0. Targeting 7 Segmentation Positioning
Target marketing: Dividing the total market into different segments based on customer characteristics, selecting one or more segments, and developing products to meet those segments’ needs 7

1. Definition Market Segmentation:
Dividing a market into distinct groups with distinct needs, characteristics, or behavior who might require separate products or marketing mixes.

2. Steps in Market Segmentation, Targeting, and Positioning

3. Market Segmentation Key Topics Segmenting Consumer Markets
Geographic segments
Demographic segmentation
Psychographic segmentation
Behavioral segmentation
Using multiple segmentation variables
Segmenting Consumer Markets
Segmenting Business Markets
Segmenting International Markets
Requirements for Effective Segmentation

4. Market Segmentation Key Topics Segmenting Consumer Markets
Geographical segmentation
Marketing mixes are customized geographically
Demographic segmentation
Psychographic segmentation
Behavioral segmentation
Using multiple segmentation variables
Segmenting Consumer Markets
Segmenting Business Markets
Segmenting International Markets
Requirements for Effective Segmentation

5. Geographic Segmentation Variables
Market Segmentation
Geographic Segmentation Variables
City or Metro Size
Neighborhood
Density
Climate
World Region or Country
Country Region
City

6. Market Segmentation Key Topics Segmenting Consumer Markets
Geographical segments
Demographic segmentation
Most popular type
Demographics are closely related to needs, wants and usage rates
Psychographic segmentation
Behavioral segmentation
Using multiple segmentation variables
Segmenting Consumer Markets
Segmenting Business Markets
Segmenting International Markets
Requirements for Effective Segmentation

7. Demographic Segmentation Variables
Market Segmentation
Demographic Segmentation Variables
Age
Gender
Family size
Family life cycle
Income
Ethnicity
Occupation
Education
Religion
Generation
Nationality

8. Market Segmentation Key Topics Segmenting Consumer Markets
Geographic segments
Demographic segmentation
Psychographic segmentation
Lifestyle, social class, and personality-based segmentation
Behavioral segmentation
Using multiple segmentation variables
Segmenting Consumer Markets
Segmenting Business Markets
Segmenting International Markets
Requirements for Effective Segmentation

9. Market Segmentation Key Topics Segmenting Consumer Markets
Geographic segments
Demographic segmentation
Psychographic segmentation
Behavioral segmentation
Typically done first
Using multiple segmentation variables
Segmenting Consumer Markets
Segmenting Business Markets
Segmenting International Markets
Requirements for Effective Segmentation

10. Behavioral Segmentation Variables
Market Segmentation
Behavioral Segmentation Variables
Occasions
Benefits
User Status
User Rates
Loyalty Status
Readiness Stage
Attitude Toward the Product

11. Market Segmentation Key Topics Segmenting Consumer Markets
Demographic segmentation
Industry, company size, location
Operating variables
Technology, usage status, customer capabilities
Purchasing approaches
Situational factors
Urgency, specific application, size of order
Personal characteristics
Buyer-seller similarity, attitudes toward risk, loyalty
Segmenting Consumer Markets
Segmenting Business Markets
Segmenting International Markets
Requirements for Effective Segmentation

12. Market Segmentation Key Topics Segmenting Consumer Markets
Geographic segmentation
Location or region
Economic factors
Population income or level of economic development
Political and legal factors
Type / stability of government, monetary regulations, amount of bureaucracy, etc.
Cultural factors
Language, religion, values, attitudes, customs, behavioral patterns
Segmenting Consumer Markets
Segmenting Business Markets
Segmenting International Markets
Requirements for Effective Segmentation

13. Market Segmentation Key Topics Segmenting Consumer Markets
Measurable
Size, purchasing power, and profile of segment
Accessible
Can be reached and served
Substantial
Large and profitable enough to serve
Differentiable
Respond differently
Actionable
Effective programs can be developed
Segmenting Consumer Markets
Segmenting Business Markets
Segmenting International Markets
Requirements for Effective Segmentation

