Industrial Market Segmentation, Target Marketing and Positioning

8/7/2019 Industrial Market Segmentation, Target Marketing and Positioning

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INDUSTRIAL MARKET

SEGMENTATION, TARGET

MARKETING AND POSITIONING



MARKET SEGMENTATIONIt is the process of dividing the total

market for a product into several

segment of distinct homogeneous

group of buyers.



STP FRAMEWORK STP FRAMEWORK

Market segment

1.Carry out

market research

2.Identifysegmentation

variables

3.Prepare

profiles of the

resultingsegments.

TARGET

MARKETING

1.Evaluate the

resulting segment

2.Select the target

segments

3.Decide target

market strategy

POSITIONING

1.Identify target

customers

attributes for differentiation

2.Select the right

attributes or

benefits

3.Communicate

the chosen

position to each

target market





3. Profiling:- each buyer group is profiled by its

specific characteristic like:-

a. Use of product

b. volume of requirementc. location

d. type of industry

e. purchasing policies etc.



BBENEFITS AND LIMITATION OF

MARKET SEGMENTATIONMARKET SEGMENTATION

Benefitsy Help to compare marking opportunity of

different market segment

y helpful in planning of different market

segments

y Effective budgeted allocation of resources

Limitation

y INCREASE IN MARKETING EXPENSESy DIFFICULTY IN SEGMENTING



CRITERIAUSED FOR SELECTION OF

SEGMENTATION VARIABLE

measurable

differentiable

substantial



VARIABLE USED FOR SEGMENTING

INDUSTRIAL MARKETS:-

Micro variables Macro variables

1.Type of industry

2. Company size

3. Customer location4. End use

1. Customer interaction

2. organisational

capability3. purchasing policies

4. purchasing criteria

5. personal

characteristics



EALUATING MARKETEALUATING MARKET

SEGMENTSSEGMENTS

Evaluation of different segments is done by

following four factors:-

1.

Size and growth

2. Profitability analysis

3. Competitive analysis

4. Company objective and resources



TARGET MARKET STRATEGY

1. CONCENTRATED MARKETING

2. DIFFERENTIATED MARKETING

3. UNDIFFERENTIATED MARKETING



CONCENTRATED MARKETING

y Focusing all efforts on single or few

segments

y n arrow range of product & service

y high price, high quality, high promotional

distribution strategy

y Done by companies having limited

resources.



DIFFERENTIATED MARKETING

y aim to target several segments whose

needs, product usage is different

y develop separate market strategy for

each segment

y increase overall cost



UNDIFFERENTIATED

MARKETINGy lack of effective market segment

y develop a single plan for all market

y standardized products

y Main advantage is that it keeps total cost

low.



NICHE MARKETING

Industrial marketers who would like to follow

niche marketing approach should understand

the following:-

y customers have a different set of needsy customers are willing to pay a higher price to

company which best satisfies their special needs

y Difficulty for competitors to gain by attacking

the co. which is a niche leader



y Key idea in niche marketing is of

specialization which can be achieved in

several ways :-

Geographical specialization

End user specialization

Customer-size specialization

Product-line specialization

customer specialization



POSITIONING

Positioning is how the firm want its

products to be perceived by the target

customers on important benefits. For e.g.

L&T, Infosys



PROCEDURE FOR DEVELOPING A

POSITIONING STRATEGY

1. Identify major attributes for

differentiation

2. product variables

3. service variables

4. Personnel variable

5. Image variables

6. selecting the differentiating attributes

7. communicating the co.·s positioning

Documents

Industrial Market Segmentation, Target Marketing and Positioning