Marketing Chapter 6
market targeting strategies
*Targeting broadly* undifferentiated (mass) marketing -> differentiated (segmented) marketing -> concentrated (niche) marketing -> micro marketing (local or individual marketing) *Targeting narrowly*
Number of differences to promote
-Developing a unique selling proposition (USP) for each brand and sticking to it -Positioning on more than one differentiator
Differentiation and positioning has three steps:
-Identifying differentiations to create competitive advantage -Choosing advantages to build a position -Selecting an overall positioning strategy A brand's full positioning is its value proposition.
segmenting business markets
-consumer and business markets used many of the same variable for segmentation -variable used by business marketers for segmentation include: operating characteristics, purchasing approaches, situational factors, personal characteristics
choosing a differentiation strategy
1. Identifying a set of differentiating competitive advantages 2. Choosing the right competitive advantages 3. Selecting an overall positioning strategy
Communicating and Delivering the Chosen Position
All the company's marketing mix efforts must support the positioning strategy. Maintain the position obtained through consistent performance and communication. The product's position should be monitored and adapted over time.
competitive advantage
An advantage over competitors gained by offering greater customer value either by Having lower prices, or Providing more benefits that justify higher prices -Firms can differentiate in terms of product, services, channels, people, or image.
Affordable.
Buyers can afford to pay for the difference.
choosing a targeting strategy factors to consider
Company resources Product variability Product's life-cycle stage Market variability Competitors' marketing strategies
Preemptive.
Competitors cannot easily copy the difference.
Distinctive.
Competitors do not offer the difference, or the company can offer it in a more distinctive way.
The website leftyslefthand.com markets products to left-handed consumers only. Which targeting strategy does this represent?
Concentrated marketing
behavioral segmentation- loyalty status
Consumers can be loyal to brands, stores, and companies.
socially responsible target marketing
Controversy and concern of target marketing -Vulnerable or disadvantaged consumers are targeted with controversial or potentially harmful products. Socially responsible target marketing should be done to serve both the interests of the company and the interests of those targeted.
market targeting
Evaluating the various segments based on: -Segment size and growth -Segment structural attractiveness -Company objectives and resources
differentiation and positioning
Firms must decide which segments to target and on the value proposition. *Product position* is the way a product is defined by consumers on important attributes.
Intermarket (cross-market) segmentation:
Grouping consumers with similar needs and buying behaviors irrespective of their location
behavioral segmentation- user rate
Markets can be segmented into light, medium, and heavy product users.
Which of the following would make a segment less attractive to enter?
New entrants finding it easy to enter the segment
_____ consists of arranging for a market offering to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers.
Positioning This is the correct answer.
At one time, Miller Beer was known as the "champagne of bottled beer." It was targeted at an elite class of customers. Later, to increase sales, Miller was repositioned to attract members of the working, middle-class. What is this segmentation method called?
Psychographic
Which of the following is a variable used to segment consumer buyers that is not used to segment business buyers?
Psychographics
target market
Set of buyers sharing common needs or characteristics that the company decides to serve
positioning statement
Summarizes company or brand positioning Format: To (target segment and need) our (brand) is (concept) that (point of difference).
Profitable.
The company can introduce the difference profitably.
Important.
The difference delivers a highly valued benefit to target buyers.
Communicable.
The difference is communicable and visible to buyers.
Superior.
The difference is superior to other ways that customers might obtain the same benefit.
segmenting international markets
Variables include: Geographic location Economic factors Political and legal factors Cultural factors
Marketers must be careful to guard against stereotypes when using ________.
age and life cycle segmentation`
differentiation
distinguish the market offering to create superior customer value
segmentation
divide the total market into smaller segments
age and life cycle segmentation
dividing a market into different age and life cycle groups
geographic segmentation
dividing a market into different geographical units, i.e. nations states, regions, counties, cities, or neighborhoods
income segmentation
dividing a market into different income segments
gender segmentation
dividing a market into different segments based on gender
demographic segmentation
dividing a market into segments based on variables, i.e. such as age, life-cycle stage, gender, income, occupation, education, religion, ethnicity and generation
multiple segmentation basis
helps companies to identify smaller, better-defined target groups identify and understand key customer segments reach customers more efficiently by tailoring market offerings and messages to customers specific needs. segmentation systems help marketers segment people and locations into marketable groups of like minded consumers
which differences to promote
important distinctive superior communicable preemptive affordable profitable
Grocers in neighborhoods with a large Hispanic population typically carry more brands that Hispanic consumers prefer than grocers in other neighborhoods. This is an example of ________.
local marketing
behavioral segmentation- user status
marketers can be segmented into nonusers, ex-users, potential users, first time users, and regular users
psychographic segmentation
marketers segment their markets using variables such as social class, lifestyle, personality characteristics. the products people buy reflect their lifestyles
requirements for effective segmentation
measurable, accessible, substantial, differentiable, actionable
Toyota allows Scion buyers to customize their cars to meet their exact needs and preferences. This is an example of ____________.
micromarketing
winning value propositions
more for more = provides the most upscale product or service more for the same = high quality at lower prices more for less = best winning proposition the same for less = gives a good deal less for much less = meeting consumers lower performance or quality requirements at lower price
positioning
position the market offering in the minds of target customers, *all create value for targeted customers*
If competitors cannot easily copy the benefit a company chooses to promote, that benefit is said to be _________.
preemptive
The marketing manager at Arbor's Delicatessen targets customers who are working to lose weight but who still want to dine out. The restaurant chain offers a wide variety of low-fat, low-calorie meals that appeal to dieters. Arbors' approach is best referred to as ________ segmentation.
psychographic
behavioral segmentation- benefit segmentation
segments divide according to the different benefits that consumers seek from the products
Behavioral segmentation- occasion segmentation
segments divided according to occasions when the buyers get the idea to buy, make their purchase, use the purchased item.
targeting
selected the segment or segments to enter
Many marketers think that companies should aggressively promote only one benefit to the target market. The benefit promoted is known as a(n) ________.
unique selling proposition