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Segmentation, Targeting and Positioning: Building the Right Relationships with the Right Customers

Segmentation, Targeting and Positioning: Building the Right Relationships with the Right Customers. Market segmentation: dividing market into distinct groups which will require separate marketing mixes Target marketing: choosing which group(s) to appeal to

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Segmentation, Targeting and Positioning: Building the Right Relationships with the Right Customers

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  1. Segmentation, Targeting and Positioning:Building the Right Relationships with the Right Customers

  2. Market segmentation: dividing market into distinct groups which will require separate marketing mixes Target marketing: choosing which group(s) to appeal to Market positioning: creating a clear, distinctive position in the consumer’s mind relative to competition Steps in Market Segmentation, Targeting, and Positioning

  3. Geographic: Regions Size/density Climate Demographic: Age/generation Gender Family size/life-cycle Income Occupation Religion Ethnic origin Psychographic: Social class Lifestyle Personality Behavioral: Occasions Benefits User status Usage rate Loyalty status Readiness state Attitude toward product Consumer Market Segmentation

  4. Demographic: Industry Company size Location Operating variables: Technology User/non-user status Customer capabilities Situational factors: Urgency Specific application Size of order Purchasing approaches: Purchasing organization Power structure Existing relationships General policies Purchasing criteria Personal characteristics: Buyer-seller similarity Attitude towards risk Loyalty Business Markets Segmentation

  5. International markets can be segmented by: Geographic location Economic factors Political and legal factors Cultural factors Intermarket segmentation: Forming segments of consumers who have similar needs, even though they live in different countries Segmenting International Markets

  6. To be useful, market segments must be: Measurable: Size, purchasing power, and profiles can be measured Accessible: Segments can be reached Substantial: Large enough to be profitable Actionable: Programs can be developed to attract and serve the segments Requirements for Effective Segmentation

  7. Three factors used to evaluate segments: Segment size and growth Structural attractiveness Competition, substitute products, power of buyers/suppliers Company objectives and resources Target Marketing Strategies

  8. Factors to be considered: Company resources Product variability Product’s life-cycle stage Market variability Competitor’s marketing strategies Choosing a Target Marketing Strategy

  9. Product position: the way the product is defined by consumers on important attributes, relative to competing products Competitive advantage: an advantage gained over competitors by offering (and delivering) greater value Sources of differentiation: Product Service Marketing channels People Image Positioning for Competitive Advantage

  10. Unique selling proposition (USP):aggressively promoting one benefit to the target audience Three major positioning errors: Under-positioning Over-positioning Confused positioning Which Differences to Promote? • Differences should be: • Important • Distinctive • Superior • Communicable • Pre-emptive • Affordable • Profitable

  11. Value proposition: Full positioning of a brand Mix of benefits used for positioning Possible Value Propositions

  12. Sliced Bread and other marketing delights… Seth Gordin Marketing Expert, book author and Entrepreneur Former Vice President of Marketing at Yahoo!

  13. Class Assignment Select one of below brands and do research to learn more about the brand. Then answer the below questions with a short group presentation. Give a brief description of your product and define the target market and segment it serves At what stage in its life cycle is this product? What are your reasons for believing it is at this point? How do the product’s packaging and labeling help boost its consumer appeal? How is the product promoted? Is this product sold in international markets? If so, does the company use a standardized or customized strategy? How is the product priced in relation to competing products? Nescafe coffee Samsung “Galaxy” Levi’s jeans tablet computers Play Station 2 Metersbonwe clothing Coca-Cola drinks L’Oreal shampoo and Snickers chocolate Apple ipod hair products Haier refrigerators Lenovo laptops KFC Restaurants BYD Automobiles Casio Watches Huawei mobile telephones

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