Segmentation, Targeting, and Positioning

Segmenting, Targeting, and Positioning

What do these words mean?

My opinion is that the none of these three ideas are meaningful by themselves. Why is that?

How do they work together?

When Should You Begin A Segmentation Strategy?

One product sold to multiple marketsBenefits? Problems?

Multiple products in a similar or the same categoryBenefits? Problems?

What is meant by . . .

Mass Customization

The business world is moving towards mass customization in many industries

How do we manage this way? How do we segment this way?

Good Segmentation Characteristics

Measurability – can we understand the size and need of the segment

Accessibility – can we communicate to the segment independently

Substantiality – does the segment value something unique

Actionability – can we build a core competency in the segment

Segmentation Tools

Cross tabulations – combining frequencies of multiple variables to identify important groups

Market-product grids – shows usage among various customer groups, occasions, or situations

Perceptual maps – shows relative positions of ideas based on given criteria

Choosing Target Segments

Market Attractiveness – size and profitability considerations, meeting unmet needs in an existing market.

Competitive Attractiveness – where are there competitive advantages, consider first to market, barriers to entry, and new entrants.

Channel Attractiveness – can we grow in our existing channels or will we have to expand. How does our promotional strategy influence the channel?

Internal Attractiveness – are there segments that we can appeal to with core competencies?

Positioning Issues

Do we pursue different positions for different market segments?

If yes, how do we do this effectively? What are the impacts on the

communication strategies? Pricing strategies? Distribution strategies? Branding strategies?