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Market segmentation & targeting lecture 2
The document outlines essential marketing principles, emphasizing the importance of market segmentation to effectively target distinct consumer subgroups based on shared characteristics and needs. Key segmentation types include demographic, psychographic, and behavioral factors, which enable organizations to enhance marketing effectiveness and customer satisfaction. It also discusses strategies for selecting target markets and the criteria involved in developing an effective marketing strategy.
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Market segmentation & targeting lecture 2
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- 2. All of thisissues need a marketing plan to overcome the threats & get their objectives & goals
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- 5. THE MOST IMPORTANTDEFINITIONS
- 6. SEGMENTATION Is Subdividing OfMarket Into Homogeneous Sub Set Of Customers Where Any Subset May Be Selected As Marketing Target TARGETING a well-defined set of customers whose needs the organization plans to satisfy POSITIONING Is the act of designing the company's image to occupy a distinctive place in the target market's mind THE MOST IMPORTANT DEFINITIONS How do we define it ?
- 7. 7- 7 Identify bases for segmenting themarket Develop segment profile Develop measures of segment attractivenes s Select the target market Develop positioning for target segments Develop a marketing mix for each segment
- 10. There is alot of definitions to the market segmentation Market segmentation involves the subdividing of a market into distinct subgroups of customers, where any subgroup can be selected as a target market Market Segmentation is the marketing process of identifying and breaking up the total market into groups of potential customers with similar motivations, needs or characteristics, who are likely to exhibit homogeneous purchase behaviour. Undertaking this process allows marketing efforts to be targeted at select groups.
- 11. creaminess sweetness creaminess sweetness creaminess sweetness C - ClusteredPreference -natural segments -increases as number of competitors increases A - Homogeneous Preference -no natural segments -all buyers have same preference B - Diffused Preference -no pattern (…or poor research) -take center position
- 12. Why market segmentation ???? To developmarketing activities Increase marketing effectiveness Generate greater customer satisfaction Create savings To identify strategic opportunities and niches Allocation of marketing budget Adjustment of product to the market need To estimate the level of sales in the market To overcome competition effectively To develop effective marketing programmes To contribute towards achieving company goals
- 13. 7- 13 • Segmenting ConsumerMarkets • Segmenting Business Markets • Segmenting International Markets • Requirements for Effective Segmentation • Geographical segmentation – Marketing mixes are customized geographically • Demographic segmentation • Psychographic segmentation • Behavioral segmentation • Using multiple segmentation variables Key Topics Market Segmentation
- 14. Market Segmentation Geographic Segmentation Variables Cityor Metro Size Density Climate World Region or Country Country Region City
- 15. 7- 15 • Segmenting ConsumerMarkets • Segmenting Business Markets • Segmenting International Markets • Requirements for Effective Segmentation • Geographical segments • Demographic segmentation – Most popular type – Demographics are closely related to needs, wants and usage rates • Psychographic segmentation • Behavioral segmentation • Using multiple segmentation variables Key Topics Market Segmentation
- 16. 7- 16 Demographic Segmentation Variables •Age • Gender • Family size • Family life cycle • Income Occupation Education Religion Nationality Market Segmentation
- 17. 7- 17 • Segmenting ConsumerMarkets • Segmenting Business Markets • Segmenting International Markets • Requirements for Effective Segmentation • Geographic segments • Demographic segmentation • Psychographic segmentation – Lifestyle, social class, and personality-based segmentation • Behavioral segmentation • Using multiple segmentation variables Key Topics Market Segmentation
- 18. 7- 18 • Segmenting ConsumerMarkets • Segmenting Business Markets • Segmenting International Markets • Requirements for Effective Segmentation • Geographic segments • Demographic segmentation • Psychographic segmentation • Behavioral segmentation – Based on knowledge, attitude, use or response to a product – Typically done first • Using multiple segmentation variables Key Topics Market Segmentation
- 19. 7- 19 Behavioral SegmentationVariables • Occasions: According to occasions buyer get the idea to buy or use the purchased item. • Benefits sought: According to different benefits consumers seek from the product. • User Status: Nonusers, ex-users, potential users, first-time users & regular users. • User Rates: Light, medium & heavy product users. • Loyalty Status: Loyalty to brands, stores & companies can be a base. Consumers can be somewhat loyal & completely loyal Market Segmentation
- 20. 7- 20 • Segmenting ConsumerMarkets • Segmenting Business Markets • Segmenting International Markets • Requirements for Effective Segmentation • Geographic segments • Demographic segmentation • Psychographic segmentation • Behavioral segmentation • Using multiple segmentation variables Key Topics Market Segmentation
- 21. 7- 21 • Segmenting ConsumerMarkets • Segmenting Business Markets • Segmenting International Markets • Requirements for Effective Segmentation • Demographic segmentation – Industry, company size, location • Operating variables – Technology, usage status, customer capabilities • Purchasing approaches • Situational factors – Urgency, specific application, size of order • Personal characteristics – Buyer-seller similarity, attitudes toward risk, loyalty Key Topics Market Segmentation
- 22. 7- 22 • Segmenting ConsumerMarkets • Segmenting Business Markets • Segmenting International Markets • Requirements for Effective Segmentation • Geographic segmentation – Location or region • Economic factors – Population income or level of economic development • Political and legal factors – Type / stability of government, etc. • Cultural factors – Language, religion, values, attitudes, customs, behavioral patterns Key Topics Market Segmentation
- 23. 7- 23 • Segmenting ConsumerMarkets • Segmenting Business Markets • Segmenting International Markets • Requirements for Effective Segmentation • Measurable – Size, purchasing power, and profile of segment • Accessible – Can be reached and served • Substantial – Large and profitable enough to serve • Differentiable – Respond differently • Actionable – Effective programs can be developed Key Topics Market Segmentation
- 24. – Consists ofa set of buyers who share common needs or characteristics that the company decides to serve. – The process of evaluating segments and focusing marketing efforts on a country, region, or group of people that has significant potential to respond Target Market
- 25. Criteria for Targeting:9 W’s • Who buys our product? • Who does not buy it? • What need or function does it serve? • What are customers buying to satisfy the need for which our product is targeted? • What price are they paying? • When is the product purchased? • Where is it purchased? • Why is it purchased?
- 26. FACTORS CONSIDERED IMPORTANT INTHE SELECTION OF TARGET MARKET STRATEGY • 1. Company’s Resources • 2. Product Homogeneity • 3. Product Stage in the Life Cycle • 4. Market Homogeneity • 5. Competitive Marketing Strategy
- 27. • Target MarketingStrategies Five basic strategies for target market selection: • (1) Single Segment Targeting • (2) Selective Targeting • (3) Mass Market Targeting • (4) Product Specialization • (5) Market Specialization
- 28. • Basic TargetMarketing Strategies
- 29. Strategies of TargetMarketing • Undifferentiated (mass) Marketing • Differentiated (segmented) Marketing • Concentrated (niche) Marketing • Micromarketing (local or individual marketing) • Ignoring market segments differences & make one offer to whole market • Target several segments & designs offer for each • Group of customers seeking a distinctive mix of benefits who are ready to pay extra premium • Tailoring to the needs & wants of the locals or individuals Key Topics
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- 38. THANK YOU! FOR YOURATTENTION