Principle Marketing Segmentation – Targeting - Positioning

Why marketers need to S-T-P? Companies cannot appeal to all buyers in the marketplace or in the same way Buyers are too numerous, widely scattered and varied in needs and buying practices Companies vary widely in their abilities to serve different segments of the market

S-T-P SEGMENTATION – TARGETING -

POSITIONING

“I don’t know the key to success but the key to failure is trying to please

everyone”

Why marketers need to S-T-P?

• Companies cannot appeal to all buyers in the marketplace or in the same way

• Buyers are too numerous, widely scattered and varied in needs and buying practices

• Companies vary widely in their abilities to

serve different segments of the market

S- Market

Segmentation

T- Market targeting

P- Market Positioning

to S-T-P

Company aims at designing driven marketing strategies that build the right relationships with the right customers

Company aims at designing driven marketing strategies that build the right relationships with the right customers

customer-• How to segment the marketplace?

• How to segment the marketplace?

MARKET

SEGMENTATION

• Buyers who differ in one or more way

• Way: wants, resources, locations, buying attitudes and buying practices

Market Segmentation

• Divide large, heterogeneous markets into

smaller segments that can be reached more efficiently and effectively with products and services that match their unique needs

• Segmenting: consumer markets, business markets, international markets

Segmenting consumer markets

Geographic segmentation

Geographic segmentation

Demographic segmentation

Demographic segmentation

Psychographic segmentation

Psychographic segmentation

Multiple segmentation bases

Multiple segmentation bases

Geographic segmentation

• Dividing the market into different

geographical units such as nations, regions, cities or neighbourhoods

Psychographic segmentation

• Deviding a market into different groups based

on social class, lifestyle or personality

characteristics

– AIO

– VALS

Behavioral segmentation

• Dividing a market into groups based on

consumer knowledge, attitude, use or response

– Usage rate (light, medium, heavy)

– Loyalty status (macolyte – Mac Zealot)

Using multiple segmentation bases

• Geodemographics – the study of the

relationship between geographical location and demographic (CACI Market Analysis

Group – ACORN)

Requirements for segmentation

• Measureable: size, purchasing power and profits of a

market segment can be measured

• Accessible: the market segments can be effectively

reached and served

• Substantial: market segments are large or profitable

enough to serve

• Differentiable: segments are conceptually distinguishable

• Actionable: effective programs can be designed for

attracting and serving the segments

MARKET

TARGETING

Company Logo

Evaluate market segments

• Segment size and growth

• Segment structural attractiveness

• Company objectives and resources

• The largest, fastest-growing segments are not always the most attractive ones for every

company

Targeting broadly Targeting narrowly

Mass marketing

Mass marketing

Niche marketing

Niche marketing

Selecting target market segments

Segmented marketing

Segmented marketing

Local/ individual marketing

Local/ individual marketing

Selecting target market segments

• Target market – a set of buyers sharing

common needs or characteristics that the company decides to serve

• Undifferentiated marketing (mass): market coverage strategy which a firm go after the whole market with one offer

Selecting target market segments

• Differentiated marketing – segmented

marketing, a firm decides to target several

market segments and designs separate offers for each

Selecting target market segments

• Concentrated marketing (niche marketing) a market – coverage strategy in which a firm goes after a large share of one or a few

submarkets

Selecting target market segments

• Micromarketing – a form of target marketing

in which companies tailor their marketing

programs to the needs and wants of narrowly defined geographic

– Local marketing

– Individual marketing

Choosing a targeting strategy

• Factors concerning a market targeting strategy

– Company resources

– Product variability

– Product’s life – cycle

– Market variability

DIFFERENTIATION

& POSITIONING

Company Logo

Product’s position

• Value proposition – how company will create differentiated value for targeted segments and what positions it wants to occupy in those

segments

• Product’s position – the way the product is

defined by consumers on important attributes – the place the product occupies in consumers’ minds relative to competing products

Positioning maps

• Perceptual positioning maps, which show

consumer perceptions of their brands versus competing products on important buying

dimensions

Differentiation & Positioning

Choosing the right competitive advantages

Selecting an overall positioning strategy

Selecting an overall positioning strategy

Developing a positioning statement

Developing a positioning statement

Communicatin

g the chosen position

Communicatin

g the chosen position

Identifying possible value differences

• Think through the customer’s entire

experience with the company’s product or

Choosing the right com-advan

• How many differences to promote

– A company should develop USP for each brand and stick to it

• Which differences to promote

– Important: the difference deliver higher value

– Distinctive: competitor do not offer the difference

– Communicable:

– Pre-emptive: competitor can not copy

– Affordable: buyer can afford to pay

– Profitable: company can capture different profitability

Not all brands differences are meaningful or worthwhile

Selecting an overall positioning strategy

More More for more More for the

same More for less

The same The same for

less Less Less for less

BLUE OCEAN STRATEGY

• Why demographic elements could be used to segment marketplace?

• Find an example of POSITIONING A PRODUCT

• Find an example of niche marketing

QUESTIONS?