Int to mktng ch8

Segmenting and Targeting Markets
CHAPTER
8
Marketing 10
Lamb, Hair, McDaniel
Designed by Prepared by
Eric Brengle Amit Shah
B-books, Ltd. Frostburg State University

Copyright ©2009 by Cengage Learning Inc. All rights reserved 1

Learning Outcomes

Describe the characteristics of markets
LOI
and market segments

LO2 Explain the importance of market segmentation

Discuss criteria for successful market
LO3 segmentation

Describe the bases commonly used to segment
LO4 consumer markets


Learning Outcomes

LO5 Describe the bases for segmenting
business markets
LO6 List the steps involved in segmenting markets

Discuss alternative strategies for selecting
LO7 target markets

LO8 Explain one-to-one marketing

Explain how and why firms implement
LO9 positioning strategies and how product
differentiation plays a role

LOI Market Segmentation

Describe the characteristics
of markets
and market segments


A Market Is...

(1) people or organizations with

(2) needs or wants, and with

(3) the ability and

(4) the willingness to buy.

A group of people that lacks any one of these
characteristics is not a market.

LOI

LOI
Market Segmentation
People or organizations with
Market needs or wants and the ability
and willingness to buy.

A subgroup of people or
Market organizations sharing one or more
Segment characteristics that cause them
to have similar product needs.

Market The process of dividing a market
into meaningful, relatively similar,
Segmentation identifiable segments or groups.


The Concept of Market
LOI
Segmentation


LO2
The Importance of Market
Segmentation

Explain the importance
of market segmentation


LO2 The Importance of Market
Segmentation

 Markets have a variety of product
needs and preferences.

 Marketers can better define
customer needs.

 Decision makers can define objectives
and allocate resources more accurately.


LO2 REVIEW LEARNING OUTCOME
The Importance of Market Segmentation

More precise
More accurate
Market definition of
marketing
segmentation customers needs
objectives
and wants

Improved
resource
allocation

Better marketing
results


Criteria for Successful
LO3
Segmentation

Discuss criteria for
successful market
segmentation


LO3
Criteria for Segmentation
Segment must be large
Substantiality enough to warrant a special
marketing mix.

Identifiability
Segments must be identifiable and
and
their size measurable.
Measurability

Members of targeted segments
Accessibility must be reachable with
marketing mix.

Unless segment responds to a
Responsiveness marketing mix differently, no
separate treatment is needed.

Successful Market Segmentation

Useful
segment?

 Substantial
 Identifiable and measurable
 Accessible
 Responsive

Then, yes: Useful segmentation scheme


Bases for Segmenting
LO4
Consumer Markets

Describe the bases
commonly used to
segment
consumer markets


LO4
Consumer Markets

Segmentation Characteristics of
Bases individuals, groups, or
organizations used to divide a
total market into segments.
(variables)


LO4
Bases for Segmentation

Geography

Demographics

Psychographics

Benefits Sought

Usage Rate


LO4 Geographic Segmentation

• Region of the country or world

• Market size

• Market density

• Climate

17
Copyright ©2009 by Cengage Learning Inc. All rights reserved

LO4 Benefits of Regional
Segmentation

• New ways to generate sales in sluggish
and competitive markets
• Scanner data allow assessment of best
selling brands in region
• Regional brands appeal to local
preferences
• Quicker reaction to competition


LO4 Demographic Segmentation

Age

Gender

Income

Ethnic background

Family life cycle

19

LO4
Gender Segmentation

• In U.S., women…
– handle 75% of family finances
– Influence 80% of consumer purchases
– Make purchase decisions about variety of goods
and services
• New cars, hardware stores, electronics, etc.
• Other brands that have targeted men are
trying to target women
– Gillette razors, Rogaine baldness
remedy, Nike, Reebok, etc.


