CHAPTER # 2NDUNDERSTANDING CONSUMERS & MARKET SEGMENTS:

• INTRODUCTION AND OBJECTIVES OF• THIS CHAPTER:•IN THIS CHAPTER WE ARE GOING TO DISCUSS IN DETAIL THAT HOW A MARKETER SEGMENTS THE OVERALL MARKET IN TO SMALLER BUT HOMOGENIOUS SEGMENTS,WHAT ARE THE DIFFERENT RULES FOR SEGMENTATION, WHAT IS THE CRITERIA FOR SEGMENTATION, AND HOW PRODUCT POSITIONING EFFORTS ARE BEING PERFORMED.

WHAT IS MARKET SEGMENTATION?

THE PROCESS OF DIVIDING A MARKET INTO DISTINCT SUBSETS OF CONSUMERS WITH COMMON NEEDS OR CHARACTERISTICS AND SELECTING ONE OR MORE TO TARGET”

EXAMPLES

CARS

Luxury

Sporty

Spacey/Specious

Cheap

EXAMPLES

FOOD

Continental

Chinese

Italian

Indian/Pakistani

Arabian

EXAMPLES

CLOTHES

Formal

Female

Traditional

Male

Party Wear

Informal

Bridal Wear

Fusion

MUSIC

PoP

Rock

R & B

Disco

Salsa

Jazz

WHO IS USING MARKET SEGMENTATION

Marriott 13 lodging brand Fairfield Inns (prices conscious people) Spring Hill Suites (modestly priced) Residence Inns (apartment like accommodation) Courtyard (price conscious Business people) Marriott Hotels (full service business travelers) Marriott Resorts (leisure & vocational

accommodation)

BASES FOR SEGMENTATION

Geographic Factors

Benefit Segmentation

Hybrid Segmentation Approaches

Sociocultural

Use Situation Factors

Use Related Characteristics

Psychographic (lifestyle)

Geo Demographic

Demographic Factors

Psychographic-Demographic Geodemographic

GOEGRAPHIC SEGMENTATION

GEOGRAPHIC SEGMENTATION THE MARKET IS DIVIDED BY LOCATION.PEOPLE WHO LIVE IN THE SAME AREA SHARE SOME SIMILAR NEEDS AND WANTS DIFFER FROM THOSE OF PEOPLE LIVING IN OTHER AREAS.CERTAIN FOOD PRODUCTSSTARBUCKS COFFEE (WWW.STARBUCKS.COM), WHOSE FIRST STORE OPENED SEATTLE IN 1971. NEARLY 20 YEARS LATER, AFTER A RAPID EXPANSION INTO THE EASTERN STATES DURING THE 1990’S, STARBUCKS DECIDED TO INTRODUCE THE MILDER DIMENSIONS LINE COFFEES IN 1998 TO BETTER SATISFY ITS EAST COAST CONSUMERS WHO TEND TO PREFER A MILDER COFFEE THAN THEIR WEST COAST COUNTERPARTS.

SOME MARKETING SCHOLARS HAVE ARGUED THAT DIRECT-MAIL MERCHANDISE CATALOGS, NATIONAL TOLL-FREE TELEPHONE NUMBERS, SATELLITE TELEVISION TRANSMISSION, GLOBAL COMMUNICATION NETWORKS, AND ESPECIALLY THE INTERNET HAVE ERASED ALL REGIONAL BOUNDARIES AND THAT GEOGRAPHIC SEGMENTATION SHOULD BE REPLACED BY A SINGLE GLOBAL MARKETING STRATEGY.

