MGT301
Principles of Marketing
Lecture-17
Summary
of
Lecture-16
Business Markets and Buying Behavior
Model of Business Buyer Behavior
Business Buying Situations
Involved Decision Making
New Task Buying
Modified Rebuy
Straight Rebuy
Major Influences on
Business Buying
Environmental
•Level of
demand
•Economic
outlook
•Interest rate
•Rate of technological change
•Political and
regulatory
developments
•Competitive
developments
•Social responsibility concerns
Organizational
Interpersonal
•Objectives
•Policies
•Procedures
•Interests
•Authority
•Status
•Organizational
•Empathy
structures
•Persuasive•Systems
ness
Individual
•Age
•Income
Business
•Education
Buyer
•Job position
•Personality
•Risk attitudes
•Culture
Problem Recognition
General Need Description
Product Specification
Supplier Search
Proposal Solicitation
Supplier Selection
Order Routine Specification
Performance Review
Today’s Topics
Market Segmentation
Shift from…
Mass Marketing ………. Segmented
Marketing
Two Basic Approaches


Market Segmentation Approach
– The needs and preferences of the global market are
viewed as heterogeneous varying from one group to
another.
Total Market Approach
 The needs and preferences of the entire, global market
are regarded as relatively homogeneous.
Major Steps in Target Marketing

Segmentation

Target Marketing

Market Positioning
Market Segmentation
Dividing a market into distinct groups with distinct needs,
characteristics, or behavior who might require separate
products or marketing mixes.
Target Marketing
The process of evaluating each market segment’s attractiveness
and selecting one or more segments to enter.
Market Positioning
Arranging for a product to occupy a clear, distinctive, and
desirable place relative to competing products in the mind of
target consumers
Steps in Market Segmentation, Targeting,
and Positioning
Market Segmentation
1. Identify bases for
segmenting the market
2. Develop segment profiles
Market Targeting
3. Develop measure of
segment attractiveness
4. Select target segments
Market positioning
5. Develop positioning for
target segments
6. Develop a marketing
mix for each segment
Segmenting Consumer Markets
What is Market Segmentation?



Segmentation is breaking down heterogeneous mass market
into more homogeneous submarkets
Consumers within segments should respond similarly to
particular marketing actions
Consumer response should be different between segments
Why segment the market?

Diverse needs, wants and buying behaviors differ

One firm cannot satisfy everyone’s needs

Different strengths and competitive advantages

Focus on what they do best

Better marketing opportunities

More profitable
Segmentation
Segmentation Variables

Geographical segmentation

Demographic segmentation

Psychographic segmentation

Behavioral segmentation
Geographical Segmentation
Dividing a market into different geographical units such as
nation, province, regions, countries, cities or neighborhoods
Geographic Segmentation
Variables

World Region or Country

Region

Province

City

Neighborhood

City or Metro Size

Density

Climate
Demographic Segmentation
Dividing the market into groups based on demographic variables
such as age, gender, etc.
Demographic Segmentation Variables

Age

Occupation

Gender

Education

Family size

Religion

Family life cycle

Race

Income

Generation

Nationality
Psychographic Segmentation
Dividing a market into different groups based on social class,
personality etc.
Psychographic Segmentation
Variables



Social class
Lifestyle
Personality
Behavioral Segmentation
Dividing a market into groups based on consumer knowledge,
.
attitude etc
Behavioral Segmentation
Variables




Occasions
Benefits
User Status
Attitude Toward the Product



User Rates
Loyalty Status
Readiness Stage
Enough for today. . .
Summary
Market Segmentation
Segmentation
Major Steps in Target Marketing

Segmentation

Target Marketing

Market Positioning
Segmentation Variables

Geographical segmentation

Demographic segmentation

Psychographic segmentation

Behavioral segmentation
Next….
Market Segmentation (cont..)
MGT301
Principles of Marketing
Lecture-17