E marketing

1. Segmenting theSegmenting the
Business MarketBusiness Market
Chapter 5Chapter 5

2. High-Profit CompaniesHigh-Profit Companies
 What makes them successful?What makes them successful?
 Three targetsThree targets

3. Business Market Segmentation &Business Market Segmentation &
BenefitsBenefits
 Market segmentationMarket segmentation
• ““A group of present or potentialA group of present or potential
customers with some commoncustomers with some common
characteristic which is relevant incharacteristic which is relevant in
explaining (and predicting) theirexplaining (and predicting) their
response to a supplier’s marketingresponse to a supplier’s marketing
stimuli.”stimuli.”
 Percentage breakdownsPercentage breakdowns

4. Business Market Segmentation &Business Market Segmentation &
BenefitsBenefits
 Five criteria for measuringFive criteria for measuring
desirabilitydesirability
• MeasurabilityMeasurability
• AccessibilityAccessibility
• SubstantialitySubstantiality
• CompatibilityCompatibility
• ResponsivenessResponsiveness

5. Business Market Segmentation &Business Market Segmentation &
BenefitsBenefits
 Competitive EnvironmentCompetitive Environment
• Competitive analysisCompetitive analysis
• Core competenciesCore competencies
• New competitionNew competition
 Technical EnvironmentTechnical Environment
• Three types of technologyThree types of technology
 Product technologyProduct technology
 Process technologyProcess technology
 Management technologyManagement technology
 Benefits of SegmentationBenefits of Segmentation

6. Bases for SegmentingBases for Segmenting
 B2C SegmentationB2C Segmentation
 MacrosegmentationMacrosegmentation
• Organizational characteristicsOrganizational characteristics
 Examples:Examples:
 DellDell
• MicrosegmentationMicrosegmentation
 Characteristics of decision-making unitsCharacteristics of decision-making units
 Examples:Examples:

7. Macrolevel BasesMacrolevel Bases
 Segmentation MethodsSegmentation Methods
• Characteristics of OrganizationCharacteristics of Organization
 SizeSize
 GeographyGeography
 Usage rateUsage rate
 Structure of purchasing functionStructure of purchasing function
• Product Service ApplicationProduct Service Application
 NAICSNAICS

8. Macrolevel BasesMacrolevel Bases
 Segmentation Methods (cont’d)Segmentation Methods (cont’d)
• Value in useValue in use
 DefinitionDefinition
• Purchasing situationPurchasing situation
 ExampleExample
• First-timeFirst-time
• NoviceNovice
• SophisticatesSophisticates

9. Microlevel BasesMicrolevel Bases
 Segmentation MethodsSegmentation Methods
• Key criteriaKey criteria
 What’s important to customerWhat’s important to customer
 ExampleExample
• ProgrammedProgrammed
• Relationship buyersRelationship buyers
• Transaction buyersTransaction buyers
• Bargain huntersBargain hunters
• Value-based strategiesValue-based strategies
 InnovationInnovation
 Customer in fast-growing marketsCustomer in fast-growing markets
 Customer in highly-competitive marketsCustomer in highly-competitive markets

10. Microlevel BasesMicrolevel Bases
 Segmentation Methods (cont’d)Segmentation Methods (cont’d)
• Purchasing strategiesPurchasing strategies
 SatisficersSatisficers
 OptimizersOptimizers
• Structure of the decision-making unitStructure of the decision-making unit
• Importance of purchaseImportance of purchase
• Attitudes toward vendorsAttitudes toward vendors
• Organizational innovativenessOrganizational innovativeness
• Personal characteristicsPersonal characteristics
 Microsegmentation IllustrationMicrosegmentation Illustration
• PhilipsPhilips

12. Organizational MarketOrganizational Market
Segmentation ModelSegmentation Model
 MacrosegmentationMacrosegmentation
 MicrosegmentationMicrosegmentation
 Check on costs and benefitsCheck on costs and benefits
• UPSUPS
 ImplementationImplementation
• Questions to askQuestions to ask