Market Segmentation, Targeting and Positioning - Benefits of Segmentation
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The document discusses market segmentation, targeting, and positioning in hospitality and tourism marketing, outlining effective strategies for dividing markets into segments with distinct needs, such as geographic, demographic, psychographic, and behavioral segmentation. It emphasizes the importance of evaluating segment attractiveness and selecting target segments to create tailored marketing mixes. Finally, the document highlights the need for effective positioning strategies to differentiate products and establish competitive advantages in the marketplace.
Market Segmentation, Targeting and Positioning - Benefits of Segmentation
- 1. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 1 Chapter 8 Market Segmentation, Targeting and Positioning
- 2. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 2 • Effective use of resources • Gain a focus • Create Value for a target market • Positioning Benefits of Segmentation
- 3. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 3 Steps in Market Segmentation, Targeting, and Positioning Market Segmentation 1. Identify bases for segmenting the market 2. Develop segment profiles Market Targeting 3. Develop measure of segment attractiveness 4. Select target segments Market Positioning 5. Develop positioning for target segments 6. Develop a marketing mix for each segment
- 4. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 4 Step 1. Market Segmentation Levels of Market Segmentation Through Market Segmentation, Companies Divide Large, Heterogeneous Markets into Smaller Segments that Can be Reached More Efficiently And Effectively With Products and Services That Match Their Unique Needs. Mass Marketing Same product to all consumers (no segmentation, i. e. a commodity) Segment Marketing Different products to one or more segments (some segmentation, i.e. Marriott)
- 5. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 5 Regional/City National International Accor Step 1. Market Segmentation Geographic Segmentation
- 6. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 6 Step 1. Market Segmentation Demographic Segmentation • Dividing the market into groups based on variables such as: – Age – Gender – Family size or life cycle – Income – Occupation – Education – Religion – Race – Generation – Nationality
- 7. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 7 Step 1. Market Segmentation Psychographic Segmentation Divides Buyers Into Different Groups Based on:
- 8. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 8 Step 1. Market Segmentation Behavioral Segmentation • Dividing the market into groups based on variables such as: – Occasions – Benefits – User status – Usage rate – Loyalty status – Readiness stage – Attitude toward product
- 9. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 9 Step 1. Market Segmentation Segments must respond differently to different marketing mix elements & programs Requirements for effective segmentation Step 1. Market Segmentation Segments must respond differently to different marketing mix elements & programs Requirements for effective segmentation • Size, purchasing power, profiles of segments can be measured. • Segments can be effectively reached and served. • Segments are large or profitable enough to serve. MeasurableMeasurable AccessibleAccessible SubstantialSubstantial ActionableActionable • Effective programs can be designed to attract and serve the segments.
- 10. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 10 Evaluating Market Segments • Segment size and growth • Segment structural attractiveness • Company objectives and resources
- 11. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 11 Segment 1Segment 1 Segment 2Segment 2 Segment 3Segment 3 Segment 1Segment 1 Segment 2Segment 2 Segment 3Segment 3 Company Marketing Mix Company Marketing Mix Company Marketing Mix Company Marketing Mix Company Marketing Mix 1 Company Marketing Mix 1 Company Marketing Mix 2 Company Marketing Mix 2 Company Marketing Mix 3 Company Marketing Mix 3 MarketMarket A. Undifferentiated Marketing B. Differentiated Marketing C. Concentrated Marketing Step 2. Market Targeting Market Coverage Strategies
- 12. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 12 Choosing a market-coverage strategy • Company resources • Degree of product homogeneity • Market homogeneity • Competitors’ strategies
- 13. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 13 • Product’s PositionProduct’s Position - the way the product is defined by consumers on important attributes - the place the product occupies in consumers’ minds relative to competing products. Marketers must: –Plan positions to give their products the greatest advantage in selected target markets Step 3: Positioning for Competitive Advantage
- 14. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 14 Positioning Strategies • Positioning by specific product attributes • Positioning by benefits • Positioning for user category • Positioning for usage occasion • Positioning against another competitors • Positioning against another product class
- 15. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 15 • Step 1. Identifying Possible Competitive Advantages: Competitive Differentiation. • Step 2. Selecting the Right Competitive Advantage: Unique Selling Proposition (USP). • Step 3. Communicating and Delivering the Chosen Position. Steps to Choosing and Implementing a Positioning Strategy
- 16. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 16 Product Differentiation • Physical attributes • Service differentiation • Personnel differentiation • Location • Image differentiation
- 17. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 17 Which differences to promote? • Important to customers • Distinctive • Superior • Communicable to customers • Preemptive • Affordable • Profitable
- 18. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 18 Positioning map of service level versus price. Source: Lovelock, Services Marketing, Prentice Hall Perceptual Map
- 19. Marketing for Hospitality and Tourism, 3e ©2003 Pearson Education, Inc. Philip Kotler, John Bowen, James Makens Upper Saddle River, NJ 07458 19 Perceptual Map 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.60.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6-1.6 -1.4 -1.2 -1.0 -0.8 -0.6 -0.4 -0.2-1.6 -1.4 -1.2 -1.0 -0.8 -0.6 -0.4 -0.2 1.01.0 0.80.8 0.60.6 0.40.4 0.20.2 -0.2-0.2 -0.4-0.4 -0.6-0.6 -0.8-0.8 MagicMagic MountainMountain JapaneseJapanese Deer ParkDeer Park BuschBusch GardensGardens Knott’sKnott’s BerryBerry FarmFarm LionLion CountryCountry SafariSafari MarinelandMarineland of theof the PacificPacific DisneylandDisneyland EconomicalEconomical Fun ridesFun rides ExerciseExercise FantasyFantasy Good foodGood food Easy to reachEasy to reach Educational,Educational, animalsanimals Little waitingLittle waiting Live showsLive shows