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1 © 2009 South-Western, a part of Cengage Learning Chapter 6 Market Segmentation, Positioning, and the Value Proposition PPT 6-1.

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Presentation on theme: "1 © 2009 South-Western, a part of Cengage Learning Chapter 6 Market Segmentation, Positioning, and the Value Proposition PPT 6-1."— Presentation transcript:

1 1 © 2009 South-Western, a part of Cengage Learning Chapter 6 Market Segmentation, Positioning, and the Value Proposition PPT 6-1

2 2 STP Marketing and the Evolution of Marketing Strategy 1.Target Market: A sub-group of a larger market chosen as the focal point for a marketing or advertising campaign. (NOT illegal or unethical!) 2.Positioning: Designing and representing a brand in a way that is distinct in the consumer’s mind. 3.Positioning Strategy: Selecting key themes to communicate to a target market. 4.Marketing Strategy: Evolves as a result of 1-3 PPT 6-2

3 3 Beyond STP—Regular Assessment 1.Reassess segmentation strategy:  Exam the current target segment to develop new and better ways of meeting its needs.  Change the target and reposition the brand to a new segment. 2.Pursue product differentiation strategy:  Emphasize or create differences in brands to distinguish them from competitors.  Advertising plays a critical role because the consumer will have to be convinced that the difference is meaningful. PPT 6-3

4 4 Identifying Target Segments: Market Segmentation Demographics Geography Psychographics Lifestyles Benefits Commitment Levels Usage Patterns PPT 6-4

5 5 The STP Marketing Process (Segmenting, Targeting, Positioning) 1.Break the broad market into smaller, more homogenous segments 2. Specifically target discrete market segments 3. Position the brand to appeal to the targeted segments PPT 6-5

6 6 Segmenting by Usage and Commitment Advertising and promotion targeted to:  Heavy users  Nonusers  Brand-loyal users  Switchers/Variety seekers  Emergent Consumers –Point of entry marketing strategy PPT 6-6

7 7 Demographic Segmentation  Age  Gender  Race  Marital Status  Income  Education  Occupation PPT 6-7

8 8 How would you describe the demographic segment targeted by this advertising campaign? PPT 6-8 Ad in Context Example

9 9 How about this ad? What is the target demographic for this ad campaign? PPT 6-9 Ad in Context Example

10 10 Geographic Segmentation  Country  Region  State  City  Neighborhood  Geo-demographic PPT 6-10

11 11 Psychographics and Lifestyle Segmentation Activities Interests Opinions Lifestyle Lifestyle segmentation provides insight into consumer’s motivations PPT 6-11

12 12 Benefit Segmentation Safety?Prestige? Fuel Economy? PPT 6-12

13 13 Business to Business Markets Markets segmented by:  Usage rates  Geographic location  SIC (Standard Industrial Classification) Code  Stage in the purchase process: first time vs. experienced buyers  Benefits desired PPT 6-13

14 14 STP Marketing is used in the business- to-business market as well as the consumer market. PPT 6-14 Ad in Context Example

15 15 Prioritizing Target Segments 1.Examine your ability to deliver value to the segments and costs of new capabilities—distinct competencies of the firm 2.Research segment size, growth potential and usage frequency 3.Assay the competitive environment 4.Find a niche you can scratch PPT 6-15

16 16 Effective Positioning  Deliver on the brand promise  There is magic in consistency  Make the positioning different and simple for consumers to understand PPT 6-16

17 17 Fundamental Positioning Themes  Benefit Positioning  User Positioning  Competitive Positioning PPT 6-17

18 18 Do you think this ad for Ryka shoes is emphasizing benefit, user, or competitive positioning? PPT 6-18 Ad in Context Example

19 19 Repositioning  Used to revive an ailing brand or fix a lackluster new market entry  Advertising themes and positioning can be trendy and become outdated  The challenge: Changing perceptions of a brand forged over years of advertising. PPT 6-19

20 20 Capturing the Value Proposition VALUE Benefits Relative Price Functional Emotional Self-expressive PPT 6-20


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