Download Document

MT 219 Marketing
Unit Four
Segmentation and Targeting
Products and Branding
Note: This seminar will be recorded
by the instructor.
MT 219 Marketing
Unit Four
Segmentation and Targeting
Products and Branding
Note: This seminar will be recorded
by the instructor.
Review of Unit 3
• How did Unit 3 go? Questions or concerns?
• Instructor suggestions for Unit 4- Pay particular
attention to segmentation for the Unit 6 Research
Project
• Questions?
Customer Driven Marketing Strategy
• Four stage process that segments, targets,
differentiates and positions a product
• Segmentation- Basic Process: Heterogeneous Market
 Segmentation  Homogeneous Sub-Markets
• Targeting- Selecting the best segments to focus on
• Differentiating- Create unique benefits for target
segments
• Positioning- Placing product into customer’s minds
compared to competition.
Unit 4 – Market Segmentation and
Targeting
Market Segmentation
Market – The set of actual and
potential customers.
Target Market
Target Market Segmentation
1.
2.
3.
4.
5.
Identify appropriate strategy
Determine segmentation variables
Develop segment variables
Evaluate segments
Select specific segments
Major Segmentation Strategies
• Undifferentiated – Single product and single strategy for
entire market –
requires homogeneous market.
• Differentiated- Two or more segments each with its own
marketing mix
• Concentrated – Single segment , one strategy
• Micromarketing- products tailored to individuals or smaller
local areas
Target Marketing
• The definition of target marketing is the process of
evaluating each market segments attractiveness
and selecting one or more segments to enter.
Kotler
- Differentiated
- Concentrated
- Undifferentiated
Market Segmentation
• Our text defines market segmentation, as the
process of diving a total market into groups with
relatively similar product needs to design a
marketing mix that matches those needs.
Why should a business segment a market?
Demographic variables
Geographic variables
Age
Region
Occupation
Gender Family size
Race
Family life cycle
State size
Urban, suburban,
rural
Market density
Climate
Ethnicity Religion
City size
Income Social Class
County size
Terrain
Education
Psychographics variables
Behaviorist variables
Personality attributes
Volume usage
Motives
End use
Lifestyles
Benefit expectations
Brand loyalty
Price sensitivity
Geographic Variable
•
•
•
•
•
•
•
Climate
Terrain
City size
Urban/rural values
Market Density
Geo-demographic Segmentation
Micromarketing
Demographic Variables –
closely related to needs and measurable
•
•
•
•
•
•
Age
Gender
Race
Ethnicity
Income
Education
•
•
•
•
•
•
Occupation
Family size
Family life cycle
Religion
Social class
Sexual orientation
Psychographic Variables
• Social class
• Lifestyle
- Achievers
- Strivers
- Survivors
• Personality
- Compulsive
- Romantic
- Authoritarian
- Enthusiastic
Behavioral Segmentation Variables
•
•
•
•
•
Most Powerful Variables
Underlies all other segmentation variables
These relate most directly to consumer desires
How the product benefits the consumer directly
Examples- Occasions
- Loyalty
- Usage rates
Which Segment Variables to Use?
• Marketers are not likely to use just one segment
variable
• Market segments often combine multiple variables
together to create a desirable target segment
• Which variables might be combined to create a
segment for- Harley Davidson Motorcycles/
- Prada Shoes?
Criteria for Effective Segmentation
1. Measurable- Must be quantifiable
2. Accessible- You must be able to reach them
3. Substantial- Must be large enough so company benefits
4. Differentiable- Segment must respond differently
5. Actionable- Company must be capable of marketing to identified
segments
Positioning
• Where the product lives in the mind of the consumer as
it relates to the competition
• Identify and select appropriate competitive advantages
for the product
• Combine competitive advantages to develop an overall
positioning strategy
- More for More
- More for the same
- More for less
- The same for less
- Less for much less
What is a Product?
Anything that is offered to a market to fulfill a need or want
good
service
idea
place
person
Classifying Consumer Products
• Convenience – relatively inexpensive, frequently purchased items with
many substitutes. Don’t confuse with a convenience store.
• Shopping – items for which buyers are willing to spend considerable
effort to compare and purchase. Don’t confuse with what you buy when
just shopping
• Specialty
- products with unique characteristics for which consumers
are willing to expend effort
• Unsought
– items people do not know of or do not think about buying.
Many times due to emergency needs. Also, many impulse items.
Services
Intangible products involving a deed, performance, or
effort that cannot be physically possessed
-Haircuts
-Concerts
-Tax preparation
-Annual doctors’ physicals
Nature of Services
•
•
•
•
Intangibility
Inseparability
Variability
Perishability
Let’s look at these individually
Issues related to service intangibility
•
•
•
•
•
Difficult for customers to evaluate
No physical possession
Difficult to advertise and display
Pricing is problematical and subjective
Service process not always protected by patents
Issues related to service inseparability
•
•
•
•
Does not allow for mass production
Customer participation required
Other customers can affect process
Difficult to distribute
Issues related to variability
•
•
•
•
•
•
•
Quality difficult to control
Standardization is a problem
Services vary from provider to provider
Services can vary from the same provider
Reputation is crucial
Franchises try to emphasize service homogeneity
Reason for grading rubrics
Issues related to service perishability
•
•
•
•
Services cannot be stored or inventoried
Unused capacity is lost forever
Demand may be time sensitive
Balancing supply and demand is difficult
Branding- Brand Equity
The marketing and financial value associated with a
brand’s strength in a market
brand name awareness
brand loyalty
perceived brand quality
brand associations
Selecting a Brand Name
•
•
•
•
•
Easy to pronounce, spell and remember
Trademarkable
Distinctive
Conveys brand benefits
Travels globally- Big concern today
Types of Brands
• National (Manufacturer’s) brands
• Store (Private) brands
• Licensing
Brand Development
Line extensions- new forms, sizes, fragrances, etc are
created in existing product line
Brand extensions – use of existing brand on a new
category, such as extending from a rock singer into acting
Multibrands- use of different brand names by one company.
Nestle or Proctor and Gamble
New Brands- Creating entirely new brands
Branding
Brand: An identifying name, term, design, or symbol.
Before marketing became a household word,
branding and advertising were simply ways to
publicize and identify one’s products.
Brand loyalty in 3 stages
There are several important concepts when talking
about branding. Marketers measure brand loyalty in
3 stages: brand recognition, brand preference, and
brand insistence.
Brand recognition
• Brand recognition is consumer awareness and
identification of a brand. Brand recognition is
important. Advertising is one way to increase brand
recognition.
Brand loyalty
• The second level of brand loyalty is called brand
preference. Brand preference is a consumer’s
reliance on previous experiences with a product to
choose that product again.
Brand Insistence
• Marketers also measure brand loyalty by “brand
insistence”. Brand insistence is a consumer’s
refusal for alternatives. This is considered the
ultimate stage in brand loyalty.
Packaging and Labeling
Packaging and Labeling Functions :
Protecting the product, to deter shoplifting, to
provide functional convenience, inventory
control, and promotion of the product.
Any Questions?
Thank you for attending!
See you next week!
Instructor will post the link to the recording
of tonight’s seminar in the course
Announcements.