Download segmentation and positioning

Survey
yes no Was this document useful for you?
   Thank you for your participation!

* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project

Document related concepts

Ambush marketing wikipedia , lookup

Service parts pricing wikipedia , lookup

Dumping (pricing policy) wikipedia , lookup

Marketing communications wikipedia , lookup

Marketing research wikipedia , lookup

Food marketing wikipedia , lookup

Multi-level marketing wikipedia , lookup

Pricing strategies wikipedia , lookup

Digital marketing wikipedia , lookup

Grey market wikipedia , lookup

Retail wikipedia , lookup

Viral marketing wikipedia , lookup

Perfect competition wikipedia , lookup

Guerrilla marketing wikipedia , lookup

Direct marketing wikipedia , lookup

Youth marketing wikipedia , lookup

Market analysis wikipedia , lookup

First-mover advantage wikipedia , lookup

Marketing mix modeling wikipedia , lookup

Marketing plan wikipedia , lookup

Darknet market wikipedia , lookup

Integrated marketing communications wikipedia , lookup

Neuromarketing wikipedia , lookup

Street marketing wikipedia , lookup

Marketing wikipedia , lookup

Market penetration wikipedia , lookup

Target audience wikipedia , lookup

Green marketing wikipedia , lookup

Multicultural marketing wikipedia , lookup

Marketing channel wikipedia , lookup

Sensory branding wikipedia , lookup

Product planning wikipedia , lookup

Advertising campaign wikipedia , lookup

Market segmentation wikipedia , lookup

Global marketing wikipedia , lookup

Target market wikipedia , lookup

Marketing strategy wikipedia , lookup

Segmenting-targeting-positioning wikipedia , lookup

Transcript
Market segmentation, targeting
and positioning
Markets
•
•
•
•
Organisations that sell to consumer and business markets
recognise that they cannot appeal to all buyers in those
markets, or at least not to all buyers in the same way.
Buyers are too numerous, too widely scattered and too
varied in their needs and buying practices.
Different companies vary widely in their abilities to serve
different segments of the market.
Rather than trying to compete in an entire market,
sometimes against superior competitors, each company
must identify the parts of the market that it can serve best.
Three stages of marketing
• Mass marketing
– In mass marketing, the seller mass produces, mass
distributes and mass promotes one product to all buyers.
• Product-variety marketing
– Here, the seller produces two or more products that have
different features, styles, quality, sizes and so on.
• Target marketing
– Here, the seller identifies market segments, selects one or
more of them, and develops products and marketing mixes
tailored to each.
Markets
• Firms moving from mass marketing and
product-variety marketing to target marketing
– More efficient form of marketing
• Greater market fragmentation has brought
about micro-marketing—targeting programs
to needs and wants of narrowly defined
segments
– Customised marketing is the ultimate form
Steps in market segmentation,
targeting and positioning
Three major steps in target
marketing
1.
Market segmentation
– Dividing a market into distinct groups of buyers with
different needs, characteristics or behaviours who might
require separate products or marketing mixes.
2. Market targeting
– Evaluating each market segment’s attractiveness and
selecting one or more of the market segments to enter.
3. Market positioning
– Setting the competitive positioning for the product and
creating a detailed marketing mix.
Market segmentation
• Markets consist of buyers, and buyers differ in one or
more ways.
– They may differ in their wants, resources, locations, buying
attitudes and buying practices.
– Because buyers have unique needs and wants, each buyer is
potentially a separate market.
– Ideally, then, a seller might design a separate marketing
program for each buyer.
– Most sellers face larger numbers of smaller buyers and do not
find complete segmentation worthwhile; instead, they look for
broad classes of buyers who differ in their product needs or
buying responses.
Bases for segmenting consumer markets (1)
• Geographic: dividing a market into different
geographical units such as nations, regions,
states, municipalities, cities or
neighbourhoods.
• Demographic: dividing the market into groups
based on variables such as age, gender, family
size, family life cycle, income, occupation,
education, religion, race and nationality.
Bases for segmenting consumer markets (2)
• Age and life-cycle stage: consumer needs and
wants change with age, so some companies
use age and life-cycle segmentation which
divides a market based on age and life-cycle
groups.
• Gender: long used in clothing, cosmetics and
magazines. Other opportunities include
finance and cars, amongst others.
Bases for segmenting consumer markets (3)
• Income: used in goods and services such as
cars, boats, clothing and travel.
• Multivariate demographic: most companies
segment a market by combining two or more
demographic variables.
Bases for segmenting consumer markets (4)
• Psychographic: buyers are divided into different groups
based on psychological/personality traits, lifestyle or
values. People in the same geo-demographic group can
have different profiles.
• Behavioural: divides buyers into groups based on their
knowledge of the product, their attitude towards it, the
