marketing
300
discussion section
announcements?
discussion question
group policy
Anyone still need to find a group?
micro-macro dilemma
personal benefits vs. social costs
personal benefits vs. social costs
personal benefits vs. social costs
personal benefits vs. social costs
trash mass twice the size of
TEXAS!
personal benefits vs. social costs
personal benefits vs. social costs
personal benefits vs. social costs
personal benefits vs. social costs
question
Why does Progressive
insurance offer
customers a price quote
for Progressive and for
its competitors?
question
(hint: think about the
purpose of the 4 Ps)
Segmentation
question
question
question
Segmentation
• Different people have different needs and different
uses for products within a category.
• As a business, it’s important to know who might be
interested in your product/service and why.
• Why?
What is a segment?
• Segments/Submarkets
 A relatively homogeneous group of customers who will
respond similarly to a marketing mix.
 Segments are based around NEED.
discussion question
Consider the student market for off-campus apartments in your
city. Identify some segments that have different needs and
determining dimensions. Then evaluate how well the needs in
these market segments are being met in your geographic area.
Is there an obvious breakthrough opportunity waiting for
someone?
discussion question
• Need
• Qualifying dimensions
– minimum requirements; without these, a consumer is not
interested (“I ABSOLUTELY NEED THIS!”)
– ex. a roof. If a house doesn’t have a roof, you probably
won’t consider living there.
• Determining dimensions
– qualities that consumers ultimately choose on once they
have a qualifying set (“THIS WOULD BE NICE TO HAVE, BUT I
DON’T NEED IT”)
– ex. I choose this house from the ones I liked because it has
off-street parking
discussion question
Consider the student market for off-campus apartments in your
city. Identify some segments that have different needs and
determining dimensions. Then evaluate how well the needs in
these market segments are being met in your geographic area.
Is there an obvious breakthrough opportunity waiting for
someone?
discussion question
Talk with your group about your ideas for a few
minutes. Come up with three distinct segments
with qualifying dimensions and a “breakthrough
opportunity.”
WARNING!
Think about students in terms of all relevant segmenting
dimensions (NEEDS), not only in terms of their age or year. The
latter will lead you down the wrong path.
discussion question
Segment
Need
Luxury-seekers Comfort, view,
status
Qualifying
Dimensions
Determining
Dimensions
Amenities, nice Gym, heated
view, cleaning parking lot
service
discussion question
Ready?
discussion question
Segment
Need
Luxury-seekers Comfort, view,
status
Qualifying
Dimensions
Determining
Dimensions
Amenities, nice Gym, heated
view, cleaning parking lot
service
Segment
Need
Qualifying
Dimensions
Determining
Dimensions
discussion question
Luxury-seekers Comfort, view,
status
Amenities, nice Gym, heated
view, cleaning parking lot
service
Budgetconscious
Low cost
housing
Cheap rent,
paid utilities
Socialites
Proximity to
bars, ability to
be loud
Cool
Paid utilities
neighborhood,
near bars
Families
Quiet, safety,
good school
district
Suburban,
Washer/Dryer
good schools, in unit
low crime area
Close to
campus
what’s wrong with this?
Sophomores
and Juniors
Seniors
Grad
Students
MADISON HOUSING SEGMENTS
are all students the same?
we know that not everyone wants the same thing, even if they
are in the same demographic
Seniors
People who want
quiet
Budget conscious
People who want
to party 24/7
what’s wrong with this?
• Some seniors might want quiet, others might be looking for
proximity to bars, others might want pets. These groups do not
necessarily overlap.
•“Seniors” also leaves out non-seniors who might be looking for
quiet, proximity to bars, etc.
People who want
quiet
Budget conscious
People who want
to party 24/7
are all students the same?
by making “seniors” a segment, you are implying that all
students want the same thing
Seniors
Clones
this is the right way
Overall Market
Quiet Seekers
Budget conscious
Partiers
this is better because it divides overall market by needs, not by
demographics
discussion question
Hey wait a minute! How come you said that
“seniors” isn’t a segment but “families” is?
discussion question
• This isn’t an exact science. Use your intuition.
• Probably most families are looking for similar
things; students probably aren’t.
• Homogeneous within (people within a
segment very similar)
• Heterogeneous between (people in different
segments are not very similar)
discussion question
• Warning: You will have the irrepressible urge
to segment by demographics. Don’t do it!
• It’s okay to use demographics (ex. age,
gender, occupation) to help you segment, but
don’t rely on them.
discussion question
• Segment based on
discussion question
• Are all the needs you mentioned being met here
in Madison?
• What is a market that you think is out there that
is not currently being met?
quiz
Reminder:
• The quizzes are timed. You have 4
minutes to submit them. After that,
the system will not accept them!
• You have 2 attempts to complete the
quiz. The system will take the higher
score.
quiz
Lipton has increased sales by developing ads that encourage its
current customers to drink Lipton tea instead of coffee at
morning "coffee breaks." This effort focuses on
A. Market development
B. Diversification
C. Product development
D. Market penetration
E. None of the above
quiz
What does “market” mean?
quiz
• The president of a company that produces cardboard boxes
is concerned about the large number of competitors with
extra capacity. As he put it, "our best shot is in the hands of
our sales manager--she makes all of our marketing decisions
and is creative enough to figure out how to sell more boxes."
It seems that this company is run as if it were in the:
a) Production era
b) Marketing company era
c) Simple trade era
d) Sales era
e) Marketing department era
quiz
A digital camera, a computer video-cam, and a computer
scanner might compete in the same
A. Single target market
B. Generic market
C. Multiple target market
D. Combined target market
E. Product-market
quiz
A. Generic market

ex. things that transfer digital images to your computer
B. Product-market

ex. digital cameras
C. Single target market

ex. waterproof digital camera
D. Multiple target market

ex. one camera targeted at professionals and amateurs (with
different marketing mixes)
E. Combined target market

ex. one camera targeted at professionals and amateurs (same
marketing mixes)
other questions?
Have a great weekend