chapter
04
Segmentation, Targeting
and the Marketing Mix
Introduces the people and groups
who work in advertising
McGraw-Hill/Irwin
Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
4-3
Chapter 4 Objectives
Describe the role of
marketing in creating satisfying
exchanges
Explain the role of advertising
in communicating a
product’s utility
Identify the various methods
advertisers use to segment
and aggregate consumer and
business markets
Discuss how target marketing
affects the firm’s advertising
strategy
Describe the elements of the
marketing mix and the role of
advertising in the mix
Explain the purpose and
importance of branding
4-4
The Larger Marketing
Context of Advertising
Marketing
Product
Marketplace
4-5
Context of Advertising:
Marketing Key Concepts
Utility
Exchanges
Perception
Satisfaction
Customer’s
Seller’s
Utility
Awareness
Attitude
Interest
4-6
The Market Segmentation Process
1. Identify people with
shared needs and
characteristics
4-7
The Market Segmentation Process
1. Identify people with
shared needs and
characteristics
2. Aggregate these
groups into market
segments according
to their mutual interest
in the product’s utility
4-8
Types of Markets
Two Types
Consumer
Business
4-9
Market Segmentation
Behavioristic
User-Status Variables
Usage-Rate Variables
Sole Users
Semi-Sole
Users
Purchase-Occasion
Variables
Volume
Segmentation
Discount
Users
Benefits-Sought Variables
Aware Nontriers
Trial/Rejectors
BenefitUsers
Repertoire
Segmentation
4-10
Market Segmentation
This Crate and
Barrel ad targets
sole users and
repertoire users
4-11
Market Segmentation
Heavy users:
Hardee’s ad
marketing the
Thickburger
4-12
Market Segmentation
Behavioristic
User Status,
User Rate,
Purchase
User Status
Variables
Occasion, & Benefits-Sought Variables
User-Rate Variables
Geographic
Demographic
Purchase-Occasion Variables
Benefits-Sought Variables
4-13
Market Segmentation
Demographic
segmentation:
Hispanic ad
spending growth
by medium
4-14
Market Segmentation
Demographic
segmentation:
Heavy usage
patterns of
various age
groups
4-15
Market Segmentation
Behavioristic
User Status, User Rate, Purchase
Occasion, & Benefits-Sought Variables
Geographic
Demographic
Geodemographic Segmentation
Psychographic
VALS
MindBase
BehaviorGraphics
4-16
Market
Segmentation
Psychographic
segmentation:
VALS
4-17
Market Segmentation
Psychographic
segmentation:
Adidas placed
ads along the
Boston Marathon
route to target
young people
who define
themselves
by their athletic
achievements
Insert left panel of Adidas ad
(p. 180)
Insert right panel of Adidas ad
(p. 180)
(ritual/shock/denial/isolation ad panel)
(affirmation/despair/renewal
ad panel)
Position = 2.9” horizontal, 1.5”
vertical
Size = 2.8”wide
Resolution = 300 dpi
Position = 5.9” horizontal, 1.5”
vertical
Size = 2.8” wide
Resolution = 300 dpi
4-18
Market Segmentation:
Business, Government, & Industry
Fewer, moreconcentrated
buyers
Differences
from Consumer
Markets
Complexity:
Manufacturers, Resellers,
Brand Partnerships
Organizational
buying
behavior
4-19
Market Segmentation:
Business, Government, & Industry
The NAICS
hierarchy and
codes can be
used to search
for prospective
clients
4-20
The Target Marketing Process
1. Select a target market from the market
segments identified
2. Use the 4Ps of the marketing mix to shape a
product concept for the market
Product
Price
Place
Promotion
4-21
Target Market Selection
Land Rover ad
appeals to
customers who
want both safety
and function
4-22
The Product Element
Life Cycle
Introduction
• Growth
• Maturity
• Decline
•
Positioning
&
Insert ex.
6.11, p. 188
Classification
Branding
Packaging
Differentiation
Product• Perceptible
life cycle curve
Tangible
• Individual
Goods
• Family
Position• Hidden
= 2.66” horizontal,
1.26”
• Equipment• Induced
• National
vertical
based
• Private
services
Size = 5.84” WIDE Label
• People• Licensed
basedResolution = 300 dpi
services
•
Identification
• Containment
• Protection
• Convenience
• Consumer
appeal
• Packaging
can pay for
itself
•
4-23
The Product Element
Life Cycle
Introduction
• Growth
• Maturity
• Decline
•
Classification
By market
• By rate of
consumption
• By tangibility
• By buying
habits
• By physical
description
•
Positioning &
Branding
Differentiation
Perceptible
• Hidden
• Induced
•
Individual
• Family
• National
• Private
Label
• Licensed
•
Packaging
Identification
• Containment
• Protection
• Convenience
• Consumer
appeal
• Packaging
can pay for
itself
•
4-24
The Product Element
Life Cycle
Introduction
• Growth
• Maturity
• Decline
•
Classification
By market
• By rate of
consumption
• By tangibility
• By buying
habits
• By physical
description
•
Positioning &
Branding
Differentiation
Perceptible
• Hidden
• Induced
•
Individual
• Family
• National
• Private
Label
• Licensed
•
Packaging
Identification
• Containment
• Protection
• Convenience
• Consumer
appeal
• Packaging
can pay for
itself
•
4-25
The Product Element
Jeep positions
itself as the “only
one” to go
anywhere on the
planet
4-26
The Product Element
Life Cycle
Introduction
• Growth
• Maturity
• Decline
•
Classification
By market
• By rate of
consumption
• By tangibility
• By buying
habits
• By physical
description
•
Positioning &
Branding
Differentiation
Perceptible
• Hidden
• Induced
•
Individual
• Family
• National
• Private
Label
• Licensed
•
Packaging
Identification
• Containment
• Protection
• Convenience
• Consumer
appeal
• Packaging
can pay for
itself
•
4-27
The Product Element
World’s most
valuable brands
4-28
The Product Element
Life Cycle
Introduction
• Growth
• Maturity
• Decline
•
Classification
By market
• By rate of
consumption
• By tangibility
• By buying
habits
• By physical
description
•
Positioning &
Branding
Differentiation
Perceptible
• Hidden
• Induced
•
Individual
• Family
• National
• Private
Label
• Licensed
•
Packaging
Identification
• Containment
• Protection
• Convenience
• Consumer
appeal
• Packaging
can pay for
itself
•
4-29
The Price Element
Price Factors:
Demand
Corporate Goals
& Strategies
Production &
Distribution
Competition
4-30
The Place (Distribution) Element
Direct
Network
Buyer Club
Indirect
Intensive
Selective
Exclusive
4-31
The Promotion Element
Direct
Marketing
Marketing
Communication
Types
Personal
Selling
Product
Advertising
Sales
Promotion
Public
Relations
