1. The Levels of Market Segmentation

2. Review: What is a Market?
A market is a group of people who have a similar need for a product or service, and willingness and ability to buy it
Most products and services are marketed to smaller groups of people, this is known a market segmentation
Marketers pick a segment that is best suited to its goals and objectives but is within it financial limits
The levels of market segmentation include:
Mass Marketing
Market Segmentation
Niche Marketing
One to One Marketing
Review: What is a Market?

3. Mass Marketing occurs when a company introduces on strategy to appeal to a broad range of customers
Mass Marketing does not appeal to specific characteristics of a single group
The product or service enjoys widespread acceptance, a unique exception to contemporary practice
Mass Marketing

4. Mass Marketing: The Example of Walmart
While positioned as a discount department store, Walmart offers a wide selection of goods across North America
Low prices and wide selection are appreciated by nearly the who population and as a result Walmart has had relentless success
Canadian Companies such as Zellers and Eatons have gone out of business because of Walmart’s growing success
Mass Marketing: The Example of Walmart

5. Mass Marketing: Fashion Retail
A sector that Walmart (and other department stores) have had a difficult time mass marketing to is the fashion sector
Small boutiques or unique small scale stores have dominated the fashion sector
Large stores like the Bay are struggling while stores like Zellers and Sears are closing down all across Canada
Mass Marketing: Fashion Retail

6. Market Segmentation is the division of a large market (mass market) into smaller homogeneous markets (segment or targets)
Segmentation strategies are based on the premise that it is preferable to tailor marketing strategies or distinct user groups
Example: Automobile Industry
Economy
Mid-Size
Luxury
Sport Utility
Market Segmentation

7. Market Segmentation: The Campbell Soup Example
Market Segmentation specializes by concentration on segments of population
Campbell’s Soup traditionally markets to moms but has recently decided to focus its attention on a new target market: children
The majority of their marketing campaign has been through kid targeted commercials and packaging
Campbell’s Rationale: Parents and kids collaborate on purchases and soup is seen as “a fun food for kids as you can slurp it”
The Campbell’s example demonstrates segmentation based on gender and age
Market Segmentation: The Campbell Soup Example

8. Market Segmentation: Plus Size Women
Recently, there has been trends in marketing (Specifically advertising) to appeal to plus size men and women
Roughly 30% of Canadian women where size 14 and up and over 2/3s of American women are overweight
Companies such as Dove, Cotton Ginny, and Curves are starting to show and celebrate heavier women in their advertisements and display windows
As a result these companies have enjoyed a massive amount of success in an untapped market
Market Segmentation: Plus Size Women

9. Niche Marketing (Sub-Segmentation)
Niche Marketing takes market segmentation one step further
In this category, marketers targets subgroups within a market segmentation
Sub groups have unique and identifiable characteristics and even though the segment is small it still presents sufficient profit potential
Small segments tend to have a small amount of competition and therefore more potential
Niche Marketing (Sub-Segmentation)

10. Niche Marketing: The Beer Industry
The beer market can be divided into three segments
Premium
Regular
Value
The regular beer industry amounts to over 90% of all beer sold in Canada, therefore, premium and value beers can be considered niche markets
With the growth of craft beer, the premium induststy is expanding and becoming less of a “niche market”
The Value Market, however, remains to be a niche market and companies compete to create the cheapest beer and focus almost solely on the “price” portion of the marketing mix
Niche Marketing: The Beer Industry

11. Direct (One-to-One or Individual) Marketing
Direct Marketing refers to when marketing programs are designed to meet the needs of a specific customer
With the rise of technology and availability of computers, companies are able to collect vast amounts of information on their customers
With technologies, marketers are using Mass Customization to create products and personal messages to individuals
While this methods is not new (clothing tailors have been using this strategy for centuries) but its potential is ever growing
Direct (One-to-One or Individual) Marketing

12. Direct Marketing Example: The Automobile Market
The rise in technology has given the automobile industry the ability for customers to build their own vehicle and control all aspects of the marketing mix
Through innovative websites, companies like Ford and Tesla let customers determine what they want in their vehicle and therefore control the product and price of their purchase
Other industries have taken the example of the automobile industry and have begun to follow suit
Direct Marketing Example: The Automobile Market