Segmentation, Targeting, & Positioning

Segmentation, Targeting, & Positioning

• The marketing program of the firm depends on how the marketer identifies the
potential customer , profiles them , targets them and positions his offering in
the mind of the customer • These concepts are studied under STP.
Segmentation, Targeting, & Positioning
• Segmentation – How one can classify or group the heterogeneous market into
homogenous market. • Targeting – involves including decisions encompassing which
market(s) to enter out of the available market segment alternatives. • Positioning
– It’s about the customer perception about the brand as being different from the
other brands on specific dimension including product attributes.
Segmentation
• Thus segmentation consists of taking the total heterogeneous market for a
product and dividing into several sub-markets or segments. • Routine example of
mousetrap..segmented according to rural and urban areas . Income category and need
based segmentation.
Advantages of Segmentation
1.Allows a marketer to take heterogeneous market, consisting of customers with
diverse needs, wants and behavior. 2.It also helps in better understanding of the
competitive situation in each of the segment. 3.It not only helps in
identification of customers with substantial similarity but also helps in
profiling them and their need structure so that the marketer can develop an
appropriate
Market segmentation & product differentiation
• Market segmentation – it is a process of dividing a market into groups of
segments having similar wants. • Segments may differ also in their needs for
information,reassurance,technical support, service promotion ,distribution etc.
Market segmentation & product differentiation
• The marketer can create the product differentiation by bringing a difference in
the physical product itself. • E.g.Gillete shaving gel as compare to cake soap or
liquid. • Dominos pizza – thirty minutes delivery process as compare to other
brands. • Ujala compare to Robin blue.
Bases for market segmentation
• Geographic segmentation – segmentation on the basis of nation , states and
regions. • E.g. – Amul first marketed in Gujrat later on the company went for a
national launch. • For e.g. certain product is famous in South India or North
India then it can be again divided into zones , villages , cities , climate etc.
Bases for market segmentation
• Demographic Segmentation – it includes factors like age ,gender , family size ,
family life cycle , income , occupation , education , marital status , religion ,
generation , nationality , language and social class. • E.g.Lakme , TVS scooty ,
diamond jwellery. • Eg. Shaving creams , Bikes , Fair &
Bases for market segmentation
• Psychographic Segmentation – Is the study of lifestyle of individuals. •
Lifestyle is a person’s entire way of living. • It reflects the person’s living as
a combination of his actions , interests , and opinions. • Fashion industry
(clubs) , women's in rural area.
Bases for market segmentation
• Behavioral Segmentation – In this case , the market is divided on the basis of
purchase decision and product or brand usage made by consumers. • Who influence
the purchase decision • E.g.- Hospital industry is divided into six parts like – •
Most modern hospitals – Escort heart and research center , Batra hospitals and
research center, these hospitals (purchase managers) are constantly on the look
for new instruments to become more efficient.
Bases for market segmentation
• Autonomous Hospitals – • For e.g. – In all India institute of medical sciences ,
the purchase decision is of specialist doctors or the head of the concerned
departments. • Government Hospitals – • For e.g. – KEM Hospital –here the medical
superintendent and the financial controller influence the purchase decision.
Bases for market segmentation
• Medium size private hospitals – Hinduja , Hiranandani hospital the final choice
is by Medical Director is final. • Nursing homes – To get these hospitals
recognized by the ministry of health, they go for quality , low price and after
sales service. Doctors approved generally. • Freelancing Anesthetist – These
Bases for market segmentation
• Marketers segment the market on different basis like – • Volume segmentation –
In this case quantity purchased is the basis for segmentation. It attempts to
identify frequent users of a product category or brand. • For e.g. – Cigarettes ,
wine and personal care categories.
Bases for market segmentation
• Brand user segmentation – The marketer tries to identify the user
characteristics on the basis of brand usage as brand users , brand triers and non-
users. • For e.g. – Cadbury by Amitabh Bacchan , Hrithik Roshan for John Player.
Bases for market segmentation
• Situation Segmentation – Many marketers are happy with identifying the segments
and profiling the segments in context with how customers are experiencing the
brand and what is their ultimate way of using the brand. • For e.g. – A person may
select a simple hotel when travelling alone
Patterns of Market Segment
• E.g.- Ice cream buyers.. • Clustered Preferences – three segments like one who
want to take center position to attract all the people(groups) • Another is to
participate in a large market segment • Develop several brands in different
segment •
Patterns of Market Segment
• Homogeneous Preferences – A market where all the consumers have roughly the same
preferences. • Diffused Preferences – consumers preferences may be scattered
throughout the space , indicating that consumers vary greatly in the preference.
Market segmentation Strategy
• Customer’s differences in preferences for brand appear to exist. • These
differences can be identified and matched with customer groups. • The marketing
program can help in reaching segments with certain preferences. • The segments
have enough demand potential to justify their selection as a target markets. • The
segments are sufficiently stable to allow adequate lead-time for the design and
implementation of a
Market segmentation process
• • • • Form the Target • Segment


Profile the segment

Evaluate
Market segmentation process
• Forming Market segments – Two approaches are followed – 1.Build up – for B2B or
industrial buyers e.g. trade india.com 2.Break down - B2C or individual. For e.g.
– cars , personal care products etc. •
Market segmentation process
• Profile segments – marketing managers can profile segments by taking into
account a different descriptive variables. • Profiling helps to large identifiable
groups within a market. • For e.g. By taking into consideration the needs of the
buyer, identifying product or service should be given.
Market segmentation process
• Evaluate market segments – What is expected from each segment should be
evaluated.. • For e.g. – Itc products. • Select Target markets – helps the
marketer to correctly identify the markets and the group of target customers for
whom the product/services are produced. • E.g.-woodland shoes , cellular phones
,pepsi , titan ,Bata , Mahindra &
Criteria for effective market segmentation

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Criteria for effective market segmentation
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• Clear differences in consumer preferences for a product must exist.

