MARKET SEGMENTATIONMARKET SEGMENTATION

DefinitionDefinition Dividing a market into distinct groups Dividing a market into distinct groups with distinct needs, characteristics, or with distinct needs, characteristics, or behaviour who might require separate behaviour who might require separate products or marketing mixes.products or marketing mixes.

Dividing a big heterogeneous market into Dividing a big heterogeneous market into small homogenous unit. small homogenous unit.

FEATURES OF MARKET SEGMENTATIONFEATURES OF MARKET SEGMENTATION

1.1. It must be identifiable.It must be identifiable.

2.2. It must be accessible.It must be accessible.

3.3. It must be optimum in size.It must be optimum in size.

4.4. It must be profitable.It must be profitable.

5.5. It must be durable.It must be durable.

6.6. It must be compatible.It must be compatible.

STEPS IN MARKET SEGMENTATIONSTEPS IN MARKET SEGMENTATIONSTEPS IN MARKET SEGMENTATIONSTEPS IN MARKET SEGMENTATION

Steps involved in Market Segmentation areSteps involved in Market Segmentation are:-:-

Identify the current and the potential needs of the Identify the current and the potential needs of the

customer existing already in the market to be segmented.customer existing already in the market to be segmented.

Identify the unique and distinguishable features that may Identify the unique and distinguishable features that may divide the market into segments.divide the market into segments.

Select those segments which offer higher potential and Select those segments which offer higher potential and which will also be amenable to the offering of the firm.which will also be amenable to the offering of the firm.

BASES FOR BASES FOR SEGMENTATIONSEGMENTATION

Consumer Market Industrial Market

Market Segmentation

Geographical

Demographical

Psychographical

Behavioural

Region, Population size,Climatic condition, Population

density

Age, Income, Purchasing power,Gender, Education, Religion,

Nationality ,Family Size

Activities, Interest, Opinion,Attitudes, Values

Benefit sought, Usage rate, User status, Brand Loyalty, Readiness

to buy

Location

Company Type:- Size, Type ofIndustry, Decision Unit

Behavioural:- Usage rate, Buying status,

Purchase procedure

TARGET MARKETINGTARGET MARKETING

DefinitionDefinition Target MarketingTarget Marketing involves breaking a market into involves breaking a market into

segments and then concentrating the marketing efforts segments and then concentrating the marketing efforts on one or a few key segments. Target marketing can on one or a few key segments. Target marketing can be the key to a business’s success.be the key to a business’s success.

Segmentation is actually the prelude to target market Segmentation is actually the prelude to target market selection. selection.

FACTORS TO BE CONSIDERED WHILE FACTORS TO BE CONSIDERED WHILE TARGET MARKET SELECTIONTARGET MARKET SELECTION

Attractiveness of a Market SegmentAttractiveness of a Market Segment

1.1. Size of the segment (number of customers and/or number of units).Size of the segment (number of customers and/or number of units).2.2. Growth rate of the segment.Growth rate of the segment.3.3. Competition in the segment.Competition in the segment.4.4. Brand loyalty of existing customers in the segment.Brand loyalty of existing customers in the segment.5.5. Sales potential for the firm in the segment.Sales potential for the firm in the segment.6.6. Expected profit margins in the segment.Expected profit margins in the segment.

Suitability of Market Segments to the Firm Suitability of Market Segments to the Firm

1.1. Whether the firm can offer superior value to the customers in the segment.Whether the firm can offer superior value to the customers in the segment.2.2. The impact of serving the segment on the firm's image.The impact of serving the segment on the firm's image.3.3. Access to distribution channels required to serve the segment.Access to distribution channels required to serve the segment.4.4. The firm's resources vs. capital investment required to serve the segment.The firm's resources vs. capital investment required to serve the segment.

TARGET MARKET STRATEGIESTARGET MARKET STRATEGIES

1.1. Single-segment strategy-Single-segment strategy- Also known as a Also known as a concentratedconcentrated strategystrategy. . One market segment (not the entire market) is served with one One market segment (not the entire market) is served with one marketing mix.marketing mix.

2.2. Selective specialization-Selective specialization- This is a multiple-segment strategy, also This is a multiple-segment strategy, also known as a known as a differentiated strategydifferentiated strategy. Different marketing mixes are . Different marketing mixes are offered to different segments. offered to different segments.

3.3. Product specializationProduct specialization-- The firm specializes in a particular The firm specializes in a particular product and tailors it to different market segments.product and tailors it to different market segments.

4.4. Market specializationMarket specialization-- The firm specializes in serving a The firm specializes in serving a particular market segment and offers that segment an array of particular market segment and offers that segment an array of different products.different products.

5.5. Full market coverageFull market coverage - The firm attempts to serve the entire - The firm attempts to serve the entire market. market.

POSITIONINGPOSITIONING

DefinitionDefinition It is all about placing a product / brand in the minds It is all about placing a product / brand in the minds

of the customer to occupy a stable, distinct and of the customer to occupy a stable, distinct and permanent place in their rational and conscious mind permanent place in their rational and conscious mind set.set.

According to According to Al Ries and Jack TroutAl Ries and Jack Trout, “, “Positioning Positioning is not what you do to your product, but what you is not what you do to your product, but what you do to the mind of your prospective customer”.do to the mind of your prospective customer”.

Thus it is all about winning a distinct place in the Thus it is all about winning a distinct place in the minds of the customer.minds of the customer.

DIFFERENT POSITIONING PLANKS / BASESDIFFERENT POSITIONING PLANKS / BASES 1.1. Economy.Economy. 2.2. Benefit.Benefit. 3.3. GenderGender . .4.4. Luxury and exclusiveness.Luxury and exclusiveness. 5.5. Fashion for elite class.Fashion for elite class. 6.6. Technology and value added features.Technology and value added features.

CRITERIA OF SUCCESSFUL POSITIONINGCRITERIA OF SUCCESSFUL POSITIONING

1.1. Clarity .Clarity .2.2. Consistency .Consistency .3.3. Credibility.Credibility.4.4. Competitiveness.Competitiveness.

REPOSITIONINGREPOSITIONING

DefinitionDefinition Repositioning involves changing target market or Repositioning involves changing target market or

distinct positioning claim/differences advantages or both distinct positioning claim/differences advantages or both to bring the saturated attention of the existing customers to bring the saturated attention of the existing customers back into the limelight once again to survive safely and back into the limelight once again to survive safely and happily in the market. In some cases, the products that happily in the market. In some cases, the products that are faring well are repositioned. Example- are faring well are repositioned. Example- Maruti OmniMaruti Omni repositioning.repositioning.

ConclusionConclusion

Thus we can say that the total Thus we can say that the total process of market process of market segmentation, targeting and segmentation, targeting and positioning is a very positioning is a very important attribute of important attribute of marketing mix. All these three marketing mix. All these three process is very closely process is very closely interrelated with each other. interrelated with each other. To make this three marketing To make this three marketing process effective a thorough process effective a thorough SWOT analysis of the firm is SWOT analysis of the firm is very important. Keeping in very important. Keeping in mind the strength, weakness, mind the strength, weakness, opportunity and threat the opportunity and threat the firm can formulate and firm can formulate and implement its total marketing implement its total marketing mix.mix.