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Session 13 MG220 BBA - 29 Sep 10


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Session 13
MG 220 Marketing Management

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Session 13 MG220 BBA - 29 Sep 10

  1. 1. Part 3: Connecting with Customers<br />> Market Targeting<br />Part 4: Building Strong Brands<br />> Overall review of Part 4<br />> Discussion on Term Project<br />Class Presentation | Session 13 | 29 Sep 2010<br />
  2. 2. Market Targeting<br />Marketers job is to identify segments and select which ones to target<br />Segments are identified => Now selecting which ones to target<br />More and more refinement helps identify smaller, more focused segments and<br /> Better target them<br />MG 220 Marketing Management<br />2<br />
  3. 3. Market TargetingEffective Segmentation Criteria<br />Market segments must rate favorably on following criteria:<br />Measurable<br />Size, purchasing power, characteristics can be measured easily<br />It should not be vague<br />Substantial<br />Large & profitable enough to serve<br />Worth going after with a tailored marketing program/effort<br />Accessible<br />Can be effectively reached and served<br />Differentiable<br />Conceptually distinguishable<br />Respond differently to different marketing-mix elements<br />Actionable<br />Effective programs can be formulated for that particular segment<br />MG 220 Marketing Management<br />3<br />
  4. 4. Market TargetingEvaluating and Selecting the Market Segments<br />Evaluation process<br />Based on five criteria (mentioned previously)<br />Vis-à-vis two factors:<br />Segment’s overall attractiveness<br />Company’s objectives and resources<br />A company must evaluate segments carefully by answering all criteria clearly and ensuring that it is favorable<br />MG 220 Marketing Management<br />4<br />
  5. 5. Market TargetingEvaluating and Selecting the Market Segments<br />Selecting Market Segments<br />Selection is done based on evaluation of market segments<br />Five different patterns are used:<br />Single-segment concentration<br />Selective Specialization<br />Product Specialization<br />Market Specialization<br />Full Market coverage<br />(illustrations ahead are in a grid pattern showing M-Market vs. P-Product)<br />MG 220 Marketing Management<br />5<br />
  6. 6. Market TargetingEvaluating and Selecting the Market Segments<br />1. Single-segment concentration<br />Pick only one segment<br />Focus on it and achieve leadership and thus<br />Have high returns of investment<br />Downside:<br />Too much dependency implies increased risk <br />Generally:<br />Companies tend to operate in more than one segment<br />Helps diversify and absorb costs in a better way<br />Concept of Supersegments: Segments sharing exploitable similarities: Companies try to operate in supersegments too<br />MG 220 Marketing Management<br />6<br />
  7. 7. Market TargetingEvaluating and Selecting the Market Segments<br />2. Selective Specialization<br />Pick different segments having no synergy<br />Each is objectively attractive and appropriate<br />Different approaches can be:<br />Different products in different markets (as in fig.)<br />Different segments (totally isolated from each other)picked for one product<br />MG 220 Marketing Management<br />7<br />
  8. 8. Market TargetingEvaluating and Selecting the Market Segments<br />3. Product Specialization<br />Focus on one product<br />Offered across all markets (segments)<br />Too much focus on product alone<br />What if product is replaced by a betterproduct or technology?<br />Example: Kodak’s camera films<br />MG 220 Marketing Management<br />8<br />
  9. 9. Market TargetingEvaluating and Selecting the Market Segments<br />4. Market Specialization<br />Focus on one market<br />Focus is on serving as many needs of that market<br />Again, too much dependency on one area<br />What if this market is not able to grow?<br />Example: Institutes too much focused onaccounting market (CA, ACCA, CAT etc.) Had to diversify into finance programs (CFA, CISA)<br />MG 220 Marketing Management<br />9<br />
  10. 10. Market TargetingEvaluating and Selecting the Market Segments<br />5. Full Market Coverage<br />Serve all customer segments for all their needs<br />Very hard to do. Generally large firms can do it only<br />E.g. Microsoft (software market)<br />Two broad strategies/approaches:<br />Undifferentiated Marketing: Firm ignores segmentdifferences and offers one product to all<br /> Coke’s 300 ml bottle example applies here<br />Differentiated Marketing: Different products fordifferent segments – still covering all segments<br />Microsoft targeting different segments in software market differently <br />MG 220 Marketing Management<br />10<br />
  11. 11. Market TargetingEvaluating and Selecting the Market Segments<br />Managing Multiple Segments<br />Using segment managers<br />Each is responsible for growth and profitability of own segments<br />Differentiated Marketing Costs<br />In differentiated marketing (targeting different segments with different products), higher sales are possible than undifferentiated marketing but costs are also increased.<br />Product modification costs<br />Manufacturing costs<br />Administrative costs<br />Inventory costs<br />Promotion costs<br />Marketers need to understand the trade-off and be cautious of segmentation (particularly over-segmentation)<br />MG 220 Marketing Management<br />11<br />
  12. 12. Market TargetingAdditional Considerations<br />Segment-by-Segment invasion plans<br />Recommended: enter one segment at a time<br />Add more with time<br />Segment-by-segment invasion plans should be kept as confidential as possible<br />Companies at times fail todevelop these plans<br />How to enter blocked markets:Concept of megamarketing<br />MG 220 Marketing Management<br />12<br />
  13. 13. Market TargetingAdditional Considerations<br />Updating Segmentation schemes<br />Market segmentation analysis should be done periodically because business environment change<br />How consumer attributes change and understanding of it helps update market segmentation<br />Ethical choice of market targets<br />Ensuring that marketing efforts are not exploiting vulnerable groups in society<br />OR promoting harmful products<br />MG 220 Marketing Management<br />13<br />
  14. 14. Part 4: Building Strong Brands<br />> Overall review: Part 4<br />Class Presentation | Session 13 | 29 Sep 2010<br />
  15. 15. Part 4: Building Strong Brands<br />Chap 9: Creating Brand Equity<br />What is Brand Equity?<br />Building Brand Equity<br />Measuring Brand Equity<br />Managing Brand Equity<br />Devising a Branding Strategy<br />Chap 10: Crafting the Brand Positioning<br />Developing and Creating a Positioning Strategy<br />Differentiation Strategies<br />Product Life-cycle marketing strategies<br />Market Evolution<br />Chap 11: Dealing with Competition<br />Competitive forces<br />Identifying Competitors<br />Analyzing Competitors<br />Competitive Strategies for Market Leaders<br />Other Competitive Strategies<br />Balancing Customer and Competitor Orientations<br />MG 220 Marketing Management<br />15<br />
  16. 16. Discussion on Term Project<br />Two Projects 10%<br />Individual Project 3%<br /> Project Report<br /> Individual Presentation (5 mins.)<br /> 2-weeks beginning Oct 5, 2010<br /> 1 x deliverable | 1 x presentation<br />Team Project 7%<br /> Teams of 4 individuals each<br /> Project Report<br /> Team Presentation<br /> 4-weeks project beginning Oct 19,2010<br /> 3 x deliverables | 1 x presentation<br />MG 220 Marketing Management<br />16<br />
  17. 17. Part 4: Building Strong Brands<br />> What is Brand Equity?<br />> Building Brand Equity<br />> Measuring Brand Equity<br />> Managing Brand Equity<br />> Discussion on Mid-Term I<br />Class Presentation | Session 14 | 5 Oct 2010<br />