Chapter 8 Segmenting and Targeting Markets. What are Markets?. Market: people or organizations with (1)…………., (2)…………., and (3)………………………… Types of Markets . Role of Market Segmentation. Market Segmentation: division of the total market into smaller, relatively homogeneous groups
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Measurability / Identifiability
Characteristics of individuals, groups, or organizations used to divide a total market into segments=(variables, bases)
Metropolitan Statistical Area (MSA)
Segmenting potential customers into neighborhood lifestyle categories. Combines geographic, demographic, and psychographic segmentation.
The process of grouping customers into market segments according to the …………..they seek from the product.
Cell phone carriers, L’Oreal, Weight watchers
Dividing a market by the ………….of product bought or consumed.
Sprint- fired customers for excessive use of CS
Steps in Segmenting Markets
Select a market for study
Note that steps 5 and 6 are actually marketing activities that follow market segmentation (steps 1 through 4).
Identify the Appropriate Targeting Strategy
Single Marketing Mix
Sugar, flour, commodities
Marketing Mix 1
Marketing Mix 2
Best Buy, Walmart, Gap
Single Marketing Mix
Situation that occurs when sales of a new product cut into sales of a firm’s existing products.
STRATEGIES FOR REACHING TARGET MARKETS
An individualized marketing method that utilizes customer information to build long-term, personalized, and profitable relationships with each customer.
- ‘share of customer’
Al Ries and Jack Trout (1981)
Tough, powerful cleaning
Tough cleaning, color protection
Detergent plus fabric softener
Sunshine scent and odor-removing formula
Stain treatment and stain removal
Bleach-boosted formula, whitening
Detergent and fabric softener in liquid form
Outstanding cleaning for baby clothes, safe
Fabric & skin safety on baby clothes
Tough cleaner, aimed at Hispanic market
A means of displaying or graphing, in two or more dimensions, the location of products, brands, or groups of products in customers’ minds.
Changing consumers’ perceptions of a brand in relation to competing brands.
Positioning and Product Differentiation