FMA 601 Foreign Market Analysis Module 3: Segmentation, Targeting and Positioning

Global Market Segmentation The process of dividing the world market into distinct subsets of customers that have similar needs (for example, country groups or individual interest groups). www.mygbs.org

Criteria for Global Market Segmentation Geographic segmentation Demographic segmentation Psychographic segmentation Behaviour segmentation Benefit segmentation Vertical vs. horizontal segmentation www.mygbs.org

Geographic Segmentation Dividing the world into geographic subgroups The advantage of geography is proximity However, just because people are in close proximity does not mean they are similar www.mygbs.org

Demographic Segmentation Based on measurable population characteristics Age Income Gender Education Generally, national income is the most important variable www.mygbs.org

Psychographic Segmentation Based on attitudes, values and lifestyle Measured through extensive item batteries which cover activities, interests and opinions (AIO-studies) Lifestyle surveys, the Values and Life Styles (VALS) www.mygbs.org

Psychographic Profiles of Porsche’s American Customers Category Description % of all owners Top Guns Driven and ambitious; care about power and control; expect to be noticed 27% Old money; a car—even an expensive one—is just a car, not an extension of one’s personality Elitists 24% Ownership is what counts; a car is a trophy, a reward for working hard; being noticed doesn’t matter Proud Patrons 23% Cosmopolitan jet setters and thrill seekers; car heightens excitement Bon Vivants 17% Car represents a form of escape; don’t care about impressing others; may even feel guilty about owning car Fantasists 9% Source: ALEX III Taylor, „Porsche Slices up its Buyers“, Fortune, 16 January 1995, p. 24 www.mygbs.org

Behavior and Benefit Segmentation Behavior segmentation Focus on whether and how much people buy or use a product usage rates: heavy, medium, light, nonusers user status: potential users, nonusers, ex-users, regulars, first timers, users of competitors’ products Benefit segmentation Focus on the numerator of the value equation – the B in V=B/P www.mygbs.org

Global Targeting Targeting is the act of evaluating and comparing the identified groups and selecting one or more as the prospect with the highest potential www.mygbs.org

Criteria for Targeting Current size of the segment and growth potential Potential competition Compatibility and feasibility www.mygbs.org

Foreign Market Analysis Market Research Market research is any organized effort to gather information about target markets or customers. It is a very important component of business strategy.[1] Market research is a key factor to maintain competitiveness over competitors. Market research provides important information to identify and analyze the market need, market size and competition. www.mygbs.org

The Proactive Role of Marketing Research A proactive management: alters the marketing mix to fit newly emerging patterns in economic, social, and competitive environments new opportunities develops a long-run marketing strategy www.mygbs.org

Marketing Research Defined The planning, collection, and analysis of data relevant to market decision making and communication of the results of this analysis to management. www.mygbs.org

Global Product Positioning Positioning is the location of a product in the mind of the consumer Positioning is partly controlled by the marketer (marketing mix) and partly not Positioning is visualised by a “positioning map” 2 dimensions or multidimensional (MDS) www.mygbs.org