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Segmentation, Targeting and Positioning in International Markets

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Presentation on theme: "Segmentation, Targeting and Positioning in International Markets"— Presentation transcript:

1 Segmentation, Targeting and Positioning in International Markets

2 Developing an international marketing strategy
Segmenting Targeting Positioning

3 Reasons for Global Market Segmentation
Country Screening Global Market Research Entry Decisions Positioning Strategy Marketing Mix Policy

4 Type Of Segmentation Grouping Countries
Segments within and across Foreign Markets

5 Bases for Country Segmentation
Demographics Socioeconomic Variables stages of economic development Per capita income Culture Political Conditions Behavior-Based Segmentation Life Style

% of World Population % of World GNP Market GNP (billion) GNP Per Capita Population (million) World (Total) $25, $4, , Triad (Total) , , North America* , , Japan , , EU , , Other High Income , <1 Upper Middle Income 2, , Lower Middle Income 2, , , Low Income , Unavailable Data N/A N/A N/A *Not including Mexico

7 Country Income Segmentation
High Income (Advanced Countries) - Triad - Others Upper Middle Income (NIC's) Lower Middle Income (DC's) Low Income (LDC's) Basket Cases (BC's) + $14,000 + $2,500 + $500 < $500

Purchasing Power Parity Compared % of world GNP with PPP % of world GNP GNP Per Capita GNP Per Capita with PPP GNP with PPP Market GNP (billion) World (Total) $25, $30, $4, $5,863 Triad (Total) , , , ,511 North America* ,253 7, , ,877 Japan ,247 2, , ,636 EU ,619 6, , ,502 Other High Income , ,904 Upper Middle Income 2,239 3, , ,604 Lower Middle Income 2,403 7, , ,126 Low Income , ,370 *Not including Mexico

9 Standard of Living Number of people per: Life Expectancy Schooling
(av. years) Doctor TV Phone McDonald’s China ,000,000 Hong Kong ,000 Japan ,000 U.S ,000 Russia ,000,000 Sources: WEFA, AsiaWeek, McDonald’s, The New York Times

10 Successful Economic Union Requirements
 Economic Compatibility  Political Compatibility  Geographic Proximity  Social Compatibility Weakness in some must be balanced by strengths in others

11 Market Groups Patterns of Multinational Cooperation
Regional Cooperation Groups Free-Trade Area Customs Union Common Market Political Union

12 New Multinational Market Groups or Trading Blocks of the 21st Century
l European Union l European Economic Area (EC and EFTA) l North American Free Trade Area l Southern Cone-Mercosur l Asean Free Trade Area (AFTA) l Commonwealth of Independent States (CIS) l Central European Free Trade Area (CEFTA)

13 European Trade Areas European Community (EC) European Free Trade Area (EFTA) Belgium Italy Austria* Liechtenstein Denmark Luxembourg Finland* Norway* France The Netherlands Iceland* Sweden* Germany Portugal Switzerland Greece Spain Ireland United Kingdom EC Countries and EC Countries and Austria Austria Poland*** Finland Finland Sweden Hungary*** Iceland Norway Sweden European Unity (EU) European Economic Area (EEA) * Five founding members. ** Awaiting membership. *** Seeking membership.

14 A Comparison of the EU and NAFTA
Population GNP GNP (millions) ($ trillions)* (per capita)* EU $ 7.79 $ 21,442 NAFTA ,662 * U.S. $ 1992.

15 Common Traits of Big Emerging Markets
l Are physically large. l Have significant populations. l Represent considerable markets for a wide range of products. l Have strong rates of growth or the potential for significant growth. l Have undertaken significant programs or economic reform. l Are of major political importance within their regions. l Are "Regional Economic Drivers". l Will engender further expansion in neighboring markets as they grow.

16 Big Emerging Markets Population GDP GDP Trade* (millions) ($ billions) (per capita) ($ billions) Asia China 1,188.0 $ $ 367 $ Indonesia India South Korea , Latin America Mexico , Argentina , Brazil , Africa South Africa , Europe Poland , Turkey , Possible Additions Colombia , Thailand , Venezuela , Vietnam * Imports and exports. SOURCES: "Big emerging Markets," Business America, Special Issue 1994, pp and for additional information, see "Indicators of Market Size for 115 Countries," Crossborder Monitor, August 31,1994.

17 “Think” and “Feel” Country Clusters

18 Plot of Concentration Versus Category Growth: Chocolate Industry

19 Chocolate Market Two-Cluster Solution

20 Three-Cluster Solution
Chocolate Market Three-Cluster Solution

21 Properties of a Market Segment
Measurable Sizable Accessible Actionable Competitive Intensity Growth Potential

22 Bases for Global Segments
Geographic Demographic Psychographic Behavior Benefits

23 Average Monthly Expenditures for Chinese Households National and Urban Areas - 1994
National Urban Areas Food (includes eating out) $22.10 $38.00 Savings Clothing Child's Education Home (includes Rent & Utilities) Daily Goods other than Food Medical Expenses & Drugs Entertainment SOURCE: Gallup China.

24 Y&R’s Cross-Cultural Consumer Characterizations (4Cs)

25 Global Scan Segmentation Study

26 Life Style Exhibit : Typology of European Car Market

27 Roper Starch Worldwide Global Study
40,000 consumers in 40 countries Shopping Styles Deal Makers (29%) - love the buying process Price Seekers (27%) - place primary value on the product that they are buying Brand Loyalists (23%) - purchase name brands and remain true to them Luxury Innovators (21%) - seek new, prestigious brands

28 How the World Shops Source: “How the World Shops,” Advertising Age, June 5, 1995, p.3.

29 How the World Shops Source: “How the World Shops,” Advertising Age, June 5, 1995, p.3.

30 How the World Shops Source: “How the World Shops,” Advertising Age, June 5, 1995, p.3.

31 International Positioning Strategies
Global Positioning and Segmentation Strategies Universal Segment / Uniform Positioning Theme Universal Segment / Different Positioning Themes Different Segment / Different Positioning Themes

32 Global Positioning & Segmentation Strategies

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