TABLE 3-2 MARKET SEGMENTATION CATEGORIES & SELECTED VARIABLES

SEGMENTATION BASE SELECTED SEGEMENTATION VARIALBESGEOGRAPHIC SEGMENTATIONREGION SOUTHWEST, MOUNTAIN STATES, ALASKA, HAWAIICITY SIZE MAJOR METROPOLITAN AREAS, SMALL CITIES,

TOWNSDENSITY OF AREA URBAN, SUBURBAN, EXURBAN, RURALCLIMATE TEMPERATE, HOT, HUMID, RAINYDEMOGRAPHIC SEGMENTATIONAGE UNDER 12,12-17,18-34,35-49,50-64,65-74,75-

99, 100+GENDER MALE, FEMALEMARITAL STATUS SINGLE, MARRIED, DISCOVERED, LIVING TOGETHER,

WIDOWEDINCOME UNDER $25,000, $25,000-$34,999, $34,999-$49,999,

$50,000-$74,999, $75,000-$99,999, $100,000 & OVEREDUCATION SOME HIGH SCHOOL, HIGH SCHOOL GRADUATE,

SOME COLLEGE, COLLEGE GRADUATE, POSTGRADUATEOCCUPATION PROFESSIONAL, BLUE-COLLAR, AGRICULTURE, MILITARYPSYCHOLOGICAL SEGMENTATIONNEEDS- MOTIVATION SHELTER, SAFETY, SECURITY, AFFECTION, SENSE OF

SELF-WORTHPERSONALITY EXTROVERTS, NOVELTY SEEKERS, AGGRESSIVE, LOW

DOGMATICSPERCEPTION LOW-RISK, MODERATE-RISK, HIGH-RISKLEARNING-INVOLVEMENT LOW-INVOLVEMENT, HIGH-INVOLVEMENTATTITUDES POSITIVE ATTITUDE, NEGATIVE ATTITUDE

PSYCHOGRAPHIC(LIFESTYLE) SEGMENTATION ECONOMY-MINDED, COUCH POTATOES, OUT DOORS

ENTHUSIASTS, STATUS SEEKERSSOCIO CULTURAL SEGMENTATIONCULTURES AMERICAN, ITALIAN, CHINESE, MEXICAN, FRENCH,

PAKISTANIRELIGION CATHOLIC, PROTESTANT, JEWISH, MOSLEM, OTHERSUBCULTURES (RACE/ETHNIC) AFRICAN AMERICAN, CAUCASIAN, ASIAN, HISPANICSOCIAL CLASS LOWER, MIDDLE, UPPERFAMILY LIFE CYCLE BACHELORS, YOUNG MARRIED, FULL NESTERS, EMPTY

NESTERSUSE-RELATED SEGMENTATIONUSAGE RATE HEAVY USERS, MEDIUM USERS, LIGHT USERS, NONUSERSAWARENESS STATUS UNAWARE, AWARE, INTERESTED, ENTHUSIASTICBRAND LOYALTY NONE , SOME, STRONGUSE-SITUATION SEGMENTATIONTIME LEISURE, WORK, RUSH, MORNING, NIGHTOBJECTIVE PERSONAL, GIFT, SNACK, FUN, ACHIEVEMENTLOCATION HOME, WORK, FRIEND’S HOME, IN-STOREPERSON SELF, FAMILY MEMBERS, FRIENDS, BOSS, PEERBENEFIT SEGMENTATION CONVENIENCE, SOCIAL ACCEPTANCE, LONG LASTING,

ECONOMY, VALUE-FOR-THE-MONEYHYBRID SEGMENTATIONDEMOGRAPHIC/PSYCHOGRAPHIC COMBINATION OF DEMOGRAPHIC AND

PSYCHOGRAPHIC PROFILES OF CONSUMER SEGMENTS PROFILES

GEODEMOGRAPHIC “MONEY AND BRAINS,” “BLACK ENTERPRISE,” OLD YANKEE ROWS,” “DOWNTOWN DIXIE STYLE”

SRIVALS ACTUALIZER, FULFILLED, BELIEVER, ACHIEVER

DEMOGRAPHIC SEGMENTATION

AGE, GENDER, MARITAL STATUS, INCOME, OCCUPATION AND EDUCATION, ARE MOST OFTEN USED AS THE BASIS FOR MARKET SEGMENTATION.REFERS TO THE VITAL AND MEASURABLE STATISTICS OF A POPULATION.HELP TO LOCATE A TARGET MARKET.DEMOGRAPHIC INFORMATION IS OFTEN THE MOST ACCESSIBLE AND COST-EFFECTIVE WAY TO IDENTIFY A TARGET MARKET.MOST SECONDARY DATA, INCLUDING CENSUS DATA, ARE EXPRESSED IN DEMOGRAPHIC TERMS.

