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TRANSCRIPT
8Identifying
Market Segments and Targets
1
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 8-2
Chapter Questions
What are the different levels of market segmentation?
How can a company divide a market into segments?
What are the requirements for effective segmentation?
How should business markets be segmented? How should a company choose the most
attractive target markets?
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Effective Targeting Requires…
Identify and profile distinct groups of buyers who differ in their needs and preferences
Select one or more market segments to enter Establish and communicate the distinctive
benefits of the market offering
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What is a Market Segment?
A market segment consists of a group of customers who share a similar set of
needs and wants.
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Segmenting Consumer Markets
Geographic
Demographic
Psychographic
Behavioral
Geographic Segmentation
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Claritas’ Prizm
Education and affluence Family life cycle Urbanization Race and ethnicity Mobility
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Demographic Segmentation
Age and life cycle Life stage Gender Income Generation Social class Race and Culture
Age and Lifecycle Stage
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Gender and Income
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Generational Influences
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Race and Culture
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Psychographic Segmentation and The VALS Framework
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Behavioral Segmentation Based on Needs and Benefits
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Behavioral Segmentation: Decision Roles
Initiator
Influencer
Decider
Buyer
User
Behavioral Segmentation: Behavioral Variables
Occasions Benefits User Status Usage Rate
Buyer-Readiness Loyalty Status Attitude
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Figure 8.2 Example of a Brand Funnel
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Loyalty Status
Hard-core Split loyals Shifting loyals Switchers
Figure 8.3 Behavioral Segmentation Breakdown
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Segmenting for Business Markets
Demographic Operating variable Purchasing approaches Situational factors Personal characteristics
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Steps in Segmentation Process
Need-based segmentation Segment identification Segment attractiveness Segment profitability Segment positioning Segment acid test Market mix strategy
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Effective Segmentation Criteria
Measurable Substantial Accessible Differentiable Actionable
Porter’s 5 Forces Model
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Threat of Rivalry
Threat of SupplierBargaining Power
Threat of Buyer Bargaining Power
Threat of New Entrants
Threat of Substitutes
Figure 8.4 Possible Levels of Segmentation
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 8-24
For Review
What are the different levels of market segmentation?
How can a company divide a market into segments?
What are the requirements for effective segmentation?
How should business markets be segmented? How should a company choose the most
attractive target markets?
Copyright © 2011 Pearson Education, Inc. Publishing as Prentice Hall 8-25