14. Target Marketing Evaluating Market Segments Segment size and growth
Segment structural attractiveness
Level of competition
Substitute products
Power of buyers
Powerful suppliers
Company objectives and resources

15. Target Marketing Strategies

16. Segmentation strategies
MARKETING MIX
All buyers in
1 segment
An undifferentiated strategy is one that essentially avoids segmentation, appealing to a wide-spectrum of people. Products such as anti-freeze or candy bars use this type of approach.
Undifferentiated

17. Differentiated MARKETING MIX 3 MARKETING MIX 1 MARKETING MIX 2
Segment 1
Segment 2
Segment 3
A company that chooses a differentiated strategy develops separate marketing programs for several segments of the market. This is a costly approach that is usually reserved for larger firms such as Nike, Toyota, or GE.
Differentiated marketing targets several different market segments and designs separate offers for each.
Segment 4
Differentiated

18. Concentrated/Micromarketing
MARKETING MIX
Segment 1
When a firm focuses its efforts on offering one or more products to a single segment, it is using a concentrated strategy. A concentrated strategy is often useful for smaller firms that do not have the resources or the desire to be all things to all people.
Concentrated/Micromarketing

19. Target Marketing
Choosing a Target- Marketing Strategy Requires Consideration of:
Company resources
The degree of product variability
Product’s life-cycle stage
Market variability
Competitors’ marketing strategies

20. Positioning Positioning:
The place the product occupies in consumers’ minds relative to competing products.
Typically defined by consumers on the basis of important attributes.

21. Positioning Map
Positioning maps show consumer perceptions of their brands versus competing products on important buying dimensions

22. Positioning Choosing a Positioning Strategy:
Identifying possible competitive advantages -- many potential sources of differentiation exist:
Products
Services
Channels
People
Image

23. Choosing a positioning Strategy
IDENTIFY COMPETITIVE ADVANTAGES
CHOOSE RIGHT COMPETITIVE ADVANTAGE
The differentiation and positioning task consists of three steps:
Identifying a set of differentiating competitive advantages upon which to build a position,
Choosing the right competitive advantages, and
Selecting an overall positioning strategy.
SELECT POSITIONING STRATEGY

24. Competitive advantage
To the extent that a company can differentiate and position itself as providing superior customer value, it gains competitive advantage.

25. Differentiation based on:
PRODUCT
DISTRIBUTION
SERVICES
PEOPLE
IMAGE
Identifying a set of possible competitive advantages to build a position by providing superior value from:

26. Positioning Choosing a Positioning Strategy:
Choosing the right competitive advantage
How many differences to promote?
Unique selling proposition
Positioning errors to avoid
Which differences to promote?

27. Difference to promote should be:
DISTINCTIVE
IMPORTANT
SUPERIOR
COMMUNICABLE
PREEMPTIVE
AFFORDABLE
Important: The difference delivers a highly valued benefit to target buyers.
Distinctive: Competitors do not offer the difference, or the company can offer it in a more distinctive way.
Superior: The difference is superior to other ways that customers might obtain the same benefit.
Communicable: The difference is communicable and visible to buyers.
Preemptive: Competitors cannot easily copy the difference.
Affordable: Buyers can afford to pay for the difference.
Profitable: The company can introduce the difference profitably.
PROFITABLE

28. Defining Associations
Points-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
Points-of-parity
(POPs)
Associations that are not necessarily unique to the brand but may be shared with other brands

29. Consumer Desirability Criteria for PODs
Relevance
Distinctiveness
Believability

30. Deliverability Criteria for PODs
Feasibility
Communicability
Sustainability

31. Positioning Choosing a Positioning Strategy:
Communicating and delivering the chosen position
Entire marketing mix must support the chosen strategy
May require changes to the product, pricing, distribution or promotion.