Criteria for effective market segmentation
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• Difference preferences for a product must be identifiable and capable of being

related to measurable variables.
Criteria for effective market segmentation
• The proposed market segment must have enough size and purchasing power to be
profitable.

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Criteria for effective market segmentation
• Actionable

• Companies must be able to respond to difference preferences with an appropriate

marketing mix.
Criteria for effective market segmentation
Acc ess ibl e

• The proposed market segment must be readily accessible and reachable with market
programs.
Target Market
• Depending on the available resources ,experience and competency of the marketer
and time available the marketer will decide which market to target. • In this
stage the marketing manager evaluates different market opportunities and decides
how many and which one to target. This is called as target marketing
Target Market
• The marketing manager should look at five factors for evaluating each segment
.They are1.Segment size & 2.Segment worthiness 3.Segment measurability 4.Segment
attractiveness 5.Segment accessibility. 6.
Types of target marketing strategies
• The product market coverage strategies are broadly classified as –
1.Undifferentiated or mass marketing strategy 2.Concentrated marketing strategy
3.Differentiated marketing strategy
Types of target marketing strategies
1.Undifferentiated or mass marketing strategy • Here the marketing manager ignores
the idea of segment characteristics and differences and develops a unified
marketing program for the entire market. • This strategy keeps overall cost low
and makes it easier to manage. • E.g. commodity market (whole sale
Types of target marketing strategies
2. Concentrated marketing strategy – • The marketing manager decides to enter into
a select market segment instead of all the available market segment. • It is an
excellent strategy for small manufacturers that can serve the segments closely and
cater the needs. • E.g. Jyothi laboratories brand of Ujala predominant in south
India and then a national launch

Types of target marketing strategies
3. Differentiated marketing strategy – • The main objective of offering a
differentiated marketing offer is to cater to different segments and get higher
sales with a dominant position in each of the segment. • For e.g. – Maruti 800 for
middle class , Baleno and swift targeted for upper middle class and Omni for lower
class or taxi operators.

Positioning
• The marketing manager needs to decide which segment to enter and how to target
that segment with a product offer through selection of market segment and target
marketing strategy. • The challenge is to decide what position the company wants
it’s products to occupy in the selected segment.
Positioning
• A product positioning is the definition that a consumer gives to the product on
important attributes. • Positioning is the act of developing the company’s
offerings and image to occupy a distinct place in the minds of the target market.
• The end result of positioning strategy is a distinct value-a reason for which
the customer would buy the product.
Positioning
• E.g. – Maggi Noodles , Dove soap , Vicks Vaporub etc.
Product positioning VS. Brand positioning
• In a commodity market hardly there is a difference between a product and brand
positioning. • Same with candles,iscense sticks etc. • Product positioning brings
us to the idea of functional value whereas • Brand positioning talks about some
thing above for which customer is willing to pay.
Product positioning VS. Brand positioning
• Whirlpool vs.Samsung. • When a new brand comes to the market people start
enquiring. • E.g.Tata DOCOMO.
Qualities of a successful position
In context with Ujala• Relevance • Distinctiveness • Coherence • Commitment •
Durability • Clarity • Courage Another examples are Tata Nano , Dell etc.

The brand positioning process
• Two categories – • • • Do good  Margo  Dettol •

Feel Good Lux Dove

The brand positioning process
• Identify a set of possible competitive advantage – • Positioning process begins
with differentiating the product on actual attributes so that customer will
receive the higher value. • Reliance industries In telecommunication – Launch a
GSM Technology with CDMA • Company’s offering sholuld be differentiated on the
basis of product ,
The brand positioning process
• E.g – DHL position themselves as reliable and firms with capabilities of speedy
and accurate delievery. • Eureka Forbes and Amway are the examples of channel
differentiation • To groom customers and tell them to give the service is an
example of people differentiation • Kodak – Red and yellow , Wipro – with rainbow
and the catch line ‘applying Thought’is an image differentiation.
The brand positioning process
• Choose the right Competitive advantage – • The next step is to select a right
competitive advantage which is most suitable for positioning the brand. • E.g.
Samsung – Nano technology , biofresh.
The brand positioning process
• Select an overall positioning Strategy – Consumers will buy the product or
service which give them highest value. • E.g. Raymonds , Kaya skin clinic ,
Dominos
The brand positioning process
• Communicate the message and deliver the chosen position – • Communicate to the
target market • E.g. Pepsi , coke , Rasna?
The brand positioning process
• Rasna is comparatively failure product as compare to other cold drinks.. •
Horliks - Konkana sen • Boost – Sachin tendulkar • Postioned properly.
Assignment
• Zhandu balm is available in the market if company wants to plan to reposition it
what options are available. Suggest at least three.