MARKETING MANAGEMENT
14th edition
8
Identifying Market
Segments and
Targets
Kotler
Keller
Effective Targeting Requires…
• Identify and profile distinct groups of buyers
who differ in their needs and preferences.
• Select one or more market segments to
enter.
• Establish and communicate the distinctive
benefits of the market offering.
CHP: 8&10-2
Ford’s Model T Followed a Mass
Market Approach
CHP: 8&10-3
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 CHP: 8&10-4
Four levels of Micromarketing
Segments
Niches
Local areas
Individuals
CHP: 8&10-5
Segment Marketing
Targeting a group of customers
who share a similar set of
needs and wants.
CHP: 8&10-6
Basic Market Preference Patterns
CHP: 8&10-7
Customerization
Combines operationally driven
mass customization with customized
marketing in a way that empowers
consumers to design the
product and service offering
of their choice.
CHP: 8&10-8
Examples of Market
Customization
CHP: 8&10-9
Segmenting Consumer Markets
Geographic
Demographic
Psychographic
Behavioral
CHP: 8&10-10
Demographic Segmentation
Age and Life Cycle
Life Stage
Gender
Income
Generation
Social Class
CHP: 8&10-11
Psychographic
Segmentation:
The VALS
Segmentation
System
CHP: 8&10-12
Behavioral Segmentation
Decision Roles
• Initiator
• Influencer
• Decider
• Buyer
• User
Behavioral Variables
• Occasions
• Benefits
• User Status
• Usage Rate
• Buyer-Readiness
• Loyalty Status
• Attitude
CHP: 8&10-13
Behavioral
Segmentation Breakdown
CHP: 8&10-14
Segmenting for Business Markets
Demographic
Operating Variable
Purchasing Approaches
Situational Factors
Personal
Characteristics
CHP: 8&10-15
Segmenting for Business Markets
•
•
•
•
•
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
CHP: 8&10-16
Effective Segmentation
Criteria
Measurable
• Size, purchasing power, profiles
Accessible
• Segments can be effectively
of segments can be measured.
reached and served.
Substantial
Differential
Actionable
• Segments are large or
profitable enough to serve.
• Segments must respond
differently to different marketing
mix elements & programs.
• Effective programs can be
designed to attract and serve
the segments.
CHP: 8&10-17
Market Targeting
Evaluating Market Segments
• Segment Size and Growth
– Analyze current sales, growth rates and expected
profitability for various segments.
• Segment Structural Attractiveness
– Consider effects of: competitors, availability of
substitute products and, the power of buyers &
suppliers.
• Company Objectives and Resources
– Company skills & resources needed to succeed in
that segment(s).
– Look for Competitive Advantages.
CHP: 8&10-18
Market Targeting
Market Coverage Strategies
Company
Marketing
Mix
Market
A. Undifferentiated Marketing
Company
Marketing Mix 1
Company
Marketing Mix 2
Company
Marketing Mix 3
Segment 1
Segment 2
Segment 3
B. Differentiated Marketing
Segment 1
Company
Marketing
Mix
Segment 2
Segment 3
C. Concentrated Marketing
CHP: 8&10-19
Patterns of Target Market Selection
CHP: 8&10-20
Patterns of Target Market Selection
CHP: 8&10-21
Patterns of Target Market Selection
CHP: 8&10-22
MARKETING MANAGEMENT
14th edition
10
Crafting the Brand
Positioning
Kotler
Keller
Marketing Strategy
Segmentation
Targeting
Positioning
CHP: 8&10-24
Positioning
Act of designing the company’s
offering and image to occupy
a distinctive place in the mind of
the target market.
Positioning provides synergy among 4Ps.
CHP: 8&10-25
Choosing a Positioning
Strategy
Step 1. Identifying
Possible Competitive
Advantages
Step 2. Selecting the
Right Competitive
Advantage
Step 3. Communicating
and Delivering the
Chosen Position
CHP: 8&10-26
Defining Associations
Points-of-parity
Points-of-difference
(PODs)
(POPs)
• Attributes or benefits
• Associations that are
consumers strongly
not necessarily unique
associate with a brand,
to the brand but may
positively evaluate, and
be shared with other
believe they could not
brands
find to the same extent
with a competitive
brand
CHP: 8&10-27
Consumer Desirability Criteria for
PODs
Relevance
Distinctiveness
Believability
CHP: 8&10-28
Deliverability Criteria for PODs
Feasibility
Communicability
Sustainability
CHP: 8&10-29
Examples of Negatively Correlated
Attributes and Benefits
• Low-price vs. High
quality
• Taste vs. Low
calories
• Nutritious vs. Good
tasting
• Efficacious vs. Mild
• Powerful vs. Safe
• Strong vs. Refined
• Ubiquitous vs.
Exclusive
• Varied vs. Simple
CHP: 8&10-30
Developing and Communicating a
Positioning Strategy
•
Positioning: How many ideas to
promote?
• Unique selling proposition
– Four major positioning errors
1.
2.
3.
4.
Underpositioning
Overpositioning
Confused positioning
Doubtful positioning
CHP: 8&10-31
USP
•
•
•
Who are the customers?
What is the set of needs that the
product fulfills?
Why is the product the best option to
satisfy those needs?
CHP: 8&10-32
Positioning Statement
•
Our (1)product/brand is
•
(2)single most important claim
•
•
among all (3)competitive frame
because (4)single most important support.
Our (1)KKY yogurt is (2)the healthiest among all
(3)KKY because of (4)our unique hygenic technology.
CHP: 8&10-33
Differentiation Strategies
Product
Personnel
Channel
Image
CHP: 8&10-34
Product Differentiation
•
•
•
•
•
•
•
Product form
Features
Performance
Conformance
Durability
Reliability
Reparability
•
•
•
•
•
•
•
•
Style
Design
Ordering ease
Delivery
Installation
Customer training
Customer consulting
Maintenance
CHP: 8&10-35
Identity and Image
Identity:
The way a
company aims to
identify or
position itself
Image:
The way the
public perceives
the company or its
products
CHP: 8&10-36