A market-coverage strategy in which a firm decides to

target several market segments and designs separate
offers for each.
 It also increases the costs of doing business.
3. Concentrated (niche) marketing

 A market-coverage strategy in which a firm goes after a

large share of one or a few segments or niches.
 The firm achieves a strong market position.
4. Micromarketing
 The practice of tailoring products and marketing programs to
the needs and wants of specific individuals and local customer
groups-includes local marketing and individual marketing.
 Local marketing – tailoring brands and promotions to the needs
and wants of local customer groups-cities, neighborhoods, and
even specific stores.
 Individual marketing – tailoring products and marketing
programs to the needs and preferences of individual customers-
also labeled “markets-of-one-marketing”, “customized-
marketing”, and “one-to-one-marketing”.
Choosing a Target Marketing Strategy

Factors:
1. Company resources
2. Product variability
3. Product life cycle stage
4. Market variability
5. Competitors' marketing
strategies
Company resources
• Limited resources Concentrated marketing

Product variability
• Uniform products Undifferentiated marketing
• Products that varies in design Differentiated or concentrated

marketing
Product's life cycle stage
• New product differentiated or concentrated marketing
• In mature stage of product life cycle differentiated
marketing
Market variability
• If buyers have the same taste, buy the undifferentiated
same amount and react the same marketing
way

differentiated or
Competitors' marketing strategies
• If competitors use undifferentiated concentrated
marketing
marketing
Socially Responsible Target Marketing
• Socially responsible marketing calls for
segmentation and targeting that serve not just the
interests of the company but also the interest of
those targeted.
POSITIONING FOR COMPETITIVE ADVANTAGE
Product position - the way the product is defined by
consumers on important attributes-- the place the
product occupies in consumers' minds relative to
competing products
Examples:
Tide - "powerful, all purpose family detergent"
Toyota Echo and Ford Focus are positioned on
economy
Mercedes and Cadillac on luxury
Porsche and BMW on performances
Volvo positions powerfully on safety
Positioning Maps
Perceptual positioning maps - shows consumer
perceptions of their brands versus competing products on
important buying dimensions.

CHOOSING A POSITIONING STRATEGY

Three steps
1. Identifying possible competitive advantages
2. Choosing the right competitive advantages
3. Selecting an overall positioning strategy
Identifying Possible Competitive Advantages

 Product differentiation
 Services differentiation
 Channels differentiation
 People differentiation
 Image differentiation
Choosing the
Right Competitive
Advantages
How many differences to promote?
 Marketers think that companies should promote only one benefit to
the target market.
A company should develop a unique selling proposition (USP) for each
brand and stick to it. Each brand should pick an attribute and tout itself
as a “number one” on the attributes. Buyers tend to remember number
one better especially in an over communicated society.
Which Differences to Promote?
 The company must carefully select the ways in which it will distinguish itself from
competitors. A difference is worth establishing to the extent that it satisfies the ff.
criteria:
Important: The difference delivers a highly valued benefit to target buyers.
Distinctive: Competitors do not offer the difference or the company can offer it in a
more distinctive way.
Superior: The difference is superior to other ways that customers might obtain the
same benefit.
Communicable: The difference is communicable and visible to buyers.
Preemptive: Competitors cannot easily copy the differences.
Affordable: buyers can afford to pay for the difference.
Profitable: The Company can introduce the difference profitability.
 Selecting an Overall
Positioning Strategy
 Consumers typically choose products and
services that give them the greatest value.
Thus, marketers want to position their brands
on the key that they offer relative to
competing brands.
More for more
•Involves providing the most upscale product or service and charging
a higher price to cover the higher costs.
More for the same
•Companies can attack a competitors
more-for-more positioning by
introducing a brand offering
comparable quality but a lower price.

"Perhaps the first time in

history that trading a $72000
car for a $36000 car could be
considered trading up”
The Same for Less
 They don’t claim to offer different or better products. Instead, they offer many of
the same brands as department stores and specialty stores but at deep discounts
based on superior purchasing power and lower-cost operations.

Less for much less

 A market almost always exists for products that offer less and therefore cost less.
Less for much less positioning involves meeting consumer’s lower performance or
quality requirements at a much lower price.

