Segmentation, Mass and Niche Marketing

Income Location Age Market Segmentation Socio-Economic Group Gender

Description of occupation Example Socio-economic groups Social grade Description of occupation Example A Higher managerial and professional Company director B Lower managerial and supervisory Middle manager C1 Non-manual Bank clerk C2 Skilled manual Electrician D Semi-skilled and unskilled manual Labourer E Those receiving no income from employment Unemployed

Everyone should be a consumer of the product Mass Marketing This involves a business aiming at whole markets rather than particular parts of them – the idea is that they have a universal appeal Everyone should be a consumer of the product The goal of mass marketing is to achieve market domination – the ultimate prize being the creation of generic brands The company aims its products at young and old and is still the market leader today

The origins of Mass Marketing Low costs Which created Increased sales Low prices Which in turn created

The origins of Mass Marketing Mass marketing started alongside mass production at the turn of the twentieth century – Henry Ford Ford decided that he wanted to see every American family owing a Ford car Producing a standardised product from standardised parts means Ford could reduce costs Ford famously joked that you could have a Model T in ‘any colour, so long as it’s black’.

Pan-European and Global Marketing Modern communications and travel have created a situation where consumers of all nationalities are developing common habits & wants These brands are sold everywhere. Global marketing includes using the same strategy the world over although there may be slight variations in the marketing mix. Global marketing is just an example of mass marketing but on a larger scale than Henry Ford could have imagined.

The benefits of Global Marketing It will increase the potential size of the target market. In markets where product differentiation is low, survival against international competitors may require cost reducing economies of scale. Due to rapidly advancing technology, product life cycles are getting shorter. Standardising a marketing strategy can help to cut costs. Firstly, a global strategy can be implemented more rapidly. Second, by selling and advertising the same product, costs need not be duplicated. For example, Opal Fruits were renamed Starburst for this very reason.

Niche Marketing This involves a business aiming a product at a particular, often tiny, segment of a market. It is the opposite of Mass Marketing.

? Why do small firms attempt this type of marketing? They are often able to sell to niche markets which have been overlooked or ignored by large firms By targeting specific market segments, firms can focus on the needs of consumers in these segments ? They are then able to avoid competition, in the short run at least They can gain an advantage over firms targeting a wider market

? What are the problems of niche marketing? Firms which are successful may attract competition Many small firms have just one product aimed at one small market Because niche markets contain small numbers of consumers, they tend to be faced by bigger and more frequent swings in consumer spending than larger markets