Upload
irene-bruce
View
224
Download
0
Embed Size (px)
Citation preview
Chapter 7 Version 6e 1©2002 South-Western
chapter
Segmenting and Targeting Segmenting and Targeting MarketsMarkets
77
Chapter 7 Version 6e 2©2002 South-Western
A Market is...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.
11
Chapter 7 Version 6e 3©2002 South-Western
Market SegmentationMarket Segmentation
MarketMarket
MarketSegmentMarket
Segment
MarketSegmentation
MarketSegmentation
People or organizations with needs or wants and the ability and
willingness to buy
People or organizations with needs or wants and the ability and
willingness to buy
A subgroup of people or organizations sharing one or more characteristics that cause them to
have similar product needs.
A subgroup of people or organizations sharing one or more characteristics that cause them to
have similar product needs.
The process of dividing a market into meaningful, relatively similar, identifiable segments or groups.
The process of dividing a market into meaningful, relatively similar, identifiable segments or groups.
11
Chapter 7 Version 6e 4©2002 South-Western
The Importance of The Importance of Market SegmentationMarket 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
22
Chapter 7 Version 6e 5©2002 South-Western
Criteria for Successful Criteria for Successful SegmentationSegmentation
Criteria Criteria for for
Market Market SegmentsSegments
Criteria Criteria for for
Market Market SegmentsSegments
SubstantialitySubstantiality
IdentifiabilityIdentifiability
AccessibilityAccessibility
ResponsivenessResponsiveness
33
Chapter 7 Version 6e 6©2002 South-Western
Criteria for SegmentationCriteria for Segmentation
SubstantialitySubstantialitySubstantialitySubstantiality
IdentifiabilityIdentifiabilityMeasurabilityMeasurabilityIdentifiabilityIdentifiabilityMeasurabilityMeasurability
AccessibilityAccessibilityAccessibilityAccessibility
ResponsivenessResponsivenessResponsivenessResponsiveness
Segment must be large enough to warrant a special
marketing mix.
Segment must be large enough to warrant a special
marketing mix.
Segments must be identifiable and their size measurable.
Segments must be identifiable and their size measurable.
Members of targeted segments must be reachable with
marketing mix.
Members of targeted segments must be reachable with
marketing mix.Unless segment responds to a marketing mix differently, no separate treatment is needed.
Unless segment responds to a marketing mix differently, no separate treatment is needed.
33
Chapter 7 Version 6e 7©2002 South-Western
Segmentation BasesSegmentation Bases
Characteristics of
individuals, groups,
or organizations used
to divide a total market
into segments.
(variables)
44
Chapter 7 Version 6e 8©2002 South-Western
Bases for SegmentationBases for Segmentation
Usage RateUsage Rate
Benefits SoughtBenefits Sought
PsychographicsPsychographics
DemographicsDemographics
GeographyGeography
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
44
Chapter 7 Version 6e 9©2002 South-Western
Geographic SegmentationGeographic Segmentation
Region of the country or world
Market size
Market density
Climate
44
Chapter 7 Version 6e 10©2002 South-Western
Bases for SegmentationBases for Segmentation
Usage RateUsage Rate
Benefits SoughtBenefits Sought
PsychographicsPsychographics
DemographicsDemographics
GeographyGeography
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
44
Chapter 7 Version 6e 11©2002 South-Western
Bases for Bases for Demographic SegmentationDemographic Segmentation
44
Age
Gender
Income
Ethnic background
Family Life Cycle
Chapter 7 Version 6e 12©2002 South-Western
Bases for SegmentationBases for Segmentation
Usage RateUsage Rate
Benefits SoughtBenefits Sought
PsychographicsPsychographics
DemographicsDemographics
GeographyGeography
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
44
Chapter 7 Version 6e 13©2002 South-Western
Bases for Bases for Psychographic SegmentationPsychographic Segmentation
PsychographicPsychographicSegmentationSegmentation
PsychographicPsychographicSegmentationSegmentation
PersonalityPersonality
MotivesMotives
LifestylesLifestyles
GeodemographicsGeodemographics
44
Chapter 7 Version 6e 14©2002 South-Western
Geodemographic SegmentationGeodemographic Segmentation44
Segmenting potential
customers into
neighborhood lifestyle
categories.
Combines geographic,
demographic, and lifestyle
segmentation.
Chapter 7 Version 6e 15©2002 South-Western
VALS 2 DimensionsVALS 2 DimensionsPrinciple-Principle-orientedoriented
Status-Status-orientedoriented
Action-Action-orientedoriented
Fulfillers
Believers
Actualizers
Achievers
Strivers
Strugglers
Experi-encers
Makers
Minimal Resources
Abundant Resources
44
Chapter 7 Version 6e 16©2002 South-Western
Bases for SegmentationBases for Segmentation
Usage RateUsage Rate
Benefits SoughtBenefits Sought
PsychographicsPsychographics
DemographicsDemographics
GeographyGeography
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
44
Chapter 7 Version 6e 17©2002 South-Western
Benefit SegmentationBenefit Segmentation
The process of grouping
customers into market
segments according to
the benefits they seek
from the product .
