hour 12,13, aug 16,18 market segmentation, targeting and positioning

8/8/2019 Hour 12,13, Aug 16,18 Market Segmentation, Targeting and Positioning

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Market Segmentation,Targeting and Positioning

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Related concepts: market segmentation,

target marketing, and positioning

Process of market segmentation, its benefits

and conditions for use Target-market strategies

Steps in developing a positioning strategy

Methods of forecasting demand of market

segments

Lesson Overview

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Indian Automobile Industry - STP

Zen, Alto

Economy

Mid SizeFamily

Luxury

Maruti 800

Getz, Swift Santo

Esteem, i10Ford Ikon,

Opel Corsa

Honda Civic

Toyota CorollaBaleno,

Accent

Chevrolet Optra,

Sonata

Mercedez Benz,BMW,

Toyota Lexus

3Who are the main passenger car manufacturers in India?


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Markets

MARKET SEGMENTS

MARKET SEGMENTS

TARGET MARKET

TARGET MARKET

MARKETMARKET SEGMENTATIONSEGMENTATION

MARKETMARKET SEGMENTATIONSEGMENTATION

4What are markets?


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Markets

1(Exercisers)

1(Exercisers)

3(Transportation riders)

3(Transportation riders)

2(School-goers)

2(School-goers)

4(Adventurers)

4(Adventurers)

Market segments for Bicycles

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Markets

MARKET SEGMENTSGroups of customers with different wants,buying preferences or product-use behavior

MARKET SEGMENTSGroups of customers with different wants,buying preferences or product-use behavior

TARGET MARKETA market segment on which

the seller decides to focus efforts

TARGET MARKETA market segment on which

the seller decides to focus efforts

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Market Segmentation

Process of dividing the total marketfor a good or service into several smaller,

internally homogeneous groups

Process of dividing the total marketfor a good or service into several smaller,

internally homogeneous groups

Members of each group are

similar with respect to the factorsthat influence demand

Members of each group are

similar with respect to the factorsthat influence demand

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Process of Market Segmentation

Determine potential of the segments andhow well they are being satisfied.

Identify wants within a market

Identify characteristics thatdistinguish the segments

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Market Segmentation Conditions

MICROMARKETINGTreat each single customer

as a separate segment

MICROMARKETINGTreat each single customer

as a separate segment

Large enoughto be

Profitable

Segment isAccessible

Measurableand

data obtainable

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Market Segmentation - First Cut

Customers reason for buyingCustomers reason for buying

CONSUMERPurchase for personal use

CONSUMERPurchase for personal use

BUSINESSPurchase to use in organizations,

to resell, or to make other products

BUSINESSPurchase to use in organizations,

to resell, or to make other products

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Segmentation Basesfor Consumer Markets

1.Geographic

Location

District, Mufussil

Urban- Rural

Metro, Non-Metro

Any Other

Possible Market Segments

Rural, UrbanMetro, Large towns,

Small towns, Villages

population > 1000,

< 1000 etcCoastal, Non-coastal

etc

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Segmentation Basesfor Consumer Markets (Contd)

2.Demographic

Age

Income

.More

More

Occupation


Infant (newly born1 yr)

child (112 yr), teens(1319), adolescent (16

19), youth (2035),

middle-aged (36 50),

elders or seniors (50+ etc)

Male, Female

Blue/white Collar, traders,

teachers, university

professors, student,

housewife etc. ---- (Contd)

Gender

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Kids Reign Supreme in FMCG Purchase

71

59

52

20

40

60

80

% of

Kids

Who

Influence

What

FMCGBrand

Their

Family

Buys

Biscuits Burgers and

Pizzas

Fruit Juices

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Indias Upwardly Mobile Market (Households)

Very

Rich

(million)

Consuming

Class

(million)

Climbers

(Middle class)

(million)

Aspirant

(LowerIncome)

(million)

Destitute

(Poor)

(million)

15 265 429 192 1402001-02

30 432 472 117 952006-07

100

200

300

400

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2.Demographic

Age

Gender

Family size &

Structure

Marital status

Education


.

Illiterates, literates,high school,

secondary, graduate,

post graduate, post

doctorates. Unmarried, married

Families with 3 or members.

