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Marketing Management Session 6


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Marketing Management Session 6

  1. 1. Identifying Market Segments and Targets
  2. 2. Effective Targeting Requires… <ul><li>Identify and profile distinct groups of buyers who differ in their needs and preferences. </li></ul><ul><li>Select one or more market segments to enter. </li></ul><ul><li>Establish and communicate the distinctive benefits of the market offering. </li></ul>
  3. 3. Four Levels of Micromarketing <ul><li>Segments </li></ul><ul><li>Niches </li></ul><ul><li>Local areas </li></ul><ul><li>Individuals </li></ul>
  4. 4. Segment Marketing Targeting a group of customers who share a similar set of needs and wants.
  5. 5. Flexible Marketing Offerings <ul><li>Naked solution </li></ul><ul><ul><li>Product and service elements that all segment members value </li></ul></ul><ul><li>Discretionary options </li></ul><ul><ul><li>Some segment members value </li></ul></ul><ul><ul><li>Options may carry additional charges </li></ul></ul>
  6. 6. The Experience Economy <ul><li>Experience </li></ul><ul><li>Services </li></ul><ul><li>Goods </li></ul><ul><li>Commodity </li></ul>
  7. 7. Customerization Combines operationally driven mass customization with customized marketing in a way that empowers consumers to design the product and service offering of their choice.
  8. 8. Segmenting Consumer Markets <ul><li>Geographic </li></ul><ul><li>Demographic </li></ul><ul><li>Psychographic </li></ul><ul><li>Behavioral </li></ul>
  9. 9. Demographic Segmentation <ul><li>Age and Life Cycle </li></ul><ul><li>Life Stage </li></ul><ul><li>Gender </li></ul><ul><li>Income </li></ul><ul><li>Generation </li></ul><ul><li>Social Class </li></ul>
  10. 10. Psychographic Segmentation <ul><li>VALS </li></ul><ul><li>Four groups with higher resources </li></ul><ul><ul><li>Innovators </li></ul></ul><ul><ul><li>Thinkers </li></ul></ul><ul><ul><li>Achievers </li></ul></ul><ul><ul><li>Experiencers </li></ul></ul>
  11. 11. <ul><li>Four groups with lower resources </li></ul><ul><ul><li>Believers </li></ul></ul><ul><ul><li>Strivers </li></ul></ul><ul><ul><li>Makers </li></ul></ul><ul><ul><li>Survivors </li></ul></ul><ul><ul><li>( </li></ul></ul>Psychographic Segmentation
  12. 12. Behavioral Segmentation <ul><li>Decision Roles </li></ul><ul><li>Initiator </li></ul><ul><li>Influencer </li></ul><ul><li>Decider </li></ul><ul><li>Buyer </li></ul><ul><li>User </li></ul><ul><li>Behavioral Variables </li></ul><ul><li>Occasions </li></ul><ul><li>Benefits </li></ul><ul><li>User Status </li></ul><ul><li>Usage Rate </li></ul><ul><li>Buyer-Readiness </li></ul><ul><li>Loyalty Status </li></ul><ul><li>Attitude </li></ul>
  13. 13. Steps in Segmentation Process <ul><li>Needs-based segmentation </li></ul><ul><li>Segment identification </li></ul><ul><li>Segment attractiveness </li></ul><ul><li>Segment profitability </li></ul><ul><li>Segment positioning </li></ul><ul><li>Segment acid test </li></ul><ul><li>Marketing mix strategy </li></ul>
  14. 14. Effective Segmentation Criteria <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>
  15. 15. DISCUSSION <ul><li>Is Mass Marketing dead? </li></ul>
  16. 16. DISCUSSION <ul><li>Think of various product categories. How would you classify yourself in terms of the various segmentation schemes? How would marketing be more or less effective for you depending on the segment involved? How would you contrast demographic versus behavioral segment schemes? Which ones do you think would be most effective for marketers trying to sell to you? </li></ul>
  17. 17. Dealing with Competition
  18. 18. Figure 1.1 Five Forces Determining Segment Structural Attractiveness <ul><li>Potential entrants </li></ul><ul><li>Suppliers </li></ul><ul><li>Buyers </li></ul><ul><li>Industry competitors </li></ul><ul><li>Substitutes </li></ul>
  19. 19. Industry Concept of Competition <ul><li>Number of sellers and degree of differentiation </li></ul><ul><li>Entry, mobility, and exit barriers </li></ul><ul><li>Cost structure </li></ul><ul><li>Degree of vertical integration </li></ul><ul><li>Degree of globalization </li></ul>
  20. 20. Industry Concept of Competition <ul><li>Pure monopoly </li></ul><ul><li>Oligopoly </li></ul><ul><li>Monopolistic competition </li></ul><ul><li>Pure competition </li></ul>
  21. 21. Analyzing Competitors <ul><li>Share of market </li></ul><ul><li>Share of mind </li></ul><ul><li>Share of heart </li></ul>
  22. 22. Expanding the Total Market <ul><li>New customers </li></ul><ul><li>More usage </li></ul>
  23. 23. Figure 11.6 Six Types of Defense Strategies <ul><li>Defender </li></ul><ul><li>Flank </li></ul><ul><li>Preemptive </li></ul><ul><li>Counteroffensive </li></ul><ul><li>Mobile </li></ul><ul><li>Contraction </li></ul>
  24. 24. Other Competitive Strategies <ul><li>Market challengers </li></ul><ul><li>Market followers </li></ul><ul><li>Market nichers </li></ul>
  25. 25. Market Challenger Strategies <ul><li>Define the strategic objective and opponents </li></ul><ul><li>Choose a general attack strategy </li></ul><ul><li>Choose a specific attack strategy </li></ul>
  26. 26. General Attack Strategies <ul><li>Frontal attack </li></ul><ul><li>Flank attack </li></ul><ul><li>Encirclement attack </li></ul><ul><li>Bypass attack </li></ul><ul><li>Guerrilla warfare </li></ul>
  27. 27. Specific Attack Strategies <ul><li>Price discounts </li></ul><ul><li>Lower-priced goods </li></ul><ul><li>Value-priced goods </li></ul><ul><li>Prestige goods </li></ul><ul><li>Product proliferation </li></ul><ul><li>Product innovation </li></ul><ul><li>Improved services </li></ul><ul><li>Distribution innovation </li></ul><ul><li>Manufacturing-cost reduction </li></ul><ul><li>Intensive advertising promotion </li></ul>
  28. 28. Market Follower Strategies <ul><li>Counterfeiter </li></ul><ul><li>Cloner </li></ul><ul><li>Imitator </li></ul><ul><li>Adaptor </li></ul>
  29. 29. EXERCISE <ul><li>Pick an industry. Classify firms according to the four different roles they might play: leader, challenger, follower and nicher. How would you characterize the nature of competition? Do the firms follow the principles described above? </li></ul>