LO4
Income Segmentation

• Income – popular demographic variable for
segmenting markets
• According to Nielsen study…
– Affluent households (earning more than $100k/ year)
twice as likely to shop at warehouses
– Lexus catering to wealthy customers
• Price-sensitive consumers
– P&G
• Bounty Basic paper towels
• Charmin Basic bath tissue


LO4
Ethnic Segmentation

• Largest ethnic markets are:

– Hispanic Americans
– African Americans
– Asian Americans

• Will comprise 1/3 of U.S. population by 2010
with buying power of $1 trillion annually


Family Life Cycle

Age

Marital
Status Children

LO4 Copyright ©2009 by Cengage Learning Inc. All rights reserved
23

LO4
Family Life Cycle


LO4 Psychographic Segmentation

Psychographic Market segmentation on the
Segmentation basis of
personality, motives, lifestyl
es, and geodemographics.


LO4 Bases for Psychographic
Segmentation
Personality

Motives

Lifestyles

Geodemographics


LO4 Lifestyle Segmentation

• How time is spent
• Importance of things around them
• Beliefs
• Socioeconomic characteristics

27

Geodemographic
LO4
Segmentation

Geodemographic Segmenting potential customers
Segmentation into neighborhood lifestyle
categories.

Combines
geographic, demographic, and
lifestyle segmentation.


LO4
Benefit Segmentation

Benefit The process of grouping
Segmentation customers into market segments
according to the benefits they
seek from the product.


LO4
Benefit Segmentation

Dividing a market by the
Usage-Rate
amount of product bought
Segmentation
or consumed.

A principle holding that
80/20 20 percent of all customers
Principle generate 80 percent of
the demand.


Bases for Segmenting Consumer Markets

Geography Demographics Psychographics Benefits Usage Rate

• Region • Age • Personality • Benefits • Former
• Market size • Gender • Motives sought • Potential
• Market • Income • Lifestyle • 1st time
density • Race/ethnicity • Geodemo-grap • Light or
• Climate • Family life hics irregular
cycle • Medium
• Heavy


LO5
Business Markets

Describe the bases for
segmenting
business markets


LO5 Bases for Segmenting
Business Markets
Producers

Resellers

Government

Institutions

Company Buying
Characteristics Processes

LO5 Bases for Segmenting
Business Markets

Company Characteristics

 Geographic location
 Type of company
 Company size
 Volume of purchase
 Product use


LO5
Buyer Characteristics
Business customers who place
an order with the first familiar
Satisficers
supplier to satisfy product and
delivery requirements.

Business customers who
consider numerous suppliers,
both familiar and unfamiliar,
Optimizers
solicit bids, and study all
proposals carefully before
selecting one.


Buyer Characteristics

Demographic characteristics

Decision style

Tolerance for risk

Confidence level

Job responsibilities

LO5 Copyright ©2009 by Cengage Learning Inc. All rights reserved
36

Segmenting Business Markets

Company Characteristics

Producers Resellers

Governments Institutions

Buying Process


LO6 Steps in Segmenting a Market

List the steps involved
in segmenting markets


Steps in Segmenting Markets

Select Choose Select Profile Select Design,
a market bases descriptors and target implement,
for for analyze markets maintain
study segmen- segments marketing
tation mix

1 2 3 4 5 6


Strategies for Selecting
LO7 Target Markets

Discuss alternative strategies
for selecting target markets


Strategies for Selecting
LO7
Target Markets

A group of people or
Target organizations for which an
Market
organization
designs, implements, and
maintains a marketing mix
intended to meet the needs of
that group, resulting in
mutually satisfying
exchanges.


LO7 Strategies for Selecting
Target Markets

Undifferentiated Concentrated Multisegment
Strategy Strategy Strategy


LO7 Undifferentiated Targeting Strategy

Undifferentiated A marketing approach that
Targeting views the market as one big
Strategy market with no individual
segments and thus
requires a single
marketing mix.


LO7
Undifferentiated Targeting Strategy

Advantage:

 Potential savings on production
and marketing costs

Disadvantages:

 Unimaginative product offerings

Undifferentiated  Company more susceptible to
Strategy competition


LO7 Concentrated Targeting Strategy

Concentrated A strategy used to select one
Targeting Strategy segment of a market for
targeting marketing efforts.