way they use it and their responses to it.
• Benefits sought: buyers are segmented according to the
different benefits they seek from the product.
Bases for segmenting consumer markets (5)
• User status: many markets can be segmented into on-users, exusers, potential users, first time users and regular users of a
product.
• Usage rate: markets can also be segmented into light, medium
and heavy user groups.
• Loyalty status: a market can be segmented by consumer loyalty,
divided according to their degree of loyalty.
• Buyer-readiness stage: there are different stages of readiness to
buy a product. Some people are aware, some are informed,
some are interested, some want the product, and some intend
to buy.
• Attitude towards the product: people can be enthusiastic,
positive, indifferent, negative or hostile.
Bases for segmenting business markets
• Industrial markets can be segmented using many of the
same variables used in consumer market segmentation:
geographic, benefits sought, user status, user rate,
loyalty status, readiness state and attitude.
• Industrial companies usually use a combination of many
segmentation methods, e.g. which end-use market to
serve, product application, customer size, benefit groups,
etc.
Segmenting international markets
• Companies segment international markets
using a combination of several variables:
– Geographic location
– Economic factors
– Political and legal factors
– Cultural factors
– Inter-market segmentation
Requirements for effective segmentation
• There are many ways to segment a market,
but not all segmentations are effective. To be
useful, market segments must rate
favourably on five key criteria:
– Measurable—the size and purchasing power of
the segments must be able to be measured.
Certain segmentation variables are difficult to
measure.
– Accessible—the segments must be able to be
reached and served.
Requirements for effective segmentation
– Substantial—the segments must be large or
profitable enough. A segment should be the
largest possible homogeneous group worth going
after with a tailored marketing program.
– Differentiable—the segments must be
conceptually distinguishable and respond
differently to different marketing mix elements
and programs.
– Actionable—effective programs must be able to
be designed for attracting and serving the
segments.
Marketing targeting
• Market segmentation reveals the market
segment opportunities facing a firm.
• The firm now has to evaluate the various
segments and decide on the number of
segments to cover and the ones to serve. This
is selecting target segments.
Evaluating market segments
• Segment size and growth
– The company must first collect and analyse data on current dollar
sales, projected sales growth rates and expected profit margins for
the various segments. It wants to select segments that have the
right size and growth characteristics, but ‘right size growth’ is a
relative matter.
• Segment structural attractiveness
– A segment might have desirable size and growth and still not be
attractive from a profitability point of view. The company must
examine several major structural factors that affect long-run
segment attractiveness—e.g. concentration of market power
Evaluating market segments
• Company objectives and resources
– Even if a segment has positive size growth and is
structurally attractive, the company must consider
its own objectives and resources in relation to that
segment.
– Some attractive segments could be quickly
dismissed because they do not mesh with the
company’s long-run objectives.
Selecting market segments
• After evaluating different segments, a company hopes to find
one or more market segments worth entering. It must then
decide which, and how many segments to serve.
• A target market consists of a set of buyers sharing common
needs or characteristics that the company decides to serve.
The company can adopt one of three market-coverage
strategies:
– Undifferentiated marketing
– Differentiated marketing
– Concentrated marketing
Market-coverage strategies
Undifferentiated marketing
• Ignores market segment differences
• Chases whole market with one market offer—focussing
on what is common in terms of needs
• Relies on mass distribution and mass advertising of a
‘superior’ product
• Costs minimised—inventory, narrow product range,
advertising, market research
• Heavy competition if other major competitors pursue
same market
Differentiated marketing
• Targets several market segment with a market offer for
each segment
• Aim is to have the ‘best’ offer in each segment, hence,
gain higher sales and stronger position
• Generally generates greater sales than undifferentiated
approach BUT costs of doing business are higher—
product modifications, market research, manufacturing,
separate marketing plans, advertising and so on
Concentrated marketing
• Appeals when resources limited
• Pursue large share of one or few segments
• Generally a good way for smaller firms to gain a foothold
in a market
• Firms have greater knowledge of their customers’ needs
• Operational efficiencies due to specialisation in
production, distribution and promotion
• Riskier strategy—‘all eggs in one basket’
Choosing a market-coverage
strategy
• There are many factors to consider when
choosing a market-coverage strategy. This has
moved from mass marketing to direct to oneto-one marketing.
