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Chapter 6 Market Segmentation and the Marketing Mix: Determinants of Advertising Strategy. Chapter Overview. How marketers use behavioral characteristics to cluster customers into market segments. Chapter Objectives. Identify methods advertisers use to segment consumer and business markets.
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Chapter 6Market Segmentation and the Marketing Mix: Determinants of Advertising Strategy
Chapter Overview How marketers use behavioral characteristics to cluster customersinto market segments
Chapter Objectives Identify methods advertisers use to segment consumerand business markets Describe the elementsof the marketing mix Explain the importanceof aggregation Explain advertising’s role in the mix Discuss how target marketing affects advertising strategy Explain the purpose and importance of branding
The Market Segmentation Process 1. Identify people with shared needs and characteristics
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
Shared Characteristics Categories Behavioristic Geographic Demographic Psychographic
Behavioristic Segmentation User-Status Sole Users Semi-Sole Users Discount Users Aware Non-triers Trial/Rejectors Repertoire Users Usage-Rate Volume Segmentation Benefits-Sought BenefitSegmentation Purchase-Occasion
Behavioristic Segmentation Charles Schwab targets the benefits-sought market
Geographic Segmentation • Sales are analyzed by: • Region • Country size • City size • Specific location • Types of stores
Demographic Segmentation Defining population groups by statistical characteristics
Demographic Segmentation Hispanic Media Ad Spending Growth Rtes
Psychographic Segmentation Feelings Values Lifestyles Attitudes Personality
Psychographic Segmentation Consumers are charted by their basis for decision making
Psychographic Segmentation 10 values shared by people around the world
Psychographic Segmentation MindBase finds shared patterns of behavior
Market Segmentation Adidas captures attitude and lifestyle
Business, Government, & Industry Professional buyers Concentratedgeographically Systematicpurchasing Small number of buyers Categorized byNAICS code Differencesfrom ConsumerMarkets
Business, Government, & Industry NAICS hierarchy and codes can be used to search for prospective clients
The Target Marketing Process Product Price Place Promotion 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
Target Market Selection Levi’s communicates how slim their jeans are and the relative attractiveness of those who wear them
Target Market Segments Park BenchSeniors New EmptyNest Movers &Shakers NewBeginnings YoungInfluentials BohemianMix Home SweetHome
The Product Element Positioning & Differentiation Classification by… Perceptible Market Hidden Consumption rate Induced Tangibility Buying habits Physical description
The Product Element Volvo positions itself as owning safety
Product Branding Product Name Individual • Family • National • Private • Licensed Words Design Symbols
Product Packaging Identification Consumerappeal Containment,protection,convenience Economy These functions may become copy points
The Price Element Price Factors: Demand Production &distribution Competition Corporate goals & strategies
The Place (Distribution) Element Direct Indirect Vertical Network Intensive Franchises Selective Buyer Club Exclusive
The Promotion Element Personal Selling Product Advertising CommunicationMix DirectMarketing Sales Promotion Public Relations Collateral Materials