1. Market Segmentation, Targeting, and Positioning Strategies
Chapter 8
Market Segmentation, Targeting, and Positioning Strategies 1

2. Objectives Define market Explain market segmentation
Relate marketing mixes to target markets
Identify various marketing strategies
Understand key market segment selection considerations
Identify and apply segmentation variables
Understand positioning strategy

3. What is a Market?
Ability
Willingness
Resources

4. Segmentation Works Because ...
Not all buyers alike
Subgroups may be identified
Subgroups smaller and more homogeneous
Easier to satisfy smaller groups 3

5. Major Steps in Segmentation & Targeting1.
Break market down 2.
Group into segments
TARGET MARKET 3.
Choose
target market 4

6. Choosing Market Segments
We need a YES response to each of these!
Distinguishing/stable characteristic
Significant size
Accessible with distribution & promotion
Responsive (similar needs)
Measurable potential 5

7. Segment Cross-Classification: Aerobic Shoes
Gender F M
Geography
Japan
Western Europe
U.S.
Age

8. Matching the Marketing Mix to Target Market
Our target market:
Women aged living in the United States
The right…
Product?
Price?
Promotion?
Place? 7

9. Possible Strategies for Target Marketing
Undifferentiated marketing 8

10. Possible Strategies for Target Marketing
Concentrated Marketing
80 / 20 Principle
Majority fallacy 9

11. 80/20 Rule
A relatively small percentage of customers accounts for a disproportionately large share of the sales
Target
customers
20%
Share of
Target
customers
80%
Share of
sales

12. Possible Strategies for Target Marketing
Differentiated marketing
Multiple market segmentation 11

13. Possible Strategies for Target Marketing
Custom Marketing: “To each his/her own.” 12

14. Custom Marketing One-to-one marketing
FOR REPEAT HOTEL GUESTS
One-to-one marketing
Uses data based-marketing and information technology
For example...
Your name
Room preferences
Special requests
Smoking or non smoking
Credit card number
Frequent hotel user discount 13

15. Bases for Segmenting Consumer Markets
Demographic
Sociographic
Lifestyle
Geographic
Behavior
Consumption
Predispositions 16

16. Bases for Segmenting Business Markets
Geography
Organizational charateristics
Purchase behavior
Usage patterns
Organizational predispositions 16

17. Positioning Positioning
The way consumers perceive the brand relative to its competition
ID competitive advantage
Stress salient characteristics
Differentiate
Positioning 27

18. Market Positioning Map: Tea - 1980s
Traditional flavor
Unique flavor
Luzianne
Lipton
Tetley
Celestial Seasons
Nestea
Iced
Hot

19. Repositioning: Tea - Late 1990s
Iced
Hot
Traditional flavor
Unique flavor
Luzianne
Lipton
Tetley
Celestial Seasons
Nestea
Arizona Iced Tea
Snapple
Lipton Rounds
Tetley Rounds
Lipton Natural Teas
Lipton Flavored

20. Review Define market Explain market segmentation
Relate marketing mixes to target markets
Identify various marketing strategies
Understand key market segment selection considerations
Identify and apply segmentation variables
Understand positioning strategy