AGE

PRODUCT NEEDS AND INTERESTS OFTEN VARY WITH CONSUMERS’ AGE.

FOR EXAMPLE, ALTHOUGH CHILDREN OFTEN CONSUME BOXED JUICE DRINKS, MINUTE MAID COMPANY (WWW.MINUTEMAID.COM) OFFERS SINGLE-SERVE DRINKS IN POUCHES, RATHER THAN BOXES, IN ORDER TO BETTER APPEAL TO THE “TWEEN” MARKETS.

GENDER

GENDER IS QUITE FREQUENTLY A DISTINGUISHING SEGMENTATION VARIABLE. WOMEN HAVE TRADITIONALLY BEEN THE MAIN USERS OF SUCH PRODUCTS AS HAIR COLORING AND COSMETICS, AND MEN HAVE BEEN THE MAIN USERS OF TOOLS AND SHAVING PREPARATIONS.

MARITAL STATUS

TRADITIONALLY, THE FAMILY HAS BEEN THE FOCUS OF MOST MARKETING EFFORTS, AND FOR MANY PRODUCTS AND SERVICES, THE HOUSEHOLD CONTINUES TO BE THE RELEVANT CONSUMING UNIT.MARKETERS ARE INTERESTED IN THE NUMBER AND KINDS OF HOUSEHOLDS THAT BUY AND/OR OWN CERTAIN PRODUCTS.MARKETERS HAVE DISCOVERED THE BENEFITS OF TARGETING SPECIFIC MARITAL STATUS GROUPINGS, SUCH AS SINGLES DIVORCED INDIVIDUALS, SINGLE PARENTS AND DUAL-INCOME MARRIED COUPLES.

INCOME, EDUCATION & OCCUPATION

INCOME HAS LONG BEEN AN IMPORTANT VARIABLE FOR DISTINGUISHING BETWEEN MARKET SEGMENTS. MARKETERS COMMONLY SEGMENT MARKETS ON THE BASIS OF INCOME BECAUSE THEY FEEL THAT IT IS A STRONG INDICATOR OF THE ABILITY (OR INABILITY) TO PAY FOR A PRODUCT OR SPECIFIC MODEL OF THE PRODUCT. FOR INSTANCE, INITIALLY MARKETERS OF HOME COMPUTERS UNDER $1,000 FELT THAT SUCH PRODUCTS WOULD BE PARTICULARLY ATTRACTIVE TO HOMES WITH MODEST FAMILY INCOMES. HOWEVER, THESE LOW-PRICED PCS ALSO PROVED TO BE QUITE POPULAR WITH HIGHER-INCOME FAMILIES WHO WANTED ADDITIONAL COMPUTERS FOR YOUNGER FAMILY MEMBERS.

INCOME IS OFTEN COMBINED WITH OTHER DEMOGRAPHIC VARIABLES TO MORE ACCURATELY DEFINE TARGET MARKETS. TO ILLUSTRATE, HIGH INCOME HAS BEEN COMBINED WITH AGE TO IDENTIFY THE IMPORTANT AFFLUENT ELDERLY SEGMENT. IT ALSO HAS BEEN COMBINED WITH BOTH AGE AND OCCUPATIONAL STATUS TO PRODUCE THE SO-CALLED YUPPIE SEGMENT, A SOUGHT-AFTER SUBGROUP OF THE BABY BOOMER MARKET.

EDUCATION, OCCUPATION, AND INCOME TEND TO BE CLOSELY CORRELATED IN ALMOST A CAUSE-AND-EFFECT RELATIONSHIP. HIGH-LEVEL OCCUPATIONS THAT PRODUCED HIGH INCOMES USUALLY REQUIRE ADVANCED EDUCATIONAL TRAINING. INDIVIDUALS WITH LITTLE EDUCATION RARELY QUALIFY FOR HIGH-LEVEL JOBS.

