Marketing Management, 12/eA South Asian Perspective

8 Identifying Market

Segments and Targets

Dr. Hitesh Ruparel

8-2

Chapter Questions What are the different levels of market

segmentation? How can a company divide a market into

segments? How should a company choose the most

attractive target markets? What are the requirements for effective

segmentation?

8-3

Effective Targeting Requires…

Identify and profile distinct groups of buyers who differ in their needs and preferences.

Select one or more market segments to enter.

Establish and communicate the distinctive benefits of the market offering.

8-4

Four Levels of Micromarketing

Segments (Homogenous, Diffused , Clustered Preferences)

Niches (Inside Outside, Overdrive) Local areas (Gujarati – Financial Express) Individuals (Asian Paints – Mera Wala

Pink)

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Segment Marketing

Targeting a group of customerswho share a similar set of

needs and wants.

8-6

Flexible Marketing Offerings

Naked solutionProduct and

service elements that all segment members value

Discretionary optionsSome segment

members valueOptions may carry

additional charges

8-7

Customerization

Combines operationally drivenmass customization with customizedmarketing in a way that empowers

consumers to design theproduct and service offering

of their choice.

8-8

Segmenting Consumer Markets

Geographic Demographic Psychographic Behavioral

8-9

Geographic

Region -South, North-East etc. – Dish TV, Ranotsav

City – Ahmedabad Mirror Rural & Semi-Urban – e-chaupal, Rajdoot

8-10

Demographic Segmentation

Age and Life Cycle - Hungama Life Stage – Savings Scheme Gender – Wave, Pleasure Income – Revlon Generation - Gillette Socio-Economical Class – Platinum Card Occupation: Teachers’ Home Loan Scheme by SBI Education: Training Institutions, Placement Consultants

8-11

Profiling Generations GI Generation

1901-1924

Silent Generation 1925-1945

Baby Boomers 1946-1964

Generation X 1965-1977

Generation Y 1978-1994

Millenials 1995-2002

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Psychographic

Lifestyle – Culture (Amul Butter Milk, Lassi,, Sankalp), Sports (Signature), Outdoor oriented

Personality – Compulsive, Gregarious, Authoritarian, Ambitious (Bristol)

8-13

Behavioral Segmentation

Decision Roles Initiator Influencer Decider Buyer User

Behavioral Variables Occasions (Amul, Monaco, TGB) Benefits (Lyril, H & S) User Status (Dermicool) Usage Rate (R-Connect) Buyer-Readiness (i-72) Loyalty Status (Jet Privilege) Attitude (Sevlon)

8-14

Segmenting for Business Markets

Demographic ind, co. size, location Operating Variable – tech, user status, custo

capabilities Purchasing Approaches – stru, rela, policies,

criteria Situational Factors – urgency, appl, order size Personal Characteristics – simi, risk atti, loyalty

8-15

Models of Sequential Segmentation

Stage of decision First-time prospects(Patience and Empathy) Novices(Knowledge) Sophisticates(Elegant, Quick-grasp,

Technical, Stylist)

Orientation Price-oriented(transactional selling) Solution-oriented(consultative selling) Strategic-value(enterprise selling)

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Steps in Segmentation Process

Needs-based segmentation Segment identification Segment attractiveness Segment profitability Segment positioning Segment acid test Marketing mix strategy

8-17

Effective Segmentation Criteria

Measurable Substantial Accessible Differentiable Actionable

8-18

Segmentation Actions

Single Segment Conc. Selective Specialization Product Specialization Market Specialization Full Market Coverage Managing Through Differentiated Costs Planned Invasion Updating Segmentation schemes i.e. market partitioning

through brand dominant to nation dominant hierarchy) Ethical choices