7.1 Product based marketing strategies 7.2 Customer based marketing strategies 7.3 Market segmentation

1. OpenArc Campus BIT-UCSC 2015
Semester IV – Ebusiness Applications
Ref: ELECTRONIC COMMERCE, Ninth Edition, Gary P. Schneider

2. Believes that customers
organize their needs into
product categories.
So the focus is on the
categories of products sold.

3.  Most companies offer a variety of products
that appeal to different groups.
 When creating a marketing strategy,
managers must consider both the nature of
their products and the nature of their
potential customers.

4.  Managers at many companies think of their
businesses in terms of the products and
services they sell.
 This is a logical way to think of a business
because companies spend a great deal of
effort, time, and money to design and create
those products and services.

5.  If you ask managers to describe what their
companies are selling, they usually provide
you with a detailed list of the physical objects
they sell or use to create a service.

6.  When customers are likely to buy items from
particular product categories, or are likely to
think of their needs in terms of product
categories, this type of product-based
organization makes sense.
 Most office supplies stores on the Web
believe their customers think of their needs
using a product category structure.

7. Scenario 1 Scenario 2
 If customers arrive at
these Web sites
looking for a specific
type of product,
 Customers who are
looking to fulfill a
specific need, such as
outfitting a new sales
office or choosing a
graduation gift, rather
than find a specific
product,

8.  Many marketing researchers and consultants
advise companies to think as if they were
their own customers and to design their Web
sites so that customers find them to be
enabling experiences that can help customers
meet their individual needs.
 Sometimes this requires the Web site to offer
alternative shopping paths.

9.  For example, an online florist’s Web site
could allow customers to specify an
arrangement that includes specific flowers
(satisfying customers with a desire for a
specific product), yet provide a separate
shopping path for customers who want to
buy an arrangement for a specific occasion
(birthday, anniversary, Mother’s Day, and so
on).

10. Built to address the specific
needs of various types of
customers (customer groups).
The first step is to identify
customers who share common
interest

11.  Web creates an environment that allows
buyers and sellers to engage in complex
communications modes.
 The communication structures on the Web
can become much more complex than those
in traditional mass media outlets such as
broadcast and print advertising. When a
company takes its business to the Web, it can
create a Web site that is flexible enough to
meet the needs of many different users.

12.  Instead of thinking of their Web sites as
collections of products, companies can build
their sites to meet the specific needs of
various types of customers.
 A good first step in building a customer-
based marketing strategy is to identify
groups of customers who share common
characteristics.

13.  Breaking customers into main groups is a
good first step, subgroups probably exist
within each of those groups.
 Marketers can use their experience with
selling in their industries to identify those
subgroups and then develop marketing
strategies and tactics that will effectively
reach customers in each subgroup.

14.  The use of customer-based marketing
approaches was pioneered on B2B sites.
 B2B sellers were more aware of the need to
customize product and service offerings to
match their customers’ needs than were the
operators of B2C Web sites.
 In recent years, B2C sites have increasingly
added customer-based marketing elements
to their Web sites.

15.  One of the most noticeable trends in this
direction is in university Web sites.
 Today, most university home pages include
links to separate sections of the Web site
designed for specific stakeholders, such as
current students, prospective students,
parents of students, potential donors, and
faculty.

16. Geographic segmentation
Demographic segmentation
Psychographic segmentation

17.  The Web gives companies an opportunity to
present different store environments online.
 In the physical world, retail stores have
limited floor and display space. These
limitations often force physical stores to
decide on one particular message to convey.

18.  On the Web, retailers can provide separate
virtual spaces for different market segments.
 For example, Dell’s home page includes links
to separate sections of its site for home
users, small and medium businesses, public
sector organizations, and large enterprises.

19. Commitment Stage
•Customers often willing to tell others about how happy they are with
their interaction
Awareness
•Customers recognize the name of the company for one of its
products
Separation
•Customers are costly to serve more than they are worth
Exploration
•Potential customers learn more about the company or its products
Extra