chp 03 focusing marketing strategy with segmentation and positioning
TRANSCRIPT
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© 2004 McGraw-Hill Ryerson, All Rights Reserved
A Global Managerial ApproachEleventh Canadian Edition
■ Wong ■ Shapiro
■ Perreault ■ McCarthy
Basic MarketingBasic Marketing
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© 2004 McGraw-Hill Ryerson, All Rights Reserved
Focusing Marketing Strategy with Segmentation
www.mcgrawhill.ca/college/wongFor use only with this text. © 2004 McGraw-Hill Ryerson, All Rights Reserved
Chapter ThreeChapter Three
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When we finish this chapter, you should
Know about the different kinds of marketing opportunities.
Understand why opportunities in international markets should be considered.
Understand why marketing strategy planning involves a process of narrowing down from broad opportunities to a specific target market and marketing mix.
Know how to define a market and distinguish between generic markets and product-markets.
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When we finish this chapter, you should
Know three approaches to market-oriented strategy planning.
Know dimensions that may be useful for segmenting markets.
Know what positioning is and why it is useful.
Know what market segmentation is and how to segment product-markets into submarkets
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Types of Opportunities to PursueExhibit 3-1
DiversificationMarketdevelopment
Productdevelopment
Marketpenetration
Present products New products
Presentmarkets
Newmarkets
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Market Penetration
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Market Development
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Product Development
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Diversification
http://www.canon.ca
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Early StartEarly Start Competitive Advantage
Competitive Advantage
Better Trends?
Better Trends?
Smaller World
Smaller WorldSmaller World
Smaller World
Competitive Advantage
Competitive Advantage
Better Trends?
Better Trends?
International Opportunities Should Be Considered
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Breakthrough OpportunitiesBreakthrough Opportunities
Competitive Advantage
What Are Attractive Opportunities
Lower costHigher quality
Customer focus
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Competitive Advantage
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Overview of Marketing Strategy Planning Process
Exhibit 3-2
External Market Environment
TargetMarket
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Market1.In general Market is a group of potential customer’s with similar needs who are willing to exchange something of value with sellers offering various goods or services –that is ways of satisfying those needs. A Generic MarketLooks at market broadly and from a customer’ viewpoint. A generic market is a market with broadly similar needs and sellers offering various , often diverse ways of satisfying those needs. For example: Entertainment seekers might have very different products that may satisfy the entertainment needs .
Product Market Is a market with very similar needs and sellers offering various close substitute ways of satisfying those needs.
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Product Market Definations
•What: Product is the product type (Goods or services)Product types describes the goods and services that customers want. Sometimes the product type is strictly a physical goods or strictly a service.
•To meet what: Customer (user)needs
•Whom: Customer types•Where: At what Geographic area
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Customer Needs
Customer Needs
Customer TypeCustomer Type
Customer Needs
Customer Needs
Customer TypeCustomer Type
Naming Product Markets and Generic Markets
Geographic Area
Geographic Area
No Product Type in Generic Market DefinitionNo Product Type in Generic Market Definition
Product-MarketDefinition
Product-MarketDefinition
Product Type
Geographic Area
Geographic Area
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Singletargetmarket
approach
Multipletargetmarket
approach
Combinedtargetmarket
approach
Selectingtarget
marketingapproach
Homogeneous(narrow)product-markets
Segmentinginto possible
target markets
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Narrowing Down to Target Markets
Exhibit 3-3
Allcustomer
needs
Somegenericmarket
Onebroad
product-market
Narrowing down tospecific product-market
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Finding the Target MarketSingle Target Market Approach: Segmenting the market and picking one of the homogenous Segments as the firm’s target market
Multiple target market approach: Segmenting the market and choosing two or more segments, then treating each as separate target marketing needing different marketing mix
Combined Target Market Approach: Combining two or more Sub-Markets into one larger target market as a basis of one strategy.
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Segmenters vs CombinersCombinersTry to increase their markets by combining two or more segments
Segmenters on the other hand aim at one or more homogenous segments and try to develop a different Marketing mix for each segments.
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1) Naming – disaggregating needs into possible markets
2) Segmenting – aggregating customers of similar needs in each market; creating submarkets
Market Segmentation Defines Possible Target Markets
Exhibit 3-5
Broad product-market (or generic market) name goes here (The bicycle-riders product-market)
Submarket 1(Exercisers)
Submarket 2(Off-road
adventurers)
Submarket 3(Transportation riders)
Submarket 4(Socializers)
Submarket 5(Environmentalists)
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A. Product-market showingthree segments
Dependability dimension
Sta
tus
dim
ensi
on
How Far Should the Aggregating Go?
Exhibit 3-6
B. Product-market showingsix segments
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Target Marketers Aim at Specific Targets
Exhibit 3-7
In a product-market area
A segmenter
Single target market approach – can aim at one submarket with one marketing mix
Multiple target market approach – can aim at two or more submarkets with different marketing mixes
A combiner
Combined target market approach – can aim at two or more submarkets with the same marketing mix
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Too Much Combining Is
Risky
Segmenters Try to Satisfy “Very Well”
Segmenters Try to Satisfy “Very Well”
Combiners Try to Satisfy “Pretty Well”
Combiners Try to Satisfy “Pretty Well” Too Much
Combining Is Risky
Too Much Combining Is
Risky
Combiners Try to Satisfy “Pretty Well”
Segmenters Try to Satisfy “Very Well”
Segmenting May Produce Bigger Sales
Segment or Combine?
Segment or Combine?Segment or Combine?
Segment or Combine?
Profit Is the Balancing
Point
KeyIssuesKey
Issues
Segmenting vs. Combining
Segmenting May Produce Bigger Sales
Segmenting May Produce Bigger Sales
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What Dimensions Are Used to Segment Markets?
OR
QualifyingDimensionsQualifying
Dimensions
• Relevant to including a customer type in a product market
• Help identify “core features”
DeterminingDimensionsDeterminingDimensions
• Affect the customer’s purchase of a product or brand
• Can be further segmented
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What Dimensions Are Used to Segment Markets?
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Possible Segmenting Dimensions - Consumer
Exhibit 3-10
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What Dimensions Are Used to Segment Markets?
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Possible Segmenting Dimensions - Consumer
Exhibit 3-10 (continued)
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Possible Segmenting Dimensions - Business
Exhibit 3-11
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Different Dimensions For
Different Submarkets
Different Dimensions For
Different Submarkets
Qualifying Dimensions Are Important Too
Qualifying Dimensions Are Important Too
Qualifying Dimensions Are Important Too
Qualifying Dimensions Are Important Too
Determining Dimensions May
Change
Determining Dimensions May
Change
Determining Dimensions May Be Very Specific
Determining Dimensions May Be Very Specific
Key IssuesKey Issues
Determining vs. Qualifying Dimensions
Determining Dimensions May Be Very Specific
Determining Dimensions May Be Very Specific
Determining Dimensions May
Change
Determining Dimensions May
Change
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Finding the Relevant Segmenting Dimensions
Exhibit 3-12
Allpotential dimensions
Qualifying dimensionsDetermining dimensions
(product type)Determining dimensions
(brand-specific)
Segmenting dimensions become more specific to reasons why the targetsegment chooses to buy a particular brand of the product
Dimensions generallyrelevant to purchasing
behaviour
Dimensions relevant toincluding a customer type
in the product-market
Dimensions that affectthe customer’s purchase
of a specific type ofproduct
Dimensions that affectthe customer’s choice
of a specific brand