1 / 47

Agenda

Agenda. Housekeeping: readings, team name, etc . News Surveillance data mining Shopping basket analysis Segmentation marketing Basics of segmentation Geographics Demographics Lifecycle Cohorts Psychographics & behavior Team discussion questions Profile yourself as consumer

reba
Download Presentation

Agenda

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Agenda • Housekeeping: readings, team name, etc. • News • Surveillance data mining • Shopping basket analysis • Segmentation marketing • Basics of segmentation • Geographics • Demographics • Lifecycle • Cohorts • Psychographics & behavior • Team discussion questions • Profile yourself as consumer • Profile your customers: How does this enable you to respond to their needs better • Next week: consumer behavior– why we buy what we buy

  2. Group discussion questions for tonight Use the various consumer profiling methods to: • Profile yourself as a consumer (use VALS-2, Prism, and other demographic, psychographic, and lifestyle descriptors). • Profile the customers in your business (or department). • How does this information about your customers enable you to provide better products/services to them?

  3. What is ? You might understand the parts, but might miss the whole chicken

  4. Demographic/Geographic refers to age, sex, income, education, race, martial status, size of household, geographic location, size of city, and profession. Life stage refers to chronological benchmarking of people's lives at different ages (e.g., pre-teens, teenagers, empty-nesters, etc.). Lifestyle refers to the collective choice of hobbies, recreational pursuits, entertainment, vacations, and other non-work time pursuits Psychographics refers to personality and emotionally based behavior linked to purchase choices; for example, whether customers are risk-takers or risk-avoiders, impulsive buyers, etc. Belief and value systems includes religious, political, nationalistic, and cultural beliefs and values. Behavior analysis includes what behaviors consumers actually engage in (after all is said and done) Methods of Seg-men-ta-tion

  5. Identifiable: the differentiating attributes of the segments must be measurable so that they can be identified. Relevant/Accessible: the segments must be reachable through communication and distribution channels.Substantial: the segments should be sufficiently large to justify the resources required to target them.Unique needs: to justify separate offerings, the segments must respond differently to the different marketing mixes.Durable: the segments should be relatively stable to minimize the cost of frequent changes. Requirements for segmentation Question: What are some criteria that could be used to ensure that a segmentation has utility?

  6. Pitfalls of Segmentation • appeal to segments that are too small • misread consumer similarities and differences • become cost inefficient • spin off too many imitations of their original products or brands • become short-run rather than long-run oriented • unable to use certain media (due to small segment size) • compete in too many markets • confuse people • become locked in to a declining market • too slow to seek innovation possibilities for new products

  7. Levels of Market Segmentation Mass marketing Same product to all customers (no segmentation) Segment Marketing Different products to one or more segments (some segmentation) Niche Marketing Different products to subgroups within segments (more segmentation) Micromarketing Products to suit tastes of individuals and locations (complete segmentation) Local Marketing Tailoring brands & promotions to local customer groups Individual Marketing Tailoring products & programs to individual customers

  8. Sample Segmentation Services & Systems • Claritas (Prizmdemographic profile by Zipcode) • Mosaic Segmentation • SRI VALS Survey (lifestyle profiling) • Ricercargeodemographic profiling • Nielson • Yankelovich • AGS Demographic Database • Family Lifecycle & Retailing

  9. PRIZM– Potential Rating Index for Zip Marketers PrizmZIP Code profile Nielsen ConneXionsLifestage Groups

  10. Demographic Profile

  11. Business segmentation can help companies align their sales territories based on the opportunities on the ground. The BEFOREmap shows territories determine by geometry—four quadrants dividing the central area—while the AFTERmap shows territories that vary in size based on the number and potential value of target businesses (the red dots indicating the locations of target businesses). By mapping its business prospects by size and industry type in Lexington, Kentucky, a company can better realign its sales territories based on the concentrations of its high-quality prospects.

