Market Segmentation and Positioning

Nota:

• Identifying individuals or organisations with similar characteristics that have significant implications for the determination of marketing strategy.

1. Benefits of Market Segmentation
   1. Target market selection

      Nota:

      • A single marketing mix strategy can be developed to match the similar requirements of those in the target market.
   2. Tailored marketing mix

      Nota:

      • Allows the grouping of customers based upon similarities that are important when designing marketing strategies.
   3. Differentiation

      Nota:

      • Target several market segments and develop separate marketing mixes for each.
   4. Opportunities and threats

      Nota:

      • The company that first spots a new under-served market segment and meets its needs better than the competition can find itself on a sales and profit growth trajectory.
2. The Process
   1. 1. Characteristics of individuals customers are understood
      1. 2. Customers grouped into segments on the basis of having similar characteristics
         1. 3. One or more segments are chosen for targeting and a marketing mix strategy is designed for that target market(s)
3. Segmenting Consumer Markets
   1. Behavioural
      1. Benefits sought

         Nota:

         • Convenience Status Performance Price
      2. Purchase occasion

         Nota:

         • Self-buy Gift Special occasions Eating occasions
      3. Purchase behaviour

         Nota:

         • Brand loyalty Innovators Solus buying
      4. Usage

         Nota:

         • Heavy users Light users Non-users
      5. Perceptions, beliefs and values

         Nota:

         • Favourable Unfavourable
   2. Psychographic
      1. Lifestyle
      2. Personality
   3. Profile
      1. Demographic

         Nota:

         • Age Gender Life cycle
      2. Socio-economic

         Nota:

         • Social class Terminal education age Income
      3. Geographic

         Nota:

         • Geodemographic
4. Segmenting Organisational Markets
   1. Macrosegmentation
      1. Organisational size

         Nota:

         • Large Medium Small
      2. Industry

         Nota:

         • Engineering Textiles Banking
      3. Geographic location

         Nota:

         • Local National European Global
   2. Microsegmentation
      1. Choice criteria

         Nota:

         • Economic value Delivery Price Service
      2. Decision-making unit structure

         Nota:

         • Complex Simple
      3. Decision-making process

         Nota:

         • Long Short
      4. Buy class

         Nota:

         • Straight rebuy Modified rebuy New task
      5. Purchasing organisation

         Nota:

         • Centralised Decentralised
      6. Organisational innovativeness

         Nota:

         • Innovator Follower Laggard
5. Target Marketing
   1. Market Awareness
      1. Market factors

         Nota:

         • Segment size Segment growth rate Segment profitability Price sensitivity Bargaining power of customers Bargaining power of suppliers Barriers to market segment entry Barriers to market segment exit
      2. Competitive factors

         Nota:

         • Nature of competition New entrants Competitive differentiation
      3. Political, social and environmental factors

         Nota:

         • Political issues Social trends Environmental issues
   2. Strategies
      1. Undifferentiated marketing
      2. Customised marketing
      3. Focussed marketing
      4. Differentiated marketing
6. Positioning
   1. 3. Differential advantage
   2. 2. Target market
   3. 1. Market segmentation
   4. Successful Positioning
      1. Clarity
      2. Consistency
      3. Credibility
      4. Competitiveness
   5. Repositioning
      1. Image repositioning
      2. Product repositioning
      3. Intangible repositioning
      4. Tangible repositioning