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  1. 1. STP Segmentation Targeting Positioning
  2. 2. SEGMENTATION <ul><li>Process of subdividing a total market into different subsets or groups. </li></ul><ul><li>Where the marketer may select one or more segments. </li></ul><ul><li>To be reached with an appropriate marketing mix. </li></ul>
  3. 3. Basis for market segmentation On the basis of consumer’s personal characteristics (non-behavioral correlates) On the basis of consumer responses (behavioral correlates) Geographic Demographic Psychographic Socio-economic Loyal status Usage based Benefits
  4. 4. Geographic Segmentation <ul><li>Subdividing the whole market into different geographical units which can be further sub-divided into smaller units. </li></ul><ul><li>A national marketer may take whole nation as his market. For example-in the detergent market Hindustan Levers and Procter and Gamble are all national marketers in India. </li></ul><ul><li>A multinational company may divide the global market on the basis of continents. Like Pepsi and Coca-cola. </li></ul>
  5. 5. Source: India 2000, Publication Division, Government of India Geographical features of India 1 Geographical area. 3,287,263 sq km. 2 Ranking in terms of geographical area in the world. 7 th largest country 3 Physical features Climate <ul><li>Four major regions : </li></ul><ul><li>The Great mountain zone. </li></ul><ul><li>The Plains of the Ganga and the Indus region. </li></ul><ul><li>The Desert region. </li></ul><ul><li>The Peninsular India </li></ul><ul><li>Tropical Monsoon types have four seasons </li></ul><ul><li>Winter – January to February </li></ul><ul><li>Hot weather – March to May </li></ul><ul><li>Rainy (south western monsoon) – June to September </li></ul><ul><li>Rainy (north eastern monsoon) – October to December </li></ul>
  6. 6. Demographic Segmentation <ul><li>Subdividing the market in terms of demographic features of a country or a region. </li></ul><ul><li>Variables that may be considered are age, gender, marital status, family size, etc. </li></ul><ul><li>Demographic data is essential for estimating the size of the target market. </li></ul>
  7. 7. Demographic features of India Source: Census of India,1991 and 2001 1 Population size 846.30 million as per 1991 census Crossed 1000 million as per 2001 census 2 Sex ratio Females per 1000 males: 933/1000. 2001 census In Kerela State: 1036/1000 – 1991 census 3 Metro Cities 1991 census Mumbai : 12.60 million Kolkata : 11.02 million Delhi : 08.42 million Chennai : 05.42 million 4 Heavily populated districts Kolkata, Chennai, Greater Mumbai, Hyderabad, Delhi, Chandigarh, Mahe, Howrah, Kanpur, Banglore (All of them have a density of above 2000 persons per square km. 5.01% population lives in these 10 cities. Avg. density of these districts is 6885 persons)
  8. 8. Socio-economic segmentation <ul><li>Variables that may considered for market segmentation are Income, occupation, education, religion, social classes, etc. </li></ul><ul><li>This segmentation is used for durable products such as automobiles, PCs, etc. </li></ul>Psychographic segmentation <ul><li>Sub division of different groups on the basis of personality, life style and values. </li></ul><ul><li>Marketers of cosmetics, textiles, fast food providers etc. must understand the life style of the target market. </li></ul><ul><li>Automobile manufacturers must consider different personality traits in dividing the market. </li></ul>
  9. 9. Benefit segmentation <ul><li>Segmented on the basis of benefits sought by consumers </li></ul>Toothpaste General benefits that consumers seek are cleanliness and hygiene in all segments. Other key benefits are:- Cosmetic Fluoride Herbal Protection against foul smell, modernity and cosmic value. Eg-Colgate, Prudent Family health, extra protection for children. Eg-Colgate Fluoride, Cibaca Fluoride. Family health and welfare. Traditionally good for health. Eg-Neem, Dabur.
  10. 10. Consumers’ perceived benefits of Two-wheelers Motorcycle brands Perceived benefits Enfield sturdy, good for long rides and high resale value. Hero-Honda Fuel efficient, high pick up and stylish Kawasaki bajaj High pickup, sleek model Scooter brands Bajaj chetak cub Fuel efficient, lifelong, high resale value Kinetic Honda Electronic ignition, easy to ride, trouble free.