  12. Applied Geographic Solutions • Mosaic segments

  13. Family Life Stage Model Through the Lifecycle

  14. The Intergenerational Cohort Approach (see Meredith, G. E., Schewe, C. D., & Karlovich, J. (2001) Defining Markets, Defining Moments: America's 7 Generational Cohorts, Their Shared Experiences, and Why Businesses Should Care

  15. Depression Cohort(Born from 1912 – 1921; Came of age during the Great Depression; Aged 79 – 88 in 2000): This group’s coming of age experience consisted of economic strife, elevated unemployment rates and having to take menial jobs to survive. Financial security—what they most lacked when coming of age—rules their thinking. Marketing Tip: Having lived through the Depression, this cohort prefers to pay more for a smaller serving, rather than throw something away. As a result, single-serving products are now becoming popular. Maxwell House Filter Pack Singles, Pillsbury single-serve cakes, and Orville Redenbacher single-serve microwave popcorn are all examples.

  16. World War II Cohort(Born from 1922-1927; Came of age during World War II; Aged 73-78 in 2000): Sacrifice for the common good was widely accepted among members of this Cohort, as evidenced by women working in factories for the war effort and men going off to fight. Overall, this cohort was focused on defeating a common enemy, and their members are more team-oriented and patriotic than those of other generational cohorts. Marketing Tip: The1940s were an intensely romantic period. Therefore romance (candlelight dinners, hand-holding, soft music) can provide a wonderful context for advertising messages. In ads for Lazy-Boy recliners, the company uses a scene of a couple sitting on the porch of a Victorian-type home; the man is dressed in clothes of the ‘40s, while the woman, clearly his sweetheart, is looking down demurely as he speaks to her. Older adults immediately relate to the ad, which goes on to emphasize how long the company has been in business—another strong selling feature for this cohort.

  17. Post-War Cohort(Born from 1928-1945; Came of age after WWII; Aged 55-72 in 2000): These individuals experienced a time of remarkable economic growth and social tranquility, a time of family togetherness, the Korean conflict, McCarthyism, school dress codes, and moving to the suburbs. Overall, this cohort participated in the rise of the middle class, sought a sense of security and stability, and expected prosperous times to continue indefinitely. Marketing Tip: Post-War grandparents are healthy, active, educated and endowed with sizeable nest eggs. Spending by grandparents on their grandchildren is on the rise. Yet, toy stores are so focused on capturing the young parent market that they ignore this fact. A good example of a company taking advantage of this market is Genesis Direct of Secaucus, NJ, which markets a catalog called Gifts For Grandkids. The company provides a quarterly newsletter that offers tips that subtly help grandparents carry out their roles.

  18. Leading-Edge Baby Boomer Cohort(Born from 1946-54; Came of age during the turmoil of the ‘60s; Aged 46-54 in 2000): This group remem- bers the assassinations of John and Robert Kennedy and Martin Luther King, Jr. It was the loss of JFK that largely shaped this cohort’s values. They became adults during the Vietnam War and watched as the first man walked on the moon. Leading-Edge Boomers were dichotomous: they championed causes (Greenpeace, civil rights, women’s rights), yet were simultaneously hedonistic and self-indulgent (pot, “free love, ”sensuality). Marketing Tip: You can reap major rewards by tying your product to health and wellness values. Retailers can joint-venture with hospitals to offer on-site health seminars that have a direct nutritional link to providing health and wellness. Offering tips in newsletters on health and fitness is another way to enhance satisfaction. Financial institutions should consider designing financial instruments (like “Christmas Club”) that promote saving strictly for health, wellness and fitness purposes.

  19. Trailing-Edge Baby Boomer Cohort, or “Generation Jones”(Born from 1955-1965; Came of age during the first sustained economic downturn since the Depression; Aged 35-45 in 2000): This group witnessed the fall of Vietnam, Watergate and Nixon’s resignation. The oil embargo, and the raging inflation rate and the more than 30 percent decline in the S&P Index led these individuals to be less optimistic about their financial future than the Leading-Edge Boomers. Marketing tip: Technology is making it easier to telecommute, and more and more Trailing-Edge Boomers are finding ways to work from home. Marketers looking to serve this labor force should offer telecommuters ways to get out of the house. Fitness clubs could offer special packages to attract home-based workers, many of whom have the flexibility to work out during the day and make up the time later in the evening. Restaurants could host telecommuter roundtables—monthly or bimonthly luncheons that would give home-based workers the opportunity to meet and network with new people.

