2Effective Targeting Requires… Identify and profile distinct groups of buyers who differ in their needs and preferences.Select one or more market segments to enter.Establish and communicate the distinctive benefits of the market offering.
15Segmenting for Business Markets DemographicOperating VariablePurchasing ApproachesSituational FactorsPersonalCharacteristics
16Segmenting for Business Markets Demographic segmentationIndustry, company size, locationOperating variablesTechnology, usage status, customer capabilitiesPurchasing approachesSituational factorsUrgency, specific application, size of orderPersonal characteristicsBuyer-seller similarity, attitudes toward risk, loyalty
17Effective Segmentation Criteria Size, purchasing power, profilesof segments can be measured.Segments can be effectivelyreached and served.Segments are large or profitable enough to serve.MeasurableAccessibleSubstantialDifferentialActionableSegments must respond differently to different marketing mix elements & programs.Effective programs can be designed to attract and serve the segments.
18Market Targeting Evaluating Market Segments Segment Size and GrowthAnalyze current sales, growth rates and expected profitability for various segments.Segment Structural AttractivenessConsider effects of: competitors, availability of substitute products and, the power of buyers & suppliers.Company Objectives and ResourcesCompany skills & resources needed to succeed in that segment(s).Look for Competitive Advantages.
25Positioning Act of designing the company’s offering and image to occupya distinctive place in the mind ofthe target market.
26Choosing a Positioning Strategy Step 1. Identifying Possible Competitive AdvantagesStep 2. Selecting the Right Competitive AdvantageStep 3. Communicating and Delivering the Chosen Position
27Defining Associations Points-of-parity(POPs)Associations that are not necessarily unique to the brand but may be shared with other brandsPoints-of-difference (PODs)Attributes or benefits consumers strongly associate with a brand, positively evaluate, and believe they could not find to the same extent with a competitive brand
28Consumer Desirability Criteria for PODs RelevanceDistinctivenessBelievability
29Deliverability Criteria for PODs FeasibilityCommunicabilitySustainability
30Examples of Negatively Correlated Attributes and Benefits Low-price vs. High qualityTaste vs. Low caloriesNutritious vs. Good tastingEfficacious vs. MildPowerful vs. SafeStrong vs. RefinedUbiquitous vs. ExclusiveVaried vs. Simple
31Developing and Communicating a Positioning Strategy Positioning: How many ideas to promote?Unique selling propositionFour major positioning errorsUnderpositioningOverpositioningConfused positioningDoubtful positioning