  11. 11. Usage based segmentation <ul><li>Market segmented into </li></ul><ul><li>High buyers </li></ul><ul><li>Medium buyers </li></ul><ul><li>light buyers </li></ul>Loyal buyers <ul><li>Relationship seekers: buyers who want to develop long term relationships with their suppliers or retailers. </li></ul><ul><li>Loyal buyers of particular brand: buyers who seek a particular brand among competing brands. </li></ul>
  12. 12. Evaluation of segmentation <ul><li>Measurable </li></ul><ul><li>Substantial </li></ul><ul><li>Accessible </li></ul><ul><li>Differentiable </li></ul><ul><li>Actionable </li></ul>
  13. 13. Targeting <ul><li>Once the firm has segmented the total market ,it should select the target market segment or segments for marketing. </li></ul><ul><li>Investing in a particular segment should be sensible in terms of company’s mission, objectives, skills and resources. </li></ul>
  14. 14. Targeting Strategies Single segment concentration strategy Multi segment strategy or differentiated marketing strategy Undifferentiated marketing strategy
  15. 15. Single segment concentration strategy <ul><li>The firm selects a single segment or market and fully concentrate its marketing efforts to try and seek maximum advantage. </li></ul>Car maker Single marketing mix Semi-luxury segment (Expensive) Small car segment (affordable,less expensive) Luxury car segment (very expensive)
  16. 16. Multi-segments strategy <ul><li>Here the firm may select two or more then two or may be all the segments and approach each segment with an appropriate marketing mix programme. </li></ul>Car maker Small car segment Semi-luxury segment Luxury segment Marketing Mix Marketing Mix Marketing Mix
  17. 17. Undifferentiated Marketing Strategy <ul><li>The firm ignores the market segment differences and goes ahead with 1 single product offer for all segments. </li></ul>Essential commodity manufacturer. Single marketing mix
  18. 18. Market Positioning <ul><li>Positioning of a product or service is creating an “image” in the consumers’ mind. </li></ul><ul><li>Consumers generally buy “images” rather than actual product. </li></ul><ul><li>Marketers mostly use advertising as a tool to build up brand or corporate “image”. </li></ul>
  19. 19. Positioning strategies Sl. no. Positioning strategies Definition Advertising claims 1. Customer benefits Associate a brand or product with customer benefits Benefit(s) 2. Price and quality A product is highlighted in terms of service features or performance. Manufacturer charges high price Value for money 3. Application Associating a product or service with a use or application Use or application of a product or services. 4. Product user Associating a product or service with a user or class of users. Cine stars or sports heroes using the product
  20. 20. Positioning strategies Sl. no. Positioning strategy Definition Advertising claims 5 Product class Associating a product or service in a particular product class World class products 6 Cultural symbols Associating cultural symbols with a product or service to differentiate from competitors product Royal 7 Competitors Associating with competitor’s product or service by comparison Compares with competitors brand
  21. 21. Competing brands in the health drinks market Advertising claims Health drink market Complan Horlicks Bournvita Boost Viva “ complete planned food” for growing children. Contains 23 vital nutrition “ The great nourisher-with extra calcium” “ Health strength and energy”.contains protiens,vitamins, menerals and carbohydrates. “ Energy Ah! Energy” “ Double action drink” Health Drink Market
  22. 22. Determining a competitive positioning strategy <ul><li>Identification and selection of good positioning strategy </li></ul><ul><li>With the help of marketing research </li></ul>Steps in determining a competitive positioning strategy <ul><li>Identify the strategy group </li></ul><ul><li>Understand the consumers’ perception of competitive brands of strategy group </li></ul><ul><li>Determine consumers’ needs and aspirations </li></ul><ul><li>Select the best one for advertising campaign </li></ul>
  23. 23. Identify the strategic group Strategic Groups Marketing Mix Target Consumer Groups I Hero Honda CD 100 Kawasaki Bajaj Yamaha & Bullet II Hero Honda TVS Suzuki III TVS EXL Champ Hero Puch High Tech High styling High power High price High style High economy Medium price Low styling High economy Low price Low Tech Upper middle and middle income classes Middle and lower middle income classes Lower income classes
  24. 24. Determine consumers need and aspirations <ul><li>Price </li></ul><ul><li>Fuel efficiency </li></ul><ul><li>After-sales service </li></ul><ul><li>Warranty </li></ul><ul><li>Stylish looks </li></ul><ul><li>Easy to ride </li></ul><ul><li>High pick up and trouble free </li></ul>Select the best one for advertising campaign A sample of respondents can be asked to select the best among the alternatives and the same can be used for the advertising campaign
  25. 25. Thank you