Segmentation, Targeting and Positioning
Segmentation, Targeting and Positioning
Steps in Market Segmentation, Targeting,and Positioning
1. Identifysegmentationvariables andsegment themarket
2. Develop profiles ofresultingsegments
MarketMarketSegmentationSegmentation
3. Evaluateattractivenessof eachsegment
4. Select thetargetsegment(s)
MarketMarketTargetingTargeting
5. Identifypossible
positioningconcepts foreach target
segment
6. Select,develop, andcommunicate
the chosenpositioning
concept
MarketMarketPositioningPositioning
Why Segmentation ?
• Not all buyers alike• Subgroups may be identified• Subgroups smaller and more
homogeneous• Easier to satisfy smaller groups
How to Segment & Target?
1.Break marke
t down
2.Group into
segments
TARGET MARKET
3.Choos
etarget marke
t
Bases for Segmenting Consumer Markets
Occasions, Benefits, Uses, or Attitudes
Behavioral
Geographic
Region, City or MetroSize, Density, Climate Demographic
Age, Gender, Family size and Life cycle, Race, Occupation, or Income ...
Lifestyle or PersonalityPsychographic
Bases for SegmentationGeographic
World Region or Country North america, Middle East, Western Europe, India, China
Country Region Northern India, Southern India, Eastern India, Western India
Density Urban, Rural, Suburban
City Size under 5000, 5000-20000, 20000-50000,50000-100000….
Demographic
Age under 6, 6-12, 13-19, 20-30, 30-45, 45-60, 60 and above
Gender Male, Female
Family Size 1-2, 2-4, 5+
Family Life Cycle Young single, young married no children, young married with children
Income under Rs.100000, 100000-300000, 300000-500000, 500000+
Occupation Professional, Technical, Officials, Self Employed, Unemployed
Education Literacy rate
Religion Hindu, Muslim, Sikkha, Christen
Generation Baby Boomers, Generation X, Generation Y
Nationality Indian, Japanese, American, French, German
Bases for Segmentation
Life Style Extravagent, Rattional, Economic
Personality Extrovert, Introvert, Ambiovert
Behavioural
Occasions Regular, Special Occasion
Benefits Quality, Service, Economy, Convenience
User Status Non user, Ex user, Potential user, First time user, Regular user
User Rate Light user, Medium user, High user
Loyalty Status None, Medium, Strong
Radiness Stage Unaware, Aware, Interested, Desirous, Intending to buy
Market Targeting1. Evaluating Market Segment
• Segment Size and Growth
• Segment Structural Attractiveness
• Company Objectives & Resources
2. Selecting Target Segment
3. Targeting Strategies
-Standardization
-Differentiation
-Focus
Five Patterns of Target Market Selection
Single-segmentSingle-segmentconcentrationconcentration
ProductProductspecializationspecialization
M1 M2 M3 P1
P2
P3
SelectiveSelectivespecializationspecialization
M1 M2 M3 P1
P2
P3
M1 M2 M3
Full marketFull marketcoveragecoverage
P1
P2
P3
MarketMarketspecializationspecialization
M1 M2 M3 P1
P2
P3
P1
P2
P3
M1 M2 M3
P = ProductP = ProductM = MarketM = Market
Choosing a Positioning Strategy
• Product’s Position - the way the product is defined by consumers on important attributes - the place the product occupies in consumers’ minds relative to competing products.
• Marketers must:– Plan positions to give their products the
greatest advantage in selected target markets,– Design marketing mixes to create these
planned positions.
Positioning• Positioning is an act of creating an image
of the product in the minds of customers.
• Positioning involves the brand’s unique benefits and differentiations in customers mind.
Ex: Complan – A complete planned food
Videocon – Indian Multinational
ServicesDifferentiationi.e. Delivery, Installation,
Repair Services, Customer
Training Services
Product Differentiationi.e. Features,
Performance, Style & Design, or Attributes
ImageDifferentiationi.e. Symbols, Atmospheres,
Events
Personnel Differentiation
i.e. Hiring, Training Better People Than
Competitors Do
Positioning StrategyIdentifying Possible Competitive Advantages
Product Differentiation
FormFea-
turesPerfor-mance
Quality
Dura-bility
Relia-bility
Repair-ability
Style Design
Product Differentiation• Form: size, shape or physical structure
Ex. Sony Handicam, Product of Asian sky shop• Features: These are the characteristics that supplements the product
basic functioning Ex: Mobile phones with blue tooth, touch screen, recorder
• Performance : Buyers will pay more for the better performanceEx: Quick service offered in 5 star hotels
• QualityEx: Mac Donald’s Burger, Barista Coffee, Surf Excel Powder
• Durability• Reliability Ex: Godrej Almirah• Reparability – easy to repair• Style – How well the product looks and feels to the customer
Ex: Parker Pens, Ray Ban Sun glasses, • Design Is the totality of features that affect how a product looks and
works in terms of customer requirements ( Pleasing look, easy to open, operate to repair, )
Ex: Gillette in electric shavers
DeliveryEx: Home Delivery,
Dominos
DeliveryEx: Home Delivery,
Dominos
Services Differentiation
OrderingEase
Ex. Telephone ordering,
Internet
OrderingEase
Ex. Telephone ordering,
Internet
Maintenance& Repair
Ex: LG Samsung
Maintenance& Repair
Ex: LG Samsung
CustomerTrainingEx: SPSS, Data base software
CustomerTrainingEx: SPSS, Data base software
InstallationEx. Reliance
WLL phones, Airtel,
Tata Sky
InstallationEx. Reliance
WLL phones, Airtel,
Tata Sky
CustomerConsultingEx. Investment
Companies
CustomerConsultingEx. Investment
Companies
MiscellaneousS
ervices
Companies can gain a strong competitive advantage through having better trained people. Trained personnel exhibits following characteristics
Competence – possess the required skills & knowledge
Courtesy – Friendly, respectful Credibility – Trustworthy Reliability – perform the service consistently and
accurately Responsiveness – respond quickly to the customer’s
problem Communication – make an effort to understand the
customer and communicate clearly
PERSONNEL Differentiation
Channel Differentiation
• Coverage
• Expertise
• Performance
Media Atmosphere
Symbols
Events
Image Differentiation
Differences WorthDifferences WorthEstablishingEstablishing
AffordableAffordable SuperiorSuperior
ProfitableProfitable
PreemptivePreemptive
DistinctiveDistinctive
ImportantImportant
Which Differences to Promote
•Distinctive: Company can offer better than competitors
•Superior: Customer might not obtain the same benefit elsewhere
•Profitable: Introduce the difference with profit
•Preemptive: Competitors can not imitate the difference easily
•Affordable: Buyers can afford to pay for the difference
•Communicable: The difference is communicable and visible to the buyers
•Important The difference delivers a highly valued benefit to the target buyers
Perceptual Map Stylish, Prestigious
Practical, Economical
Conservative, Older
Sporty, Fast
Rolls Royce
Maruti Alto
Baleno Ambassador
Mercedes
Honda Accord
Ferrari
Maruti Omini
Swift
Palio