1. CUSTOMER-DRIVEN MARKETING STRATEGY: CREATING VALUE FOR TARGET CUSTOMERS Chapter Seven Copyright ©2014 by Pearson Education, Inc. All rights reserved

2. 7- 2 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Reflection 2 SO head back into your groups Take 5 minutes to reflect on what you would have done differently. Given what you know now:  Redo your intro  Redo your summary Answer this one – What is most valuable in a business buying situation?

3. 7- 3 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall Superbowl 3 http://www.nfl.com/superbowl/49 http://www.msnbc.com/msnbc/the-super-bowl- commercials-2015-watch-all-the-top-ads

4. 7- 4 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall 4 http://www.caradvice.com.au/133570/how-many- cars-are-there-in-the-world/ http://www.caradvice.com.au/133570/how-many- cars-are-there-in-the-world/

5. Customer-Driven Marketing Strategy: Creating Value for Target Customers Market Segmentation Market Targeting Differentiation and Positioning Topic Outline Copyright ©2014 by Pearson Education, Inc. All rights reserved

6. Market Segmentation Copyright ©2014 by Pearson Education, Inc. All rights reserved

7. Market Segmentation Market segmentation Dividing a market into smaller segments with distinct needs, characteristics, or behavior that might require separate marketing strategies or mixes. Copyright ©2014 by Pearson Education, Inc. All rights reserved

8. Market Segmentation In this section we will talk about: Segmenting consumer markets Segmenting business markets Segmenting international markets Requirements for effective segmentation Copyright ©2014 by Pearson Education, Inc. All rights reserved

9. Market Segmentation Geographic segmentation Demographic segmentation Psychographic segmentation Behavioral segmentation Segmenting Consumer Markets Copyright ©2014 by Pearson Education, Inc. All rights reserved

10. Market Segmentation Geographic segmentation divides the market into different geographical units such as nations, regions, states, counties, or cities http://www.census.gov/2010census/popmap/ Segmenting Consumer Markets Copyright ©2014 by Pearson Education, Inc. All rights reserved

11. Market Segmentation Demographic segmentation divides the market into groups based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality Segmenting Consumer Markets Copyright ©2014 by Pearson Education, Inc. All rights reserved

12. Market Segmentation Age and life-cycle stage segmentation is the process of offering different products or using different marketing approaches for different age and life-cycle groups Gender segmentation divides the market based on sex (male or female) Copyright ©2014 by Pearson Education, Inc. All rights reserved

13. Market Segmentation Income segmentation divides the market into affluent, middle-income or low-income consumers Segmenting Consumer Markets Copyright ©2014 by Pearson Education, Inc. All rights reserved

14. Market Segmentation Psychographic segmentation divides buyers into different groups based on social class, lifestyle, or personality traits Segmenting Consumer Markets Copyright ©2014 by Pearson Education, Inc. All rights reserved

15. Market Segmentation Behavioral segmentation divides buyers into groups based on their knowledge, attitudes, uses, or responses to a product Occasions Benefits sought User status Usage rate Loyalty status Segmenting Consumer Markets Copyright ©2014 by Pearson Education, Inc. All rights reserved

16. Market Segmentation http://www.mars.com/global /index.aspx http://www.mars.com/global /index.aspx http://www.youtube.com/wa tch?v=0gjsoSY18kg http://www.youtube.com/wa tch?v=0gjsoSY18kg Segmenting Consumer Markets Copyright ©2014 by Pearson Education, Inc. All rights reserved

17. Market Segmentation Multiple segmentation is used to identify smaller, better-defined target groups Copyright ©2014 by Pearson Education, Inc. All rights reserved

18. Market Segmentation To be useful, market segments must be: Requirements for Effective Segmentation MeasurableAccessible SubstantialDifferentiable Actionable Copyright ©2014 by Pearson Education, Inc. All rights reserved

19. Market Targeting Target market consists of a set of buyers who share common needs or characteristics that the company decides to serve Selecting Target Market Segments Copyright ©2014 by Pearson Education, Inc. All rights reserved

