Ch 7 Market Segmentation, Targeting and Positioning

MT #2 Ch 6-9

P&G
- Vast segments of categories
- Detergent, cleaning supplies, medicine, electronic, dog food,
- Ie) tide: different categories

Market segmentation
- One full market into different segments and target different consumers differently
- Macro level different but micro level similar behavior

Differentiation
-

Positioning
- How consumers give a position to a brand in their minds

Bases for segmentation

Geographic
- World region or country
o McDonald selling different from China and Canada, Starbucks have Pike Place in
North America but not in China.
- Country region
o
- City or Metro Size
o Walmart Canada: 73 – 81,000 sq feet avg because smaller population. Average
size in North America – 130,000 sq ft, some 180,000 – 200,000 sq ft
- Density
o Ikea sell bed that can change from couch to bed in urban and suburban can buy
king size bed
- Climate
o Buy more umbrellas in Vancouver than in West (different weather)

Demographic
- Age
o Clothing/ Accessories: Newborn, toddler, teen, adult
o CARP: retired can become member after membership, get what type of updated
products are available
- Gender
o Pink = girls, Blue = boys
o Ie) Menaji: skin care products for men
o Ie) Curves: womens only workout gym
- Size of Family
o Single: 2 door car, family: bigger car
 o Furniture: more people = bigger tables
- Family life cycle
o Needs of 20 vs 40 year old different
- Income
o Different price points
- Ethnic
o Food: different food cusine
- Generation
- Religion
- Occupation
o Banker: may buy more suits vs construction worker: protective wear and casual
clothing
- Ie) Centrum: different ingredient of medication for different gender and age
- Ie) GE: huge refrigerators for big family, and small microwaves for singles

Psychographic
- Social class
o Upper upper, lower- upper, upper-middle, middle class, working classs, lower
class, lower-lower class
- Lifestyle
o Athletic/ outdoor type, active sub-urban life, single, single urban professional
o Activities
 Work, hobbies, social events, vacations, entertainment, sports/club,
community, shopping
o Interest
 Family, home, job, community, recreation, fashion, food, media
o Opinion
 Themselves, social issue, politics, business, economic, education,
products, culture
o Ie) organic food choice
o Ie) winter break: some stay at home some go to the mountains to explore
o Ie) rollerblade:
- Personality
o Buy things that suit personality
o Ie) Snowy 4x4 drive very fast because they believe their cars are safe
o Ie) royal Caribbean: guy jump off cruise ship for viral video, targets younger
people with shaking rink, pools vs regent seven seas cruise: target older
generation who want to eat and relax
o Ie) Mountain Dew: youthful, rebellious, adventurous

Behavioral
- Occasions
o Available during occasion
o Ie) Halloween candy discount 1 week before Halloween and bigger sale
o Ie) Tim hortons and Starbucks: pumpkin spice latte in fall
 o Ie) starbucks: peppermint latte in Christmas
o Ie) coca cola: drink coca compared to coffee because same caffeine level
- Benefit sought
o Convenience
 Amazon: amazon prime for fast shipping
 Drive through
o Low price
 Winner, ross,
o Customer service
 London drugs – always help
o Ie) protein bars: different bars for different choices (powerbar, clif, etc)
- User status
o Non user
o Ex user
o Potential user
o First time user
o Regular user
o Ie) smokers and alcohol users
- User rate
o Ie) Membership point card
- Loyalty status
o Ie) nike always buy regardless if other brands on sale
o Ie) coupon cards or stamp cards
- Attitude toward product
o Enthusiastic
 Movies: like so go early to collect scene points
- Ie) rogers, bell, telus: less calls, but data usage or plans with calling to other countries

Multiple Segmentation
- 2 or more segmentations in message
- Ie) ads with kids, family, house -> more components
- Ie) TD: proudparent campaign – LGBTQ, parents

Requirements for Effective Segmantation

- Measurable
o
- Accessible
o Cannot read, write or see
- Substantial
o Big market = segment, not = do not do it
- Differential
o If there is no need to differentiate then do not need to, if there is difference then to
consider
o Ie) married women and single women buy same perfume then why to make two
different
 - Actionable
o Doable for company
o Ie) small coffee shops: do not segment employees, all employees have same work
together vs starbucks: one barista take order, one makes drinks, one does clean up
- If they need it then they will contact us, so do not need to worry

Market Targeting Strategies

Undifferentiated (mass) marketing
Differentiated
Concentrated (niche) marketing
- Targeting a single group
o ie) monte blanc: high end expensive pens enthusiasts.
Micromarketing (local or individual marketing)
- Groupon: discount on things in consumer area
- Nikeid.com: design own shoes

Positioning
- Subconscious positioning of product in consumer’s mind
- Ie) ebay: it – no matter what “it” is, you can find “it” on ebay!
- ie) fairlife: 90 day expiring milk
- ie) ginch gonch: 18-40 years old to show their underwear in public “no shame”.

Perceptual Map
- Any two variables (very bad very good) and compare to different brands
- ie) low price, high price; bad quality, good quality; low consumer reports, higher
consume reports

Differentiation and Positioning: Way to Differentiate

Ie) staples: that was easy – good customer service, less stuff but get what needed -> easy to buy
- Product: features, performance, style, design
o Ie) Bose – good quality expensive headphones
- Service: expedient, convenient, cautious
o Ie) lexus – good product and good service of after sale and info to customer
- Channels: coverage, expertise, performance
o Ie) Amazon – prime member
- People: training, culture, morale
o How employees treat customers
o Ie) starbucks – “one cup at a time” customer in front is most important person
(don’t worry about line ups)
o Ie) Sinapore airline – grace/ elegant of staff / westjet – sense of humour
- Image: distinctive intangible benefit
o Ritz-carlton hotel – FEEL luxurious life, FEEL good without touch
- Possible Value proposition:
o High position = high value = high demand
- Benefits vs Price
o Green zone = winning proposition
 o Red zone = losing proposition  less benefit for more price, less benefit for same
price, same benefit more price
o Yellow zone = no proposition (+/- = mutual)  price the same benefit the same

MT#2: Feb 28, 2019 90 mins /75 (20%)

#1-35 Multiple choice (5 options in each item) /35
#36 Set of Questions (A or B) /20
#37 Set of Questions (A) /20