4 segmentation

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4 segmentation

  1. 1. NSW
  2. 2. Chapter 4 Market segmentation, targeting and positioning
  3. 3. Targeting? Segmentation? Position? Three main learning objectives
  4. 4. Market segmentation This is the process of dividing the total market into several smaller similar groups. All members in a group have similar factors that influence their demand .
  5. 5. Benefits of segmentation <ul><li>Identify and satisfy specific benefits </li></ul><ul><li>Efficiently use limited resources </li></ul><ul><li>Select target market. </li></ul><ul><li>Action the market segmentation plan. </li></ul>
  6. 6. Limitations of segmentation Limits Mass production increase Expense s Limits Standardisation
  7. 7. <ul><li>Segmentation limits : </li></ul><ul><li>Mass production, which offers economies of scale. </li></ul><ul><li>Standardisation of service, which increases delivery speed and efficiency. </li></ul><ul><li>Segmentation increases : </li></ul><ul><li>Expense through production and marketing of products to only specific groups of the market. </li></ul><ul><li>Promotion, administrative and inventory costs. </li></ul>Limitations of segmentation
  8. 8. Bases for segmentation
  9. 9. Bases for segmentation Demographic Psychographic Behaviour Geographic Marketer
  10. 10. Population <ul><li>People constitute a market. </li></ul><ul><li>Marketers analyse the population and its geographic and demographic distribution as the first steps to understanding the consumer market. </li></ul>
  11. 11. Bases for segmentation <ul><li>Geographic — The city size, urban/ suburban/ rural population distribution and climate. </li></ul>
  12. 12. <ul><li>Geographic distribution — frequently divided into rural, urban and suburban. </li></ul>-Rural -Suburban -urban
  13. 13. <ul><ul><li>Age. </li></ul></ul><ul><ul><li>Gender. </li></ul></ul><ul><ul><li>Family life cycle. </li></ul></ul><ul><ul><li>Education. </li></ul></ul><ul><ul><li>Income distribution. </li></ul></ul><ul><ul><li>Ethnicity. </li></ul></ul>Demographics — the vital statistics that describe a population. In particular:
  14. 14. Relevance of consumer demographics <ul><li>Infant market (0 – 4 yrs). </li></ul><ul><li>Child market (5–12 yrs). </li></ul><ul><li>Teenage market (13–16 & 17–20). </li></ul><ul><li>Young adult/Young family market (21–39). </li></ul><ul><li>Middle-aged market (40–55). </li></ul><ul><li>Mature-age market (55–65). </li></ul><ul><li>Over 65s. </li></ul>Age
  15. 15. Gender Male Female
  16. 16. Family life cycle <ul><li>Single parent and two-parent famil ies . </li></ul><ul><li>Young couples with no children. </li></ul><ul><li>Family (usually 2 adults, 2 young children). </li></ul><ul><li>Family with teenagers. </li></ul><ul><li>Multicultural (or mixed) family. </li></ul>Family life cycle will determine the purchase behaviour
  17. 17. Consumer income <ul><li>Upper class </li></ul><ul><li>Middle class </li></ul><ul><li>Lower class </li></ul><ul><li>… .. </li></ul>
  18. 18. 12 Pensioners, widows, casual or lower-grade workers Those at lowest levels of subsistence E 19 Semiskilled and unskilled workers Working D 25 Skilled manual workers Skilled working C2 27 clerical, junior managerial, administrative Lower middle C1 14 Intermediate managerial, or professional Middle B 3 Higher managerial or professional Upper middle A % of population Occupation of head of household Social status Class name
  19. 19. <ul><li>Psychographic — Personalities, lifestyles, social class including a ctivities, i nterests and o pinions (AIO). </li></ul><ul><li>Behaviour towards products. </li></ul><ul><ul><li>Benefits desired or sought. </li></ul></ul><ul><ul><li>Product usage rate. </li></ul></ul>
  20. 20. Social i nfluences <ul><li>Culture. </li></ul><ul><li>Social class. </li></ul><ul><li>Reference groups. </li></ul><ul><li>Families and other households. </li></ul><ul><ul><li>Core values, attitudes and beliefs. </li></ul></ul><ul><ul><li>The family as a buying unit. </li></ul></ul>
  21. 21. Culture difference 3,13 4,7 Red, Black White, Black 7, White, Purple 6,8,9,10 Red, Yellow, number Color
  22. 22. 12 Pensioners, widows, casual or lower-grade workers Those at lowest levels of subsistence E 19 Semiskilled and unskilled workers Working D 25 Skilled manual workers Skilled working C2 27 clerical, junior managerial, administrative Lower middle C1 14 Intermediate managerial, or professional Middle B 3 Higher managerial or professional Upper middle A % of population Occupation of head of household Social status Class name
  23. 23. Market segmentation process <ul><li>1. Identifying the needs and wants of customers. </li></ul>2. Identifying the different characteristics between market segments. 3. Estimating the market potential .
  24. 24. Identify the needs and wants of customers what they need?
  25. 25. Identify different market segments <ul><li>Identify characteristics that distinguish particular segments from others. </li></ul>Business persons need first or business class instead of economy class.
  26. 26. Estimate the market potential <ul><li>Forecasting of market demand will determine: </li></ul>Market potential Sales potential Market demand <ul><ul><li>Market share. </li></ul></ul>
  27. 27. Conditions for effective segmentation A segmentation process must meet 3 conditions: <ul><li>The characteristics used to categorise customers must be measurable and the data obtainable . </li></ul><ul><li>The segment itself must be accessible through existing marketing institutions with a minimum of cost and waste. </li></ul><ul><li>A segment must be large enough to be profitable. </li></ul>
  28. 28. Targeting Where is the market?
  29. 29. Resources goals & image profit
  30. 30. Target market strategies <ul><li>The target market should be compatible with an organisation’s goals and image . </li></ul><ul><li>The marketing opportunity presented by the segment must match the company’s resources . </li></ul><ul><li>The business must generate a profit if it is to continue its existence. </li></ul>
  31. 31. aggregation single market multiple segmentation Segment 1 Segment 2 Segment 3 Company marketing mix Segment 1 Segment 2 Segment 3 Company marketing mix Company mix 1 Company mix 2 Company mix 3 Market
  32. 32. <ul><li>VolksWagenwerk 。 </li></ul>
  33. 33. Polo
  34. 34. Beetles
  35. 35. Passat
  36. 36. Pheaton
  37. 37. Touran
  38. 39. Positioning <ul><li>Definition: </li></ul><ul><li>Customers’ image or perception of a particular brand or company </li></ul>How is my image?
  39. 40. Positioning strategies Class or attribute Price & Quality competitor
  40. 41. Cappuccino from Starbucks Beef sandwiches from McDonalds Iphone 4 from Apple N95 from Nokia Camry from Toyota 5 series from BMW Neverfull bag from LV 1.Brief introduction of the product 2.Identify target market of the product
  41. 42. Thank You

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