Market Segmenatation, Targeting and positioning
- 1. Copyright 1999 Prentice Hall 7-1 Chapter 7 PRINCIPLES OF MARKETING Eighth Edition Philip Kotler and Gary Armstrong Market Segmentation, Targeting, and Positioning for Competitive Advantage
- 2. Copyright 1999 Prentice Hall 7-2 Steps in Segmentation, Targeting, and Positioning 1. Identify Bases for Segmenting the Market 2. Develop Profiles of Resulting Segments 3. Develop Measures of Segment Attractiveness 4. Select Target Segment(s) 5. Develop Positioning for Each Target Segment 6. Develop Marketing Mix for Each Target Segment Market Positioning Market Targeting Market Segmentation
- 3. Copyright 1999 Prentice Hall 7-3 Step 1. Market Segmentation Levels of Market Segmentation Mass Marketing Same product to all consumers (no segmentation) Segment Marketing Different products to one or more segments (some segmentation) Micromarketing Products to suit the tastes of individuals or locations (complete segmentation) Niche Marketing Different products to subgroups within segments ( more segmentation)
- 4. Copyright 1999 Prentice Hall 7-4 Step 1. Market Segmentation Bases for Segmenting Consumer Markets Geographic Demographic Age, gender, family size and life cycle, or income Psychographic Social class, lifestyle, or personality Behavioral Occasions, benefits, uses, or responses Nations, states, regions or cities
- 5. Copyright 1999 Prentice Hall 7-5 Using Multiple Segmentation Bases: Geodemographics
- 6. Copyright 1999 Prentice Hall 7-6 Step 1. Market Segmentation Bases for Segmenting Business Markets Bases for Segmenting Business Markets Demographics Personal Characteristics Situational Factors Operating Characteristics Purchasing Approaches
- 7. Copyright 1999 Prentice Hall 7-7 Step 1. Market Segmentation Bases for Segmenting International Markets Political/ Legal Cultural Intermarket Economic Geographic Industrial Markets
- 8. Copyright 1999 Prentice Hall 7-8 Step 1. Market Segmentation Requirements for Effective Segmentation • Size, purchasing power, profiles of segments can be measured. • Segments must be effectively reached and served. • Segments must be large or profitable enough to serve. Measurable Accessible Substantial Differential Actionable • Segments must respond differently to different marketing mix elements & actions. • Must be able to attract and serve the segments.
- 9. Copyright 1999 Prentice Hall 7-9 Step 2. Market Targeting Evaluating Market Segments • Segment Size and Growth Segment Size and Growth – Analyze sales, growth rates and expected profitability. • Segment Structural Attractiveness Segment Structural Attractiveness – Consider effects of: Competitors, Availability of Substitute Products and, the Power of Buyers & Suppliers. • Company Objectives and Resources Company Objectives and Resources – Company skills & resources relative to the segment(s). – Look for Competitive Advantages.
- 10. Copyright 1999 Prentice Hall 7-10 Step 2. Market Targeting Market Coverage Strategies Segment 1 Segment 2 Segment 3 Segment 1 Segment 2 Segment 3 Company Marketing Mix Company Marketing Mix Company Marketing Mix 1 Company Marketing Mix 2 Company Marketing Mix 3 Market A. Undifferentiated Marketing B. Differentiated Marketing C. Concentrated Marketing
- 11. Copyright 1999 Prentice Hall 7-11 Step 2. Market Targeting Choosing a Market-Coverage Strategy Company Resources Product Variability Product’s Stage in the Product Life Cycle Market Variability Competitors’ Marketing Strategies
- 12. Copyright 1999 Prentice Hall 7-12 Step 3. Positioning for Competitive Advantage • Product’s Position Product’s Position - the place the product occupies in consumers’ minds relative to competing products; i.e. Volvo positions on “safety”. • Marketers must: – Plan positions to give products the greatest advantage – Develop marketing mixes to create planned positions
- 13. Copyright 1999 Prentice Hall 7-13 Step 3. Positioning for Competitive Advantage: Strategies Against a Competitor Usage Occasions Away from Competitors Product Attributes Product Class Benefits Offered Users B A E D C H G F
- 14. Copyright 1999 Prentice Hall 7-14 Steps to Choosing and Implementing a Positioning Strategy • Step 1. Identifying a set of possible competitive advantages: Competitive Differentiation. • Step 2. Selecting the right competitive advantage. • Step 3. Effectively communicating adn delivering the chosen position to the market.
- 15. Copyright 1999 Prentice Hall 7-15 Developing Competitive Differentiation Product Service Personnel Image Areas for Competitive Differentiation
- 16. Copyright 1999 Prentice Hall 7-16 Selecting the Right Competitive Advantages Criteria for Determining Which Differences to Promote Affordable Superior Profitable Preemptive Distinctive Important Communicable