Segmentation , targeting and positioning

Segmentation , Targeting and Positioning:(BUILDING THE RIGHT RELATIONSHIPS WITH THE RIGHT CUSTOMERS)BY TANIA CHAKRABORTY (14-50-117) RITUPARNA DEVI (14-50-118) ANGARAAG SHARMA (14-50-119) INTRODUCTIONSEGMENTATIONTARGETINGPOSITIONINGCASE STUDY CONCLUSIONCONTENTSSEGMENTATION, TARGETING , POSITIONING (STP) is a familiar strategic approach in Modern Marketing.

It is one of the most commonly applied marketing models in practice

It is the second most popular marketing model , only beaten by the venerable SWOT analysis.INTRODUCTIONSTP or segmentation targeting positioning is a marketing tool with the help of which marketers differentiate, attract, retain and grow customer base for their respective products.

The STP model is useful when creating marketing communications plans since it helps marketers to prioritize prepositions and then develop and deliver personalized and relevant messages to engage with different audiences.What is STP ?

Grouping consumers by some criteria so that those within a group will respond similarly to a marketing action and those in a different group will respond differently MARKET SEGMENTATION

Segmentation VariablesSegmentation VariablesGeographic Geo-demographicBehavioralDemographicPsychographic7They are the many possible variables into which you can divide a market.

Your text identifies five:

Well look at each of these in a momentGeographic SegmentationDivision of the market based on the location of the target market

People living in the same area have similar needs and wants that differ from those living in other areas

Climate

Population density

Taste

Micromarketing

8What is it?

What is the theory behind it?Examples?

Climate: snowblowers/Subaru Outbacks vs. sunscreen/convertibles

Population Density: lawn mowers/gas grills vs. small appliances/convertible sofas

Taste: mild salsa sells best in the northeast while hot salsa is preferred in the west

A concept related to this issue is Micromarketing: What is it?Campbell Soup segments its domestic market into 20 different segments; each regional sales office has its own budget and authority to develop specific advertising and promotional campaigns geared to local market needs and conditions

Demographic Segmentation Partitioning of the market based on factors such as agegender marital statusincomeoccupationeducation ethnicity9What is it?

Lets look at some of these demographic variables

Geo-demographic SegmentationA hybrid segmentation scheme

Based on notion that people who live close to one another are likely to have similar financial means, tastes, preferences, lifestyles and consumption habits10Now we look at another segmentation variableWhat is it?

A hybrid of what? Geography and Demography

What theory is it based on?

Is it true?

Market researchers seem to think so becausePsychographic SegmentationPartitioning of the market based on lifestyle and personality characteristics

Marketers use it to further refine a target market

Its appeal lies in the vivid and practical profiles of consumer segments that it can produce

Accomplished by using AIO inventories11What is it?

Behavioral Segmentation Partitioning of the market based on attitudes toward or reactions to a product and to its promotional appeals

Behavioral segmentation can be done on the basis of:Usage rateBenefits sought from a productLoyalty to a brand or a store

12Another segmentation variable is

What is it?After doing the market segmentation the firm has to evaluate the segment of their market potential. Then the company has to decide which and how many segments to serve and how to serve them.

Single segment concentration.Selective specialization.Product specializationMarket specializationFull market coverageMARKET TARGETINGSingle product in single market

The farm equipment division of Mahindra and Mahindra concentrated on tractors and primarily targeted agriculture market

The Zodiac brand concentrates on formal shirts on executive and professionals

Some hospitals focus on certain therapeutic area, heart speciality, etc

Evaluating and selecting the market segments i) Single segment concentrationM1M2M3P1P2P3There are certain in single segment concentration: a particular market segment can become sour or a competitor may invade the segment

Specialized product in specialized market

The firm attempts to serve all customer groupii) Selective SpecializationM1M2M3P1P2P3Single product in different markets

The firm makes a certain product that it sells to several different market segments

Eg. A microscope manufacture, for instance, sells to university , government and commercial laboratoriesiii) Product SpecializationM1M2M3P1P2P3Various products in single marketThe firm concentrates on serving many needs of a particular customer group or marketiv) Market SpecializationM1M2M3P1P2P3Different products in different markets.

