2000 Prentice Hall

Objectives
Identifying Market Segments
Choosing Target Markets
2000 Prentice Hall
Steps in Market Segmentation,
Targeting,and Positioning
1. Identify
segmentation
variables and
segment the
market

2. Develop
profiles of
resulting
segments
Market
Segmentation
3. Evaluate
attractiveness
of each
segment

4. Select the
target
segment(s)
Market
Targeting
5. Identify
possible
positioning
concepts for
each target
segment

6. Select,
develop, and
communicate
the chosen
positioning
concept

Market
Positioning
2000 Prentice Hall
Basic Market-Preference
Patterns
(a) Homogeneous
preferences
Sweetness
C
r
e
a
m
i
n
e
s
s

(c) Clustered
preferences
C
r
e
a
m
i
n
e
s
s

Sweetness
(b) Diffused
preferences
C
r
e
a
m
i
n
e
s
s

Sweetness
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Market-Segmentation
Procedure
Survey
Motivations
Attitudes
Behavior
Analysis
Factors
Clusters
Profiling

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Bases for Segmenting
Consumer Markets
Occasions, Benefits,
Uses, or Attitudes
Behavioral
Geographic
Region, City or Metro
Size, Density, Climate

Demographic
Age, Gender, Family size
and Fife cycle, Race,
Occupation, or Income ...
Lifestyle or Personality
Psychographic
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Bases for Segmenting
Business Markets
Demographic
Operating Variables
Purchasing Approaches
Situational Factors
Personal Characteristics
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Measurable
Accessible
Substantial
Differential
Segments must be large or
profitable enough to serve.
Segments can be
effectively reached and
served.
Actionable
Size, purchasing power,
profiles of segments can
be measured.
Segments must respond
differently to different
marketing mix elements &
actions.
Must be able to attract and
serve the segments.
Effective Segmentation
2000 Prentice Hall
Heavy and Light Users of
Common Consumer Products
HEAVY HALF LIGHT HALF
PRODUCT (% USERS)
75%
71%
Soups and
detergents (94%)
25%
29%
79% 21%
Toilet tissue (95%)
Shampoo (94%)
75% 25%
17%
17%
Paper towels (90%)
Cake mix (74%)
Cola (67%)
83%
83%
13%
5%
87%
19%
Beer (41%)
Dog food (30%)
Bourbon (20%)
81%
95%
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Additional Segmentation
Criteria
Ethical Choice of Market Targets
Segment Interrelationships &
Supersegments
Segment-by-Segment Invasion Plans
Intersegment Cooperation
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Five Patterns of Target Market
Selection
Single-segment
concentration
Product
specialization
M1 M2 M3
P1

P2

P3


Selective
specialization
M1 M2 M3
P1

P2

P3


M1 M2 M3
Full market
coverage
P1

P2

P3
Market
specialization
M1 M2 M3
P1

P2

P3
P1

P2

P3


M1 M2 M3
P = Product
M = Market
2000 Prentice Hall
Segment-by-Segment
Invasion Plan
Customer Groups
Truckers Railroads Airlines
Large
computers
P
r
o
d
u
c
t

V
a
r
i
e
t
i
e
s

Personal
computers
Mid-size
computers
Company B
Company C
Company A
2000 Prentice Hall
Review
Identifying Market Segments
Choosing Target Markets