Segementatiion Targeting Positiong

Understanding and Influencing Organizational Buyer Behavior

DecisionBehaviorDecisionBehavior Customer

NeedsCustomer

Needs

AccurateTarget

AccurateTarget

GrowthRate

GrowthRate

Product

Price

Distribution

Service

Communication

Marketing Communication Message BehaviorPrograms Channels Processor Desired

SalesForceExperienceTrade ShowsAdvertisingCompetitors

OrganizationConsumer

PreferredSupplier

Product Purchase

PurchaseFrequency

Customer Loyalty

Organizational Buyer

Users

Gatekeepers

Influencers

Deciders

Who is the Organizational Consumer Decision Maker?

IdentifyingValue in theMarketplace

Determining Value Capabilities

Missionand MarketingObjectives

Planning The Marketing Program

CustomerValue

SelectivityConcentration

DifferentialAdvantage

COREMARKETINGSTRATEGY

Strategy Formulation

Marketing Programs

COREMARKETINGSTRATEGY

ProductPolicy andStrategy

Pricing

Relationships

Communicating

Value

Evaluation

EVALUATINGVALUEDELIVERY

MARKETINGPROGRAMS

Segmentation, Targeting and Positioning

British Tobacco and Phillip Morris focused on industrialising countries showing cigarette as fashionable status symbol and lifestyle..

Developing Market-Oriented Strategies in Broad Product-Markets

Combined Target Market Approach

Multiple Target Market Approach

Single Target Market Approach

Market Segmentation Strategies

Global Market Segmentation The process of sub-dividing a market into

distinct, actionable, homogeneous, substantial subsets.

1. Geographic Segmentation2. Demographic(income and population)3. Psychographic(values, attitudes, lifestyles)4. Behaviour characteristics.5. Benefit Sought6. Business Environment(soft, hard, regulations)7. Segmenting Industrial Markets / Size / Value /Standards / Industrial Classification /

Geographic and Demographic

Whether to go to triad, EU, US and Japan(high income)

Industrialising countries(Chine, India, Brazil-middle income)

African continent(low income) On the basis of population demographic

distribution.

Psychographic Segmentation Backer Spielvogel & Bates’ Global Scan -

labelled segments as strivers, achievers, pressured, traditional and adapters. Percentage varied from country to country.

1. Strivers: young 31 yrs, hectic achievement driven life, materialistic but having less time and money.

2. Achievers: older than strivers, affluent, assertive, attained success and upward mobile, status and quality conscious.

3. Pressured: largely women of all ages, having constant family and financial pressures.

4. Adaptors: older, contented people who maintained their values with open minds.

5. Traditional: rooted to past, heritage, cultural values.

Young and Rubicam’s Cross cultural consumer Characteristics

Constrained(resigned- staples and price driven and struggling poor-look for discount)

Middle majority(happy mainstreamers-habit brand loyal, unhappy aspirers- conspicuous consumptions, happy succeeders-luxury and quality)

Innovators(rebellious transitional-unique impulsive products, improve world reformers-home made or ecological products)

Behaviour Segment

Whether they buy use and the frequency of usage.

1. Uses: heavy, light, non-users.2. User status: potential, non, ex-, regular,

first time and competitors and products users.

Benefit Segment:on the basis of benefit sort.

Target Marketing

Who are the Target Customers?

Which markets should be targeted?

Why are these markets targeted?

Can we describe Customer need requirements?

Agree on Target Market/Segments

Summarize Customer Need Requirements

Focus activities on Target Market

Developing Market-Oriented Strategies in Broad Product-Markets

Combined Target Market Approach

Multiple Target Market Approach

Single Target Market Approach

This approach segments the marketand picks one of the homogeneoussegments as the firm's target market.

The segmenter here aims at onesubmarket with one marketing mix.

TheStrategy

Single Target Market Approach

Developing Market-Oriented Strategies in Broad Product-MarketsCombined Target

Market ApproachMultiple Target

Market ApproachSingle Target

Market Approach

This approach segments the marketand chooses two or moresegments as the firm's target market.

The segmenter here aims at two or more submarkets with a different marketing mix for each.

Strategy1

Strategy 2

Strategy3

Multiple Target Market Approach

Developing Market-Oriented Strategies in Broad Product-Markets

Combined Target Market Approach

Multiple Target Market Approach

Single Target Market Approach

This approach combines two or moresubmarkets into a larger target marketas a basis for one strategy.

The combiner here aims at twosubmarkets with one marketing mix.

TheStrategy

Combined Target Market Approach

Step 1-Identify Similar Micro Segments

Basis for Micro-Segmentation– Similar Buying

Center Processes

– Functional Customer Needs

– Stages in Buying Process

M ic roseg m en t 1 M ic roseg m en t 2

B as is :C h arac tris tic s o f th e

D ec is ion M ak in g U n it

M ac roseg m en t 1

M ic roseg m en t 1 M ic roseg m en t 2

B as is :C h arac tris tic s o f th e

D ec is ion M ak in g U n it

M ac roseg m en t 2

B as isS ize ,L oca tion ,In d u s try

A ll P o ten tia l C u s tom ers

Step 2-Identify Level of Decision Participants Influence

Identify Similar MicroSegments Across Macro Segments Similar Buying Center

Processes Functional Customer

Need Requirements Stages in the Decision

Process

BUYGRID FRAMEWORK

New Modified StraightTask Rebuy Rebuy

Need Recognition

ProductCharacteristics

InformationSearch

Evaluation

Decision

Evaluation

Step 3- Identify Most Important Benefits Sought

Personal Interviews Focus Groups

– Open ended

– Concentrate on how customers use the product.

