Marketing Strategy (Segmentation, Targeting and Positioning)

Irving Arias Dro
Mind Map by Irving Arias Dro, updated more than 1 year ago
Irving Arias Dro
Created by Irving Arias Dro almost 6 years ago
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University Marketing Mind Map on Marketing Strategy (Segmentation, Targeting and Positioning), created by Irving Arias Dro on 01/13/2016.

Resource summary

Marketing Strategy (Segmentation, Targeting and Positioning)
  1. SEGMENTATION
    1. DEFINITION: Market segmentation is a marketing strategy which involves dividing a broad target market into subsets of consumers, businesses, or countries that have, or are perceived to have, common needs, interests, and priorities, and then designing and implementing strategies to target them.
      1. The importance
        1. People have differet wants, needs. There is the need of target people (segmentation). Harvard Business School study suggests that 85% of 30,000 products failed for poor segmentation.
          1. Mass marketing strategy employs mass promotion, mass production and mass distribution in the same way for mass consumers. In the past, companies have used mass marketing to achieve the economies of scale. However, times have changed, and it is almost impossible to create products to appeal to the entire market
        2. THe division of Markets into subgroups :
          1. Demographic
            1. A market split into sub-segments on the basis of variables such as age, gender, sex, family, income, education, religion, culture, occupation, profession, ethnicity etc is known as demographic segmentation. To make it simpler, it is the division of market on the basis of demographics
              1. Age
                1. This is one of the most effective ways of demographic segmentation. At the age of 1 to 2, firm shall try to offer stuff like nappies for new born, baby cream, anti colic, baby clothes etc. With the passage of time, these may change to toys ( a lot of sub-division) then bikes, balls, sport, jeans, school, then college, then University, car, insurance, employment, then retirement, pension and even death
                2. Ethnicity
                  1. Companies have successfully segmented their markets on ethnic basis all over the world in areas where the demand needs to be met that way. For example: HFA(Halal)in the UK makes sure that Muslim consumers are provided Halal foods.
                  2. Gender
                    1. Gender segmentation is another powerful and successful segmentation and can be seen in areas like clothing, cosmetics, beauty products, hair styles, careers, cars, insurance and now even education. Perfume companies target men and women separately with their various model and brands.
                3. Geographic
                  1. Marketers can segment according to geographic criteria—nations, states, regions, countries, cities, neighborhoods, or postal codes. With respect to region, in rainy regions merchants can sell things like raincoats, umbrellas and gumboots. In hot regions, one can sell summer clothing. A small business commodity store may target only customers from the local neighborhood, while a larger department store can target its marketing towards several neighborhoods in a larger city or area, while ignoring customers in other continents.
                  2. Psychopgraphic
                    1. Psychographic segmentation, which is sometimes called lifestyle, is measured by studying the activities, interests, and opinions (AIOs) of customers. It considers how people spend their leisure.
                      1. Examples: people drinking decaf coffee or tea, weight watchers, seekers of less fatty food. Products based on life styles may be highly customised to appeal to a particular way of life
                    2. Behavioural
                      1. For instance, some users may be classed as heavy users while others as light users. Some may be just first time user while other are occasional users only.
                        1. Examples: some users may be classed as heavy users while others as light users. Some may be just first time user while other are occasional users only. It may consists on: Brand loyalty, Attitude towards product, Readiness to buy,etc.
                    3. Benefits:
                      1. Easier to understand the exact needs of the customer and target the marketing strategy at a particular group. Profit Potential, business growth, Retaining Customer,
                      2. Disadvantages
                        1. 1. No highly customised product. Only group served not individuals. 2. No link to competitive advantage 3. Lack of suitable process
                      3. Targeting:
                        1. Definition: The selection of potential customers to whom a business wishes to sell products or services.
                          1. undifferentiated
                            1. It does not target a particular segment of the market. Instead the firm adopts one marketing strategy and hopes that it will appeal to as many people as possible.
                              1. Example: Coca Cola's original marketing strategy was based on this format when they offered one product, which they believed had universal appeal. However now that Coca Cola has introduced other products, it has changed its marketing strategy to differentiated marketing
                            2. Diferentiated
                              1. If a firm decides to target several segments of the market, it is engaging in a differentiated marketing strategy
                                1. Example: An airline company offering first (segment 1), business (segment 2) and economy class tickets (segment 3) , with separate marketing programmes to attract customers for each of the ticket types is an example of differentiated marketing strategy.
                              2. Concentrated
                                1. Concentrated marketing occurs when a business concentrates its marketing effort on one segment of the market.
                                  1. The firm will develop a product that caters for the needs of that particular group. For example Rolls Royce cars and the Harrods Group target the premium segment of the market.
                              3. Positioning
                                1. Definition: Aims to make a brand occupy a distinct position, relative to competing brands, in the mind of the customer. Companies apply this strategy either by emphasizing the distinguishing features of their brand. or they may try to create a suitable image (inexpensive or premium, utilitarian or luxurious, entry-level or high-end, etc.) through advertising.
                                  1. Steps in positioning:
                                    1. Stage1: Analyse competitors' positions
                                      1. Analyse competitor's position in the market place, marketers must understand the current state of the market. Eg. What competitors are out there? and how does the target market perceive them?
                                        1. Example: For years: Mcdonald's developed positioning strategies based only on its direct competition. McDonald's failed to realise that consumers' needs for a quick, tasty meal was fulfilled by indirect competitors such as microwave singe serving meals or telephone takeaways.
                                      2. Stage 2: Offer a good or service with a competitive advantage
                                        1. Offer a good or service with a competitive advantage to provide a reason why consumers will perceive the product as being better than the competition.
                                          1. Example; offering asuperior image like Giorgio Armani, a unique product feature like Levi's 501, button fly jeans.
                                        2. Stage 3: finalize the marketing Mix
                                          1. Finalizing the marketing mix by putting all the pieces into place. A good or service must deliver benefits that the segment values such as convenience or status.
                                          2. Stage 4: Evaluate responses and modify as needed
                                            1. Marketers evaluate target market's responses so they can modify strategies as needed. Overtime, the firm may find that it needs to change which segments its targets or alter product's position to respond to marketplace changes.
                                              1. For example: re-positioning is commonly used when a companytry to modify its brand image to keep up with changing times. Powerade was originally positioned as a drink that should be consumed when you were il. Nowdays, through the use of professional athletes the product is positioned as a sports drink that can improve endurance.
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