Market Segmentation, Targeting and Positioning

Presentation for Management Graduates (Marketing specialize) on Market Segmentation, Target marketing and Positioning

1. SEGMENTATION, TARGETING AND POSITIONING

2. Content Meaning Of Market Segmentation. Benefits Of Market Segmentation. Limitations Of Market Segmentation . Levels of Marketing Basis Of Market Segmentation. Meaning of Target Market Importance of Target Marketing How To Choose An Effective Segment Market ? Pattern of T arget market Selection Methods for Developing Target market

3. SEGMENTATION Market segmentation- Dividing market into smaller groups with distinct needs , characteristics or behavior that might require different marketing strategies

4. BENEFITS OF MARKET SEGMENTATION Understanding market opportunities Better matching of customer needs Enhanced profits for business Better opportunities for growth Helps in deciding prices Helps to r etain loyal customers Efficient use of marketing communication media Gain share of the market segment Know your customer better Assist in designing suitable distribution strategy Better service to customers

5. LIMITATIONS OF MARKET SEGMENTATION Segments are too small Consumers are misinterpreted Too many brands hence increases competition Increases product cost and market share cost Customization may be a costly affair

6. Levels of market segmentation Mass Marketing (targeting the whole potential market with a single message) Segment marketing( a strategy where the company divides its market into different segments based on their unique needs and characteristics) Niche marketing (where the marketer focus on a segment which have narrower and concise needs) Local marketing (targeting local customer group) Micro marketing (catering the needs of potential customer having a very specific lifestyle or specific geographic location)

7. Basis for Segmentation

8. Geographic Segmentation It calls for division of the market into different geographical units such as nations, states, regions, cities etc. For Example : Mc. Donald, KFC Variables - Region- south India, western region, north, east. City- class- 1 st , metro cities, cities with a population of 0.5 million to 1 million Rural & urban .

9. Demographic Segmentation We divide the market into groups on the basis of variables such as: Age Gender Generation Marital Status Nationality Family life cycle Family Size Life Stage Occupation Income Religion Social Class

10. Psychographic Segmentation In this segmentation buyers are divided into different groups on the basis of life style, personality traits and values. People within same demographic group can exhibit very different psychographic profiles. Example : Halal and Jhatka Meat Life style: Culture oriented, sports oriented Personality- Compulsive, Ambitious

11. Behavioral Segmentation In behavioral segmentation, marketers divide buyers into groups on the basis of their knowledge of, attitude towards, use of, or response to a product. Behavioral variables include : Occasions Benefits User status Usage rate Buyer readiness Loyalty status Attitude towards the product Readiness Stage

12. Why is determining a Target Market is Important? To identify their potential consumer, the more successful they will be in delivering products and services that are in demand. It makes easier to develop the products what the people wants.

13. How do you determine who your target market is ? Is your product international, national or local in scope? Are your target customer is male or female? How old are they? Your target customer single married or divorced? what is their lifestyle like: conservative, exciting, trend, economical? Where do they live?

14. How To Choose An Effective Segment Market ?

15. Five Patterns Of Target Market Selection Single-Segment Concentration: Concentrated Marketing where the firm gains a strong knowledge of segments and acquires a strong market presence. E.g.- Vertu Mobile phone. Selective Specialization: A firm selects a number of segments. Each objectively attractive and appropriate, there may be little or no synergy between the segments. E.g.- M aggie. P1 P2 P3 M1 M2 M3 Single – segment Concentration P1 P2 P3 M1 M2 M3 Selective Specialization

16. Product Specialization: The firm makes a certain product that it sells to several different market segments. Eg : Electricity. Market Specialization: The firm concentrates on serving many needs of a particular customer. Eg : Kindle P1 P2 P3 P1 P2 P3 M1 M2 M3 M1 M2 M3 Product Specialization Market Specialization

17. Full Market Coverage: The firm attempts to serve all customer groups with all products they need. E.g – Coca cola, ITC, Microsoft office (software market) ,etc. It covers the large market in two ways: Undifferentiated market- The firm ignores segment differences and goes after the whole market with one offer. e.g - Nirma detergent powder, Maruti 800, etc. Differentiate market – The firm operates in several market segments and design different products for each. e.g - Johnson & Johnson products, Maruti models, etc. P1 P2 P3 M1 M2 M3 Full Coverage Market

18. Additional Consideration…

19. Methods for developing a target market

20. Positioning

21. Positioning “The act of designing the company’s image and value offer so that the segment’s customers understand and appreciate what the company stands for in relation to its competitors ” ~Philip Kotler

22. For Example:- When we listen about “Benz” and “Rolex watch” The first word that comes in mind……. Prestige

23. Some more examples are… Liril - Freshness Fair & Lovely - Fairness Cream Pears - Tender skin like babies Bata - Value for money shoes Woodland - Sturdy shoes for adventure sports

24. Elements that affects the Positioning

25. Approaches to Positioning

26. What Differentiation is ? “is an act of designing a set of meaningful differences to distinguish the company’s offers from competitor’s offers.”

27. Ways of Differentiation :- Better Offering Newer Offering Faster Offering Cheaper Offering

28. Specific ways for Differentiating :-

29. Positioning Strategies :- Positioning Strategies Competitive Positioning Selling Positioning Product-Oriented Positioning Consumer-Oriented Positioning Benefit Positioning Attribute Positioning Use Positioning User Positioning Price/Quantity Positioning

30. Positioning ERRORS Under Positioning Over Positioning Confused Positioning Doubtful Positioning

31. Under Positioning Failing to present a strong central benefit or reason to buy the product. occurs when customers cannot readily identify the brand or the brand´s features. The product must stand out in the mind of the consumer Example :- S olar Lamp, ASUS LAPTOPS

32. Over Positioning Marketers makes the product too special, so the potential customer group becomes too small. It means that buyers believe that the product is meant for a very select audience because it is premium priced . Example:- Aqua Sure, T ANISHQ

33. Confused Positioning By claiming two are more benefits that contradict each other. Too many benefits or claims, or when the brand attempts to position in too many segments. Example:- NEXT computers CRYSTAL PEPSI Milkmaid

34. Doubtful Positioning Claiming a benefit that customers will doubt that the brand can actually deliver. Example: Fair and Handsome Weight loss medicines