TARGET MARKETING sellers distinguish the major market segments, target one of those segments and develop products and marketing programs tailored to each segment.
Target marketing requires marketers to take three major steps: Market Segmentation Market Targeting Market Positioning
MARKET SEGMENTATION MARKET TARGETING MARKET POSITIONING 1. Identify segmentation variables and segment the market 2. Develop profiles of resulting segments 3. Evaluate the attractiveness of each segment 4. Select the target segment(s) 5. Identify possible positioning concepts for each target segment 6. Select, develop and communicate the chosen positioning concept STEPS IN MARKET SEGMENTATION, TARGETING AND POSITIONING
MARKET SEGMENTATION market can be segmented in a number of ways. Market consists of buyers and buyers differ in many ways. It represents an effort to increase a company’s targeting precision. It can be carried out at four levels : segment, niches, local areas and individuals.
MASS MARKETING In mass marketing, the seller engages in the mass production, mass distribution and mass promotion of one product for all buyers.
SEGMENT MARKETING – consists of large identifiable group within a market. Segmentation is a midpoint between mass marketing and individual marketing. The consumers belonging to a segment are assumed to be quite similar in their wants and needs. NICHES MARKETING – it is a more narrowly defined group. Marketers usually identify niches by dividing a segment into sub segments.
LOCAL MARKETING – marketing program is being tailored to the needs and wants of local customer groups INDIVIDUAL MARKETING – the ultimate level of segmentation leads to “segment of one”, “customized marketing”, or “one to one marketing.” SELF – MARKETING – is a form of individual marketing in which the individual customer takes more responsibility for determining which products and brands to buy.
BASES FOR SEGMENTING CONSUMER MARKETS GEOGRAPHIC SEGMENTATION – calls for dividing the market into different geographical units such as nations, states, regions, counties, cities or neighborhoods. DEMOGRAPHIC SEGMENTATION – the market is divided into groups on the basis of demographic variables such as age, family, size, family life cycle, gender, income, occupation, education, religion, etc.
PSYCHOGRAPHIC SEGMENTATION – buyers are divided into different groups on the basis of lifestyle and/or personality. BEHAVIORAL SEGMENTATION – buyers are divided into groups on the basis of their knowledge of, attitude toward, use of, or response to a product. Many marketers believe that behavioral variables – occasions, benefits, user status, attitude, etc. – are the best starting points for constructing market segments.
MULTI – ATTRIBUTE SEGMENTATION (GEOCLUSTERING) – yields richer descriptions of consumers and neighborhoods than traditional demographics because it reflects the socioeconomic status and lifestyle of neighborhood’s inhabitants. TARGETING MULTIPLE SEGMENTS – companies may begin their marketing with one targeted segment, and then expand into other segments.
REQUIREMENTS FOR EFFECTIVE SEGMENTATION Measurable Substantial Accessible Differentiable Actionable
MARKET TARGETING Once the firm has identified its market segment opportunities, it has to evaluate the various segments and decide how many and which ones to target.
SELECTING THE MARKET SEGMENTS SINGLE – SEGMENT CONCENTRATION – selecting a single segment. The firm gains a strong knowledge of the segment’s needs and achieves a strong market position in the segment. SELECTIVE SPECIALIZATION – the firm selects a number of segments, each objectively attractive and appropriate, given the firm’s objectives and resources.
PRODUCT SPECIALIZATION – the firm concentrates on making a certain product that it sells to several segments. MARKET SPECIALIZATION – the firm concentrates on serving many needs of a particular customer group FULL MARKET COVERAGE – the firm attempts to serve all customer groups with all the products that they might need.
ADDITIONAL CONSIDERATIONS IN EVALUATING AND SELECTING SEGMENTS ETHICAL CHOICE OF MARKET TARGETS SEGMENT INTERRELATIONSHIPS AND SUPERSEGMENTS SEGMENT- BY - SEGMENT INVASION PLANS INTERSEGMENT COOPERATION