To accompany A Framework for Marketing Management, 2nd Edition Slide 1 in Chapter 9 © 2003 Prentice Hall, Inc. Chapter 9 Chapter 9 Identifying Market Identifying Market Segments and Selecting Segments and Selecting Target Markets Target Markets PowerPoint by Karen E. James PowerPoint by Karen E. James Louisiana State University - Shreveport Louisiana State University - Shreveport To accompany A Framework for Marketing Management, 2nd Edition Slide 2 in Chapter 9 © 2003 Prentice Hall, Inc. Objectives Objectives  Learn how companies identify the segments that make up a market.  Understand the criteria companies use to choose the most attractive market segments. To accompany A Framework for Marketing Management, 2nd Edition Slide 3 in Chapter 9 © 2003 Prentice Hall, Inc. Target Marketing Target Marketing  Target marketing requires marketers to take three major steps: – Market segmentation: Identifying and profiling distinct groups of buyers who differ in their needs and preferences. – Market targeting: Selecting one or more market segments to enter. – Market positioning: Establishing and communicating the key distinctive benefit(s) of the company’s market offering to each target. To accompany A Framework for Marketing Management, 2nd Edition Slide 4 in Chapter 9 © 2003 Prentice Hall, Inc. Using Market Segmentation Using Market Segmentation  Mass marketing is losing popularity  Micromarketing can be undertaken at four levels: – Segment marketing – Niche marketing – Local marketing – Individual marketing To accompany A Framework for Marketing Management, 2nd Edition Slide 5 in Chapter 9 © 2003 Prentice Hall, Inc. Using Market Segmentation Using Market Segmentation  Three patterns of preference segments are typically identified: – Homogeneous preferences – Diffused preferences – Clustered preferences To accompany A Framework for Marketing Management, 2nd Edition Slide 6 in Chapter 9 © 2003 Prentice Hall, Inc. Using Market Segmentation Using Market Segmentation  Needs-based segmentation  Segment identification  Segment attractiveness  Segment profitability  Segment positioning  Segment “acid test”  Marketing-mix strategy Needs-based Segmentation Process To accompany A Framework for Marketing Management, 2nd Edition Slide 7 in Chapter 9 © 2003 Prentice Hall, Inc. Using Market Segmentation Using Market Segmentation  Useful market segments share certain characteristics: – Measurable – Substantial – Accessible – Differentiable – Actionable To accompany A Framework for Marketing Management, 2nd Edition Slide 8 in Chapter 9 © 2003 Prentice Hall, Inc. Segmenting Consumer Markets Segmenting Consumer Markets Bases for Segmentation  Geographic  Demographic  Psychographic  Behavioral  Nation or country  State or region  City or metro size  Density  Climate To accompany A Framework for Marketing Management, 2nd Edition Slide 9 in Chapter 9 © 2003 Prentice Hall, Inc. Segmenting Consumer Markets Segmenting Consumer Markets Bases for Segmentation  Geographic  Demographic  Psychographic  Behavioral  Age, race, gender  Income, education  Family size  Family life cycle  Occupation  Religion, nationality  Generation  Social class To accompany A Framework for Marketing Management, 2nd Edition Slide 10 in Chapter 9 © 2003 Prentice Hall, Inc. Segmenting Consumer Markets Segmenting Consumer Markets Bases for Segmentation  Geographic  Demographic  Psychographic  Behavioral  Lifestyle – Activities – Interests – Opinions  Personality  Core values [...]... attractiveness in light of company’s objectives and resources  Five patterns of target market selection can then be considered ©2003 Prentice Hall, Inc To accompany A Framework for Slide 15 in Market Targeting Strategies Patterns of Target Market Selection  Single-segment concentration  Product specialization  Selective specialization  Market specialization Full market coverage ©2003 Prentice Hall, Inc... buyers into three groups: – Price-oriented customers: best served via transactional selling – Solution-oriented customers: best served by means of consultative selling – Strategic-value customers: best served by means of enterprise selling ©2003 Prentice Hall, Inc To accompany A Framework for Slide 14 in Market Targeting Strategies  Evaluating and selecting market segments requires assessing the segment’s... specialization  Market specialization Full market coverage ©2003 Prentice Hall, Inc To accompany A Framework for Slide 16 in Market Targeting Strategies  Targeting multiple segments may result in cost economies  Supersegment targeting may be appropriate  Blocked markets often require megamarketing countermeasures  Be aware of ethical concerns ©2003 Prentice Hall, Inc To accompany A Framework for Slide... Consumer Markets Bases for Segmentation  Geographic  Demographic  Occasions  Benefits  User status  Usage rate  Loyalty status  Psychographic  Buyer-readiness  Behavioral  Attitude ©2003 Prentice Hall, Inc To accompany A Framework for Slide 11 in Segmenting Consumer Markets  Multi-attribute segmentation via geoclustering combines multiple variables to identify smaller, betterdefined target. .. geographic, lifestyle, and behavioral characteristics ©2003 Prentice Hall, Inc To accompany A Framework for Slide 12 in Segmenting Business Markets Bases for Segmentation  Operating variables  Situational factors  Purchasing  Personal approaches characteristics  Demographic variables ©2003 Prentice Hall, Inc To accompany A Framework for Slide 13 in Segmenting Business Markets  Rackman and Vincentis proposed . for Marketing Management, 2nd Edition Slide 1 in Chapter 9 © 2003 Prentice Hall, Inc. Chapter 9 Chapter 9 Identifying Market Identifying Market Segments and Selecting Segments and Selecting. attractive market segments. To accompany A Framework for Marketing Management, 2nd Edition Slide 3 in Chapter 9 © 2003 Prentice Hall, Inc. Target Marketing Target Marketing  Target marketing. Framework for Marketing Management, 2nd Edition Slide 15 in Chapter 9 © 2003 Prentice Hall, Inc. Market Targeting Strategies Market Targeting Strategies  Evaluating and selecting market segments