What’s Happening? http://www.stumbleupon.com/su/8cNyFv/www.dailydawdle.com/2010/09/10-best-lifes-too-short-for-wrong-job.html
Market Segmentation and Positioning Chapter 8
Market Segmentation Dividing the total heterogeneous market for a good or product into smaller groups which are more homogeneous.
1. Break market down 2. Group into segments 3. Choose target market TARGET MARKET Steps in Segmentation & Targeting
Segmentation works because,…. • Not all buyers are alike • Subgroups may be identified • Subgroups are smaller and more homogeneous • Easier to satisfy smaller groups • www.fordvehicles.com
Effective Segmentation • To be useful, market segments must be: • Measurable: size, purchasing power, and profile • Accessible: can be reached and served/responsive • Substantial: large enough to profitably serve • Differentiable: respond differently to a marketing mix • Actionable: effective programs can be designed • Segments should be evaluated for: • Size • Growth characteristics • Structural attractiveness • Compatibility with company objectives and resources
Discussion Questions Put yourselves into small groups and answer the following assigned questions on page 218: Question 2 and all parts of 4
Market Segmentation Variables Geographic: dividing a market into different geographical units, such as nations, states, regions, counties, cities, or neighbourhoods Demographic: dividing the market into groups based on demographic variables such as age, sex, family size, family life cycle, religion, race, and nationality Socioeconomic:identifying differences in income, education, occupation and social class Psychographic: dividing a market into different groups based on activities, interests, lifestyle, opinions, values or personality characteristics Behavioural: dividing a market into groups based on consumer loyalty (to brand or store), usage, benefits sought/ expected, response to a product and price
Identifying Market Differences Best to use multiple approaches in order to identify smaller, better-defined target groups. Start with a single base and then expand to other bases.
Four strategies for target marketing • Undifferentiated Marketing: • When everyone is a customer. Firm decides to ignore market segment differences and go after the whole market with one offer. • Concentrated Marketing: • Zeroing in on a single target. A firm goes after a large share of one market. • Differentiated Marketing: • Different Buyers, Different Strategies. Afirm decides to target several market segments and designs separate offers for each. http://www.tide.com/en_CA/index.jsp • Custom/Individual Marketing: • Tailoring marketing offers to the needs and preferences of individual customers
Choosing a Market Coverage Strategy Depends on: Company resources Degree of product variability Product life cycle stage Market viability Competitors’ marketing strategies
Market Positioning • Market positioning: • Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers. • Product position:the way the product is defined by consumers on important attributes, relative to competing products • The “quicker-picker-upper?” • The “uncola?” • “Great taste, less filling?”
Positioning Map Positioning map for large luxury SUVs.