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    SM Chapter-3

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    Md. Arif Hossan 213-14-330
    Strategic market segmentation involves three key steps: 1. Segmenting the market based on characteristics of customers and how they use and purchase products. Common variables include demographics, needs, usage, and purchase behavior. 2. Analyzing market segments to select target segments based on their attractiveness, differences from competitors, and fit with company capabilities. 3. Implementing a segmentation strategy by forming identifiable and actionable customer groups that are profitable and stable over time. This ensures segments can be effectively targeted with customized marketing programs.

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    SM Chapter-3

    Uploaded by

    Md. Arif Hossan 213-14-330
    81 views24 pages
    Strategic market segmentation involves three key steps: 1. Segmenting the market based on characteristics of customers and how they use and purchase products. Common variables include demographics, needs, usage, and purchase behavior. 2. Analyzing market segments to select target segments based on their attractiveness, differences from competitors, and fit with company capabilities. 3. Implementing a segmentation strategy by forming identifiable and actionable customer groups that are profitable and stable over time. This ensures segments can be effectively targeted with customized marketing programs.

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    Strategic market segmentation involves three key steps: 1. Segmenting the market based on characteristics of customers and how they use and purchase products. Common variables include demographics, needs, usage, and purchase behavior. 2. Analyzing market segments to select target segments based on their attractiveness, differences from competitors, and fit with company capabilities. 3. Implementing a segmentation strategy by forming identifiable and actionable customer groups that are profitable and stable over time. This ensures segments can be effectively targeted with customized marketing programs.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    81 views24 pages

    SM Chapter-3

    Uploaded by

    Md. Arif Hossan 213-14-330
    Strategic market segmentation involves three key steps: 1. Segmenting the market based on characteristics of customers and how they use and purchase products. Common variables include demographics, needs, usage, and purchase behavior. 2. Analyzing market segments to select target segments based on their attractiveness, differences from competitors, and fit with company capabilities. 3. Implementing a segmentation strategy by forming identifiable and actionable customer groups that are profitable and stable over time. This ensures segments can be effectively targeted with customized marketing programs.

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    © All Rights Reserved
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    of 24

    Strategic Marketing

    [email protected]
    Chapter 3

    Strategic
    Market
    Segmentation
    Strategic market segmentation (1)

    ▪ Levels and types of market segmentation


    Levels and types of market segmentation
    Vision
    Strategic Strategic intent
    Segmentation Product benefits
    Resource allocation
    Alignment
    Managerial Planning
    Segmentation
    Marketing programs
    Operational - Advertising
    Segmentation - Sales
    - Distribution
    Best Buy segmentation strategy

    ▪ Jill’s - “soccer moms”


    ▪ Barry’s - wealthy professionals
    ▪ Buzz’s - “tech enthusiasts”
    ▪ Ray’s - the family man
    ▪ Mr Storefront - the small business customer
    ▪ Carrie’s - young, single females
    ▪ Helen and Charlie’s - older couples whose children have left home
    ▪ Gov. Palin’s “_________________” moms
    From Mass Markets to Micro Markets

    OLD NEW

    CONSUMERS Passively receive Empowered media users


    whatever TV control and shape content
    networks thanks to TiVo, iPod and
    broadcast Internet
    ASPIRATIONS To keep up with To standout from the
    the crowd crowd
    TV CHOICE Three networks Hundreds of channels
    plus maybe a plus video on demand
    PBS station
    MAGAZINES Age of the big Age of the special interest
    glossies: Time, magazine for every age
    Life, Newsweek and affinity group
    ADS Everyone hums Talking to a group of
    the Alka-Seltzer one, ads go ever
    jingle narrower
    BRANDS Rise of the big,Niche brands, product
    ubiquitous brands extensions and mass
    from Coca-Colacustomization mean many
    to Tide product variations
    Strategic market segmentation (2)

    ▪ Market-driven strategy and segmentation


    – Market segmentation, value opportunities and new market space
    – Market targeting and strategic positioning
    Segmentation and Market-Driven Strategy
    SEGMENTS

    VALUE
    OPPORTUNITIES

    CAPABILITIES/
    SEGMENT
    MATCH

    TARGET(S)

    POSITIONING
    STRATEGY
    Strategic market segmentation (3)

    ▪ Market-driven strategy and segmentation


    – Market segmentation, value opportunities and new market space
    – Market targeting and strategic positioning

    ▪ Activities and decisions in market segmentation


    Market Segmentation Activities and Decisions
    Market to be
    Segmented
    Strategic
    Analysis Decide How
    of Segments to Segment

