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Marketing Segment: Athletic Shoes

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Look at your feet? What do you prefer to wear? Many students want to wear athletic shoes, but not just any athletic show, a high-status expensive athletic shoe. Let's look at how the market for this footwear is broken down into segments so that millions and millions of shoes can be sold.

Published in: Business
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Marketing Segment: Athletic Shoes

  1. 1. Enterprise Marketing Market Segmentation ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  2. 2. Identifying Market Segments • Marketing is expensive, time consuming and resource intensive. • Resources, time and money are limited Therefore: • Target your market: Identify your market segment and focus your marketing efforts towards it. ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  3. 3. Segmentation: Reebok • Question: • Is there the perfect running shoe (sneaker)? • Answer: No • Instead, there are perfect running shoes. ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  4. 4. Case Study: Reebok • Sneakers industry sales are a $16 billion per year in the US. • Key competitors: Nike, Reebok, Adidas, Puma, New Balance. • 100’s of models. Large consumer choice • How do you do you differentiate your products? ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  5. 5. Examples of differentiation: • Nike’s Swooshless line: Low cost ($40) sold exclusively at Wal-Mart • Adidas 1: incorporating a computer and thin sensor to monitor shock and adjust sole stiffness. ($250) • Puma for teenagers: target teenagers with cool, fashionable, low-tech sneakers sold at teen stores • New Balance: target seniors with comfortable walking shoes with choices of wider and narrower widths ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  6. 6. Reebok’s target market segment • Recognizes that many urban youths wear sneakers as a fashion statement. • They have little interest in athletics • Dominant competitor is this segment is Nike. • Reebok develops a new segments called, “Street Fashion” • Reebok calls the product line: S. Carter collection ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  7. 7. Celebrity Endorsements • Nike revolutionized the sneaker industry with celebrity endorsements • Nike signed famous athletes such as Michael Jordan to promote their products. • Celebrities are “social proof.” ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  8. 8. Reebok: S. Carter Collection • Reebok deviated from the tradition of signing famous athletes. • Instead, they signed hip hop star: Jay-Z to promote the S. Carter Collection. • The result: $100 million in sales and the fastest selling shoes in Reebok’s history. ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  9. 9. Reebok’s other endorsement deals • Reebok signed with Chinese basketball star Yao Ming to promote basketball shoes in China. • Yao Ming’s contact is worth $70 million dollars. • Yao Ming agrees to help Reebok market their products in his native country: China. ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  10. 10. More Reebok’s endorsement deals • Reebok signed Venus Williams to promote their tennis product line. • Reebok signed with the NBA and the NFL to be their exclusive team uniform providers. • Reebok will offer NBA and NFL branded shoes and clothing to consumers. ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  11. 11. Definitions • Market Segmentation: Sorting potential buyers into groups that have common needs and will respond similarly to a marketing action • Product Differentiation: Strategy of using different marketing mix activities, such as product features and advertising, to help consumers perceive a product as being different and better than competing products ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  12. 12. Ways Reebok Segments Markets • Age segments: Teenagers are more than 32% of total sales (Demographic) • Gender segments: Men segment buys more but Women segment has higher growth (Demographic) • Price segments: 62% of sneakers cost less than $50 (Demographic) • Sports segments: Running shoes are #1 (29%) sales, basketball shoes #2 (21%), cross trainers #3, (13%). Basketball shoes sales increasing, cross trainers declining slightly (Demographic) • Lifestyle segments: 75% of sales are for casual, non-athletic use. Athletic shoes are more profitable with prices rising dramatically (Psychographic) ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  13. 13. Reebok: Market Product grid Group Running shoes Aerobic shoes Tennis shoes Basket ball shoes Walking shoes Cross- training S. Carter Runners P P Exercise P P Tennis P P Basket ball P P Walkers S S S S P P Comfort/ style S S S S S S Street fashion P ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  14. 14. Segmentation: Link needs to Actions Identify Market Needs Features Benefits Cost Quality Convenience Execute Marketing Program Product Price Promotion Place Process of segmenting and targeting markets ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  15. 15. When to segment the market? • There is a potential for increased profit • There is similarity of needs within a market segment • There is a difference of need among market segments • Potential of marketing action to reach a segment • Simplicity and cost of assigning potential buyers to a segment ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved
  16. 16. Ways to segment markets • Geographic customer characteristics (Where are they?) • Demographic customer characteristics (Demonstrable facts) • Psychographic customer characteristics: lifestyle (How they think) • Behavioral (How they act, usually users or non-users) ©2017 Mr. Breitsprecher & Breitlinks (www.breitlinks.com) All rights reserved

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