More for less

 Many companies claim to do this. More features, more product, more value, for a
really low price. We typically see "More for Less" when a new brand is entering a
target market with established players. Many claim to offer "More for less" today.
 Developing a Position
Statement
Position Statement
 A statement that summarizes company or
brand positioning---it takes this form: To
(target segment and need) our (brand) is
(concept) that (point of difference)
 Communicating and Delivering
the Chosen Position
Once it has chosen a position, the company must
take strong steps to deliver and communicate the
desired position to target consumers. All the
company’s marketing mix efforts must support the
positioning strategy.
KET SEGMENTS FOR MITSUBISHI
1. Micro and Compact Car
2. Family Car
3. Road Off and SUV
4. Sports Car
5. Premium Car
6. Business Cars and Trucks
MICRO AND COMPACT CAR
FAMILY CAR, ROAD OFF AND SUV
PREMIUM AND SPORTS CAR
BUSINESS CARS AND
TRUCKS
Segmenting Consumer Markets
GEOGRAPHICAL

• By region of the world Mitsubishi

cars, there are different VERSIONS that is
suitable for all…
DEMOGRAPHIC

• Aims towards a diverse audience that is “young at heart”

Genders – Male and Female

Age – under 40 years old
PSYCHOGRAPHIC

Lifestyle: Different cars that cater a person lifestyle

Income: Different cars for different range of income level

Segmenting Business Markets

• Demographic Segmentation
- industry, company size, location

• Operating Variables
- technology, usage status, customer capabilities

• Purchasing approaches

• Situational factors
- urgency, specific application,
size of order

• Personal characteristics
- buyer-seller similarity, attitudes
toward risk, loyalty
Segmenting International Markets

•Geographic segmentation
- location or region
•Economic factors
- population income or level of economic development
•Political and legal factors
- type/stability of government, monetary regulations,
amount of bureaucracy, etc.
•Cultural factors
- language, religion, values, attitudes, customs,
behavioral patterns
 Concentrated (niche)
Marketing

•Caters to youth (generation x and y)

•Male and Female
•Active Lifestyle
•Middle and High Income
Requirements for Effective
Segmentation
•Measurable
-size, purchasing power and profile of segment
•Accessible
-can be reached and served
•Substantial
-large and profitable enough to serve
•Differentiable
-respond effectively
•Actionable
-effective programs can be developed
 PRINCIPLES OF
MITSUBISHI

1. Corporate Responsibility to Society - In order for

a corporation to create sustainable prosperity, it is essential
that it operates in a manner that is conducive to achieving this
goal for the greater society

2. Integrity and Fairness - The importance of meeting

the expectations of their customers and the public is by
exhibiting high ethical conduct in all their transactions

3. Global Understanding through Business -

Expand business, based on an all-encompassing global
perspective
RIGHT SEGMENT TO BE TARGETING SINCE:

• Standout brand
• All new markets
• Hot products; designs are masculine, sporty and youthful
• Young and diverse audience
 Future Product
Strategy

1. Increasing production of electrical cars

Why Electrical cars?

•Small
•Cost effective
•Environmentally friendly

2. Expanding SUV lineup in emerging markets

Undifferentiated (mass) Marketing:
• Consists of a set of buyers who share
common needs or characteristics that the
company decides to serve
SELECTING TARGET MARKET
SEGMENTS
•Undifferentiated (mass) marketing
-same product to all consumers

•Differentiated (segmented) marketing

-different products to one or more segments

•Concentrated (niche) marketing

•Micromarketing (local or individual)

Differentiated (segmented) Marketing
Micromarketing (local and
individual)

•retailing and customized marketing (e.g. HAVIANAS –customized slippers)

•Tailoring brand products and marketing programs to suite taste of individual

 Choosing a Target
Marketing Strategy

Considerations include:

-company resources

-the degree of product variability

-product’s life-cycle stage

-market variability

-competitor’s marketing strategies

MARKET
POSITIONING
•The place the product occupies in consumer’s
minds relative to competing products

•Typically defined by consumers on the basis of

important attributes

•Involves implanting the brand’s unique benefits and

differentiation in the customer’s mind

•Positioning maps that plot perceptions of brands

are commonly used
CHOOSING A POSITIONING STRATEGY

• Differentiation can be based on

-products
-services
-channels
-people
-image
 Repositioning

•Mitsubishi is moving towards being classy and

conservative (emphasizing on driving pleasure).
They are emphasizing on safety, and design
Incorporating more modern sleek designs.
Mitsubishi is going towards the same category as
“Audi, Volkswagen, Volvo”
Communicating the Positioning

Companies must be certain to DELIVER their value

propositions. Positions must be monitored and
adapted over time.
 Thank you
for
Listening ! 