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COMPETITION IS EVERYWHERE. 7.1 Targeting Market Segments 7.2 Positioning for Competitive Advantage 7.3 Competing for Market Segments 7.4 Learning About the Competition. TARGETING MARKET SEGMENTS. GOALS for Lesson 7.1

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competition is everywhere


7.1 Targeting Market Segments

7.2 Positioning for Competitive Advantage

7.3 Competing for Market Segments

7.4 Learning About the Competition

targeting market segments

GOALSfor Lesson 7.1

  • Describe how markets can be segmented by geographic location, demographic characteristics, psychographics, product usage, and benefits derived.
  • Explain how to evaluate market potential and calculate market share.
identifying market segments
Identifying Market Segments
  • Marketing Segment – a group of individuals or organizations within a larger market that share one or more important characteristics.
  • Mass Marketing – aimed at a broad population of consumers rather than a narrow segment.
identifying market segments4
Identifying Market Segments
  • Geographic segmentation – dividing customers based on where they live
  • Demographic characteristics – age, gender, race, income, education
  • Psychographics – people’s interests and values
identifying market segments5
Identifying Market Segments
  • Product usage – frequency with which consumers use a product.
  • Benefits derived – divides the population into groups depending on the value they receive form the product or service.
analyzing market segments
Analyzing Market Segments

1. Number of potential consumers

2. Interest in the product or service and other mix elements

3. Money available to make the purchase

4. Ability to communicate with consumers through the promotional mix

market segment analysis

People who like to ski

Market Segment Analysis
  • People who vacation at ski resorts
  • People who read ski magazines
  • People with annual income over $50,000
market potential
Market Potential

Market potential is the total revenue that can be obtained from the market segment.

market share
Market Share

Market share is the portion of the total market potential that each company expects to get in relation to its competitors.

review activities
Review Activities
  • Review Questions, pg. 170, #1-4
  • Review Activity, pg. 185, #28, a - e
positioning for competitive advantage

GOALS for Lesson 7.2

  • Explain the various bases for positioning a product to distinguish it from the competition.
  • Describe the three common positioning strategies.
  • To highlight differences between competitors in the mind of the consumer that may influence purchases.
  • Market Position – refers to the unique image of a product or service in a consumer’s mind relative to similar competitive offerings.
bases for positioning
Bases for Positioning
  • Attribute – product characteristics or features
  • Price and quality – desired level of quality in the product and establishing an appropriate price
  • Use or application – stressing unique uses
bases for positioning14
Bases for Positioning
  • Product user – encourages use of a product or service by associating a personality or type of user with the product
  • Product classification – to associate with a particular category
  • Competitor – demonstrate how they positioned against competitors
market position
Market Position

Laundry Product ALaundry Product B


Cleans quickly and easily Leaves fresh scent

Price and Quality

Low price, good value Higher price for highest quality

Use or Application

Use as pre-wash on tough stains Use for hand-washing delicates

Product User

Homemaker’s reliable friend New generation’s discovery

Product Classification

Used by Olympic athletes Used by professional laundries


Gets out dirt Product B can’t Gentler on clothing than Product A

positioning examples
Positioning Examples
  • Attribute - Windex -
  • User - Pepsi -
  • Price/Value - Wal-Mart – see favorites
  • Classification - Titleist Golf Balls -
selecting a positioning strategy
Selecting a Positioning Strategy
  • Consumer perceptions are the images consumers have of competing goods and services in the market place
    • Ex. – Hersey produces the ideal chocolate bar
    • Ex. – BMW the ultimate driving machine
selecting a positioning strategy18
Selecting a Positioning Strategy
  • Competition – that your product is superior to the competition
    • Ex – Coke vs. Pepsi
  • Business environment – changes that might affect the position of its products or services
    • Ex – golf clubs (new technology)
positioning strategy
Positioning Strategy?
  • Hospital’s Emergency Services
  • Fast Food
  • Furniture
  • Guitar Classes
  • Cell Phones
  • Energy Drinks

If you were a business owner, which positioning technique would be best for each product or service? Why?

competing for market segments

GOALS for Lesson 7.3

  • Explain direct vs. indirect competition and price vs. non-price competition.
  • Describe the benefits of competition to consumers.
types of competition for positioning
Types of Competition for Positioning
  • Direct competition – competition in a market segment with businesses that offer the same type of product or service
    • Marriott vs. Hyatt
    • McDonalds vs. Burger King
types of competition for positioning22
Types of Competition for Positioning
  • Indirect competition – competes with a product that is outside its product classification group.
    • Ex –
types of competition for positioning23
Types of Competition for Positioning

Price competition – emphasis on price when companies compete.

Ex – restaurants, grocery stores, airlines

types of competition for positioning24
Types of Competition for Positioning

Non-price competition – emphasis on non price factors, quality, brand, location, or service

Ex – insurance companies, high end products.

benefits of competition
Benefits of Competition
  • Consumer receives the best price for products available.
  • Competition encourages improvements in products with the addition of unique features and benefits.
  • Businesses are always looking for new and improved products to put into the marketplace to compete with their competitors.
  • Competition offers consumers the benefit of a wide variety of products from which to choose.
product development project element 4
Product Development Project – Element #4

Competition Analysis – 7.2 and 7.3

Who are your competitors?

  • Who are your direct competitors? What are their strengths and weaknesses? How can you use them to help your business?
  • Who are your indirect competitors?

How are you going to position your product, what are the bases for the positioning, why?

learning about the competition

GOALS for Lesson 7.4

  • Discuss the types of information businesses need to know about their competitors.
  • Describe the kinds of activities businesses engage in to gain marketing intelligence.
types of information
Types of Information
  • Price
  • Distribution
  • Product/Service planning
  • Promotion
  • Competitor’s market position
sources of information
Sources of Information

Marketing Intelligence

  • Attend trade shows
  • Talk to customers
  • Analyze sales reports
  • Ship in competitor’s business
  • Subscribe to information services
  • Examine competitor’s product
collecting and analyzing information
Collecting and Analyzing Information
  • Collection is an organized process
  • Objectives
    • To identify the strengths and weaknesses of key competitors
    • To assess competitors’ current market strategies
    • To predict competitors’ future actions