The firm attempts to serve all customer group with all the products they might need.

It is possible for only the large firms

Eg. Reliance : They have wide range of products in nearly all kind of marketsv) Full market coverage M1M2M3P1P2P3Positioning has come to mean the process by which marketers try to create an image or identity or value in the minds of their target market for its product, brand, or organization.

Involves implanting the brands unique benefits and differentiation in the customer mind by developing Best qualityBest serviceLowest price

PRODUCT POSITIONING Positioning the product or service into the targeted sector is done by evaluating each sector via the 4Ps framework (Product, Price, Place and Promotion) basing a decision around what the product would sell at, to whom it would be targeted at , where we would sell it and how we would promote it, i.e developing the marketing mix that will support the positioning in the market place. 3 STEPS OF POSITIONING PROCESSDetermine what consumers currently think about your product (with respect to competing products)

Decide what you want consumers to think about your product.

Figure out how to reposition. Competitive advantagesPoints of difference or product differentiationPositioning strategiesPositioning results from differentiation and competitive advantagesPositioning for competitive advantageProduct attributes (Ariel with micro cleaning system)Benefits offered (P&Gs Head & Shoulders shampoo)Usage occasion (Cadbury drinking chocolate : the good night cup)User class (Baby shampoo vs. gentle shampoo)Against a competitor (7UP is the UNCOLA)Product class (Raymond brand, Titan watches)Factors responsible for advantage of a product.23Step 1. Identifying Possible Competitive Advantages: Competitive Differentiation.

Step 2. Selecting the Right Competitive Advantage: Unique Selling Proposition (USP).

Step 3. Communicating and Delivering the Chosen Position.

Steps to choosing and implementing a Positioning StrategyProduct differentiation

Service differentiation

Personnel differentiation

Channel differentiation

Image differentiation

Developing competitive differentiation

Important to customers

Distinctive

Superior

Communicable to customers

Preemptive

Affordable

ProfitableSelecting right competitive advantages

CASE STUDY 1:STP of Maggi 2-Minute Noodles

CASE STUDY 2:Cadbury Dairy Milk Chocolate

Geographical segmentation

Age and life cycle: the buyers who mostly prefer dairy milk come under the age group of 4-50 yearsGender : it is for all types of persons whether male or femaleIncome: price is reasonable and affordable so person does not have to think much before buyingGeneration : it is not much affected by generation difference

Market segmentationBehavioral segmentation

Decision roles: it is mostly played by children and youngstersOccasion : there is no specific occasionBenefits : it is easily available and has qualityUser status: regular User rate : heavyloyalty status : absolute The main target is children and youth

Commonly targets all types of customers whether old or young , male or female

Target Market Of Cadbury Dairy Milk Used promotional techniques by

Giving ad through any superstar Electronic mediaPress mediaSign boards

Market Positioning Of Cadbury Dairy Milk It has competitive advantage over competitors:

Important: according to customers needs, wants and requirementsDistinctive: more quality and more features like unique taste, design, logo, etcSuperior: superior in quality, continuous improvements and have different featuresCommunicable: easy to understand about the quality and featuresPreemptive: logo, quality, taste and other features are not copiedAffordable: reasonable and affordable by all customers

In Summary, first comes segmentation, then targeting and then positioning. And once the product has been established, a change in one brings a change in the other and vice versa. A change in targeting will bring a change in positioning. And a change in segmentation will bring a change in targeting. STP focuses on commercial effectiveness, selecting the most valuable segments for a business and then developing a marketing mix and product positioning strategy for each segmentCONCLUSIONTHANK YOU