Market segmentation is the process that companies use to divide large heterogeneous markets into small markets that that can be reached more efficiently and can be reached more efficiently and effectively with products and services that match their unique needs their unique needs. It is the process of dividing a market into distinct groups of buyers on the basis of needs, characteristics, or behavior. Segmentation allows the company to better allow the company to better satisfy the needs of its customers. When segmentation is done right, you get the highest return for your marketing expenditure.
Market targeting involves:
Evaluating market segments: Consider segment size and growth, segment structural attractiveness, and company objectives and resources.
Selecting target market segments: Alternatives range from undifferentiated marketing to micromarketing
Being socially responsible
Product Positioning: Developing a specific marketing mix so that consumers can perceive meaningful differences between a brand and competing brands (i.e., product differentiation). -It involves implanting your brand’s unique benefits in customers’ minds
Product position: The way the product is defined by consumers on important attributes - the place the product occupies in consumers’ minds relative to competing products.
Product Differentiation can be based on:
Products: some +ve product attributes or benefits – performance, reliability, safety, durability, etc.
Safety (Volvo), BMW (Performance), Rockfort shoes (Comfort), Subway (Eat fresh),Walmart (Rock bottom prices), Aspirin (Good for your heart), Whirpool dishwashers (quieter), Cheer (color protection)
Services: some +ve service features – Friendly service, convenient service, prompt service, …
Channels: some advantage relating to the distribution method Dell & Amazon.com (High-quality direct selling approach)
People: well-trained employees
Singapore Airline (Courteous, competent flight attendants), Disney theme parks (Friendly, upbeat, helpful employees)
3. a) Marketers can position brands at any of three levels: 1). Product attributes: reliability, safety, mileage/gallon 2). Benefits: reliable, safe, low gas consumption 3). Tap into emotions – Create a positive emotion around the brand b) The battle of the brands: The competition between retailers’ and manufacturers’ brands c) . Licensed brand e.g., Disney, Nickelodean characters (The Little Mermaid, Lion King characters, Sponge Bob, Rugrats characters), well-known brand names (Tommy Hilfiger, Calvin Kline, Sunkist, Playboy), celebrity names … manufacturers pay fee to use d) Brand extensions: Occurs when a company introduces a new product in a new product category with the existing brand name. A successful brand name helps brand extensions.
e) Line extensions: Occurs when a company introduces additional items in a given product category under the same brand name - minor changes to existing products.
4. Good-value pricing
1).-Offers the right combination of quality and good service at a fair price -Existing brands are redesigned to offer more quality for a given price or the same quality for fewer prices
Everyday low pricing (EDLP): involves charging a constant everyday low price with few or no temporary price discounts High-low pricing: involves charging higher prices on an everyday basis but running frequent promotion to lower prices temporarily on…