1. Segments and Selecting
Chapter 9
Identifying Market
Segments and Selecting
Target Markets
Marketing Management
Tenth Edition
Philip Kotler

2. Objectives
Identifying Market Segments
Choosing Target Markets

3. Steps in Market Segmentation, Targeting,and Positioning
1. Identify
segmentation
variables and
segment the
market
2. Develop
profiles of
resulting
segments
Market
Segmentation
3. Evaluate
attractiveness
of each
segment
4. Select the
target
segment(s)
Market
Targeting
5. Identify
possible
positioning
concepts for
each target
segment
6. Select,
develop, and
communicate
the chosen
concept
Market
Positioning

4. Basic Market-Preference Patterns
(a) Homogeneous
preferences
Sweetness
Creaminess
(b) Diffused
preferences
Creaminess
Sweetness
(c) Clustered
preferences
Creaminess
Sweetness

5. Market-Segmentation Procedure
Survey
Motivations
Attitudes
Behavior
Analysis
Factors
Clusters
Profiling

6. Bases for Segmenting Consumer Markets
Geographic
Region, City or Metro
Size, Density, Climate
Demographic
Age, Gender, Family size and Fife cycle, Race, Occupation, or Income ...
Lifestyle or Personality
Psychographic
Occasions, Benefits, Uses, or Attitudes
Behavioral

7. Bases for Segmenting Business Markets
Demographic
Operating Variables
Purchasing Approaches
Situational Factors
Personal Characteristics

8. Effective Segmentation
Measurable
Effective Segmentation
Substantial
Size, purchasing power, profiles of segments can be measured.
Accessible
Segments must be large or profitable enough to serve.
Differential
Segments can be effectively reached and served.
Actionable
Segments must respond differently to different marketing mix elements & actions.
Must be able to attract and serve the segments.

9. Heavy and Light Users of Common Consumer Products
HEAVY HALF
LIGHT HALF
PRODUCT (% USERS)
75%
71%
Soups and
detergents (94%)
25%
29%
79%
21%
Toilet tissue (95%)
Shampoo (94%)
75%
25%
17%
Paper towels (90%)
Cake mix (74%)
Cola (67%)
83%
13% 5%
87%
19%
Beer (41%)
Dog food (30%)
Bourbon (20%)
81%
95%

10. Additional Segmentation Criteria
Ethical Choice of Market Targets
Segment Interrelationships & Supersegments
Segment-by-Segment Invasion Plans
Intersegment Cooperation

11. Five Patterns of Target Market Selection
Single-segment
concentration
Selective
specialization
M1 M2 M3 P1 P2 P3
Product
specialization
M1 M2 M3 P1 P2 P3 P1 P2 P3
M1 M2 M3
P = Product
M = Market
Market
specialization
M1 M2 M3 P1 P2 P3
M1 M2 M3
Full market
coverage P1 P2 P3

12. Segment-by-Segment Invasion Plan
Customer Groups
Truckers
Railroads
Airlines
Company B
Company C
Company A
Large
computers
Product Varieties
Personal
Mid-size

13. Review
Identifying Market Segments
Choosing Target Markets