1. Segmentation, Targeting & Positioning for Competitive Advantage

2. Marketing Process Involves
Market orientation as philosophy
Market segmentation
Targeting market
Positioning
Marketing mix

3. Importance of Segmentation and Targeting
The focus of a successful marketing program is the customer. Effectively marketing must fully understand the needs.
Customers with decent life and individualism have Heterogeneous demands, This has given rise to need segmenting.
The process of understanding the customer and choosing a group of customer you can serve best is targeting.
So target a segmentation is core of the marketing process.

4. Identify the Total Market
Identify Total Market
Effective Segmentation
Bases for Segmentation
Select Target Segment
Positioning Strategy
Marketing Mix
Monitor, Evaluate and Control
Objective 3

5. Identify the Total Market
The first step in the target market selection process is to specifically define the total market of all potential customers for a product category.

6. Segmentation and Effectiveness
Identify Total Market
Effective Segmentation
Bases for Segmentation
Select Target Segment
Positioning Strategy
Marketing Mix
Monitor, Evaluate and Control
Objective 3

7. Segmentation
Segmenting means dividing a heterogeneous demanding markets into homogenous groups based on similar characteristics or traits
Heterogeneous demand- different groups of customers have differing needs from specific products.
Homogeneous segment- the separation of markets into distinctive groups based on homogeneous characteristics.

8. Criteria for successful segmentation
Distinctive
Actionable
Substantial
Accessible
Measurable Identifiable

9. Criteria for successful segmentation
Distinctive
Clear differences in consumer preferences for a product must exist.

10. Criteria for successful segmentation
Measurable Identifiable
Difference preferences for a product must be identifiable and capable of being related to measurable variables.

11. Criteria for successful segmentation
Substantial
The proposed market segment must have enough size and purchasing power to be profitable.

12. Criteria for successful segmentation
Companies must be able to respond to difference preferences with an appropriate marketing mix.
Actionable

13. Criteria for successful segmentation
Accessible
The proposed market segment must be readily accessible and reachable with market programs.

14. Determine Bases for Segmentation
Identify Total Market
Effective Segmentation
Bases for Segmentation
Select Target Segment
Positioning Strategy
Marketing Mix
Monitor, Evaluate and Control
Objective 3

15. Bases for Segmentation
To divide a market into segments, firms use segmenting criterion that describe the characteristics of each part of the market.

16. Demographic Segmentation
Segmentation Base
Demographic Segmentation
Benefits-Sought Segmentation
Geographic Segmentation
Situation Segmentation
Psychographic Segmentation
Behavior/Usage Segmentation

17. Income Level Social class Ethnic Education Segmentation Base
Life-cycle
Social class
Ethnic
Education

18. Demographic Segmentation
Segmentation Base
Demographic Segmentation
Benefits-Sought Segmentation
Geographic Segmentation
Situation Segmentation
Psychographic Segmentation
Behavior/Usage Segmentation

19. Segmentation Base
Localizes its marketing efforts to specific geographic regions

20. Demographic Segmentation
Segmentation Base
Demographic Segmentation
Benefits-Sought Segmentation
Geographic Segmentation
Situation Segmentation
Psychographic Segmentation
Behavior/Usage Segmentation

21. Segmentation Base
Grouping customers together based on social class, lifestyles and psychological characteristics (attitudes, interests and opinions)
Useful but more difficult to identify and measure compared to demographic variables

22. Demographic Segmentation
Segmentation Base
Demographic Segmentation
Benefits-Sought Segmentation
Geographic Segmentation
Situation Segmentation
Psychographic Segmentation
Behavior/Usage Segmentation

23. Segmentation Base
Markets can be segmented based on the benefits that consumers desire from using a specific product

24. Demographic Segmentation
Segmentation Base
Demographic Segmentation
Benefits-Sought Segmentation
Geographic Segmentation
Situation Segmentation
Psychographic Segmentation
Behavior/Usage Segmentation

25. Segmentation Base
Purchase situation or occasion
Physical surroundings
Social surroundings
Temporal perspective

26. Demographic Segmentation
Segmentation Base
Demographic Segmentation
Benefits-Sought Segmentation
Geographic Segmentation
Situation Segmentation
Psychographic Segmentation
Behavior/Usage Segmentation

27. Segmentation Base
Markets can be segmented by how often or how heavily consumers use a specific product
Pareto’s Principle or 80/20 Principle - 80% of revenue generated by 20% of customers
Light Users
80%
Heavy Users
20%

28. Select Segments for Targeting
Identify Total Market
Determine Need for Segmentation
Determine Bases for Segmentation
Select Target Segment
Positioning Strategy
Marketing Mix
Monitor, Evaluate and Control
Objective 3

29. Targeting
Targeting: choose the specific segment toward which a firm directs its market efforts.
Niche Marketing: the process of targeting a small market segment with a specific, specialized marketing mix.
Micromarketing- the process of targeting smaller, more narrowly defined market segments.
On the individual consumer end of the continuum, a firm may decide to target individual consumers and personalize marketing efforts toward each.