20. Market Targeting Undifferentiated marketing targets the whole market with one offer  Mass marketing  Focuses on common needs rather than what’s different Target Marketing Strategies Copyright ©2014 by Pearson Education, Inc. All rights reserved

21. Market Targeting Differentiated marketing targets several different market segments and designs separate offers for each Goal is to achieve higher sales and stronger position More expensive than undifferentiated marketing Target Marketing Strategies Copyright ©2014 by Pearson Education, Inc. All rights reserved

22. Market Targeting Concentrated Marketing When using a concentrated marketing (or niche marketing) strategy, instead of going after a small share of a large market, a firm goes after a large share of one or a few smaller segments or niches Target Market Strategies Copyright ©2014 by Pearson Education, Inc. All rights reserved

23. Market Targeting Local marketing involves tailoring brands and promotion to the needs and wants of local customer groups Cities Neighborhoods Stores Target Market Strategies Copyright ©2014 by Pearson Education, Inc. All rights reserved

24. Market Targeting Individual marketing involves tailoring products and marketing programs to the needs and preferences of individual customers Also known as:  One-to-one marketing  Mass customization Target Market Strategies Copyright ©2014 by Pearson Education, Inc. All rights reserved

25. Market Targeting Depends on: Company resources Product variability Product life-cycle stage Market variability Competitor’s marketing strategies Choosing a Target Market Copyright ©2014 by Pearson Education, Inc. All rights reserved

26. Insurance Watch the following:  Audience  Demographics  Psychographics

27. Geico http://www.youtube.com/watch?v=5IhLJa7lYOY http://www.youtube.com/watch?v=dYDNjGMThbQ

28. Progressive http://www.youtube.com/watch?v=itDejkU20Ig

29. Differentiation and Positioning Product position is the way the product is defined by consumers on important attributes—the place the product occupies in consumers’ minds relative to competing products Perceptions  Impressions  Feelings Copyright ©2014 by Pearson Education, Inc. All rights reserved

30. Toyota http://www.youtube.com/watch?v=vpei3AY6qyE&fe ature=c4-overview- vl&list=PLsOvRYzJPCwURQDKSUCg3loRJYc2L--SC http://www.youtube.com/watch?v=vpei3AY6qyE&fe ature=c4-overview- vl&list=PLsOvRYzJPCwURQDKSUCg3loRJYc2L--SC http://www.youtube.com/watch?v=OlIIbe7ZUFU&li st=PLsOvRYzJPCwURQDKSUCg3loRJYc2L--SC http://www.youtube.com/watch?v=OlIIbe7ZUFU&li st=PLsOvRYzJPCwURQDKSUCg3loRJYc2L--SC

31. Differentiation and Positioning Product position is the way the product is defined by consumers on important attributes—the place the product occupies in consumers’ minds relative to competing products Perceptions  Impressions  Feelings Copyright ©2014 by Pearson Education, Inc. All rights reserved

32. Differentiation and Positioning Identifying a set of possible competitive advantages to build a position Choosing the right competitive advantages Selecting an overall positioning strategy Communicating and delivering the chosen position to the market Choosing a Differentiation and Positioning Strategy Copyright ©2014 by Pearson Education, Inc. All rights reserved

33. Differentiation and Positioning Competitive advantage is an advantage over competitors gained by offering consumers greater value, either through lower prices or by providing more benefits that justify higher prices Identifying Possible Value Differences and Competitive Advantages Copyright ©2014 by Pearson Education, Inc. All rights reserved

34. Differentiation and Positioning Identifying a set of possible competitive advantages to build a position by providing superior value from: Choosing a Differentiation and Positioning Strategy Product differentiationService differentiationChannel differentiationPeople differentiationImage differentiation Copyright ©2014 by Pearson Education, Inc. All rights reserved

35. Differentiation and Positioning Value proposition is the full mix of benefits upon which a brand is positioned Selecting an Overall Positioning Strategy Copyright ©2014 by Pearson Education, Inc. All rights reserved

36. Show me! Value proposition is the full mix of benefits upon which a brand is positioned Copyright ©2014 by Pearson Education, Inc. All rights reserved