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Chapter 4 Identifying Market Segments and Selecting Target Markets.

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1 Chapter 4 Identifying Market Segments and Selecting Target Markets

2 The Learning Objectives
Levels and Patterns of Marketing Segmentation Marketing Target Positioning Strategy

3 Market Segmentation Dividing a market into distinct groups of buyers on the basis of needs,characteristics,or behavior who might require separate products or marketing mixes.

4 Segment Market A group of consumers who respond in a similar way to a given set of marketing effort.

5 Market targeting The process of evaluating each market segment’s attractiveness and selecting one or more segment to enter.

6 Marketing positioning
Arranging for a product to occupy a clear,distinctive, and desirable place relative to competing products in the minds of target consumers.

7 Levels of market segmentation
Mass marketing Segment marketing Niche marketing

8 micromarketing Local marketing Individual Marketing

9 Discussion 1. How do you think the relationship between local marketing and international marketing? 2. How to interpret One –one marketing? (eg. Del: smart marketing)

10 Steps in Market Segmentation, Targeting,and Positioning
5. Identify possible positioning concepts for each target segment 6. Select, develop, and communicate the chosen concept Market Positioning 3. Evaluate attractiveness of each segment 4. Select the target segment(s) Market Targeting 1. Identify segmentation variables and segment the market 2. Develop profiles of resulting segments Market Segmentation

11 Basic Market-Preference Patterns
(b) Diffused preferences Creaminess Sweetness (c) Clustered preferences Creaminess Sweetness (a) Homogeneous preferences Sweetness Creaminess

12 Market-Segmentation Procedure
Survey Motivations Attitudes Behavior Analysis Factors Clusters Profiling

13 Segmenting consumer markets(p252)
Geographic Segmentation Demographic Psychographic Behavioral

14 Bases for Segmenting Consumer Markets
Geographic Region, City or Metro Size, Density, Climate Demographic Age, Gender, Family size and Fife cycle, Race, Occupation, or Income ... Lifestyle or Personality Psychographic Occasions, Benefits, Uses, or Attitudes Behavioral

15 Discussion How to choose the segmenting variables?
Consider the following products,please list the segmenting standard for each product and explain the reasons for them.; 2.shampoo; 3. Life insurance;

16 Bases for Segmenting Business Markets
Demographic Operating Variables Purchasing Approaches Situational Factors Personal Characteristics

17 Effective Segmentation
Measurable Effective Segmentation Substantial Size, purchasing power, profiles of segments can be measured. Accessible Segments must be large or profitable enough to serve. Differential Segments can be effectively reached and served. Actionable Segments must respond differently to different marketing mix elements & actions. Must be able to attract and serve the segments.

18 Heavy and Light Users of Common Consumer Products
HEAVY HALF LIGHT HALF PRODUCT (% USERS) 75% 71% Soups and detergents (94%) 25% 29% 79% 21% Toilet tissue (95%) Shampoo (94%) 75% 25% 17% Paper towels (90%) Cake mix (74%) Cola (67%) 83% 13% 5% 87% 19% Beer (41%) Dog food (30%) Bourbon (20%) 81% 95%

19 Additional Segmentation Criteria
Ethical Choice of Market Targets Segment Interrelationships & Supersegments Segment-by-Segment Invasion Plans Intersegment Cooperation

20 Five Patterns of Target Market Selection
Selective specialization M1 M2 M3 P1 P2 P3 Product specialization M1 M2 M3 P1 P2 P3 Single-segment concentration P1 P2 P3 M1 M2 M3 P = Product M = Market Market specialization M1 M2 M3 P1 P2 P3 M1 M2 M3 Full market coverage P1 P2 P3

21 2.Market Targeting Target market Undifferentiated marketing
Concentrated Marketing

22 Undifferentiated Marketing
A market-coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer.

23 Differentiated marketing
A market-coverage strategy in which a firm decides to target several market segments and designs separate offers for each.

24 Concentrated marketing
A market-coverage strategy in which a firm goes after a large share of one or a few submarkets.

25 Discussion How to choose the Target market?

26 3.Positioning Product position Competitive advantage
Value propositioning

27 Product Position The way the product is defined by consumers on important attributes----the place the product occupies in consumers’ minds relative to competing product.

28 The BCG Competitive Advantage Matrix
Number of Approaches to Achieve Advantage Few Many Volume Specialized Size of the Advantage Small Large Stalemated Fragmented

29 Product Differentiation
Form Fea- tures Perfor- mance Quality Conform- ance Quality Dura- bility Relia- bility Repair- ability Style Design

30 Services Differentiation
Ordering Ease Installation Customer Consulting Miscellaneous Services Delivery Customer Training Maintenance & Repair

31 Differentiation Personnel Channel

32 Image Differentiation
Media Symbols Atmosphere Events

33 Differences Worth Establishing
Important Profitable Distinctive Differences Worth Establishing Affordable Superior Preemptive

34 Positioning is the act of designing the company’s offering and image to occupy a distinctive place in the the target market’s mind. P 298

35 Perceptual Map Live shows Easy to reach Little waiting Good food
1.0 0.8 0.6 0.4 0.2 -0.2 -0.4 -0.6 -0.8 Economical Fun rides Exercise Fantasy Good food Easy to reach Educational, animals Little waiting Live shows Magic Mountain Japanese Deer Park Busch Gardens Knott’s Berry Farm Lion Country Safari Marineland of the Pacific Disneyland

36 Sales & Profit Life Cycles
Time Sales & profits ($) Introduction Growth Maturity Decline

37 Four Introductory Marketing Strategies
Price Low High Promotion Rapid- skimming strategy Slow- skimming strategy Rapid- penetration strategy Slow- penetration strategy

38 Case study 香港大班月饼 Background

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