Summary of Chapter 2
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Two Slide 1
2.1 The Importance of the Consumer
Research Process
• Marketers must understand customers
to design effective:
– marketing strategies
– products
– promotional messages
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Chapter Two Slide 2
Collecting primary data
2.2 The Consumer Research Process
Figure 2.2
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Chapter Two Slide 3
CHAPTER
THREE
Market Segmentation
and Strategic Targeting
Mass Marketing vs Segmented Marketing
Chapter Three Slide 5
Learning Objectives
1. To Understand Why Market Segmentation Is
Essential.
2. To Understand the Criteria for Targeting
Selected Segments Effectively.
3. To Understand the Bases for Segmenting
Consumers.
4. To Understand How Segmentation and Strategic
Targeting Are Carried Out; Positioning
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Chapter Three Slide 8
What Kind of
Consumer Does This Ad Target?
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Chapter Three Slide 9
This Ad Targets Runners Who Are Physically
Active People and Also Relish the Outdoors.
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Chapter Three Slide 10
STP:
Segmentation – Targeting - Positioning
Chapter Three Slide 11
Steps of STP:
6. Develop Marketing
Mix for Each Target Segment
5. Develop Positioning
for Each Target Segment
4. Select Target
Segment(s)
3. Develop Selection Criteria
Market
Positioning
Market
Targeting
2. Develop Profiles
of Resulting Segments
1. Identify Bases
for Segmenting the Market
Market
Segmentation
Chapter Three Slide 12
STP:
Segmentation – Targeting - Positioning
Chapter Three Slide 13
Segmentation
Process of dividing the market into sub groups
The process of defining and subdividing a large homogenous
market into clearly identifiable segments having similar needs,
wants, or demand characteristics.
Chapter Three Slide 14
Segmentation
Why Segmentation is important?
Chapter Three Slide 15
Why Segmentation is Important
• Consumers needs are different, so it increases the
relevance. Enables building releationship
• To gain greater knowledge about customers so that
it can vary the products
• Prevent promoting product to wrong people,
so increases cost of inefficiency
• Enables differentiation
Chapter Three Slide 16
Bases for Segmentation
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Chapter Three Slide
17
Bases for Segmentation
Chapter Three Slide
18
Bases for Segmentation
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide
19
Consumer-Rooted Segmentation Bases
Facts
Demographics
Geodemographic
Personality Traits
Cognitions
Lifestyles
Sociocultural
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Chapter Three Slide
20
Demographic Segmentation
Age
Gender
Marital Status
Family Lifecycle
Income,
Education, and
Occupation
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Chapter Three Slide
21
Discussion Questions
• What types of marketers might segment
according to social class?
• What ethical issues might marketers have
when marketing to different social classes?
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Chapter Three Slide 22
Geodemographic Segmentation
• Based on geography and demographics
• People who live close to one another are
similar
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Chapter Three Slide 23
Bases for Segmentation
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Chapter Three Slide
24
Personality Traits
• People often do not identify these traits
because they are guarded or not consciously
recognized
e.g: Consumer innovators
• Open minded
• Perceive less risk in trying new things
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 25
Lifestyles
• Psychographics (AIOS)
a)
b)
c)
d)
e)
Activities
Interests
Opinions
Attitudes
Values
• They explain buyer’s purchase decisions and choices
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 26
Discussion Questions
• How might you differ from a person with
similar demographics to yourself?
• How would this be important for marketers?
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Chapter Three Slide 27
Socio-Cultural Values and Beliefs
• Sociological = group
• Anthropological = cultural
• Include segments based on
Variables
– Cultural values
– Sub-cultural membership
– Cross-cultural affiliations
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Chapter Three Slide 28
Bases for Segmentation
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide
29
Consumption-Specific
Segmentation Bases
Usage rate
Facts
Usage situation
Benefit segmentation
Cognitions
Perceived brand
loyalty
Brand relationship
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Chapter Three Slide
30
Bases for Segmentation
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide
31
Consumption-Specific Segmentation
Usage-Behavior
• Usage rate
– Awareness status
– Level of involvement
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Chapter Three Slide 32
Consumption-Specific Segmentation
Usage-Behavior
• Usage-situation segmentation
– Segmenting on the basis of special occasions or
situations
– Example : When I’m away on business, I try to
stay at a suites hotel.
