Session_6_Segmentation, Targeting, Positioning

1. SEGMENTATION,SEGMENTATION,
TARGETING ANDTARGETING AND
POSITIONING (STP)POSITIONING (STP)
PhD.c.PhD.c. SeymurSeymur M. GM. GULULIIYEVYEV

2. STP Strategy
1. Market
Segmentation
2. Market
Targeting
3. Market
Positioning
S T P

3. Market Segmentation
 Market segmentation is the
subdividing of a market
into distinct subsets of
customers.
Segments
 Members are different
between segments but
similar within.

4. WHAT IS A SEGMENTATION?WHAT IS A SEGMENTATION?
 HETEROGENIC MARKET – different types of
products are needed by consumers or customers.
For instance: home, automobile, clothes and so
on…
 SEGMENTATION – dividing heterogeneous
markets to homogeneous submarkets.
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5. Segmentation Marketing
Definition
Differentiating your product
and marketing efforts to
meet the needs of different
segments, that is, applying
the marketing concept to
market segmentation.

6. Primary Characteristics
of Segments
 Bases - characteristics that tell us why segments
differ (e.g. needs, preferences, decision processes).
 Descriptors - characteristics that help us find and
reach segments.
 (Business markets) (Consumer markets)
Industry Age/Income
Size Education
Location Profession
Organizational Life styles
structure Media habits

7. Segmentation in Action
We se g m e nt o ur custo m e rs by le tte r vo lum e , by
po stag e vo lum e , by the type o f e q uipm e nt the y
use . The n we se g m e nt o n whe the r the y buy o r
le ase e q uipm e nt.
Base d o n this kno wle dg e , we targ e t o ur m arke ting
m e ssag e s, fine tune o ur sale s tactics, le arn which
be ne fits appe alto which custo m e rs and z e ro in o n
ke y de cisio n m ake rs at a co m pany.
— Kathleen Synnot, VP, Worldwide Marketing
Mailing Systems Division, Pitney Bowes, Inc.

8. STP as Business Strategy
Segmentation
 Identify segmentation bases and segment the market.
 Develop profiles of resulting segments.
Targeting
 Evaluate attractiveness of each segment.
 Select target segments.
Positioning
 Identify possible positioning concepts for each target segment.
 Select, develop, and communicate the chosen concept.
… to create and claim value

9. Benefits of Segmentation
1. Consumer needs are effectively met
2. More profitable market segment are chosen
3. Different promotional activities are used for each
segment
4. Changes in the market are effectively tracked
5. Marketing activities are effectively implemented
6. All resources are used efficiency
Weaknesses of Segmentation
1. Segmentation requires a huge costs
2. Stock costs are increased due to needed different
stocks
3. Different ad is needed for each segment
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10. BASIC SEGMENTATION CRITERIABASIC SEGMENTATION CRITERIA
AND ITS TYPESAND ITS TYPES
CONSUMER MARKET SEGMENTATION
1. Geographical and regional based segmentation
2. Demographic segmentation
3. Psychological segmentation
4. Segmentation regarding to product factors
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11. Market Segmentation
 Geographic Segmentation
 Dividing the market into different geographical
units such as nations, states, regions,
countries, cities, or neighborhoods.
(Philip Kotler)

12. Market Segmentation
 Demographic Segmentation
 Dividing the market into groups based on
demographic variables such as age, gender,
family size, family life cycle, income,
occupation, education, religion, race, and
nationality.
(Philip Kotler)

13. Market Segmentation
 Psychographic Segmentation
 Dividing a market into different groups based
on social class, lifestyle, or personality
characteristics.
(Philip Kotler)

14. Market Segmentation
 Behavioral Segmentation
 Dividing a market into groups based on
consumer knowledge, attitude, use, or
response to a product.
(Philip Kotler)

15. BUSINESS MARKET SEGMENTATIONBUSINESS MARKET SEGMENTATION
 Regional and Geographical based segmentation
 Organization type
 Customer type
 Product using
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16. Market Targeting
 Market Targeting:
 The process of evaluating each market
segment’s attractiveness and selecting one or
more segment to enter.

17. Market Targeting
 A target market is a set of buyers sharing
common needs or characteristics that the
company decides to serve.

