chapter 7 marketing segmentation targeting and positioning.pptx

7/23/2019 Chapter 7 Marketing Segmentation Targeting and Positioning.pptx

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Principles of Marketing

Chapter 7- Market Segmenting,

Targeting, and Positioning

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Unfortunate Truth Time

No matter what you produce, no matter how

important you think it is, not eeryone wants

your product!

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"ood News

Pro#a#ly someone wants said product!

Now it is your $o# to find a way to reach them

and let you know you hae what they are

looking for% ia targeting them!

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Market Segmentation

&Process of #reaking down all consumers into

groups of potential #uyers with similar

characteristics'

(hy does it matter)

*ifle ersus machine gun

(ant to find the right sweet spot of reaching

enough consumers to make the effort worthwhile,#ut tailored enough to incite action +generally a

sale

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Targeted ersus Mass Market

Target marketing +sometimes called

differentiated marketing is focusing on select

groups to sell to

Mass market +sometimes called

undifferentiated marketing is selling the same

products to all people

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These can #asically #e seen as #eing directly

linked to the times of their popularity

Targeted marketing is the current state simply

#ecause we hae the a#ility to target

effectiely

.nternet, C*M programs, #ig data, etc!

Think a#out #uying a car today) .t is almost fully

customi/a#le +within reason

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Mass marketing +though still a large part of

#usiness was most popular in the days of

mass production lines!

&0ou can hae any color, as long as it is #lack'

Could you imagine how difficult it would hae

#een $ust to make one single different colored car

on an assem#ly line)

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1enefits of Segmentation and Targeting

(hen you segment and target you can2

3oid head-on competition with other firms trying

to capture the same customers +differentiation

3necdotally, how would these items #e sold)

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4eelop new offerings and e5pand profita#le

#rands and product lines

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*emarket older, less-profita#le products and

#rands

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.dentify early adopters

6arly adopters want your products, so targeting them is

a wise idea when you can reach them

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*edistri#ute money and sales efforts to focus on

your most profita#le customers

89:8 rule

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*etain &at-risk' customers in danger of defecting

to your competitors

;i


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Market research is the most optimal route to

proper segmenting and targeting #e it either

through #ig data or directly monitoring

customers and anywhere in #etween!

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Segmenting and Target Current Customers

*etention of customers is much more

important than gaining new customers +89:8

rule again

Think a#out some low inolement serices and

products that you routinely make

=ow much do you think those are worth)

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;ess suscepti#le to shocks

(hen recessions hit, people will still fre


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Can cater to customers more effectiely

(ith all the data we hae, we can sere customers

much #etter than other firms

This can #e aided with loyalty programs +if done

correctly

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Segmentation within segmentation

6en among customers, there are more alua#le

customers

>ey accounts are ery important to #usinesses,especially when you are small

3t times, it is also


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?ne-to-one marketing

@ar end of the targeting scale since you are a#out

as highly focused as possi#le

Steps are

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Steps in one-to-one marketing

6sta#lish short-term measures to ealuate efforts

3lways need to hae a measura#le goal +sensing a theme

.dentify customers

@ind out who wouldcould

#e the most #eneficial to keep in contact with and gatherthat information

4ifferentiate among customers

4etermine who is the #est customers #ased on their lifetime alue

@ind those that spend little with you, #ut large amounts with competitors

.nteract with customers, target the #est ones

.f they are good, spend time with them and sere them the #est you can

Customi/e products and marketing messages to them

This can #e the actual product, its packaging, deliery, etc! The key is that it is

something that makes them feel special

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=ow to Segment

@ocus is again on making sure the targets are

as reacha#le as possi#le

Main types of segmentation

1ehaioral

4emographic

"eographic

Psychographic

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1ehaioral Segmentation

Segmentation #ased on how people and

organi/ations #ehae with or act toward

products

=uh)

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1enefits sought #y product-

@acial cream for me

Price is not an issue, my face is my paycheck

. wanted


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=ow often the product is used +usage rate-

Something that needs to hae a new feel each time

it is used)

Think2 a acation spot

Usage situation +daily use, holiday, etc!

1uyer status and loyalty

.s a .P program necessary) (ould it #e#eneficial)

(hy are nonusers not using the product)

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4emographic Segmentation

Segmentation #ased on tangi#le, personal

characteristics

These are generally easy to o#tain, #ut can #e

tricky to implement

Some of the types and their #enefits are2

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3ge- 3s preiously discussed, age is an

important factor in consumption +3nyone

#ought an * since our class)

