MRKTNG 3000 1nd Edition Lecture 4 Outline of Last Lecture I Chile vs China a Discussion questions Outline of Current Lecture II Market Segmentation a Types i Demographic ii Geographic iii Psychographic iv Geodemographic v Purchase behavior vi Loyalty vii User status viii Benefit III Market targeting a Approaches i Mass ii Niche iii Differentiated These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute iv Individualized IV Positioning Current Lecture Steps in market segmentation targeting and positioning Market segmentation market targeting market positioning Market segmentation process of dividing the total market for a good or service into several smaller internally homogenous groups Segmentation process 1 Identify segmentation variables and segment the market a Involves knowledge of consumer behavior and marketing research 2 Develop profiles of resulting segments Why segment Segmentation is necessary because customers in a market have Differences in buying habits Differences in the way the good or service is used Different motives for buying Marketing focuses on serves exploits individual differences Market segmentation allows managers to Visualize their prospective customers in designing a marketing mix Concentrate their resources on only one or a few market segments When should you practice segmentation Always segment Market segmentation Types Demographic age gender ethnicity income education occupation family type marital status Geographic nation region urban rural regional climatic Psychographic attitudes lifestyles Geodemographic based on zip codes demographic information based on zip codes Purchase behavior usage light medium or heavy users Loyalty status brand loyal or variety seekers User status user vs nonusers former users Benefit importance of a particular product benefit Market targeting Approaches Mass marketing no segmentation One product for all customers Niche marketing One product for one segment Differentiated marketing Multiple products for multiple segments Individualized marketing Customizing product service for individual Substantial Size matters too small and it is insignificant not profitable Reachable Be able to communicate and distribute to people Responsive customers must react positively to firm s offering move toward the firm s products services and accept the firm s value proposition Effective segmentation and targeting leads to profitability Identifiable substantial reachable responsive profitable Positioning Categories Hierarchical order of categories Lowest to highest Category membership Statement of membership important For new product To show that brand belongs Points of difference How is the brand superior to others Benefits selected Strongest positions where the brand has point of difference on main benefit Small brands find niches Stress one benefit in the promotion Correlational inferences Goal positioning Brand essence Abstracted benefits that relate to consumer goal Laddering up personality dimensions Laddering down show reason to believe a benefit in order to enhance competitivebased positioning