Introduction to Marketing

Marketing Segmentation & PositioningMarketing SegmentationDividing a market into smaller groups with distinct needs, characteristics or behaviors who might require separate products or marketing mixes.Companies have moved from mass marketing to target marketingCompanies look for different ways in which to segment the market and develops profiles of the resulting market segments.

Market TargetingThe process of evaluating each market segments attractiveness and selecting one or more segments to enter Differentiation Actually differentiating the firms market offering to create superior customer valuePositioning

Arranging for a product to occupy a clear, distinctive and desirable place relevant to competing products in the minds of target consumers Segmenting consumer marketsGeographic segmentationDividing markets into different geographical units such as, nation, states, region, counties, cities or neighborhoods .

Many companies localize their products, advertising, promotion, and sales efforts to fit the needs of individual regions, cities and even neighborhoods eg: Coke developed four ready to drink canned coffees for Japanese.

Demographic segmentationDividing a market into groups based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation and nationality. Age and life-cycle segmentation: Dividing a market into different age and life-cycle groups eg: Anlene milkGender Segmentation: Dividing a market into a different groups based on gender . eg: Nivea for menIncome: Dividing a market into different groups based on social class, lifestyle, or personality characteristics. eg: Standard charted priority bankingPsychographic segmentationDividing a market into different groups based on social class, life style or personality characteristics.eg: American Express My life My Card campaign provides a glimpse into the lifestyle of famous people

Behavioral SegmentationDividing a market into groups, based on consumer knowledge, attitude, use or response to a productOccasions : Dividing a market into groups according to occasions when buyers get the idea to buy, actually make their purchase or use the purchase item. eg : Ginger beer with food Benefit sought: Dividing a market into groups according to the different benefits that consumers seek from the products. eg: Athletic wear segments based on functional benefits User status: Segment into non user, ex user, potential users, first time user and regular user. eg: P&G invites newly weds to visit pamper.comUsage rate: Segment based on usage, Light, Medium and Heavy users. eg: Sidhaleppa Loyalty Users : Divide groups based on there degree of loyalty. eg: Arpico privilege users Segmenting Business MarketsSegment Business MarketsConsumers and business use many of the same variables to segment their markets. Business buys can be segmented geographically, demographically (Industrial and company size), or by benefit sought, user status or loyalty status.

Business markets use additional variables, such as customer operating characteristics, purchasing approaches, situational factors and personal characteristics.

eg: For small business customers, American Express has created the OPEN: Small Business Network, the one place thats all about small business Segmenting International MarketsForming segment of consumers who have similar needs and buying behavior even though they are located in different countries.Teens show surprisingly similarity no matter where they live these teens could be from almost anywhere. Thus, many companies target teens with worldwide marketing campaigns Eg: Mercedes Benz targets the worlds well-to-do, regardless of their country. Requirements for Effective segmentationMeasurable: The size, purchasing power, and profiles of the segments can be measured. Accessible: Market segment can be effectively reached and served. Substantial: The market segments that are large or profitable enough to serve.Differentiable: The segments are conceptually distinguishable and responses differently to different marketing mix elements and programsActionable: Effective programs can be designed for attracting and serving the segments

Selecting Target Market segmentsTarget MarketingA set of buyers sharing common needs or characteristics that the company decides to serveUndifferentiated (mass ) marketingDifferentiated (segmented ) marketingMicromarketing(local or individual marketingConcentrated (niche) marketingUndifferentiated MarketingA market-coverage strategy in which a firm decides to ignore market segments differences and go after the whole market with one offer.It focuses on what us common in the needs of consumers rather than on what is different.

eg: Araliya sugar

Differentiated MarketingA market-coverage strategy in which a firm decides to target several market segments and designs separate offers for each.eg: Baby Cheramy

Baby chermy range for kids

Cheramy touch for adultsConcentrated MarketingA market coverage strategy in which a firm goesafter a large share of one or few segments or niche.

Niche marketing can market more effectively andmore efficiently.

Eg: Apple computers

Micro MarketingThe practice of tailoring products and marketing programs to the needs and wants of specific individuals and local customer groups includes local marketing and individual marketing

Local marketing Tailoring brands and promotions to the needs and wants of local customer groups-cities neighborhoods, and even specific stores.eg: bread talk seeni sambola bun to suit the local pallet

Individual marketing- Tailoring products and marketing programs to the needs and preferences of individual customers- also labeled markets-of-one marketing customized marketing and one to one marketing. eg: Dell creates customer configured computersDifferentiation and PositioningPositioning Map

Competitive advantageAn advantage over competitors gained by offering Consumers greater value, either through lower prices or by providing more benefits that justify higher prices.

Companies should differentiate at every customer contact point- product, services, channels people, or image Choosing the right competitive advantageHow many differentiations to promote: companies could choose to differentiation on a unique selling proposition (USP) or more than one differentiation.

Face wash & Cleanser

Carrot Face washMore than one differentiationUnique selling proposition Choosing the right competitive advantageWhich differentiations to promote: Not all differentiations are meaningful. Key criteria's to follow in establishing a difference.

Important: The difference delivers a highly valued benefit to target buyersDistinctive: Competitors dont offer the difference or the companies can offer in a more distinctive waySuperior: The difference is superior to other ways that customers might obtain the same benefit Communicable: The difference is communicable and visible to buyers.Preemptive : Competitors cannot be copy Affordable : Buyers can offered to pay for the difference Profitable : Companies can introduce the difference profitably

Select an overall positioning strategyA full positioning of the brand is called the brands Value proposition More for More More for Same The Same for LessLess for much less More for moreMore for the sameMore for lessThe same for lessLess for much less MoreThe sameLessMoreThe sameLessPriceBenefits