Occupation

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Socio-economic Pyramid ofIndian Population

A1 & A2

(9.5%)

B1 & B2 (17%)

C (19.5%) Skilled workers,

clerks, salespersons, etc

D (22.4%) Same as above,

occupation profile with SSC

E1 & E2 (31.6%) Unskilled labour

Typically SSC qualified,

about 40% Graduates;

occupation clerk/

shopkeeper

Graduates, white-

collar workers,

and professionals

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Segmentation Bases for ConsumerMarkets (Contd)

3.Psychographic

Personality

Values

Life-style


-Ambitious, self-confident,

Aggressive, Introverted,Extroverted, Sociable,

Achievers, etc

-Activities (Spiritual, Yoga,

travel);Interests(Music,Politics, Art etc); Opinions

(Conservation, capitalism)

-Values and lifestyles (VALS),

List of Values (LOV)

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4.Behavioral

Benefits Desired


,

Virtually for allProducts (Titan, Garden

HMT, Pepsodent)

Heavy, Medium,

Low user, Non-user

Rasana Hard Core, Soft Core,

Switchers

Product Usage

Use Situations

Customer Loyalty

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Segmentation BasesSegmentation Basesfor Business Marketsfor Business Markets

Bases for

Segmentation

Customer LocationCustomer Location

Customer SizeCustomer Size

Possible Market SegmentsPossible Market Segments

Customer located in one

site will have one marketplan and other in another

Large, Medium and

Small buyers (Payment

terms, packaging, callfrequency etc different )

For steel manufacturer

it could be construction,

office furniture, cable,

automobile etc

Product End UseProduct End Use

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Bases for

Segmentation

BUYER Behavior,

Motivation, or

Purchase criteria


In any end use segment , wecan further segment based on

purchase criteria say buyers

being insensitive, sensitive

and highly sensitive to price

change. We can also segment them

according to their needs, say

Standardized or Customised

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Bases for

Segmentation

- Purchase Criteria,

Size, & Geography

-Buying Situation


Matrix Approach

New Task Buying,

Straight rebuy,Modified rebuy

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Target-Market Strategy

SingleMarketingStrategyshotgun

Market-aggregationStrategy

mass-marketundifferentiated-market

and

Product differentiation

Strategy

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Single-Segment

Strategyconcentration

NICHEMARKETERS

OneMarketing

Mix

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MultipleMarketing

Mixes

Multiple-SegmentStrategy

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Selecting a Target MarketGuidelines

Compatiblewith companys goals

Compatiblewith companys goals

Match target

market opportunitywith company resources.

Match target

market opportunitywith company resources.

Profit thatjustifies investmentProfit thatjustifies investment

Competitorsare few and/or weak

Competitorsare few and/or weak

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Positioning

Aposition is the way afirms product, brand, or

organization is viewed

relative to the competition

by current and prospective

customers.

What is a Position?

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So what is Positioning?

Firm creating and maintaining in the

minds of a target market a particular

image relative to competing products

Firm creating and maintaining in the

minds of a target market a particular

image relative to competing products

Coordinate the marketing mixto convey position

Design the feature thatconveys position

Select position concept

THREE STEPS

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How do you Position a Product?

Perceptual Map

Determine what is important to the

target market and how its members

view the competing products

How do you select the positioning concept?

STEP 1

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Perceptual Map for differentbrandsof barsoap

DeodorantNon-deodorant

Low moisturizing

High moisturizing

1

2

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7

6

4 5

Lifebuoy

Dove

What barsoap?

Whatposition? 29


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How do you Position a Product?..Contd

Brand name

A Slogan

Appearance, or any otherfeatures of the Product,

the Place where it is sold,

the appearance of the employees, and

in many other ways

Design the feature that mosteffectively conveys the position

STEP 2

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How do you Position a Product?..Contd

What is repositioning?

Coordinate the Marketing-mixto convey a consistent position

STEP 3

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When the position of any product iseroded, or needs to be changed due to

competition, and the firm wants to re-

establish its attractiveness in its market

it is engaging in repositioning.


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Forecasting Market Demand

MARKET SHAREProportion of total sales of aProduct during a stated period

in a specific marketthat is captured by a single firm

MARKET FACTOR

1) exists in the market2) is measurable3) is related to the demandfor a product in a known way

brand x brand y

our company brand z

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Total sales of a

Product during aPeriod in a specific

market underideal conditions

MARKET POTENTIAL

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Portion of market potentialthat a specific company

could expectunder ideal conditions

SALES POTENTIAL


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Estimate of salesfor one company

during a period in aspecific market

assuming a definedmarketing plan

SALES FORECAST


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Methods of Sales Forecasting

Market-FactorAnalysis

Survey ofBuyer Intentions

Sales-ForceComposite

ExecutiveJudgment

TestMarketing

Past Salesand

Trend Analysis

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hour 12,13, aug 16,18 market segmentation, targeting and positioning

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