• Permission marketing has emerged, which is
‘a process of converting strangers into friends
and friends into customers.’
Permission marketing
• Permission marketing is based on prospective
customers giving their permission for the
marketer to communicate with them.
• The basis is consumer benefit and permission
can be revoked and cannot be transferred.
Permission marketing
•
There are four tests for permission
marketing:
•
•
•
•
Do your marketing efforts facilitate a learning
relationship with your customer?
Do you have a permission database to track those
who have agreed to communicate?
Do you have a script to educate people about your
products or services?
Once you have a customer, do you work to deepen
your permission to communicate with them?
Which is the best strategy?
• Company resources
• Product variability—uniform products (steel,
grapefruit) suits undifferentiated
• Product life cycle stage—growth stage suits
undifferentiated or concentrated,
differentiated suits mature stage
• Market variability (consumer tastes)—greater
then differentiated
• Competitors’ marketing strategies—
segmentation requires differentiation
Market positioning
• Once a company has decided which segments
of the market it will enter, it must decide
which ‘positions’ it wants to occupy in those
segments.
• Product position is the way the product is
defined by consumers on important
attributes—the place the product occupies in
consumers’ minds is relative to competing
products.
Positioning strategies
• Marketers can follow several positioning
strategies:
– Positioning on specific product attributes such
as price and performance.
– A product can be positioned against a
competitor.
– A product can be positioned for different
product classes, e.g. some margarines are
positioned against butter and others against
cooking oils.
Choosing and implementing a
positioning strategy
• Some firms find it easy to choose a
positioning strategy (BMW—drive
excitement) , but in many cases, two or more
firms (Mercedes and Jaguar) will go after the
same position.
– Then, each will have to find other ways to set
itself apart—post-sale service, technology.
Identifying a positional direction
• A cornerstone of brand marketing strategy is
the concept of brand positioning—identifying
the ‘position’ of a brand in the mind of the
customers.
• One type of analysis to achieve this is known
as perceptual mapping.
Perceptual mapping
Maps can have multiple axes
Brand repositioning strategies
Knowing what attributes
are important to the various
segments helps the
development of marketing
strategies if repositioning
needed or current
positioning needs to be
strengthened
Identifying possible competitive advantages
• Consumers choose products and services that
give them the greatest value.
• If a company can position itself as providing
superior value to selected target markets
either by lowering prices or increasing
benefits, it gains competitive advantage.
• You could look at positioning as being the
brand’s promise—the firm must deliver the
promise
Identifying possible competitive advantages
• Product differentiation—a company can
differentiate its physical product. At one
extreme, some companies offer highly
standardised products that allow little
variation: chicken, steel, aspirin. Other
companies offer products that can be highly
differentiated, such as motorcars, commercial
buildings and furniture.
• Services differentiation—in addition to
differentiating its physical product, the
company can also differentiate the services
that accompany the product. Many
possibilities exist.
Identifying possible competitive advantages
• Personnel differentiation—companies can gain
a strong competitive advantage by hiring and
training better people than their competitors.
• Image differentiation—even when competing
companies offer the same products and
accompanying services, buyers may perceive a
difference based on company or brand
images. Thus, companies work to establish
images that differentiate them from
competitors.
Selecting the right competitive advantage
• A difference is worth establishing to the
extent that it satisfies the following criteria:
– Important:
• The difference delivers a highly valued benefit to
target buyers.
– Distinctive:
• Competitors do not offer the difference, or the
company can offer it in a more distinctive way.
– Superior:
• The difference is superior to other ways that
customers might obtain the same benefit.
Selecting the right competitive advantage
– Communicable:
• The difference is communicable and visible to buyer.
– Pre-emptive:
• Competitors cannot easily copy the difference.
– Affordable:
• Buyers can afford to pay for the difference.
– Profitable:
• The company can introduce the difference profitably.
Communicating and delivering the chosen position
• The company must take steps to deliver and
communicate the desired position to the
target consumers.
• The marketing mix must support the
positioning strategy.
• Designing the marketing mix involves working
out the tactical details of the positioning
strategy.
Summary
• Sellers can take three
approaches to a market:
– Mass marketing
– Product variety
marketing or
– Target marketing.
• The key steps in target
marketing are
– Segmentation
– Targeting and
– Positioning.
• Segments must be
– Measurable
– Accessible
– Substantial and
– Actionable.