GLOBAL
MARKETING
Marketing Segmentation
Market Attractiveness
Positioning
What is Market Segmentation?

Process of dividing a potential market into
distinct subsets of consumers with common
needs or characteristics.
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Separating a heterogeneous market into smaller
homogeneous units.
Important Elements of Market
Segmentation

Each market segment has unique needs and
wants and will have a unique demand curve.
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Each market segment requires its own
marketing strategy and marketing plan.

Market segmentation produces increased costs
to the firm in the short run.

Increased costs are generally offset by increasing
sales in the long run.
The Segmentation Process
Needs-Based
Segmentation
The Segmentation Process
Needs-Based
Segmentation
Segment
Identification
Segmentation Bases
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Geographic
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Country
Region
County size
SMSA population
Density
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Demographic
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Age
Sex
Income
Education
Occupation
Race
Family life cycle
Segmentation Bases
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Psychographic
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Social class
Personality
Lifestyle
Activities, interests, &
opinions (AIO’s)
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Behavioralistic
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Decision unit
Usage rate
Readiness
Benefits sought
Occasion
Brand loyalty
Global Segmentation

Global Scan
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Strivers
 Median age of 31; hectic lives. Driven to achieve success. Materialistic pleasure
seekers; time & money in short supply.
Achievers
 Older than strivers; affluent; assertive. Upwardly mobile, having already
attained success. Status-conscious, value quality.
Pressured
 Women of all ages; financial and family pressures; overwhelming life problems
Adapters
 Older people; content with their lives. Maintain values while keeping an open
mind about change.
Traditionals

Rooted to the past; clings to cultural heritage and values.
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Euroconsumer Study (DMBB)
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Successful idealists
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Affluent materialists
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Status-conscious up and comers; use conspicuous consumption.
Comfortable belongers
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Have achieved professional & material success, but also
maintain commitment to abstract or socially responsible ideals.
Conservative, mostly comfortable with familiar.
Disaffected survivors
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Lack power and affluence; tend to be either resentful or
resigned. Concentrated in high crime, urban inner-city
neighborhoods.
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Young & Rubicam’s Cross-Cultural Consumer
Characterizations (4Cs)
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Constrained
 Resigned poor
 Struggling poor
Middle majority
 Mainstreamers
 Aspirers
 Succeeders
Innovators
 Transitionals
 Reformers
The Segmentation Process
Needs-Based
Segmentation
Segment
Identification
Segment
Attractiveness
Market Attractiveness

Market attractiveness represents the degree of
market opportunity offered by a market segment
and the ability of the firm to meet the segment’s
needs within a competitive setting.

Select segment(s) that offer best opportunity for
profits.
The Segmentation Process
Needs-Based
Segmentation
Segment
Identification
Segment
Attractiveness
Segment Positioning
Strategy
Positioning

Match offerings of firm to the needs and wants of
market segments.
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Effective positioning involves understanding customers’
perceptions about both the psychological and physical
characteristics of offerings.
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Positioning starts with a product. But positioning is not
what you do to a product—it’s what you do to the mind
of the customer. That is, you position the product in
the mind of the customer.
Positioning Strategy
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Learn the customer’s viewpoint. Create
positioning statement based on unique customer
needs.
Primary Needs
Articulated Needs
Exciting Needs
Primary
needs
Articulated
needs
Exciting
needs
Positioning Statements

To communicate positioning, a marketing plan
should include a positioning statement following
the form:
“To (target group and need) our (brand) is
(concept) that (point of difference).”
Example:
“To young, active soft-drink consumers who
have little time for sleep, Mountain Dew is the
soft drink that gives you more energy than any
other brand because it has the highest level of
caffeine. With Mountain Dew, you can stay alert
and keep going even when you haven’t been able
to get a good night’s sleep.”
Points to Remember About
Positioning:

Based on consumer perceptions of tangible and
intangible characteristics of offering.
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The intensity of the brand will affect
positioning.
Global Positioning
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Product categories associated with high
consumer involvement and a shared “language”
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High-Tech positioning
Emphasis on specialized information
 Consumers already possess or wish to acquire
considerable technical information
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High-Touch positioning
Emphasis on product image
 Wealth, materialism, romance
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The Segmentation
Process
Needs-Based
Segmentation
Segment
Identification
Segment
Attractiveness
Segment Positioning
Strategy
Positioning
“Acid” Test
Testing the Positioning Statement
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Test the positioning statement with target
consumers--what do they think, how do they
react to the statement?
Assess need level: the stronger the need, the
higher the expected customer interest.
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“Do you see this product as solving a problem or
filling a need for you?”
Testing, continued...
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Communicability and believability: if the scores
on these dimensions are low, the positioning
must be refined or revised.
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“Are the benefits clear to you and believable?”
Testing, continued...
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Perceived value: The higher the perceived vale,
the higher the expected consumer interest.
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“Is the price reasonable in relation to the value?”
Testing, continued...
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Gap level between the new product and existing
products: The greater the gap, the higher the
expected consumer interest.
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“Do other products currently meet this need and
satisfy you?”
The Segmentation
Process
Needs-Based
Segmentation
Segment
Identification
Segment
Attractiveness
Segment Positioning
Strategy
Positioning
“Acid” Test
Strategy
Implementation
Segmentation Strategies
Mass
Marketing
Mass
Customization
Multisegment Strategy

Pursue two or more segments that are attractive
and profitable, but not the whole market.
Sequential Segment Strategy

Multisegment approach, but rather than
pursuing all the attractive segments
simultaneously, pursue the most attractive first;
when cash flow from that segment is positive,
then pursue the next most attractive segment,
and so on.
Single-Segment Strategy
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Focus on just one attractive segment.
Niche Segment Strategy

Focus on a smaller group within a segment.
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Requires a further customization of marketing
strategy.
Mass Customization Strategy
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Focus on all niches within a segment by
customizing strategies to each subsegment.