1. Chapter 6 Market Segmentation and the Marketing Mix: Determinants of Advertising Strategy
William F. Arens Michael F. Weigold Christian Arens
McGraw-Hill/Irwin
Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

2. Chapter Overview
How marketers use behavioral characteristics to cluster perspective customers into market segments

3. Chapter Objectives
Define market segmentation and describe its purposes
Explain the target marketing process
Show how IMC is used with the product element in marketing
Illustrate how IMC is used with the price element in marketing
Review how IMC is used with the place element in marketing
Discuss how IMC is used with the communication element in marketing

4. Q. 1. Define Market Segmentation.

5. The Market Segmentation Process
1. Identify people with shared needs and characteristics
Demographic
Behavioristic
Geographic
Psychographic
Shared Characteristics
Categories
2. Aggregate these groups into market segments according to their mutual interest in the product’s utility

6. Segmenting Consumer Markets

7. Q. 2. What are the four bases for segmenting markets?

8. Behavioristic Segmentation
Sole Users
Semi-Sole Users
Discount Users
Aware Non-triers
Trial/Rejectors
Repertoire Users
User-Status
Purchase-Occasion
Volume Segmentation
Usage-Rate
Benefit Segmentation
Benefits-Sought

9. Geographic Segmentation
Sales are analyzed by:
Region
Country size
City size
Zip code
Types of stores

10. Demographic Segmentation

11. Demographic Segmentation

12. Psychographic Segmentation
Feelings
Values
Lifestyles
Personality
Attitudes

13. Market Segmentation
Adidas captures attitude and lifestyle

14. Psychographic Segmentation

15. Psychographic Segmentation
10 values shared by people around the world

16. Psychographic Segmentation
MindBase finds shared patterns of behavior

17. Business, Government, & Industry
Professional buyers
Concentrated geographically
Differences from Consumer Markets
Many purchase
decision factors
Small number of buyers
Categorized by NAICS code

18. Business, Government, & Industry

19. Market Concentration
Note the importance of the Midwest and California to manufacturing marketing

20. Aggregating Market Segments
Select Groups Interested in Public Utility
Whole market
Specific market
Combine Groups to Build Target Market Segments
Homogeneous
Profit Potential

21. Defining the Target Market

22. The Target Marketing Process
1. Select a target market from the market segments identified
2. Use the 4Ps of the marketing mix to shape a product concept for the market
Product
Price
Place
Promotion

23. Target Market Segments
Park Bench Seniors
New Empty Nest
Movers & Shakers
New Beginnings
Young Influentials
Bohemian Mix
Home Sweet Home

24. Q. 4. Explain the relationship between advertising and the Product element of the marketing mix.

25. Product Life Cycles

26. The Product Element Market Tangibility Consumption rate Buying habits
Physical description
Classification by…
Own a word
Market segment appeal
Benefits offered
Positioning
Classification
Differentiation

27. The Product Element
Perceptible
Induced
Hidden
Differentiation

28. Product Branding Goal is brand loyalty Individual Family National
Name
Individual
Family
National
Private
Licensed
Words
Design
Symbols

29. The Most Valuable Brands

30. Containment, protection, convenience
Product Packaging
Identification
Consumer appeal
Containment, protection, convenience
Economy
These functions may become copy points

31. Q. 5. Explain the relationship between advertising and the Price element of the marketing mix.

32. The Price Element Price Factors: Demand
Production & distribution costs
Competition
Corporate goals & strategies
Variable influences

33. Q. 6. Explain the relationship between advertising and the Place element of the marketing mix.

34. The Place (Distribution) Element
Direct
Indirect
Vertical
Network
Intensive
Franchises
Selective
Buyer Club
Exclusive

35. Q. 7. Explain the relationship between advertising and the Promotion element of the marketing mix.

36. The Promotion Element Personal Selling Product Advertising
Communication Mix
Direct Marketing
Sales
Promotion
Public
Relations
Collateral
Materials