CHAPT 09 ER

CHAPTER 09

SEGMENTATION, TARGET MARKETING, AND POSITIONING

9-1

FULFILLING CONSUMER NEEDS AND WANTS

Market Segmentation Target Marketing Positioning

CHAPTER 09

9-2

EXHIBIT 9.1

MARKET SEGMENTATION, TARGET MARKETING, AND POSITIONING

Market Segmentation Dividing a market into meaningful smaller markets or submarkets based on common characteristics.

Target Marketing Evaluating the market segments, then making decisions about which among them is most worthy of investment for development.

CHAPTER 01

Positioning Communicating one or more sources of value to customers in ways that connect needs and wants to what the product has to offer. Positioning strategies are executed through the development of unique combinations of the marketing mix variables.

9-3

WHAT IS SEGMENTATION?

Segmentation seeks to find one or more factors about members of a heterogeneous market that allow for dividing of the market into smaller, more homogeneous subgroups The purpose would be to develop different marketing strategies to best meet the segments distinct needs and wants.

CHAPTER 09

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CRITERIA FOR EFFECTIVE SEGMENTATION

1. 2.

Is the segment of sufficient size? Is the segment readily identifiable and can it be measured? Is the segment clearly differentiated on one or more important dimensions? Can the segment be reached in order to deliver the value of the product?

3.

CHAPTER 09

4.

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SEGMENTING CONSUMER MARKETS

By region

By climate

By density of population
Geographic Segmentatio n

CHAPTER 09

By growth in population

By size of population

9-6

SEGMENTING CONSUMER MARKETS

Age
Geodemographics

Generational Group

Social Class

Gender

CHAPTER 09

Demographic Segmentation

Education

Family and Household

Occupation Income

Race and Ethnicity

9-7

SEGMENTING CONSUMER MARKETS

Psychographic Segmentation
VALS (Values and Lifestyles)

CHAPTER 09

9-8

EXHIBIT 9.11

VALS FRAMEWORK

CHAPTER 01

Reprinted with permission from VALSTM Program, SRI Consulting Business Intelligence (SRIC-BI); www.sric-bi.com/VALS.

9-9

SEGMENTING CONSUMER MARKETS

Behavioral Segmentation
Benefits Sought

Usage Patterns

CHAPTER 09

9-10

SEGMENTING CONSUMER MARKETS

Firms use Multiple Segmentation Approaches Simultaneously

Firms develop a profile of a segment that might include aspects of any or all of the segmentation approaches we have learned.

CHAPTER 09

9-11

EXHIBIT 9.13

VISUAL EXAMPLES OF SEVERAL SEGMENTATION APPROACHES

CHAPTER 01

9-12

SEGMENTING BUSINESS MARKETS

Demographic

Industry

CHAPTER 09

Company Size Location

9-13

SEGMENTING BUSINESS MARKETS

Operating Variables

Technology

CHAPTER 09

User Status Customer Capabilities

9-14

SEGMENTING BUSINESS MARKETS

Purchasing Approaches

Purchasing Function Organization Power Structure

CHAPTER 09

Nature Of Existing Relationship General Purchasing Policies Purchasing Criteria

9-15

SEGMENTING BUSINESS MARKETS

Situational Factors

Urgency

CHAPTER 09

Specific Application Size of the Order

9-16

SEGMENTING BUSINESS MARKETS

Personal Characteristics

Buyer-Seller Similarity

CHAPTER 09

Attitudes Toward Risk Loyalty

9-17

TARGET MARKETING

Analyze Market Segments

Segment Size and Growth Potential

CHAPTER 09

Segment Competitive Forces Strategic Fit of the Segment

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TARGET MARKETING

Develop Profiles of Each Potential Target Market

Primary Target Markets

CHAPTER 09

Secondary Target Markets

Tertiary Target Markets

Target markets to abandon for future development

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EXHIBIT 9.15

CONTINUUM OF TARGET MARKETING APPROACHES

Very Broad Differentiated target marketing Concentrated target marketing

Very Narro w Customized target marketing

Undifferentiated target marketing

CHAPTER 01

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TARGET MARKETING

Select a Target Marketing Approach

Undifferentiated Target Marketing
Differentiated Target Marketing

CHAPTER 09

Concentrated Target Marketing Customized (One-to-One) Marketing

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POSITIONING

The firm must turn its attention to creating, communicating, and delivering the value offering to the target markets. Positioning the product so that consumers understand its ability to fulfill their needs and wants.

CHAPTER 09

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EXHIBIT 9.16

EXAMPLES OF PERCEPTUAL MAPS USED IN POSITIONING DECISIONS

CHAPTER 01

9-23

EXHIBIT 9.16

EXAMPLES OF PERCEPTUAL MAPS USED IN POSITIONING DECISIONS

CHAPTER 01

9-24

EXHIBIT 9.16

EXAMPLES OF PERCEPTUAL MAPS USED IN POSITIONING DECISIONS

CHAPTER 01

9-25

SOURCES OF DIFFERENTIAL COMPETITIVE ADVANTAGE

Price Leadership Image Leadership Innovative Leadership

CHAPTER 09

Convenience Leadership

Service Leadership

Personnel Leadership

Product Leadership

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POSITIONING ERRORS

Underpositioning

Overpositioning

CHAPTER 09

Confused Positioning

Doubtful Positioning

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