1. Chapter 6
Market Segmentation, Positioning, and the Value Proposition

2. STP Marketing and the Evolution of Marketing Strategy
Target Market: A sub-group of a larger market chosen as the focal point for a marketing or advertising campaign.
Positioning: Designing and representing a brand in a way that is distinct in the consumer’s mind.
Positioning Strategy: Selecting key themes to communicate to a target market.
Ch 6: Segmenting Markets 2

3. The STP Marketing Process (Segmenting, Targeting, Positioning)
Break the market into smaller, more homogenous segments
Specifically target the discrete market segments
Position the product or service to appeal to the targeted segments
Ch 6: Segmenting Markets 3

4. How would you describe the demographic segment targeted by this advertising campaign?

5. How about this ad? What is the target demographic for this ad campaign?

6. Identifying Target Segments: Market Segmentation
Geography
Demographics
Psychographics
Lifestyles
Commitment Levels
Benefits
Ch 6: Segmenting Markets 6
Usage Patterns

7. Segmenting by Usage and Commitment
Advertising targeted to:
Heavy users
Nonusers
Brand-loyal users
Switchers/Variety seekers
Emergent Consumers
Ch 6: Segmenting Markets 7

8. Demographic Segmentation
Age
Gender
Race
Marital Status
Income
Education
Occupation
Ch 6: Segmenting Markets 8

9. Geographic Segmentation
Ch 6: Segmenting Markets 9

10. Psychographics and Lifestyle Segmentation
Activities
Lifestyle
Opinions
Lifestyle segmentation provides insight into consumer’s motivations
Interests
Ch 6: Segmenting Markets 10

11. Benefit Segmentation Passenger Safety? Prestige? Fuel Economy?
Ch 6: Segmenting Markets 11
Fuel Economy?

12. Business to Business Markets
Markets segmented by:
Usage rates
Geographic location
SIC (Standard Industrial Classification) Code
Stage in the purchase process: first time vs. experienced buyers
Benefits desired
Ch 6: Segmenting Markets 12

13. STP Marketing is used in the business-to-business market as well as the consumer market

14. Prioritizing Target Segments
Examine your ability to deliver value to the segments and costs of new capabilities
Research segment size, growth potential and usage frequency
Assay the competitive environment
Find a niche you can scratch
Ch 6: Segmenting Markets 14

15. Effective Positioning
Is based on substance of the brand’s values
Reflects internal values and structure of the firm’s market orientation
Is consistent over time
Is both memorable AND distinctive
Ch 6: Segmenting Markets 15

16. Fundamental Positioning Themes
Benefit Positioning
User Positioning
Competitive Positioning
Ch 6: Segmenting Markets 16

17. Do you think this ad for Ryka shoes is emphasizing benefit, user or competitive positioning?

18. Repositioning
Used to revive an ailing brand or fix a lackluster new market entry
The challenge: Changing perceptions of a brand forged over years of advertising.
Ch 6: Segmenting Markets 18

19. Capturing the Value Proposition
Benefits
Relative Price
Functional
Emotional
Self-expressive
Ch 6: Segmenting Markets 19