30. Target the Mass Market versus the Individual Consumer
Niche
Micro-marketing
The Individual
Continuum of Market Segmentation Size
Personal-ization
Micro-marketing
Niche
Standardized Marketing Mix

31. Advantage of Targeting Efforts
Cannot effectively serve all the segments, must target marketing efforts to a segment or segments.
Marketing opportunities and unfilled ‘gaps ’ are more accurately identified
Marketing mix is more delicately blended to meet potential customer’s needs
Offer the greatest potential to achieve profit or relationship goals

32. Targeting Strategy 1.Undifferentiated marketing
3.Concentrated marketing
4.Custom marketing

33. Targeting Strategy
Undifferentiated targeting strategy
Companies might develop one marketing mix strategy that is appropriate for all members of the total market.
Concentrated strategy
Differentiated strategy

34. Targeting Strategy
Undifferentiated targeting strategy
Only one marketing mix is developed and directed toward a few, or perhaps one, profitable market segments.
Concentrated strategy
Differentiated strategy

35. Targeting Strategy
Undifferentiated targeting strategy
Exists when a firm develops different marketing mix plans specially tailored for each of two or more market segments.
Concentrated strategy
Differentiated strategy

36. Select Positioning Strategy
Identify Total Market
Effective Segmentation
Determine Bases for Segmentation
Targeting Segment
Positioning Strategy
Marketing Mix
Monitor, Evaluate and Control
Objective 3

37. Positioning
Positioning
Kotler defined: “designing an offer so that it occupies a distinct and valued place in the minds of the target customer.”

38. Positioning Positioning
Image that customers have about a product in relation to the product’s competitors

39. Positioning Strategy
Key to developing the appropriate marketing mix is the positioning strategy of the product.

40. Presumptions of Positioning
All products have object and subject attributes
Recognizable
Comparable

41. Select Positioning Strategy
Effective positioning
What consumers currently think about the product, especially in relation to competing products
What the marketer wants consumers to think about the product
Which positioning strategy will elevate the consumers’ current product image to the desired product image.

42. Select Positioning Strategy
Position Mapping- creating a visual description about consumer perceptions of a product on two or more dimensions in relation to competitors.

43. Select Positioning Strategy
The positioning strategy must determine where a company wants to go
And how to get there by positioning the product according to any of the following ways:
Price/Quality
Product Attributes like consistency, safety
Service differentiation like speedy, convenient or careful delivery.
Channel differentiation e.g Dell computers, Avon distinguish by their high quality direct channels.
People differentiation
Symbol differentiation like MacDonalds golden arches

44. Bases for Segmentation Monitor, Evaluate and Control
Marketing Mix
Identify Total Market
Segmentation
Bases for Segmentation
Select Target Segment
Positioning Strategy
Marketing Mix
Monitor, Evaluate and Control
Objective 3

45. Marketing Mix
The final steps are to develop and a marketing mix matched to the needs of the target market
This must support the chosen positional strategy in the selected target markets
Therefore determine the ‘4Ps ’ or “7Ps” of its marketing mix as a tool to achieve the desired position

46. Recognize 4Ps and the 7Ps
Productcustomer value
Pricecost
Placeconvenience
Promotioncommunication
Peopleconsideration
Processesco-ordination
Physical evidenceconfirmation

47. Marketing Strategy and the Marketing Mix
Product
Place
(Distribution)
Marketing Mix
Promotion
Price
Objective 4

48. Marketing Strategy and the Marketing Mix
Product
Refers to goods, services, people, places and ideas
Household consumers
Business-to-business customers

49. Marketing Strategy and the Marketing Mix
Place
(Distribution)
Marketing channel is the network of organizations that create time, place and ownership utilities for household consumers and business customers.

50. Marketing Strategy and the Marketing Mix
Integrated Marketing Communication (IMC)
System of management and integration of marketing communication elements
Advertising, publicity, sales promotion, personal selling, sponsorship marketing, and point-of-purchase communications
Promotion

51. Marketing Strategy and the Marketing Mix
Pricing decisions are complex and are driven by a variety of considerations including:
Customer demand, costs, information availability, competition, profit motives, product considerations, and legal considerations
Price