Niche
One segment of a
market.


LO7
Concentrated Targeting Strategy

Advantages:
 Concentration of resources
 Meets narrowly defined
segment
 Small firms can compete
 Strong positioning

Disadvantages:
 Segments too small, or
Concentrated changing
 Large competitors may
Strategy
market to niche segment


LO7 Multisegment Targeting Strategy

Multisegment A strategy that chooses two or
Targeting more well-defined market
Strategy segments and develops a
distinct marketing
mix for each.


LO7 Multisegment Targeting Strategy

Advantages:
 Greater financial success
 Economies of scale

Disadvantages:
 High costs
 Cannibalization
Multisegment
Strategy


LO7 Costs of Multisegment Targeting

 Product design costs
 Production costs
 Promotion costs
 Inventory costs
 Marketing research costs
 Management costs
 Cannibalization


LO7
Cannibalization

Situation that occurs when
Cannibalization sales of a new product cut into
sales of a firm’s existing
products.


Alternatives for Selecting Target Markets

Undifferentiated Multisegment Concentrated


LO8 One-to-One Marketing

Explain one-to-one marketing


LO8
One-to-One Marketing

One-to-One An individualized marketing
Marketing method that utilizes
customer information to
build long-
term, personalized, and
profitable relationships with
each customer.


LO8 One-to-One Marketing

One-to-One
Has a Goal of…
Marketing is...

Individualized Cost Reduction

Information-Intensive Customer Retention

Long-Term Increased Revenue

Personalized Customer Loyalty

54

LO8

Trends
1. One-size-fits all marketing no longer effective

2. Direct and personal marketing will grow to meet
needs of busy consumers.

3. Consumers will be loyal to companies that have
earned—and reinforced—their loyalty.

4. Mass-media approaches will decline as technology
allows better customer tracking.


LO9 Positioning

Explain how and why firms
implement positioning
strategies and how
product differentiation
plays a role


LO9
Positioning

Positioning Developing a specific marketing
mix to influence potential
customers’ overall perception of a
brand, product line, or organization
in general.


Positioning of Procter & Gamble
LO9
Detergents
Brand Positioning Market
Share
Tide Tough, powerful cleaning 31.1%
Cheer Tough cleaning, color protection 8.2%
Bold Detergent plus fabric softener 2.9%
Gain Sunshine scent and odor-removing formula 2.6%
Era Stain treatment and stain removal 2.2%
Dash Value brand 1.8%
Oxydol Bleach-boosted formula, whitening 1.4%
Solo Detergent and fabric softener in liquid form 1.2%
Dreft Outstanding cleaning for baby clothes, safe 1.0%
Ivory Snow Fabric & skin safety on baby clothes 0.7%
Ariel Tough cleaner, aimed at Hispanic market 0.1%
59

Effective Positioning

1. Assess the positions occupied by
competing products

2. Determine the dimensions underlying
these positions

3. Choose a market position where
marketing efforts will have the greatest
impact

LO9 60

LO9
Product Differentiation

Product A positioning strategy that
Differentiation some firms use to distinguish
their products from those of
competitors.

Distinctions can be real or
perceived.


LO9
Perceptual Mapping

Perceptual A means of displaying or
Mapping graphing, in two or more
dimensions, the location of
products, brands, or groups of
products in customers’ minds.


Perceptual Mapping

LO9

LO9
Positioning Bases
Attribute

Price and Quality

Use or Application

Product User

Product Class

Competitor

Emotion

LO9
Repositioning

Changing consumers’
Repositioning perceptions of a brand in relation
to competing brands.


Positioning and Product Differentiation


Int to mktng ch8

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Was ist angesagt?

Was ist angesagt? (20)

Andere mochten auch

Andere mochten auch (10)

Ähnlich wie Int to mktng ch8

Ähnlich wie Int to mktng ch8 (20)

Mehr von Universidad de Monterrey

Mehr von Universidad de Monterrey (20)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Int to mktng ch8