PSYCHOGRAPHIC SEGMENTATION

PSYCHOGRAPHIC PROFILE OF A CONSUMER SEGMENT CAN BE THOUGHT OF AS A COMPOSITE OF CONSUMERS MEASURED ACTIVITIES, INTERESTS AND OPINIONS (AIOS). AS AN APPROACH TO CONSTRUCTING CONSUMER PSYCHOGRAPHIC PROFILES, AIO RESEARCH SEEDS CONSUMERS RESPONSES TO A LARGE NUMBER OF STATEMENTS THAT MEASURE ACTIVITIES.

E.G., GOLFING, VOLUNTEERING AT A LOCAL BLOOD BAND, GARDENING, INTERESTS (THE CONSUMER’S OR FAMILY’S PREFERENCES AND PRIORITIES, E.G., HOME, FASHION, FOOD) AND OPINIONS (HOW CONSUMER FEELS ABOUT A WIDE VARIETY OF EVENTS AND POLITICAL ISSUES, SOCIAL ISSUES, THE STATE OF THE ECONOMY, ECOLOGY.

SOCIOCULTURAL SEGMENTATION

FAMILY LIFE CYCLE SEGMENTATION IS BASED ON THE PREMISE THAT MANY FAMILIES PASS THROUGH SIMILAR PHASES IN THEIR FORMATION, GROWTH AND FINAL DISSOLUTION. AT EACH PHASE, THE FAMILY UNIT NEEDS DIFFERENT PRODUCTS AND SERVICES. YOUNG SINGLE PEOPLE, FOR EXAMPLE, NEED BASIC FURNITURE FOR THEIR FIRST APARTMENT, WHEREAS THEIR PARENTS, FINALLY FREE OF CHILD REARING, OFTEN REFURNISH THEIR HOMES WITH MORE ELABORATE PIECES.

EACH OF THE STAGES IN THE TRADITIONALLY FAMILY LIFE CYCLE (BACHELORHOOD, HONEYMOONERS, PARENTHOOD, POSTPARENTHOOD, AND DISSOLUTION) REPRESENTS AN IMPORTANT TARGET SEGMENT TO A VARIETY OF MARKETERS.

USE-RELATED SEGMENTATION

AN EXTREMELY POPULAR AND EFFECTIVE FORM OF SEGMENTATION CATEGORIZES CONSUMERS IN TERMS OF PRODUCT, SERVICE, OR BRAND USAGE CHARACTERISTICS, SUCH AS LEVEL OF USAGE, LEVEL OF AWARENESS, AND DEGREE OF BRAND LOYALTY.RATE OF USAGE SEGMENTATION DIFFERENTIATES AMONG HEAVY USERS, MEDIUM USERS, LIGHT USERS, AND NONUSERS OF A SPECIFIC PRODUCT, SERVICE OR BRAND.

HEAVY USERS OF TRAVEL AGENTS IN SINGAPORE WERE MORE INVOLVED WITH AND MORE ENTHUSIASTIC ABOUT VACATION TRAVEL, MOTE INNOVATIVE WITH REGARD TO THEIR SELECTION OF VACATION TRAVEL PRODUCTS, MORE LIKELY TO TRAVEL FOR PLEASURE AND MORE WIDELY EXPOSED TO TRAVEL INFORMATION FROM MASS MEDIA.AWARENESS STATUS ENCOMPASSES THE NOTION OF CONSUMER AWARENESS OF THE PRODUCT, INTEREST LEVEL IN THE PRODUCT, READINESS TO BUY THE PRODUCT, OR WHETHER CONSUMERS NEED TO BE INFORMED ABOUT HE PRODUCT. AD FOR CAMPBELL’S TOMATO SOUP THAT DESIGNED TO CREATE BOTH AWARENESS AND INTEREST AMONG CONSUMERS WHO ARE INTERESTED IN REDUCING THEIR RISK OF CANCER.

