Segmentation Targeting and Positioning

Extract

[...] Targeting . cont 2. Differentiated:  An organisation directs its marketing efforts at two or more segments by developing a marketing mix for each segment.  Increased sales can result because the company's mixes are being aimed at more people.  A disadvantage is that a greater number of production processes, materials and people are required.  Another disadvantage is that production and marketing costs will be higher Targeting . cont 3. Niche:  With this targeting strategy the organisation directs its marketing efforts towards a single market segment by creating and maintaining one marketing mix. [...]

[...] To do this it is essential to understand consumer perceptions. Positioning cont        Positioning is the process of creating an image for a product in the minds of target customers. The product must be perceived by the selected target customers to have a distinct image. Product differentiation is widely viewed as the key to successful marketing. Market research is required to fully understand customer motivations and expectations. Consumers generally assign a positioning to a company or product relative to that of the market leader. [...]

[...] Single variable segmentation is achieved using only one variable. Multivariable segmentation is achieved by using more than one characteristic to divide a total market. In this way the marketer gains more information about the individuals in each segment. Segmentation effectiveness: Segments must be: Measurable Substantial Accessible Stable Useful Segmentation cont     Segmentation Profiling: A comprehensive understanding of the characteristics of individuals in segments is essential. Building a fuller picture of target segments is sometimes called profiling. Understanding the profile of segments helps to maximise the impact of the marketing mix on the customers relative to the competition. [...]

[...] Segmentation cont 3.       Psychographic. This is dividing the consumer market according to social class, lifestyle or personality. Personality is a useful variable when products are similar to competing products. Personality traits are difficult to measure. Lifestyle segmentation groups individuals according to how they live and spend their time, the importance of items in their surroundings, and their beliefs about themselves and broad issues. Lifestyle analysis provides a broad view of buyers because it encompasses numerous characteristics related to peoples activities, interests and opinions. [...]

[...] Variables can be divided into those that relate to basic customer characteristics and those that are product related behavioural characteristics. Marketers generally select a combination of variables. Segmentation cont  1.   Segmentation Variables Geographic. Geographic variables include climate, terrain, natural resources and population density. A company can decide to operate in one or a few geographical areas, or operate in all but pay attention to local variations. Segmentation cont 2. Demographic.  The ease with which demographic variables can be measured has largely contributed to their widespread use in segmenting markets. [...]