segmentation - lecture 5 b
TRANSCRIPT
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8/3/2019 Segmentation - Lecture 5 b
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CONSUMER
SEGMENTATION
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Market Segment
A subgroup within the market who sharecertain relevant characteristics
A group of customers with certaincharacteristics in common & whose needscan be met with a distinct marketing mix
Segmentation & Targeting
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Market segmentation - Definitions
The analytical division of the market intodiscrete groups of customers that sharecommon attributes.
The identification of subsets of buyerswithin a market who share similarities,needs and who have similar buying
processes.
Segmentation & Targeting
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Niche Marketing
A niche is more narrowly defined group,typically a small market whose needs arenot well served.
Marketers divide it into sub-segments Niches are fairly small and attract few
competitors
Customers are willing to pay more Niche has a size, profit and growth
potential.
Segmentation & Targeting
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Local & Individual Marketing
Target marketing is leading to marketingprograms being tailored to the needs andwants of the local customer groups( Trading
areas, neighborhoods, even individualstores).
Individual Marketing.The ultimate level of
segmentation leads to segments of onecustomized marketing or one to one
Marketing.
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Patterns Of Market Segmentation
Homogenous preferences:Market where allconsumers have roughly the same preference.
Diffused preferences:Consumers preferences
are scattered, they vary a lot in theirpreferences. First brand to enter the market islikely to position in the center to appeal to mostpeople, a second close to the first, would try to
share the market or can locate in the corner toattract a consumer group not satisfied with theexisting brand..
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Patterns Of Market Segmentation
Clustered preferences: The market mightreveal distinct preference clusters, callednatural market segments. The first firm in
this market has three options:-
Position in the centre and appeal all
Position in the largest market segment(
concentrated marketing) Several brands for separate segments
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Some Bases for SegmentingConsumer Markets
Slide8-6
Demographic
Segmentation
Geographic
PsychologicalBenefit
Behavior SouthwestAirlines
BMWColgateToothpaste
KnorrSoup
LevisDockers
Table8.2
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Segmenting by Usage andCommitment
Advertising and promotion targeted to:
Heavy users
Nonusers Brand-loyal users
Switchers/Variety seekers
Emergent Consumers
Point of entry marketing strategy
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Demographic Segmentation
Age Gender
Race
Marital Status
Income
Education
Occupation
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How about this ad?What is the target
demographic forthis ad campaign?
Ad in Context Example
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Geographic Segmentation
Country / State
Rural / Urban Region
City
Neighborhood
Segmentation & Targeting
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Psychographics and Lifestyle
Segmentation
Activities
I
nterests
Opinions Lifestyle
Lifestyle segmentationprovides insight intoconsumers
motivations
Segmentation & Targeting
S i & i
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Benefit Segmentation
Safety?Prestige?
Fuel Economy?
Segmentation & Targeting
http://rds.yahoo.com/_ylt=A0WTefR8U55JPssAfR6JzbkF;_ylu=X3oDMTBpZm5udGl1BHBvcwM1BHNlYwNzcgR2dGlkAw--/SIG=1kut1jd16/EXP=1235199228/**http%3A//images.search.yahoo.com/images/view%3Fback=http%253A%252F%252Fimages.search.yahoo.com%252Fsearch%252Fimages%253Fp%253DJeep%252Bprint%252Bad%2526fr%253Dyfp-t-501%2526ei%253Dutf-8%2526x%253Dwrt%26w=500%26h=375%26imgurl=static.flickr.com%252F215%252F485288381_a87db1412a.jpg%26rurl=http%253A%252F%252Fwww.flickr.com%252Fphotos%252Fjeepin%252F485288381%252F%26size=148.2kB%26name=missingperson1024%26p=Jeep%2Bprint%2Bad%26type=JPG%26oid=0c7290e2f9ed6250%26fusr=jeepinjason%26tit=missingperson1024%26hurl=http%253A%252F%252Fwww.flickr.com%252Fphotos%252Fjeepin%252F%26no=5%26tt=92%26sigr=11efrkqsi%26sigi=11ek7ue4o%26sigb=12ojcfjos%26sigh=1143lbu83 -
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Ways to segment
Geographic
Region
Urban/Sub urban
Demographic
Age
Gender
Occupation
Socio-economic group
Psychographic
Life style
Personality
Social status
Behavioral
Rate of usage
Benefits sought
Loyalty status
Readiness to purchase
Ch # 7-Segmentation, Targeting & Positioning
S t ti & T ti
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Patterns Of Market Segmentation
Homogenous preferences- Market whereall consumers have roughly the samepreference.
Diffused preferences- Consumerspreferences are scattered, they vary a lotin their preferences. First brand to enterthe market is likely to position in the centerto appeal to most people, a second closeto the first, would try to share the market.
Segmentation & Targeting
S t ti & T ti
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Patterns Of Market Segmentation
Clustered preferences- The market mightreveal distinct preference clusters, callednatural market segments. The first firm in
this market has three options:- Position in the centre and appeal all
Position in the largest market segment(
concentrated marketing) Several brands for separate segments
Segmentation & Targeting
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Choice of market segments
Unattractivesegment
Averagesegment
Attractivesegment
Absence ofCompetitive
advantage
Stronglyavoid
Avoid Possible
Avg. interms ofCompetitive
advantage
Avoid Possible Secondarytarget
StrongCompetitiveadvantage
Possible Secondarytarget
Prime target
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Segmentation strategies
Undifferentiated: Ignoresegments
Concentrated or focused:
Concentrate on a singlesegment (Small firms)
Differentiated: Differentmarketing mix for eachsegment (Large firms)
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Undifferentiated Strategy
Also known as market aggregation
Targets entire market with the samemarketing mix segments ignored
Used when segments cannot be identifiedor where aggregation proves moreprofitable than segmentation
Fords Model T car were sold as theuniversal carany car as long as it isblack
Segmentation & Targeting
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Concentrated strategy
Marketing effort directed at a single highlydefined segment
Niche marketing Rolex watches
Used when one group is especiallyattractive for the organization to target
A useful strategy for smaller firms avoids
a head on collision with major players Provides scope for competitive advantage
in a small niche in the market
Segmentation & Targeting
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Differentiation Strategy
Multi segment approach
Separate mix for each segment
Expensive In terms of product & marketingcost
Only possible for large firms
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Irwin/McGraw-Hill The McGraw-Hill Companies, Inc., 1998
Sample Positioning Map:Automobiles
Slide8-10
Figure8.6
Traditional Sporty
Functional
Luxurious
Lexus
BMW
Pontiac
Mercedes
Cadillac
Lincoln
ChryslerBuick
Porsche
Chevrolet
Nissan
Toyota
SaturnVW
Ford
Dodge
Mercury