SOMETIMES BRAND LOYALTY IS USED AS THE BASIS FOR SEGMENTATION. MARKETERS OFTEN TRY TO IDENTIFY THE CHARACTERISTICS OF THEIR BRAND-LOYAL CONSUMERS SO THAT THEY CAN DIRECT THEIR PROMOTIONAL EFFORTS TO PEOPLE WITH SIMILAR CHARACTERISTICS IN THE LARGER POPULATION.INCREASINGLY, MARKETERS STIMULATE AND REWARD BRAND LOYALTY BY OFFERING SPECIAL BENEFITS TO CONSISTENT OR FREQUENT COSTUMERS. SUCH FREQUENT USAGE OR RELATIONSHIP PROGRAMS OFTEN TAKE THE FORM OF A MEMBERSHIP CLUB (E.G. HERTZ NUMBER 1 CLUB GOLD, AMERICAN AIRLINES, PLATINUM LEVEL, OR MARRIOTT'S REWARDS.)

USAGE-SITUATION SEGMENTATION

OCCASION OR SITUATION OFTEN DETERMINES WHAT CONSUMERS WILL PURCHASE OR CONSUME.WHEN I AM AWAY ON BUSINESS FOR A WEEK OF MORE, I TRY TO STAY AT SUITES HOTEL.I ALWAYS BUY MY WIFE FLOWERS ON VALENTINE’S DAY.THE GREETING CARD INDUSTRY, FOR EXAMPLE, STRESSES SPECIAL CARDS FOR A VARIETY OF OCCASIONS THAT SEEM TO BE INCREASING ALMOST DAILY (GRANDPARENTS DAY, SECRETARIES DAY ETC.)

DIAMOND INDUSTRY PROMOTE DIAMOND RINGS AS AN ENGAGEMENT SYMBOL.THE GODIVA CHOCOLATE AD IN FIGURE 3-4 (WWW.GODIVA.COM) IS AN EXAMPLE OF SITUATIONAL, SPECIAL USAGE OF SEGMENTATION. IT APPEARED IN MAGAZINES A WEEK PRIOR TO VALENTINE’S DAY AND SUGGEST THAT A BOX OF GODIVA CHOCOLATE “WILL MAKE HER HEART SKIP A BEAT.”

BENEFIT SEGMENTATION

MARKETING AND ADVERTISING EXECUTIVES CONSTANTLY ATTEMPT TO IDENTIFY THE ONE MOST IMPORTANT BENEFIT OF THEIR PRODUCT OR SERVICES THAT WILL BE MOST MEANINGFUL TO CONSUMERS. EXAMPLES OF BENEFITS THAT ARE COMMONLY USED INCLUDE FINANCIAL SECURITY (PRUDENTIAL FINANCIAL) DATE PROTECTION (IOMEGA) GOOD HEALTH (WHEATIES) FRESH BREATH (ECLIPSE GUM) AND PEACE OF MIND (HEFTY ONE ZIP BAGS).CREST WHITENING PLUS SCOPE TOOTHPASTE (WWW.CREST.COM ARE WHITER TEETH AND FRESH BREATH.

HYBRID SEGMETATION APPROACHES

MARKETERS COMMONLY SEGMENT MARKETS BY COMBINING SEVERAL SEGMENTATION VARIABLES RATHER THAN RELYING ON A SINGLE SEGMENTATION BASE.

1.PSYCHOGRAPHIC-DEMOGRAPHIC PROFILESDEMOGRAPHIC-PSYCHOGRAPHIC PROFILING HAS BEEN WIDELY USED IN THE DEVELOPMENT OF ADVERTISING CAMPAIGNS TO ANSWER THREE QUESTIONS:

a) WHOM SHOULD WE TARGET?b) WHAT SHOULD WE SAY?c) WHERE SHOULD WE SAY IT?