    Finer Form
    Segmentation Segments
    Strategies
    Strategic market segmentation (4)

    ▪ Market-driven strategy and segmentation


    – Market segmentation, value opportunities and new market space
    – Market targeting and strategic positioning

    ▪ Activities and decisions in market segmentation


    ▪ Defining the market to be segmented
    Strategic market segmentation (5)

    ▪ Identifying market segments


    – Segmentation variables
    – Characteristics of people and organizations
    ▪ Consumer markets
    ▪ Organizational markets
    ▪ Product use situation segmentation
    ▪ Buyers’ needs and preferences
    – Consumer needs
    – Attitudes
    – Perceptions
    ▪ Purchase behaviour
    Segmentation Variables

    Purchase
    Behavior

    Buyers’ Needs/ Characteristics


    Preferences of People/
    Organizations

    Use
    Situation
    Illustrative Segmentation Variables
    Consumer Industrial/
    Markets Organizational Markets
    Characteristics Age, gender, income, Type of industry, size, geographic
    of people/ family size, lifecycle stage, location, corporate culture, stage of
    organizations geographic development, producer/
    location, intermediary
    lifestyle
    Use situation Occasion, importance of Application, purchasing
    purchase, prior experience with Procedure (new task, modified rebuy,
    product, user status straight
    rebuy
    Buyers’ needs/ Brand loyalty status, brand Performance requirements, brand
    preferences preference, benefits sought, preferences, desired
    quality, proneness to make a deal features, service
    requirements
    Purchase Size of purchase, Volume, frequency
    behavior frequency of purchase of purchase
    Strategic market segmentation (6)

    ▪ Forming market segments


    – Requirements for segmentation
    ▪ Response differences
    ▪ Identifiable segments
    ▪ Actionable segments
    ▪ Cost/benefits
    ▪ Stability
    – Approaches to segment identification
    – Customer group identification
    – Forming groups based on response differences
    Miller Brewing’s beer brand targets

    ▪ Miller Genuine Draft - “mainstream sophisticates”


    ▪ Milwaukee’s Best Light - “hardworking men”
    ▪ Pilsner Urquell - “beer afficionados”
    ▪ Miller Icehouse - for “drinking buddies”
    Requirements for Segmentation

    Identifiable
    segments
    Response Actionable
    differences segments
    Segmentation
    Requirements

    Stability Favorable
    over time cost/benefit
    Approaches to Segment Identification
    CUSTOMER
    IDENTIFIERS
    RESPONSE
    OF CUSTOMER
    PROFILE
    GROUPS

    E Characteristics
    E Use Situation

    of People and
    Organizations
    E Buyers Needs
    and Preferences

    E Purchase
    Behavior and
    Loyalty
    Segment Dimensions for Hotel Lodging Services
    Illustrative Example: Gasoline Buyers

    Higher-income, middle-aged men, drive 25-50000 miles a


    Road year… buy premium with a credit card … purchase sandwiches 16% of
    Warriors and drinks from the convenience store… will sometimes use buyers
    carwash
    Men and women with moderate to
    True high incomes, loyal to a brand and
    Blues 16% of
    sometimes a particular station …
    buyers
    frequently buy premium, pay in cash
    Generation Upwardly mobile men and women -
    F3 (Fuel, half under 25 years of age -
    27% of
    Food & Fast) constantly on the go … drive a lot
    buyers
    snack heavily from the convenience store
    Usually housewives who shuttle
    Homebodies children around during the day and
    21% of
    use whatever gas station is based on
    buyers
    town or on route of travel

    Price Not loyal to brand or station and 20% of


    Shoppers rarely buy premium … frequently on buyers
    tight budgets.
    Strategic market segmentation (8)

    ▪ Selecting the segmentation strategy


    – Deciding how to segment
    – Strategic analysis of market segments
    ▪ Customer analysis
    ▪ Competitor analysis
    ▪ Positioning analysis
    ▪ Estimating segment attractiveness
    ▪ Segmentation “fit” and implementation
    Strategic Analysis of Market Segments

    Customer
    Analysis
    Financial and Competitor
    Market Analysis
    Attractiveness

    Positioning
    Analysis
    Segmentation “Fit” for Implementation
    Segment Attractiveness
    and Internal Compatibility
    Internal Compatibility
    High Low

    Attractive segments Attractive segments


    High that match with but with poor match
    company with company
    capabilities capabilities
    Market Segment
    Attractiveness
    Unattractive segments Unattractive segments
    Low but with match to that do not match with
    company company capabilities
    capabilities
    Thank You!

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