Chapter 4 Identifying Market Segments and Selecting Target Markets
The Learning Objectives Levels and Patterns of Marketing Segmentation Marketing Target Positioning Strategy
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.
Segment Market A group of consumers who respond in a similar way to a given set of marketing effort.
Market targeting The process of evaluating each market segment ’ s attractiveness and selecting one or more segment to enter.
Marketing positioning Arranging for a product to occupy a clear,distinctive, and desirable place relative to competing products in the minds of target consumers.
Levels of market segmentation Mass marketing Segment marketing Niche marketing
micromarketing Local marketing Individual Marketing
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)
Steps in Market Segmentation, Targeting,and Positioning 1.Identify segmentation variables and segment the market 2.Develop profiles of resulting segmentsMarketSegmentation 3. Evaluate attractiveness of each segment 4. Select the target segment(s)MarketTargeting 5. Identify possible positioning concepts for each target segment 6. Select, develop, and communicate the chosen positioning conceptMarketPositioning
Bases for Segmenting Consumer Markets Occasions, Benefits, Uses, or Attitudes Behavioral Geographic Region, City or Metro Size, Density, Climate Demographic Age, Gender, Family size and Fife cycle, Race, Occupation, or Income... Lifestyle or Personality Psychographic
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. 1.computer; 2.shampoo; 3. Life insurance; 4.book
Bases for Segmenting Business Markets Demographic Operating Variables Purchasing Approaches Situational Factors Personal Characteristics
Measurable Accessible Substantial Differential Segments must be large or profitable enough to serve. Segments can be effectively reached and served. Actionable Size, purchasing power, profiles of segments can be measured. Segments must respond differently to different marketing mix elements & actions. Must be able to attract and serve the segments. Effective Segmentation
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%
Differences Worth Establishing Affordable Superior Profitable Preemptive Distinctive Important
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 P 298
Perceptual Map 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 -1.6 -1.4 -1.2 -1.0 -0.8 -0.6 -0.4 -0.2 1.00.80.60.40.2 -0.2-0.4-0.6-0.8 MagicMountain Japanese Deer Park BuschGardens Knott’sBerryFarm LionCountrySafariMarineland of the PacificDisneyland Economical Fun rides Exercise Fantasy Good food Easy to reach Educational,animals Little waiting Live shows
Sales & Profit Life CyclesIntroductionGrowthMaturityDecline Time Sales & profits ($)