Market Segmentation: “Aggregates potential buyers into groups that have common needs and will respond similarly to a marketing action” (Kerin et al, p. 174). Market segmentation breaks down the market into smaller groups to be more effective in marketing their product differently to each of them. Breaking down the market into smaller groups allows the company to see clearly what consumers are looking for in that certain market with the ultimate goal of increasing profit and sales. The markets can be broken down into four different categories, geographically, demographically, behaviorally and psychographic segmentation. For example, a product that is being marketed to teenage girls could be presented differently on the MTV than it would be on BET, the actors could be different or something as simple as changing the background music.
Target Marketing: “One or more specific groups of potential consumers toward which an organization directs its marketing program” (Kerin et al, p. 9). Believe it or not you see it every day if you watch any amount of TV. If you watch TV between the times of 8am-2pm you will mostly see advertisements specifically for the Baby Boomers generation. There are several marketing campaigns you will see on TV commercials, however you will notice that you will see the same ones over and over during certain times of the day trying to reach the targeted market.
Market segmentation and target marketing are two steps of the marketing process. Although the two go hand-in-hand, there are distinct differences between them, as market segmentation must take place before a target market is determined. Target marketing is the overall term for directing your marketing endeavors toward a group of people. Market segmentation is the breaking down of the market into smaller groups with the intention of promoting your product or service differently to each of them. Market segmentation allows your target marketing to become more specific; it divides broad markets--such as male, female, teen and adult--into smaller segments in which people are grouped by shared characteristics.
Product Differentiation: “The strategy of using different marketing mix activities to help consumers perceive a product as being different and better than competing products” (Kerin et al, p. 174). This process is very important when marketing a product that has similar products already in the market. There are certain ways you can use this process such as, create value by focusing on cost value of a product verse a competing product. Marketing your product as cheaper and getting the same value out of your product creates a perceived value in the consumer’s eyes. By creating a perceived cost value, with quality products you are creating brand loyalty. Once you have the brand loyalty and continue to offer quality products at a lower cost than competitors it will be, you will see lower attrition of customers, (Kelchner, L. (n.d.). The Advantages of a Product Differentiation Strategy). A good example of a successful product differentiation is the Coke and Pepsi brands. These two brands have been competing for decades, however one of the off brands for Pepsi has cornered the market, Mountain Dew. Coke’s competing brand is Mellow Yellow, but ever since Pepsi’s marketing campaign of “Do the Dew” and advertising Mountain Dew for the extreme people out there, they have crushed their competitors.
Product Positioning: “The place a product occupies in consumers’ minds based on important features relative to competitive products” (Kerin et al, p. 188). The first thing that comes to mind in today’s market for product positioning are jingles or slogans. Something that will catch the consumers mind and have them remember it. For example, you probably have heard McDonald’s jingle/slogan, “ba dap ba ba I’m Loving It”. I don’t even need to see the commercial all I need to here is that jingle and I know it is McDonald’s. This is important