global marketing 7
TRANSCRIPT
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Se mentation
Targeting, and
(Global Edition)Chapter 7
1
Chapter topics:
How to identif like
groups of potentialcustomers?
How to chose the groupsto target?
How to segment those
groups? How to position the brand
in the mind of the
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and cart riders in Great Britain
Represents an effort to identify andcate orize rou s of customers and
countries according to common
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77.5 million dogs are owned in the US.Who owns whom?
The process of evaluating segments
and focusing marketing efforts on acountr re ion or rou of eo le thathas significant potential to respond
reached most effectively, efficiently,
and profitably
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Positioning is required to differentiate the
target market.
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Defined as the rocess of identif in
specific segments whether they be
groups of potential customers withomogeneous a r u es w o are e y
to exhibit similar responses to acompanys marketing mix
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Contrasting Views of GlobalSegmentation
Conventional Wisdom
Assumes heterogeneity
nconven ona s om
Assumes emergence of
etween countriesAssumes homogeneity
national boundaries
Focuses on culturaldifferences at macro
within-country diffs
Em hasizes micro level
level
Relies on clustering ofdiffs & commonalities
Segments micro markets
na ona mar e s Less emphasis on
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within and betweencountries
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Micro segments based on
CB are highest priority
Demo ra hics
Psychographics
Behavioralcharacteristics
Benefits sought
Skiing became a sport in Norway,
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where it was invented 4,000 years ago
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ncome
Population
Age distribution
Gender
Education
What are the trends?
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A widening age gap exists between the older -age populations in developing countries
,aged
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The Euroconsumer: uccess u ea s s:comprises from 5% to 20% of the population
material success while maintaining commitment to
abstract or socially responsible ideals
Affluent Materialists:
status-conscious up-and-comers many of whom arebusiness professionals
use conspicuous consumption to communicate their success
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The Euroconsumer (contd):
25% to 50% of a countrys population
conservative
most comfortable with the familiar
content with the comfort of home, family, friends, and community
Disa ecte Survivors
lack power and affluence
tend to be either resentful or resigned
concentrated in hi h-crime urban inner cit
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Focus on whether people purchase a
product or not, how much, and howoften they use it
User status
disproportionality / Paretos Law: 80%
for by 20% of the customers
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H=22% H=39% H=39%Colas
U=0% U=10% U=90%
H=59% H=20% H=21%Bourbon
U=0% U=11% U=89%
H=67% H=16% H=17%Beer
U=0% U=12% U=88%
H=27% H=36% H=37%Cake mixes
U=0% U=15% U=85%
= = =Power towels
U=0% U=17% U=83%
H=2% H=49% H=49%
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Toilet tissue
U=0% U=26% U=74%
value equation
Va ue = Bene its Price
product solves, the benefit it offers, or
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Benefit segment Sensory Sociables Worriers Independents
Principal benefit flavour, brightness of decay prevention price.
Demographics children teens,young people
large families men
Behavioural chars. users of spearmint smokers heavy users heavy users
Brands favoured Colgate, Stripe Macleans, Plus Crest brands on salee, ra
Brite
Personality chars. self-involvement sociability hypochondriasis autonomy
Lifestyle chars. hedonistic active conservative value-oriented
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Russell Haley, Benefit Segmentation: A Decision-Oriented Research Tool,Journal of Marketing, July 1968,p. 33
Effective SegmentationCriteria
Measurable
Accessible
Differentiable
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Be mindful of the itfalls Tendency to overstate the size and short-
markets
a strategic opportunity
anagemen s ne wor o con ac s wemerge as a primary criterion for targeting
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Current size of the segment and
Potential competition
Compatibility with companys overall
objectives and the feasibility of successfullyreaching the target audience
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Current Segment Size andGrowth
enough to present a company with the
If the answer is no, does it havesignificant growth potential to make it
-term strategy?
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Is there currently strong competition in
e mar e segmen Is the com etition vulnerable in terms
of price or quality?
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Will adaptation be required? If so, is this
economically justifiable in terms of expected sales? Will import restrictions, high tariffs, or a strong home
country currency drive up the price of the product in
demand?
to source products in the country for export
elsewhere in the region? Is targeting a particular segment compatible with the
companys goals, brand image, or established
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sources o competitive a vantage?
Framework for SelectingTarget Markets
Demographic information is a starting point
but not the decidin factor
Product-market must be considered
Marketing model drivers must be considered
actors requ re or a us ness to ta e root angrow
re ere any ena ng con ons presen
Conditions whose presence or absence will
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e erm ne success o e mar e ng mo e
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9 basic questions for creating a product-market profile:1. Who buys our product or brand?.
3. What need or function does our product serve? Doesour product or brand address that need?
4. Is there a market need that is not being met bycurrent product or brand offerings?
. 6. What are customers currently buying to satisfy the
need, or solve the problem, that our product targets?
7. What price are they paying for the product they arecurrently buying?
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. 9. Where is our product purchased?
Standardized global marketing
Mass marketing on a global scale Undifferentiated target marketing
Standardized marketing mix
Intensive distribution
Lower production costs Lower communication costs
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Concentrated Differentiated global
Niche marketing Multi-segment
ng e segmen oglobal market Two or more distinct
oo or g o adepth rather than Wider market coverage
Ex: Chanel, Body
Spice and Hugo Boss
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Locating a brand in consumersm n s over an aga nstcompetitors in terms ofattr utes an ene ts t at t ebrand does and does not offer
Attribute or Benefit
ualit and Price Use or User
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Global consumer culturepositioning
Identifies the brand as a symbol of aparticular global culture or segment
High-touch and high-tech products
Foreign consumer culturepositioning
Associates the brands users, useoccasions, or product origins with a
Beer is associated withthis Germans culture;the s mbol on his shirt
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oreign country or cu ture
is not German!
Local consumer culture
Identifies with local cultural
Consumed by local people
Used frequently for food, personal,and household nondurables
Ex: Budweiser is identified withsmall-town America
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which beer?
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Light body
Miller
li
B
Low price Prestige price
Hamms
#2
c li z
Budweiser
A
D
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Strategy options:
strengthen and leverage its current position-
search for new unowned position that isvalued b enou h consumers and rab it(look for the hole)
deposition or reposition the competitionExclusive club strategy - Big Three, Big
Eight, Big Ten, etc.
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high-tech positioning: based on concrete productfeatures; buyers typically already possess or wish to
acqu re cons era e ec n ca n orma on
-consumers; requires less emphasis on specializedinformation and more emphasis on image; buyers ofhigh-touch products share common language and set ofsymbols relating to themes of wealth, materialism, and
romance
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(e.g., Bang & Olufsen consumer electronics)