1. © 2013 Cengage Learning. All Rights Reserved
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 

2. 4
Targeting
© 2013 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 

3. Marketing Framework

4. Targeting
Once the market is segmented, marketers select (target) one or more of those markets to pursue
Firms select target markets which are a good fit with the firm and have good profit potential

5. How to Choose a Target Top down: strategic fit
Does this market fit with who we are?
Bottom up: profitability
How profitable will this segment be?

6. How to Choose a Target “Go for it” and “avoid” are easy decisions
“Hmms” are dilemma scenarios

7. SWOT

8. SWOT Strengths and weaknesses are relative to competitors
Opportunities and threats are usually driven by changes in one of the 5Cs

9. Competitive Comparisons
Companies typically assess their strengths relative to their competitors

10. Competitive Comparisons
Perceptual maps show customers’ perceptions of firm’s strengths/weaknesses relative to competitors

11. Market Sizing
Use the purchase decision making process: Awareness, trial, repeat, etc.
Population x %aware x %trial x %repeat
Multiply by how much & how often buy
(Population x %aware x %trial x %repeat) x per annum purchase
Multiplied by average retail price paid

12. Managerial Recap Targeting is important but not difficult
Choose target by iterating between
Corporate fit
Utilize SWOT to help clarify corporate fit
Segment sizing
Use secondary data (e.g., demographics)
Use customer survey data on attitudes & preferences and behavior to smooth out the size estimation