GEODEMOGRAPHIC SEGMENTATION

PEOPLE WHO LIVE CLOSE TO ONE ANOTHER ARE LIKELY TO HAVE SIMILAR FINANCIAL MEANS, TASTES, PREFERENCES, LIFESTYLES AND CONSUMPTION HABITS.CLUSTERS ARE CREATED BASED ON CONSUMER LIFESTYLES, AND SPECIFIC CLUSTER INCLUDES ZIP CODES THAT ARE COMPOSED OF PEOPLE WITH SIMILAR LIFESTYLES WIDELY SCATTERED THROUGHOUT THE COUNTRY

MARKETERS USE THE CLUSTER DATE FOR DIRECT-MAIL CAMPAIGNS, TO SELECT RETAIL SITES AND APPROPRIATE MERCHANDISE MIXES, TO LOCATE BANKS AND RESTAURANTS, AND TO DESIGN MARKETING STRATEGIES FOR SPECIFIC MARKET SEGMENTS.GEODEMOGRAPHIC SEGMENTATION IS MOST USEFUL WHEN AN ADVERTISER’S OR MARKETER'S BEST PROSPECT (IN TERMS OF CONSUMER PERSONALITIES, GOALS AND INTERESTS) CAN BE ISOLATED IN TERMS OF WHERE THEY LIVE.

CRITERIA FOR EFFECTIVE TARGETING OF MARKET SEGMENTS

TO BE AN EFFECTIVE TARGET, A MARKET SEGMENT SHOULD BE:

1.IDENTIFIABLE

2.SUFFICIENT (IN TERMS OF SIZE)

3.STABLE OR GROWING

4.ACCESSIBLE (REACHABLE) IN TERMS OF BOTH MEDIA AND COST.

1. IDENTIFICATION

TO DIVIDE THE MARKET INTO SEPARATE SEGMENTS ON THE BASIS OF A SERIES OF COMMON SHARED NEEDS OR CHARACTERISTICS THAT ARE RELEVANT TO THE PRODUCT OR SERVICE.SEGMENTATION VARIABLES, SUCH AS GEOGRAPHY (LOCATION) OR DEMOGRAHICS (AGE, GENDER, OCCUPATION, RACE) ARE RELATIVELY EASY TO IDENTIFY OR ARE EVEN ABSERVABLE.EDUCATION INCOME OR MARITAL STATUS, CAN BE DETERMINED THROUGH QUESTIONNAIRIES.

2. SUFFICIENCY

FOR MARKET SEGMENT TO BE A WORTHWHILE TARGET, IT MUST CONSIST OF A SUFFICIENT NUMBER OF PEOPLE WARRANT TAILORING A PRODUCT OR PROMOTIONAL CAMPAIGN TO ITS SPECIFIC INTEREST.

CENSUS BUREAU (AVAILABLE AT MANY LIBRARIES AND ONLINE VIA THE INTERNET)

3. STABILITY

MOST MARKETERS PREFER TO TARGET CONSUMER SEGMENTS THAT ARE RELATIVELY STABLE IN TERMS OF DEMOGRAPHIC AND PSYCHOLOGICAL FACTORS AND NEED AND THAT ARE LIKELY TO GROW LARGER OVER TIME.

4. ACCESSIBILITY

A FOURTH REQUIREMENT FOR EFFECTIVE TARGETING IS ACCESSIBILITY, WHICH MEANS THAT MARKETERS MUST BE ABLE TO REACH THE MARKET SEGMENTS THEY WANT TO TARGET IN AN ECONOMICAL WAY.

MARKET SEGMENTATION PROCESS

IDENTIFYING SEGMENTS

SELECTING TARGET SEGMENTS

CREATING MARKETING MIX FOR EACH TARGET SEGMENTS.

CRITERIA FOR EFFECTIVE TARGETING OF MARKET SEGMENTS

TO BE AN EFFECTIVE TARGET, A MARKET SEGMENT SHOULD BE:

1.IDENTIFIABLE

2.SUFFICIENT (IN TERMS OF SIZE)

3.STABLE OR GROWING

4.ACCESSIBLE (REACHABLE) IN TERMS OF BOTH MEDIA AND COST.

