Marketing Management 13 April 2011

Customer-Driven Marketing Strategy: Creating Value for Target Customers

Creating Value for Target Customers Companies cannot appeal to everyone in the marketplace Not all buyers and consumers are the same – too scattered, varied in needs, buying practices Marketers must build the right relationships with the right customers Movement away from mass marketing towards target marketing No longer the shotgun approach, rather a rifle approach

Creating Value for Target Customers Marketing involves customers to serve and how you will serve them The goal is to create greater value for your preferred customers compared to competitors The steps in designing a customer-driven marketing strategy involve: Market Segmentation Market Targeting Differentiation Positioning

Customer-Driven Marketing Strategy Market Segmentation: the division of a market into smaller groups with similar needs and characteristics Market Targeting: the selection of one or more segments to enter after concrete evaluations of all market segments Differentiation: creating superior customer value by differentiating your market offering Positioning: how you place your goods and services in the hearts and minds of target customers relative to other competing brands

Segmentation Major Segmentations Variables Include: Geographic: climate, world region, nations, provinces, cities, suburbs Demographic: age, gender, income, occupation, education, race, religion, generation, nationality Psychographic: social class, lifestyle, personality Behavioural: occasion, usage, benefits, attitude, loyalty

Segmenting Business Markets Consumer and Business Markets use similar variables to segment their markets Business Markets also use additional variables to segment markets Operating Characteristics Purchasing Styles Situational Factors Personal Characteristics International Segmentation: segments of consumers with similar needs and buying behaviour even if located in different countries

Effective Segmentation Useful Market Segments Consist of the following attributes: Measurable – big enough and identifiable Accessible – can be reached served Substantial – large enough and profitable Differentiable – must be distinguishable from others with differentiated responses Actionable – must be able to serve the segments through various programs

See you next time. Cheers Guys!