marketing chapter 7-11

segmentation
dividing up markets into meaningful customer groups
targeting
choosing which customer to serve
differentiation
creating market offerings that best serve targeted customers
positioning
positioning the offerings in the minds of consumers
market segmentation
-dividing a market into smaller segments of buyers with distinct needs, characteristics, or behaviors that might require separate marketing strategies or mixes
-through market segmentation , companies divide large , heterogeneous markets into smaller segments that can be reached more efficiently and effectively with products and services that match their unique needs.
market targeting
evaluating each market segments attractiveness and selecting one or more segments to enter
differentiation
differentiating the market offering to create superior customer value.
positioning
arranging for a market offering to occupy a clear, distinctive and desirable place relative to competing products in the minds of the consumers.
shotgun approach
scattering market efforts
rifle approach
focusing on the buyers who have great interest in the values they create best.
– this method is popularly used by companies.
approach used by companies
they have moved away from mass marketing and toward target marketing :
1)identifying market segments,
2)selecting one or more of them,
3)and developing products and marketing programs tailor to each.
4 steepens involved in developing a customer driven marketing strategy
1) market segmentation
2)market targeting
3)differentiation
4)positioning
segmenting consumer markets
1)geographic segmentation
2)demographic
3)psychographic
4)behavioral
geographic segmentation
– dividing the market into different geographical units such as nation, regions, states, countries, cities or even neighborhoods.
ex- macs, dominos pizza
-many companies are localizing their products , advertising and promotion sales efforts to fit the needs of the individual regions, cities and neighborhoods.
demographic segmentation
-divides the market into segments based on variables such as age, life cycle stage, gender, income, occupation, education,religion, ethnicity, and generation.
-most popular bases for segmenting customer groups because
a) reason being consumer needs, wants and usage rates often vary closely with demographic variables.
-b) demographic variables are easier to measure than most other types of variables.
c) even when marketers first define segments using other bases, such as benefits sought or behavior, they must know a segments demographic characteristics to asses the size of the target market and reach it efficiently.
age and life segmentation
consumer needs and wants change with age.
– they must be careful to guard against stereotypes when using age and lifecycle segmentation.
gender segmentation
-dividing a market into different segmentations based on gender.
-used in clothing, toiletries, cosmetics and magazines.
income segmentation
-dividing a market into different income segments
-marketers of products and services such as automobiles, clothing, cosmetics, financial services and travel
-many companies target affluent companies target affluent consumers with luxury goods and convenience services. although not all companies target the affluent . ex- dollar store
psychographic segmentation
– dividing a market into different segments based on social class, lifestyle or personality characteristics.
– ex- anthropology and hotel W
behavioral segmentation
-dividing a market into segments based consumer knowledge ,attitudes, uses or responses to a product.
– best starting point for building market segments.
occasion segmentation
-buyers can be grouped according to occasions when they get the idea to buy, actually make their purchase, or use the purchased item.
– it helps firms build up product usage
behavioral segmentation
-dividing a market into segments based on consumer knowledge, attitudes, uses, or responses to a product.
– marketers believe that behavior variables are the best starting point for building market segments.
occasion segmentation
dividing the market into segments according to occasions when buyers get the idea to buy, actually make their purchase, or use the purchased item.
-helps firms build up product usage.
benefit segmentation
dividing the market into segments according to the different benefits that consumers seek from the product.
– requires finding the major benefits people look for in a product class, the kinds of people who look for each benefit.
user status
– marketers can be segmented into nonusers, ex-users, potential users, first timer users and regular users of a product.
-marketers want to reinforce and retain regular users, attract targeted non users and reinvigorate relationships with ex users
-included in the potential users group are consumers facing life-stage changes such as new parents and newlyweds who cane turned into heavy users.
usage rate
marketers can also be segmented into light, medium and heavy product users. heavy users are often small percentage of the market but account for a high percentage pf total consumption.
loyalty status
a market can also be segmented by consumer loyalty.
– consumers can be loyal to brands, stores and companies.
-buyers can be divided into groups according to their degree of loyalty.
– company can learn a lot by analyzing loyalty patterns in its market.
– it should start by studying its own loyal customers.
using multiple segmentation bases
-marketers rarely limit their segmentation analysis to one or few variables.
– they use multiple segmentation bases in an effort to identify smaller, better-defined target groups.
– several business information services such as nelson, acxicom and experian provide multivariable segmentation systems that merge geographic , demographic , lifestyle , and behavioral data to help companies segment their markets down to zip codes, neighborhoods and even households.
— prism and other such systems can help marketers segment people and the locations into marketable groups of like minded consumers,
– each segment has its own pattern of likes, dislikes, lifestyles and purchase behaviors
– such segmentation provides a powerful tool for marketers of all kinds.
-it can help companies identify and better understand key customer segments, reach them more efficiently and tailer market offerings and messages to specific needs.