2. Chapter 7
Global Segmentation and
Positioning
Chapter 7
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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3. Chapter Overview
1. Reasons for International Market
Segmentation
2. International Market Segmentation
Approaches
3. Segmentation Scenarios
4. Bases for Country Segmentation
5. International Positioning Strategies
Chapter 7
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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4. Chapter Overview (contd.)
6. Global, Foreign, and Local Consumer
Culture Positioning
7. Appendix
Chapter 7
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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5. Introduction
Variation in customer needs is the primary motive
for market segmentation.
Most companies will identify and target the most
attractive market segments that they can
effectively serve.
In global marketing, market segmentation
becomes especially critical because of wide
divergence in cross-border consumer needs and
lifestyles.
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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6. Introduction (contd.)
Once the management has chosen its target
segments, management needs to determine a
competitive positioning strategy for its products.
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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7. 1. Reasons for International Market
Segmentation
Segments ideally should possess the following set
of properties:
– Identifiable
– Sizable
– Accessible
– Stable
– Responsive
– Actionable
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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8. 1. Reasons for International Market
Segmentation (contd.)
Country Screening
Global Market Research
Entry Decisions
Positioning Strategy
Resource Allocation
Marketing Mix Policy
– Balance between standardization and
customization
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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9. 2. International Market Segmentation
Approaches
International segmentation procedures:
– Country-ad-segments or aggregate
segmentation
– Disaggregate international consumer
segmentation
– Two-stage international segmentation
The standard country segmentation procedure
classifies prospect countries on a single dimension
Chapter 7
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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10. 2. International Market Segmentation
Approaches (contd.)
(e.g., per capita GNP) or on a set of multiple
socioeconomic, political, and cultural criteria
available from secondary data sources.
When there are numerous country traits, use
smaller set of dimensions using data reduction
techniques such as factor analysis.
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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11. 3. Segmentation Scenarios
Universal or global segments
Regional segments
Unique (diverse) segments
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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12. 4. Bases for Country Segmentation
Demographics
– Demographics variables are among the most
popular criteria.
Socioeconomic Variables
– Caveats in using per capita income as an
economic development indicator:
» Monetization of transactions within a
country
Chapter 7
Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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13. 4. Bases for Country Segmentation
(contd.)
» Gray and Black Market sections of the
economy
» Income disparities
– Purchasing Power Parity (PPP) criteria
– Socioeconomic Strata (SES) Analysis
– Human development index (HDI) classification
Behavior-Based Segmentation
14. 4. Bases for Country Segmentation
(contd.)
Lifestyles
– Global Values Segments; the survey
investigated 1000 consumers in 35 countries
(source: Robert Starch Worldwide):
» Strivers (23 percent)
» Devouts (22 percent)
» Altruists (18 percent)
» Intimates (15 percent)
» Fun Seekers (12 percent)
» Creatives (10 percent)
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15. 5. International Positioning Strategies
The formulation of a positioning strategy (local or
global) includes the following steps:
1. Identify the relevant set of competing
products or brands.
2. Determine current perceptions held by
consumers about your product/brand and the
competition.
3. Develop possible positioning themes.
4. Screen the positioning alternatives and select
the most appealing one.
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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16. 5. International Positioning Strategies
(contd.)
5. Develop a marketing mix strategy.
6. Over time, monitor the effectiveness of your
positioning strategy and if needed, conduct an
audit.
Uniform vs. Localized Positioning Strategies
Universal Positioning Appeals
– Positioning themes:
» Specific product features/attributes
» Product benefit, solutions for problems
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Kotabe & Helsen's Global Marketing
Management, Third Edition, 2004
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17. 5. International Positioning Strategies
(contd.)
» User application
» Lifestyles
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18.
19. 6. Global, Foreign, and Local Consumer
Culture Positioning
Global consumer culture positioning (GCCP)
– Brand as a symbol of a given global consumer
culture
Local consumer culture positioning (LCCP)
– Brand as an intrinsic part of the local culture.
Foreign consumer culture positioning (FCCP)
– Brand mystique built around a specific foreign
culture
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Management, Third Edition, 2004
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20. 7. Appendix
Segmentation techniques and tools:
– Cluster Analysis: Collection of statistical
procedures for dividing objects into groups
(clusters). The grouping is done in such a
manner that members belonging to the same
group are very similar to one another but quite
distinct from members of other groups.
– Regression Analysis: In regression, one
assumes that there exists a relationship between
a response variable, Y, and one or more socalled predictor variables, X1, X2 and so on.
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21. 7. Appendix (contd.)
– For each of the parameter estimates, the
regression analysis will also produce standard
error.
– The higher the R2 value, the better the ability
of the regression model to predict the data.
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Management, Third Edition, 2004
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