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Chapter Three Slide 33
Which Consumption-Related
Segmentation Is Featured in This Ad?
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Chapter Three Slide
34
This is an Example of a Situational
Special Usage Segmentation.
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Chapter Three Slide 35
Benefits Segmentation
• Benefits sought represent consumer needs
• Important for positioning
• Benefits of media
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 28
Benefits Visiting Tourists Seek in
National Park – Table 3.13
Segment
Description
Environmentalists
Interested in an unpolluted, un-spoilt natural environment
and in conservation. Not interested in socializing,
entertainment, or sports. Desire authenticity
and less man-made structures and vehicles
in the park.
Want-it-all Tourists
Value socializing and entertainment more than
conservation. Interested in more activities and
opportunities for meeting other tourists. Do not
mind the “urbanization” of some park sections.
Independent Tourists
Looking for calm and unpolluted environment,
exploring the park by themselves, and staying at
a comfortable place to relax. Influenced by word
of mouth in choosing travel destinations.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 37
Brand Loyalty and Relationships
• Brand loyalty includes:
– Behavior: Frequency and consistency of buying a given brand
– Attitude: the consumers’ feeling of commitment to the brand
• Frequency award programs are popular
• Customer relationships can be active or passive
• Retail customers seek:
– Personal connections vs. functional features
• Banking customers seek:
– Special treatment
– Confidence benefits
– Social benefits
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 38
STP:
Segmentation – Targeting - Positioning
Chapter Three Slide 39
Criteria for Effective Targeting
Identifiable
Sizeable
Stable
Accessible
Congruent with the
company’s objectives
and resources
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Chapter Three Slide 41
Which Distinct Benefit Does Each of the
Two Brands Shown in This Figure Deliver?
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Chapter Three Slide 42
The Dentyne Ad’s Benefit is Fresh Breath and the
Nicorette Ad is Whitening and Smoking Cessation
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 43
Implementing Segmentation Strategies:
TARGETING
• Micro- and behavioral targeting
– Personalized advertising messages
– Narrowcasting: opposite of broadcasting
• Email
• Mobile
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 44
Undifferentiated Targeting
Chapter Three Slide 45
Differentiated Targeting
Chapter Three Slide 46
Focused Targeting
Chapter Three Slide 47
Mass vs Targeted
Chapter Three Slide 48
Marketing Mix for Different Segments
Sample Acxiom Clusters - Table 3.16
Shooting Stars
• Still relatively young at a mean age of 36, and with top rankings for
income, college education, home value and net worth, these
consumers have the world by the tail. Feeling financially secure with
large investment portfolios, Shooting Stars spend their disposable
Income making life a comfortable one, focusing on health, exercise,
gourmet food, golf, and travel.
Tots & Toys
• Two things—work and family—consume these professional working
couples. They’re putting their college degrees into action, climbing
the corporate ladder for lucrative careers, while saving for their
children’s education through do-it-yourself home improvements and
trips to the zoo for entertainment. With time at a premium, it’s not
surprising that the radio is the most relied-upon source for news and
entertainment.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 50
Implementing Segmentation Strategies
• Concentrated Marketing
– One segment with unique marketing mix
• Differentiated
– Several segments with individual marketing mixes
for each
• Countersegmentation: Combaning differnt
segments into two to obtain more efficient
one.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 51
STP:
Segmentation – Targeting - Positioning
Chapter Three Slide 52
Positioning
The value
proposition,
expressed through
promotion, stating
the product’s or
service’s capacity
to deliver specific
benefits.
Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall
Chapter Three Slide 54
Developing Positioning Strategy
Chapter Three Slide 55
Positioning
Chapter Three Slide 56
Positioning should be supported in all touch points
PR
Design
Online
Compet
ition
Distributi
on
Adverti
sing
Pricing
Positioning
Product
consistent at all
touch points
Services
Sponsorship
POS
Events
Sales
Media
Chapter Three Slide 57
Positioning
Chapter Three Slide 58