– Possible Improvements

– Wishes

ProductNeed

PurchaseDecision

PRICING

QUALITY

SUPPLYGUARANTEE

CUSTOMERSERVICE

PRESTIGE

SECURITY

RELATIONSHIP

MOTIVATION

Step 4-Develop Customer Attribute/Benefit List

Replace Air with Oxygen

Apparatus for Mixing, dissolution and utilization of Oxygen

Control System to Maintain Peak Efficiency

2/3 Treatment Processing Time

5X Poundage Removal

Ability to absorb shock loads

Reduce Operating Costs

Step 5- Have Decision Makers Prioritize Benefits

Easy to reach keys

100

Makes me relax

80

I got my moneys worth

50

Customer Sort Customer Attributes

Customers Choose Exempler from each pile

Customer rate importance of each pile

Customer rate current performance

Cluster Analysis Helps to Reveal-Voice of the Customer

•Can add Coolant without replacing cartridge•Cooling material does not affect contents•Cooling material takes up a minimum of space

•Keeps contents cold•Cools effectively•Keeps contents warm

Use Convenient Cooling Mechanism

Temperature isControllable

MaintainsTemperatureof Package Contents

[[

Step 6- Identify Stage of Involvement in Decision

Involvement varies across organizational functions

Segmentation Matrix

Segment Names

Benefits Sought

PriorityRanking

Identify,Select, and Describe the Target Market

Product or Service____________________

Target Segment_______________________

Segment Size_________________________

Key Decision Makers___________________

Key Customer Needs

1.____________ 2.____________

3.____________ 4.____________

Global Targeting

Act of evaluating, comparing and selecting the prospective segment with highest potential.

Criteria: 1. Size and growth potential(China)2. Potential competition(Kodak-Fuji fight in US,

Europe)3. Compatibly and feasibility with company’s

mission and objectives(Coke’s challenge to Pepsi in Russia)

Selecting a Global Target Market Strategy

Standardised global marketing: same marketing mix extensive distribution, more sales less production cost(Revlon –’Shake Your Body’ campaign)

Concentrated global marketing: To reach single focused segment (Winterhalter sells dishwasher only to restaurant, Estelle Lauder cosmetic to upper upper segment only)

Differentiated global marketing: targeting two or more distinct segments with different marketing mix.

Positioning The Product

Specify Target Market Specify Key Benefit Specify Key Support Specify Differential

Advantage

Develop Positioning Statement

Get Team Buy In

PRODUCT POSITIONINGDIFFERENTIAL ADVANTAGE

DifferentialAdvantage

Non differentialAdvantage

FunctionalPsychological

Economic

Non PriceCompetition

PriceCompetition

SustainableDifferentialAdvantage

How do our customers perceive us in relation to our competitors?

What is our image?

"Segmenting" the Segment

Positioning Strategies May Be Based On:Establishing a Differential Advantage

CompetitiveAnalysis

CustomerAnalysis

PotentialAdvantage

Identify NewDifferentialAdvantage

Satisfies KeyCustomerNeed

TargetMarket

Segment

CanCompetition

Match

DifferentialAdvantage

No No

YesYes

No

Specific Features

Benefits, Problem solutions, Needs

Specific Usage Occasions

User Category Against another

Product Product Class

disassociation

Positioning Examples

Canon Compact Big Copier

Xerox

Luxury Features

3M Reliability, Quality

Mita Simple to Use

Minolta Works with you

Sharp Options/Features

Natural Brand Positioning

PerceivedPrice

StandardizedPhysicalCharacteristic

-20

+20

-1 +1

Positioning Statement Format

Convince [Our Target Market] that

[Customer Benefits Sought] because

[How Our Strategy Provides Benefits]

Target Market and Positioning

Product or Service_______________

Target Market Segment_____________

Convince_______________________ thatTarget Market

_______________________________ BecauseCustomer Benefits Sought

_________________________________How our strategy provides benefits

Global Product PositioningActing on consumers mind rather that the product. High tech positioning

1. Technical products: computers, microprocessors, RAM.

2. Special interest products:Adidas, Sports, I-Pods

3. Product that demonstrates well : Polaroid camera High touch positioning: focus more on image than

specialised technical information.

1. Product for common problems showing slice of life.

2. Global village products: mineral water, designer fashions and pizza etc.

3. Universal theme based products: ruggedness and heroism of Harley Davidson

Developing Objectives

Which type of objective should be emphasized?

Should the type of objective vary by segment and customer target?

What criteria should be used to assess objectives?

Develop Objectives– By Market Segment

– By Geography

– By Customer Target

Template for Good Objectives

____________ percent of _____________A quantifiable number Target Customer

will _______________ the ____________Objective Product or Service

in ________________.Time Frame

Evaluating Market Feasibility

Industry Demand Market Share Required Investments Costs Performance.