9
Identifying
Market Segments
and Targets
Marketing Management, 15th ed
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?
Baby Boomers: A Lucrative Market
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
Ford’s Model T Followed a Mass
Market Approach
Four levels of Micromarketing
Segments Niches
Local areas Individuals
What is a Market Segment?
A market segment consists of a
group of customers who share a
similar set of needs and wants.
Gather.com: A Niche
Social Networking Site
Niche Marketers
Enterprise Rent-A-Car
targets the insurance-
replacement market
Baskin Robbins Focuses on
Local Marketing
What is Customerization?
Customerization combines operationally
driven mass customization with customized
marketing in a way that empowers
consumers to design the product and service
offering of their choice.
Segmenting Consumer Markets
Geographic
Demographic
Psychographic
Behavioral
Demographic Segmentation
Age and Life Cycle
Life Stage
Gender
Income
Generation
Social Class
Toyota Scion
Targets Gen Y Consumers
Dove Targets Women
Behavioral Segmentation
Decision Roles Behavioral Variables
• Initiator • Occasions
• Influencer • Benefits
• Decider • User Status
• Buyer • Usage Rate
• User • Buyer-Readiness
• Loyalty Status
• Attitude
The Brand Funnel Illustrates
Variations in the
Buyer-Readiness Stage
• Aware
• Ever tried
• Recent trial
• Occasional user
• Regular user
• Most often used
Loyalty Status
Hard-core
Split loyals
Shifting loyals
Switchers
Figure 8.3 Behavioral
Segmentation Breakdown
Segmenting for Business Markets
Demographic
Operating Variable
Purchasing Approaches
Situational Factors
Personal
Characteristics
Steps in Segmentation Process
Needs-based segmentation
Segment identification Marketing-Mix
Segment attractiveness Strategy
Segment profitability
Segment positioning
Segment acid test
Effective Segmentation Criteria
Measurable
Substantial
Accessible
Differentiable
Actionable
Figure 8.4 Patterns of
Target Market Selection
Figure 8.4 Patterns of
Target Market Selection
Figure 8.4 Patterns of
Target Market Selection
Crest Whitestrips Follows a
Multisegment Strategy
Figure 8.5 Segment-by-Segment
Invasion Plan
Pepsi used Megamarketing in India
Marketing Debate
Is mass marketing dead?
Take a position:
1. Mass marketing is dead.
or
2. Mass marketing is still a viable way to build
a profitable brand.
Marketing Discussion
Think of various product categories.
How would you classify yourself
in terms of the various segmentation
schemes?
How would marketing be more or less
effective for you depending upon the
segment involved?
