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Marketing Segmentation & Positioning. Marketing Segmentation. Dividing a market into smaller groups with distinct needs, characteristics or behaviors who might require separate products or marketing mixes. Companies have moved from mass marketing to target marketing

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marketing segmentation
Marketing Segmentation
  • Dividing a market into smaller groups with distinct needs, characteristics or behaviors who might require separate products or marketing mixes.
  • Companies have moved from mass marketing to target marketing
  • Companies look for different ways in which to segment the market and develops profiles of the resulting market segments.

Market Targeting

The process of evaluating each market segments attractiveness and selecting one or more segments to enter


Actually differentiating the firm’s market offering to create superior customer value


Arranging for a product to occupy a clear, distinctive and desirable place relevant to competing products in the minds of target consumers

geographic segmentation
Geographic segmentation
  • Dividing markets into different geographical units such as, nation, states, region, counties, cities or neighborhoods .
  • Many companies localize their products, advertising, promotion, and sales efforts to fit the needs of individual regions, cities and even neighborhoods

eg: Coke developed four ready to drink canned coffees for Japanese.

demographic segmentation
Demographic segmentation

Dividing a market into groups based on variables such

as age, gender, family size, family life cycle, income,

occupation, education, religion, race, generation and


  • Age and life-cycle segmentation: Dividing a market into different age and life-cycle groups eg: Anlene milk
  • Gender Segmentation: Dividing a market into a different groups based on gender . eg: Nivea for men
  • Income: Dividing a market into different groups based on social class, lifestyle, or personality characteristics. eg: Standard charted priority banking
psychographic segmentation
Psychographic segmentation
  • Dividing a market into different groups based on social class, life style or personality characteristics.

eg: American Express “My life My Card” campaign provides a glimpse into the lifestyle of famous people

behavioral segmentation
Behavioral Segmentation

Dividing a market into groups, based on consumer knowledge,

attitude, use or response to a product

  • Occasions : Dividing a market into groups according to occasions when buyers get the idea to buy, actually make their purchase or use the purchase item. eg : Ginger beer with food
  • Benefit sought: Dividing a market into groups according to the different benefits that consumers seek from the products. eg: Athletic wear segments based on functional benefits
  • User status: Segment into non user, ex user, potential users, first time user and regular user. eg: P&G invites newly weds to visit
  • Usage rate: Segment based on usage, Light, Medium and Heavy users. eg: Sidhaleppa
  • Loyalty Users : Divide groups based on there degree of loyalty. eg: Arpico privilege users
segment business markets
Segment Business Markets

Consumers and business use many of the same variables to

segment their markets. Business buys can be segmented

geographically, demographically (Industrial and company

size), or by benefit sought, user status or loyalty status.

Business markets use additional variables, such as customer

operating characteristics, purchasing approaches, situational

factors and personal characteristics.


For small business customers, American Express has

created the OPEN: Small Business Network, “ the one

place that’s all about small business”

segmenting international markets
Segmenting International Markets

Forming segment of consumers who have similar needs

and buying behavior even though they are located in

different countries.

Teens show surprisingly similarity no matter where they

live – these teens could be from almost anywhere.

Thus, many companies target teens with worldwide

marketing campaigns

Eg: Mercedes Benz targets the worlds well-to-do, regardless of their country.

requirements for effective segmentation
Requirements for Effective segmentation
  • Measurable: The size, purchasing power, and profiles of the segments can be measured.
  • Accessible: Market segment can be effectively reached and served.
  • Substantial: The market segments that are large or profitable enough to serve.
  • Differentiable: The segments are conceptually distinguishable and responses differently to different marketing mix elements and programs
  • Actionable: Effective programs can be designed for attracting and serving the segments
target marketing
Target Marketing

A set of buyers sharing common needs or

characteristics that the company decides to serve

Undifferentiated (mass ) marketing

Differentiated (segmented ) marketing

Concentrated (niche) marketing


(local or individual marketing

undifferentiated marketing
Undifferentiated Marketing

A market-coverage strategy in which a firm decides

to ignore market segments differences and go after

the whole market with one offer.

It focuses on what us common in the needs of

consumers rather

than on what is different.

eg: Araliya sugar

differentiated marketing
Differentiated Marketing

A market-coverage strategy in which a firm decides

to target several market segments and designs

separate offers for each.

eg: Baby Cheramy

Baby chermy range for kids

Cheramy touch for adults

concentrated marketing
Concentrated Marketing

A market coverage strategy in which a firm goes

after a large share of one or few segments or niche.

Niche marketing can market more effectively and

more efficiently.

Eg: Apple computers

micro marketing
Micro Marketing

The practice of tailoring products and marketing programs to

the needs and wants of specific individuals and local customer

groups – includes local marketing and individual marketing

Local marketing – Tailoring brands and promotions to the

needs and wants of local customer groups-cities neighborhoods,

and even specific bread talk –seenisambola bun to suit the local


Individual marketing- Tailoring products and marketing

programs to the needs and preferences of individual customers-

also labeled “markets-of-one marketing” “customized marketing” and

“one to one marketing”. eg: Dell creates customer configured computers

competitive advantage
Competitive advantage

An advantage over competitors gained by offering

Consumers greater value, either through lower

prices or by providing more benefits that justify

higher prices.

Companies should differentiate at every customer

contact point- product, services, channels people,

or image

choosing the right competitive advantage
Choosing the right competitive advantage

How many differentiations to promote:

companies could choose to differentiation on a

unique selling proposition (USP) or more than one


Unique selling proposition

More than one differentiation

Face wash & Cleanser

Carrot Face wash

choosing the right competitive advantage1
Choosing the right competitive advantage

Which differentiations to promote: Not all differentiations are

meaningful. Key criteria's to follow in establishing a difference.

  • Important: The difference delivers a highly valued benefit to target buyers
  • Distinctive: Competitors don’t offer the difference or the companies can offer in a more distinctive way
  • Superior: The difference is superior to other ways that customers might obtain the same benefit
  • Communicable: The difference is communicable and visible to buyers.
  • Preemptive : Competitors cannot be copy
  • Affordable : Buyers can offered to pay for the difference
  • Profitable : Companies can introduce the difference profitably
select an overall positioning strategy
Select an overall positioning strategy

A full positioning of the brand is called the brands

Value proposition

  • More for More
  • More for Same
  • The Same for Less
  • Less for much less




The same


The same