What is positioning?Positioning is defined as the target market’s perception of the product’s key benefits and features, relative to the offerings of competitive products.The important aspects of this definition are:Positioning is the perception held by consumersThe focus is on the perceptions of the target marketOnly the key features and benefits can be effectively communicated for […]
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What is niche marketing?Niche marketing is a specialized market offering focused on the needs of one tightly-defined market segment.Usually the niche marketer only offers a very limited product range to this segment. As a result, the niche marketer builds a reputation (brand equity) for being THE expert for providing their products to the market segment.Advantages
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What is undifferentiated marketing?Undifferentiated marketing occurs when a marketing mix is designed for the general needs of an overall market, without regard for the needs of the different segments in that market.What is concentrated marketing?Concentrated marketing is focusing the firm’s market entire offering solely on the needs of one defined target market.What is differentiated marketing?Differentiated
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Outline of the target market selection evaluation criteriaTarget markets should be evaluated on:Financial IssuesSegment sizeSegment growth rateProfit marginsStructural AttractivenessCompetitors (direct and indirect)Competitive rivalryAccess to distribution channelsCurrent channel relationshipsStrategic DirectionFit with the firm’s strategic futureGrowth expectationsMarketing ExpertiseResources (financial position and staff resources)Capability (to develop products and compete)Importance of brand equity (ability to leverage, dilution concerns)Opportunity CostAre
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Marketing Study NotesWhat is a target market?A target market is a market segment that has been deliberately selected by an organization in order to focus their marketing efforts and offerings.Why is target market selection important?Target market selection is the second major phase of the STP process.It is important because it is a key marketing strategy
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A segment profile is a descriptive summary of the size, needs, behaviors and preferences of consumers within a particular market segment, with the goal of evaluating segment attractiveness and developing suitable marketing strategies.
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The market segmentation evaluation criteriaAfter constructing a set of market segments in the STP process, the market segments are then subject to evaluation against a set criteria.This is a checkpoint stage in the STP process. Its goal is to ensure that the segments meet basic requirements and guidelines for usable segments.Main Evaluation Criteria for Market
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How to segment a market? (Technical aspects)There are two main approaches: cluster analysis (if data is available), otherwise segmentation trees.Cluster analysisCluster analysis is an analysis designed to categorize objects to a pre-defined number of different groups, with each group being relatively similar on a range of selected attributes. The resultant groups are referred to as
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What is a business segmentation base?A business segmentation base is definable characteristics or behavior of organizations that can be utilized to classify the organizations into related groups, for the purpose of target marketing.Main business segmentation bases (with examples)Geographic location/s: Where the business operates. Examples: Countries, regions, spread of operations across areasBusiness description: Basic description of
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Geographic Segmentation Base AdvantagesConsiders cultural differences of different regionsGood for firms with limited geographic reach needing to select a specific target marketGreat when there is significant socio-economic diversity and significant consumer behavioral differences across regionsGeographic Segmentation Base LimitationsAssumes that consumers in a geographic area are similar, which is generally unlikely across a broad areaUsually needs
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