"enerations are important age factors as each

group has similarities

Seniors +ABDE- ;ied in tough times, so not a lot

of e5cess spending! Most all spending is onmedical and healthcare

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1a#y 1oomers +BDF-BFD- :ndlargest

generation

Most prosperous generation in historyG

Not aerse to new things, #ut not completely

immersed

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"eneration H +BFE-B7-

1orrow money, #ut not easily

"enerally tech say

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"eneration 0 +B8-:888-

;argest US generation

"rew up with credit

Technology is a gien

Iuick to ignore irreleant information

"reatest amount of customer lifetime alue

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.ncome-

.ndication of #uying power +discretionary income

Not always aimed at the highest leel

More an more #usinesses are aiming at #eing more

inoled with low income groups +mostly due to

economy

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"ender

4ifferent groups purchase differently

"enerally gender will always #e a factor in

segmentation since it is


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@amily ;ife Cycle-

My wife and . mostly spend money on ourseles

My friends all hae kids, so their spending is all on

their kids

My friends parents no longer spend money on their

kids, #ut on their grandkids and generally more

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6thnicity

The US is dierse, so there is always a way to

segment #ased on ethnicity

=ispanic food isle in Mississippi

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"eographic Segmentation

Segmentation #ased on geography

Not always as o#ious as it might seem

3sking for /ip codes to see where customers come from

"eotargeting is plotting data on a map to try ando#sere patterns

Can #e simple like a new store in a town or finding

where non-local shoppers come from

"eodemographics is using geography and

demographics to paint a #etter picture of the

consumer

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"eographic Segmentation

Population density +num#er of people per

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Psychographic Segmentation

Segmentation #ased on actiities, interests,

opinions, attitudes, alues, and lifestyles

0ou can #e in the same demographic segment

and hae wildly different psychographic

profiles

Common metric for psychographcis is the

3;S +alues, attitudes, and lifestyles

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3;S-

.nnoators- successful, sophisticated, take-charge

people with high self-esteem

3lways open to new ideas 3lways seeking challenges

ariety is the key for their lifestyles

"enerally like the finer things in life

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3;S-

Thinkers- motiated #y ideas

Mature, satisfied, comforta#le, and reflectie

;ike order, knowledge and responsi#ility (ell educated and seek information continually

@ocus on purchasing for dura#ility, functionality, and

alue

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3;S-

3chieers- motiated #y achieement

"oal oriented and deeply committed to career and

family ;ike predictie, conseratie, and following the status


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3;S-

65periencers- motiated #y self e5pression

Seek ariety and new e5periences

;ike e5ercise, e5citement, and social actiities 6n$oy haing &cool' stuff

Spend a large portion of income on appearances

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3;S-

1elieers- motiated #y ideas

Conseratie, conentional, #ased in tradition

*outini/ed lifestyles ;oyal customers

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3;S-

Striers- trendy and fun loing

Concerned with opinions and approal of others

Money defines their success Shopping is a social actiity

"enerally impulsie with purchases

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3;S-

Makers- Motiated #y self-e5pression

;ike working on things in their lies

Practical people and like self sufficiency Not fans of #ig #usiness

Prefer practical purchases oer flash

"enerally #uy #asic products

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3;S-

Suriors- focused lies

Think the world changes too


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Segmentation in 1:1

=arrison, =ague, and =ague argue that 1:1

only has the #ehaioral, needs-#ased segments

of2

Price-focused- small companies with low profit

margins with the good or serice #eing sold as not

#eing strategically important

Iuality and #rand-focused segment- firms thatwant the #est possi#le products and are willing to

pay for them

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Segmentation in 1:1

=arrison, =ague, and =ague argue that 1:1

only has the #ehaioral, needs-#ased segments

of2

Serice-focused- demand high-


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Selecting Target Markets and Target Market

Strategies

Target Market Selection

Target market should #e profita#le enough gien

an operating cost

Need to make sure you can recoup costs to hae aia#le market

.tJs growing

(ould you prefer to open a #usiness that caters to the

middle class of China or .ndia)

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Strategies


.tJs not oercrowded or you are differentiated

=ow easy would it #e to enter the car#onated drink

market) .t is accessi#le or you can find a way to reach it

Politically or legally, how easy is it to enter a country,

an area, or a group of people)

=ow #eneficial would high technology #e for people ofChad)

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Strategies


0ou hae the resources to compete

=ow easy would it #e for us to enter the airline

industry) .t fits within your firmJs o#$ecties

(ould it #e a good idea for Patagonia to enter into the

whaling #usinsess)

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Choosing the Num#er of Markets to Target

Multisegment marketing- targeting multiple

groups of consumers

3llow users to #uy at anyG leel of your

#usinesses Think a#out hotels and their leels of serice

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Concentrated Marketing

Targeting a ery select group of customers

*isky since you are ery focused

Niche marketing- targeting an e5tremely

specific group

Microtargeting- gathering as much information

as possi#le a#out customers to know the most

information a#out them

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"lo#al Markets

"enerally hae a mass market or a customi/ed

strategy

May hae the same #rand name, #ut the product is

different +1ig Mac

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Ne5t Time

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chapter 7 marketing segmentation targeting and positioning.pptx

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