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Enterprise Marketing

Enterprise Marketing. Edward Gallagher MBA fasteddieg2001@yahoo.co.uk. Identifying Market Segments and Targets. Review: Marketing is expensive, time consuming and resource intensive. Resources, time and money are limited Therefore:

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Enterprise Marketing

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  1. Enterprise Marketing Edward Gallagher MBA fasteddieg2001@yahoo.co.uk

  2. Identifying Market Segments and Targets Review: • Marketing is expensive, time consuming and resource intensive. • Resources, time and money are limited Therefore: • Target your market: Identify your market segment and focus your marketing efforts towards it.

  3. Market Segmentation: Case Study: Reebok • Question: • Is there the perfect running shoe (sneaker)? • Answer: No • Instead, there are perfect running shoes.

  4. Case Study: Reebok • Sneakers industry sales are a $16 billion per year in the US. • Key competitors: Nike, Reebok, Adidas, Puma, New Balance. • 100’s of models. Large consumer choice • How do you do you differentiate your products?

  5. Examples of differentiation: • Nike’s Swooshless line: Low cost ($40) sold exclusively at Wal-Mart • Adidas 1: incorporating a computer and thin sensor to monitor shock and adjust sole stiffness. ($250) • Puma for teenagers: target teenagers with cool, fashionable, low-tech sneakers sold at teen stores • New Balance: target seniors with comfortable walking shoes with choices of wider and narrower widths

  6. Reebok: Targets a new market segment • Recognizes that many urban youths wear sneakers as a fashion statement. • They have little interest in athletics • Dominant competitor is this segment is Nike. • Reebok develops a new segments called, “Street Fashion” • Reebok calls the product line: S. Carter collection

  7. Celebrity Endorsements • Nike revolutionized the sneaker industry with celebrity endorsements • Nike signed famous athletes such as Michael Jordan to promote their products. • Celebrities are “social proof.”

  8. Reebok: S. Carter Collection • Reebok deviated from the tradition of signing famous athletes. • Instead, they signed hip hop star: Jay-Z to promote the S. Carter Collection. • The result: $100 million in sales and the fastest selling shoes in Reebok’s history.

  9. Reebok’s other endorsement deals • Reebok signed with Chinese basketball star Yao Ming to promote basketball shoes in China. • Yao Ming’s contact is worth $70 million dollars. • Yao Ming agrees to help Reebok market their products in his native country: China.

  10. Reebok’s other endorsement deals. • Reebok signed Venus Williams to promote their tennis product line. • Reebok signed with the NBA and the NFL to be their exclusive team uniform providers. • Reebok will offer NBA and NFL branded shoes and clothing to consumers.

  11. Definitions • Market Segmentation: Sorting potential buyers into groups that have common needs and will respond similarly to a marketing action • Product Differentiation: Strategy of using different marketing mix activities, such as product features and advertising, to help consumers perceive a product as being different and better than competing products

  12. Ways Reebok Segments Markets • Age segments: Teenagers are more than 32% of total sales • Gender segments: Men segment buys more but Women segment has higher growth • Price segments: 62% of sneakers cost less than $50 • Sports segments: Running shoes are #1 (29%) sales, basketball shoes #2 (21%), cross trainers #3, (13%). Basketball shoes sales increasing, cross trainers declining slightly. • Lifestyle segments: 75% of sales are for casual, non-athletic use. Athletic shoes are more profitable with prices rising dramatically.

  13. Reebok: Market Product grid

  14. Segmentation: Linking needs to Actions Identify Market Needs Features Benefits Cost Quality Convenience Execute Marketing Program Product Price Promotion Place Process of segmenting and targeting markets

  15. When should the market be segmented? • There is a potential for increased profit • There is similarity of needs within a market segment • There is a difference of need among market segments • Potential of marketing action to reach a segment • Simplicity and cost of assigning potential buyers to a segment

  16. Ways to segment markets • Geographic customer characteristics • Demographic customer characteristics • Psychographic customer characteristics: lifestyle. • Buying situations • Benefits/features sought • Usage/patronage

  17. Executing segment Marketing • Group products to be sold in categories based on: features, benefits, price • Develop a Market-Product grid, estimate the size of the market • Select target markets • Take marketing actions to reach target markets

  18. Positioning • Definition: The space a product occupies in consumers’ minds on important features, relative to competitors • Examples: • 7-up The Un-cola • Volvo Safety

  19. Homework: • Watch lecture from Malcolm Gladwell “What We Can Learn From Spaghetti Sauce” http://www.vidoemo.com/yvideo.php?i=aUlpQUFocWuRpVWVSNlk&malcolm-gladwell-what-we-can-learn-from-spaghetti-sauce=

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