MARKET TARGETING AND TARGET MARKETS

MARKET TARGETING IS THE PROCESS OF SELECTING CUSTOMERS FROM THE IDENTIFED SEGMENTS, AND THE SELECTED GROUP OF CUSTOMERS ARE CALLED TARGET MARKETS, AND TARGET MARKET IS THE GROUP OF CUSTOMERS WHO HAVE GOT MONEY, AUTHORITY AND NEED FOR A PRODUCT OR GROUP OF PRODUCT, AND THEY ARE WIILLING TO PURCHASE OR USE A PRODUCT .SO MARKET TARGETING IS THE PROCESS AND THE TARGET MARKETS ARE THE RESULT OF THAT PROCESS.

TARGET MARKET STRATEGIES

WE HAVE GOT 3 TARGET MARKET STRATEGIES:AGGREGATION STRATEGY:HERE A MARKETER TREATS THE WHOLE MARKET AS A SINGLE SEGMENT, THIS STRATEGY IS ALSO KNOWN AS “MASS MARKET STRATEGY” OR UNDIFFERENTIATED MARKET STRATEGY, SO THE COMPANY DEVISE THE SAME MARKETING MIX FOR THE WHOLLY SELECTED

MARKET. E.G GASOLINE, (FUEL), SALT, SUGAR, VEGETABLES, SUGAR, ETC,THIS STRATEGY IS SUITABLE FOR THOSE FIRMS WHICH ARE PRODUCING UNDIFFERENTIATED PRODUCTS. THE ADVANTAGE OF THIS STRATEGY IS THAT, A FIRM CAN MINIMIZE ITS OVERALL COST, INCLUDING PROMOTIONAL COST,

WAREHOUSING COST, TRANSPORTATION COST, AND LOWER PRODUCTION COSTS, BECAUSE THE TOTLA MARKET IS HERE IS BEING TREATED AS A SINGLE SEGMENT.SINGLE SEGMENT STRATEGY:IT REFERS TO SELECTING A SINGLE SEGMENT AS A TARGET MARKET FROM THE WHOLE MARKET, AND ONE MARKETING MIX IS BEING DEVELOPED FOR

THEM,THIS STRATEGY ENABLES MARKETERS TO ACQUIRE SPECIALIZATION OR REPUTATION AS A SPECIALIST IN MARKET. E.G MERCEDEZ CAR TARGETING UPPER CLASS, SUZUKI TARGETING MIDDLE CLASS, THE DISADVANTAGE OF THIS STRATEGY IS THAT THE MARKETER HAS GOT ALL THE EGGS IN A SINGLE BASKET,

MEANS ALL THE BUSINESS SUCCESS IS DEPENDING UPON THE SINGLE SEGMENT WITH LIMITED PRODUCTS AND OTHER POTENTIAL MARKET SEGMENTS ARE NOT CONSIDERED AS TARGET MARKETS.MULTIPLE SEGMENT STRATEGYUNDER THIS STRATEGY TWO OR THAN 2 SEGMENTS OF CONSUMERS ARE TREATED AS

TARGET MARKETS, AND A SEPARATE MARKETING MIX IS BEING DEVELOPED FOR EACH SELECTED TARGET MARKET,E.G SUNSILK SHAMPOO OFFERS 5 VARAITIONS IN ITS PRODUCT LINE, (FOR NORMAL, DULL, DRY, SHINNY, AND DAMAGED HAIR).

THIS STRATEGY RESULTS IN GREATER VOLUME OF SALES, AS MORE SEGMENTS ARE BEING TARGETED, BUT ITS INEFFECTIVE IN TERMS OF “COST” AND “MARKET COVERAGE”

GUIDELINES FOR SELECTING A TARGET MARKET:

DEMAND, PURCHASING ABILITY AND WILLING NESS TO BUY.

COMPANY SHOULD HAVE ENOUGH RESOURCES TO FULFILL THEIR DEMAND.

SUFFICINCY

COMPETITION SHOULD NOT BE THAT MUCH TOUGH.

STABILITY.

POSITIONING

POSITIONING STRATEGIES:

POSITIONING IN RELATION TO COMPETITORS

POSITIONING IN RELATION TO A PRODUCT CLASS SPECIAL ATTRIBUTE:

POSITIONING BY PRICE AND QUALITY

BY:

ADIL ADNAN.

IQRA UNIVERSITY