  20. Generation X Cohort(Born from 1965-1976; Came of age during a time of instability and uncertainty; Aged 24-34 in 2000): These are the latchkey children of divorce and have received the most negative publicity. This cohort has delayed marriage and children, and they don’t take these commitments lightly. More than other groups, this cohort accepts cultural diversity and puts quality of personal life ahead of work life. They’re “free agents,” not “team players. ”Despite a rocky start into adulthood, this group shows a spirit of entrepreneurship unmatched by any other cohort. Marketing Tip: Because this cohort is very street smart when it comes to advertising, oversold sales pitches full of hype will fall flat. They need to be spoken to in a way that says, “You’re different. We respect that.” Chrysler’s Neon’s “Hi” campaign, which showed the car with the simple message “Hi” written above it, was very effective with Xers mainly because it dropped all pretensions and talked directly to the customer in a non-threatening way.

  21. Generation Y Cohort(Born from 1977-?; Came of age during the “Information Revolution;” Aged 23 and under in 2000): We call the youngest cohort “Generation Y,” or “Y-Gen, ”because the advent of the Internet is a defining event for them, and be- cause they will be the “engine” of growth over the next two decades. While still a work in progress, their core value structure seems to be quite different from that of Gen-X. They are more idealistic and social-cause oriented, without the cynical, “What’s in it for me?” free-agent mindset of many Xers. Marketing Tip: This is the most diverse cohort of all. One third are from a minority group compared to one fourth of the total population. In marketing to this group, reflect greater diversity in your ads. The Gap and Benetton have been particularly effective in mirroring diversity in their advertising. Even Ralph Lauren’s “wasp-ish” lines of clothing have embraced racial and ethnic diversity.

  22. In your discussion team: Describe yourself as a target market using the descriptors from the various methods of profiling we have covered. Given your description, how would a marketer most optimally contact and engage you? Sample Profile

  23. Cluster analysis builds hierarchical trees based on similarity among individuals compared across several dimensions of questions Cluster analysis

  24. Cluster analysis builds hierarchical trees based on similarity among individuals compared across several dimensions of questions Cluster analysis Group of people (segments) who are more similar to each other than to other groups Everyone in the room Individual people

  25. Cluster Analysis of Recreational Groups

  26. Actualizers 9% Principles Status Action • VALS-2 survey Fulfilled 13% 11% 12% 13% 13% 16% Strugglers 12%

  27. Social Technographics Ladder (2008) Forrester categorizes social computing behaviors into a ladder with six levels of participation; we use the term "Social Technographics" to describe analyzing a population according to its participation in these levels. http://www.forrester.com/Groundswell/profile_tool.html

  28. Profile of Motor Boat Owner Segmentation

  29. Social Network Analysis In online communities, who are the influencers? The Hypernetworked World

  30. Finding Voters in Primetime http://www.natmedia.com/2012/02/03/2010-media-buying-trends-primetime-tv-part-2/

  31. http://millennialmarketing.com/2012/04/at-last-a-millennial-segmentation/http://millennialmarketing.com/2012/04/at-last-a-millennial-segmentation/

  32. Team activity: Segmentation Task Using one or more of the profiling methods discussed, identify several of your target market segments in your business. Describe one in detail in a paragraph and be present to the class.

  33. Target Market & the 4 Ps

  34. Marketing resources are focused to better meet customers needs and deliver more value to them How STP adds value to a firm Customer develop preference for brands that better meet their needs and deliver more value Customers become brand/supply loyal, repeat purchase, share favorable experiences Brand supplier loyalty leads to increased market share and creates a barrier to competition Fewer marketing resources needed over time to maintain share due to brand or supplier loyalty Profitability (value to the firm) increases

  35. Summary— Benefits of Segmentation • More cost-effective than mass media promotion • More clearly identify what people want and need • Deliver relevant communications to target markets • Deliver desired outcomes to specific groups • Increase customer satisfaction, retention, & loyalty • Refine and enhance understanding of segments & data use • Increased opportunity for growth • Enhance profits & market share

  36. END

More Related