18. Market Targeting
 Evaluating and Selecting the Market Segments:
Company’s Objectives
And Resources
Attractiveness of the Market
•Size
•Growth
•Profitability
•Scale Economies
•Competition
•Risks
•Synergy

19. Market Targeting
 Five Patterns of Target Market Selection
 (by D.F. Abell)S1 S2 S3
P1
P2
P3
P = Products
S = Market Segment
Single Segment Concentration

20. Market Targeting
S1 S2 S3
P1
P2
P3
P = Products
S = Market Segment
Selective Specialization
 Five Patterns of Target Market Selection
 (by D.F. Abell)

21. Market Targeting
S1 S2 S3
P1
P2
P3
P = Products
S = Market Segment
Product Specialization
 Five Patterns of Target Market Selection
 (by D.F. Abell)

22. Market Targeting
S1 S2 S3
P1
P2
P3
P = Products
S = Market Segment
Market Specialization
 Five Patterns of Target Market Selection
 (by D.F. Abell)

23. Market Targeting
S1 S2 S3
P1
P2
P3
P = Products
S = Market Segment
Full Market Coverage
 Five Patterns of Target Market Selection
 (by D.F. Abell)

24. TARGET MARKET SELECTIONTARGET MARKET SELECTION
STRATEGIESSTRATEGIES
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1. Differentiated Marketing
2. Undifferentiated Marketing
3. Focused Marketing

25. Market Targeting
 Three Alternative Market Strategies
 (by Philip Kotler)
Undifferentiated
Marketing Company
Marketing
Mix
The Market

26. UNDIFFERENTIATED MARKETINGUNDIFFERENTIATED MARKETING
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MARKET
COMPANY
One 4P
Everybody can be customer. It is
impossible to segment market for some
kind of products. For instance: bread,
salt, matches and etc… only one 4P is
used in such markets.
This strategy is used as soon as sales
income and profit expectations of a
company are met.

27. Market Targeting
Differentiated
Marketing Mix 1
Mix 2
Mix3
S1
S2
S3
 Three Alternative Market Strategies
 (by Philip Kotler)

28. DIFFERENTIATED MARKETINGDIFFERENTIATED MARKETING
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 Different 4P’s is used in
different identified
market segments.
 This strategy is generally
used by HOLDINGS.
1st
4P
COMPANY
2nd
4P
3rd
4P

29. Market Targeting
Concentrated
Marketing
S2
Company
Marketing
Mix
 Three Alternative Market Strategies
 (by Philip Kotler)

30. FOCUSED MARKETINGFOCUSED MARKETING
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 Market is segmented and
only one segment is chosen
to work.
 Produced goods and services
may belong to one segment.
To exemplify: Universities
are advertised for people
aged between 18-25.
one 4P
COMPANY

31. MARKET EVALUATION AD SALESMARKET EVALUATION AD SALES
FORECASTINGFORECASTING
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Potential Market, Sales Potential, Sales ForecastingPotential Market, Sales Potential, Sales Forecasting
Potential Market – the number of people can be
costumers for an industry.
Sales Potential – How many people can buy the
product.
Sales Forecast – the number of products can be sold.

32. Market Positioning
 Market Positioning
 Arranging for a product to occupy a clear,
distinctive, and desirable place relative to
competing products in the minds of target
consumers.
(Philip Kotler)

33. Market Positioning
 “Positioning” according to Ries and Trout
 “Positioning is what you do to the minds of the prospect. That is,
you position the product in the mind of of the prospect.
 (Al Ries and Jack Trout: “Positioning: The Battle fo r Yo ur Mind”, NY Warner
Books, 1982)
Here!

34. Market Positioning
 “Product Position”
 The Way the product is defined by Consumers
on important attributes – the place the product
occupies in consumers minds relative to
competing products.
(Philip Kotler)

35. Market Positioning

Find yourUSP
 (Unique Selling Proposition)
 And stand out from the crowd!
 (Reference: Find your USP )

36. Market Positioning
 USP defined
 The concept of "USP" is credited to Rosser
Reeves, chairman of the Ted Bates & Co.
advertising agency in the 1950s. He was
one of the first to develop a technique for
communicating in an overcrowded
marketplace. His definition of what makes a
USP holds true today.

37. Market Positioning
 USP defined
 All advertising must make a proposition to
the customer:
Buy this, and you will receive a specified
benefit.
 The proposition must be unique;
something competitors cannot claim, or
have not chosen to emphasize in their
promotions.
 The proposition must be so compelling
that it motivates individuals to act.

38. Market Positioning
 USP References:
 Ref: Your USP: Use it or lose it
 Practice: What is your USP?
 In the class
 When you apply for a Job
 When you want to marry!