44
Chapter 7 Version 6e 18©2002 South-Western
Bases for SegmentationBases for Segmentation
Usage RateUsage Rate
Benefits SoughtBenefits Sought
PsychographicsPsychographics
DemographicsDemographics
GeographyGeography
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
Bases Bases Used toUsed toSegmentSegment
ConsumerConsumerMarketsMarkets
44
Chapter 7 Version 6e 19©2002 South-Western
Usage-Rate SegmentationUsage-Rate Segmentation
Dividing a market by the
amount of product
bought or consumed.
44
Chapter 7 Version 6e 20©2002 South-Western
The 80/20 PrincipleThe 80/20 Principle
A principle holding that
20 percent of all customers
generate 80 percent
of the demand.
44
Chapter 7 Version 6e 21©2002 South-Western
Business Marketing SegmentationBusiness Marketing SegmentationGeographic
Customer Type
Customer Size
Product UseBusinessBusinessMarketsMarkets
BusinessBusinessMarketsMarkets
Purchasing Criteria
Purchasing Strategy
Importance
Personal Characteristics
Micro- segmentation
Micro- segmentation
Macro- segmentation
Macro- segmentation
55
Chapter 7 Version 6e 22©2002 South-Western
Steps in Segmenting a MarketSteps in Segmenting a Market
Select a
market for
study
Choosebases
for segmen-
tation
Selectdescrip-
tors
Profileand
analyzesegments
Selecttarget
markets
Design,imple-ment,
maintainmkting
mix
66
Chapter 7 Version 6e 23©2002 South-Western
Target MarketTarget Market
A group of people or
organizations for which an
organization designs,
implements, and maintains a
marketing mix intended to
meet the needs of that
group, resulting in mutually
satisfying exchanges.
77
Chapter 7 Version 6e 24©2002 South-Western
Strategies for SelectingStrategies for SelectingTarget MarketsTarget Markets
ConcentratedStrategy
ConcentratedStrategy
UndifferentiatedStrategy
UndifferentiatedStrategy
MultisegmentStrategy
MultisegmentStrategy
77
Chapter 7 Version 6e 25©2002 South-Western
Undifferentiated Undifferentiated Targeting StrategyTargeting Strategy
AdvantagesAdvantages: Potential savings on
production and marketing costs
DisadvantagesDisadvantages: Unimaginative product
offerings Company more
susceptible to competition
77
Chapter 7 Version 6e 26©2002 South-Western
Concentrated Concentrated Targeting StrategyTargeting Strategy
AdvantagesAdvantages: Concentration of resources Meets narrowly defined
segment Small firms can compete Strong positioning
DisadvantagesDisadvantages: Segments too small, or
changing Large competitors may market
to niche segment
77
Chapter 7 Version 6e 27©2002 South-Western
AdvantagesAdvantages: Greater financial success Economies of scale
DisadvantagesDisadvantages: High costs Cannibalization
Multisegment Multisegment Targeting StrategyTargeting Strategy
77
Chapter 7 Version 6e 28©2002 South-Western
Costs of Multisegment TargetingCosts of Multisegment Targeting
$ Product design costs
$ Production costs
$ Promotion costs
$ Inventory costs
$ Marketing research costs
$ Management costs
$ Cannibalization
77
Chapter 7 Version 6e 29©2002 South-Western
CannibalizationCannibalization
Situation that occurs when
sales of a new product
cut into sales of a
firm’s existing products.
77
Chapter 7 Version 6e 30©2002 South-Western
PositioningPositioning
Developing a specific
marketing mix to influence
potential customers’ overall
perception of a brand,
product line, or organization
in general.
88
Chapter 7 Version 6e 31©2002 South-Western
PositionPosition
The place a product, brand,
or group of products
occupies in consumers’
minds relative to competing
offerings.
88
Chapter 7 Version 6e 32©2002 South-Western
Effective PositioningEffective Positioning
Assess the positions of competing products
Determine the dimensions of these positions
Choose an effective market position
88
Chapter 7 Version 6e 33©2002 South-Western
Product DifferentiationProduct Differentiation
A positioning strategy that
some firms use to
distinguish their products
from those of competitors.
88
Chapter 7 Version 6e 34©2002 South-Western
Perceptual MappingPerceptual Mapping
A means of displaying or
graphing, in two or more
dimensions, the location of
products, brands, or groups
of products in customers’
minds.
88
Chapter 7 Version 6e 35©2002 South-Western
Perceptual Mapping--Levi’sPerceptual Mapping--Levi’s88
High PriceHigh PriceHigh PriceHigh Price
Low PriceLow PriceLow PriceLow Price
Cla
ssic
Cla
ssic
Cla
ssic
Cla
ssic
Desig
ner
Desig
ner
Desig
ner
Desig
ner
Old product
New product
Vintage
Red Line
Silver Tab
Slates
DockersPremium
DockersClassics
501
Red TabBasics
Red TabDry Goods
L2
Red TabElesco
Chapter 7 Version 6e 36©2002 South-Western
Positioning BasesPositioning Bases
AttributeAttribute
Price and QualityPrice and Quality
Use or ApplicationUse or Application
Product UserProduct User
Product ClassProduct Class
CompetitorCompetitor
Positioning Positioning BasesBases
Positioning Positioning BasesBases
88
Chapter 7 Version 6e 37©2002 South-Western
RepositioningRepositioning
Changing consumers’
perceptions of a brand
in relation to
competing brands.
88