chapter 05 (segmentation & targetting )

7/31/2019 CHAPTER 05 (Segmentation & Targetting )

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Marketing Management by Arun Kumar and N Meenakshi Vikas Publishing House Pvt. Ltd. 2006

CHAPTER 5SEGMENTATION AND

TARGETING


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LEARNING OBJECTIVES

Understanding the concept of customer value

proposition to define the need for segmentation

The inherent inefficiency of non-segmented markets

The concepts of market segmentation and target

marketing, and their use in developing marketing

strategy

The methods of segmenting consumer andorganizational markets


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The factors that can be used to evaluate marketsegments

Evaluating market segments and target market

selection

Four target market strategies: Undifferentiated,

Differentiated, Focused and Customized

marketing

LEARNING OBJECTIVES (Contd.)


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SEGMENTATION

Segmentation is the process of dividing the

market of a product or service in smaller

groups of customers

Customers in one group should:

Buy the product for the same purpose

Use the product in the same way

Buy the product in the same way


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CUSTOMER VALUE

PROPOSITION Identifying clusters of customers who desire

the same value proposition

Customer value proposition is a unique mix

of product and service attributes, customer

relations, and corporate image that acompany offers


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NON SEGMENTED

MARKETS

Products or services cannot satisfy all

customers in a market

Marketing not based on segmentation is

essentially inefficient

Any marketing endeavor has to start with

the process of segmenting the market, else it

will be ineffective (due to underserving the

market) and inefficient (because of

overserving the market)


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PURPOSE OF

SEGMENTATION

Target market selection

Tailored marketing mix

Differentiation

Opportunities and threats


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SEGMENTATION ANDMARKET ENTRY


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PROCESS OF MARKET

SEGMENTATION: TARGET

MARKETING

Selection of a target market

Target market strategies

Undifferentiated targeting

Concentrated targetingMulti-segment targeting


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SEGMENTING CONSUMER

MARKETS

Behavioral variables

Psychographic variables

Profiling


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Psychographic segmentation

Lifestyle

Personality

Profile segmentation

Demographic variables

Socio economic variablesGeographic variables

Segmenting Consumer Markets (Contd.)


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SEGMENTING

ORGANIZATIONAL MARKETS

Macrosegmentation

Organizational size

Industry

Geographical segmentation Microsegmentation

Choice criteria

Decision making unit structure

Decision making process

Buy class

Purchasing organization

Organizational innovativeness


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EVALUATING MARKET

SEGMENTS AND TARGET

MARKET SELECTION Market attractiveness

Market factors

Segment size

Segment growth rate

Price sensitivity

Bargaining power of customers

Bargaining power of suppliers

Barriers to market segment entry

Barriers to market segment exit


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Competitive factors

Nature of competitionNew entrants

Competitive differentiation

Political, social and environmental factors

Political issues

Social trends

Environmental issues

Evaluating Market Segments And Target Market Selection (Contd.)


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Firms capability to serve segments

Exploitable marketing assets

Cost advantage

Technological edge

Managerial capabilities and commitment

Evaluating Market Segments And Target Market Selection (Contd.)


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TARGET MARKET

STRATEGIES

Undifferentiated marketing

Differentiated marketing

Focus

Customized marketing

chapter 05 (segmentation & targetting )

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