1. Market Segmentation, Targeting, Positioning Marketing Chapter 9

2. Target Market Specific segment of consumers most likely to purchase a particular item Market People with sufficient purchasing power, authority, and willingness to buy

3. Types of Markets Consumer Purchased by the ultimate consumer for personal use. Business Purchased to be used in the production of other goods & services for resale. Are these consumer products or business products?

4. Market Segmentation Dividing the total market into several homogeneous groups. No single marketing mix can satisfy everyone. Geographic Demographic Psychographic Product Related Targeting a Specific Marketing Segment

5. Geographic Segmentation Dividing market on basis of location of population US population is concentrated in states with large metropolitan areas Major population shifts To the Sunbelt States To the West Regional Preferences

6. Using Geographic Segmentation Demand for some goods vary according to region Residence location Climate GIS Segmentation by Residence Location

7. Demographic Segmentation Segmenting by: Gender Age Ethnic Group Family Life-cycle Household type Census Bureau http://www.census.gov

8. Segmenting by Age Cohort effect Members of a generation which are bound together by significant events occurring during formative years, 17-22. 9/11 Generation- those 17-22 on Sept. 11, 2001.

9. School Age Children Under the age of 12 Make choices about food, toys, clothing

11. Current teens to 25 year olds

12. Racially diverse

13. Grew up with internet

14. ‘Interactive’ describes them

15. ¼ live in single parent household

16. ¾ have mothers who work

17. 71 million

18. Cell phones, text

19. Music

20. Snacks and Soft Drinks

21. Clothing

22. Music

24. Family Oriented

25. Facing financial issues

26. Well Educated

27. Comfortable with internet, technology

28. Optimistic

29. Not as Defined by Career as Previous Generation

30. More Technologically Advanced Than Previous Generation

31. Very Peer Influenced

33. Seniors – over 65 Graying of America- living longer 20% by 2025 over 65 Control ¾ of the US assets Difficult to advertise to Buy & travel, healthcare, recreation Targeting Older Consumers

34. Segmentation based on gender

35. Several Web-Sites Aimed at Senior Citizens

36. Segmentation based on age

37. Segmenting by Ethnic Group African American Hispanic – nearly 48 million Fastest growing segment Asian Americans Approx. 18 million Highest per household income Concentrated in west coast Native Americans

38. Ad Aimed at Customers Who Prefer to Speak and Read Spanish: Segmenting by Racial/Ethnic Group

39. Segmenting by Family Life Cycle Family formation & dissolution Unmarried, setting up household for the first time Young single living Married couples- no children Birth of first child Divorced, single household Empty nesters

40. La-Z-BoyTargeting Families with Small Children

41. Segmenting by Household Type Average household size is shrinking in US & globally Two parent households have declined Targeting Smaller Households

42. Engel’s Laws As household income increases: A smaller % is spent on food % spent on housing & clothing remains the same % spent on other (recreation & education) increases

43. Demographic Segmentation Abroad Some countries don’t take a census regularly Some countries collect religious affiliation, others don’t collect income data Targeting High-Income Groups

44. Psychographic Segmentation Lifestyle or mode of living Psychological make-up Needs, motives, perceptions, attitudes AIO – activities, interests, opinions VALS – values, attitudes, lifestyles

45. Product Related Segmentation Based on: Benefits Usage Rates Degree of brand loyalty

46. Strategies for Reaching Target Markets Undifferentiated One product or one product line marketed to all customers with a single marketing mix Differentiated Numerous products with different marketing mixes Concentrated or Niche Marketing Focus efforts on satisfying smaller target markets Micro-marketing Targeting potential customers at very basic level

47. Positioning Placing a product in a certain position in the minds of prospective buyers to differentiate it from the competitor.