principle of marketing topic identifying & targeting market segments lecture no 7,8. by: salman...
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Principle of MarketingTopic
Identifying & Targeting Market Segments
Lecture No 7,8.
By: Salman Shahid
Market Segmentation Targeting & positioning
Market Segmentation: Dividing a market into distinct groups of
buyers with different needs, characteristics, or behavior who might require separate products or marketing mixes.
Market Segmentation
Features of market segmentation
• It must be identifiable
• It must be accessible
• It must be optimum in size
• It must be profitable
• It must be durable
• It must be compatible
Levels of Market Segmentation
• Mass Marketing
• Segment Marketing
• Niche (concentrated) marketing
• Micro Marketing
Mass Marketing
Mass Marketing is a market coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer
Example of Mass Marketing
Segment Marketing
Isolating broad segments that make up a market and adapting the marketing to match the needs of one or more segments (different income & age groups)
Example “Nokia” of Segment Marketing
Price Rupees: 19290 Price Rupees: 38290
Pri
ce R
upee
s:
919
0
Niche (concentrated) marketing
Focusing on sub-segments or niche with distinctive traits that may seek a special combination of benefits
Micromarketing
The practice of tailoring products and marketing programs to suit tastes of specific individuals and location – includes local marketing and individuals marketing. (Software companies, weapons companies)
Bases for Segmenting Consumer Markets
• Geography – Nations– Country– Region of the country– State– City– County
Bases for Segmenting Consumer Markets
• Demography– Age
– Gender
– Family size
– Family life cycle
– Income
– Occupation
– Education
– Ethnicity
– Nationality
Bases for Segmenting Consumer Markets
• Psychographics
– Social class (lower lowers, upper lowers, working class, middle class, upper middles, lower upper, uppers uppers)
– Lifestyle (Achievers, strivers, strugglers)
– Personality (compulsive, gregarious, authoritarian, ambitious)
Bases for Segmenting Consumer Markets
• Behavior– Purchase occasions– Benefits– User status– Usage rate– Loyalty status– Readiness stage
Bases for segmenting business markets
• Demography
– Industry which industries that buy this product should we focus on?
– company size what size companies should we focus on?
– Location what geographical areas should we focus on?
Bases for segmenting business markets
• Operating variables– customer technologies– usage rate– user status – customer service requirements
Bases for segmenting business markets
• Purchasing approaches
– centralized vs. decentralized purchasing
– current vs. potential customers
– purchasing criteria
Bases for segmenting business markets
• Situational factors
– urgency of need
– application of product
– size of order
Evaluating market segments
• Segment characteristics– Measurable– Adequate size– Different response– Accessible– Actionable
Evaluating market segments
• Segment structural attractiveness – number & strength of competitors – availability & strength of substitute products – potential market entrants – supplier power – buyer power
Evaluating market segments
• Fit with company objectives & resources
Market TargetingEvaluating market segments
• In evaluating different market segments, a firm must look at three factors:
• segment size and growth
• Segment structural attractiveness
• Company objectives and resources
Example of market targeting
Technology, Agriculture, Textile, Education
Target market
Target market selecting market segments
After evaluating different segments, the company must now decide and how many segments to serve. This is the problem target market selection.
Target market
A set of buyers sharing common needs or characteristics that the company decides to serve.
Example of Target market Textile
• Females
• Males
• Children
• Senior citizens
Example of Target market Textile for males
Example of Target market Textile for Females
Example of Target market Textile children & senior citizens
Example of Target market Textile Bed sheets
Curtains
Woven garment
Market coverage strategies
• Undifferentiated marketing
• Differentiated marketing
• Concentrated marketing
Undifferentiated marketing
A marketing-coverage strategy in which firm decides to ignore market segment differences and go after the whole market with one offer.
Example of Undifferentiated marketing
Differentiated marketing
A market-coverage strategy in which a firm decides to target several market segments and designs separate offers for each.
Example of Differentiated marketing
Concentrated marketing
• A market-coverage strategy in which a firm goes after a large share of one or a few submarkets.
Positioning for competitive advantage
Product position:- the why the product is defined by consumers on important attributes – the place the product occupies in consumers, minds relative to competing products
Example -1 Positioning for competitive advantage
Honda civic advertises its low price.
Example-2 Positioning for competitive advantage
• BMW promotes performance