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CHAPTER 6: Market Segmentation, Targeting and Positioning (S-T-P)

1. Market segmentation Most companies have moved

Principles of Marketing
Assoc. Prof. Dr. Thu Huong Pham
Mobile: 0912522490
Email: huongftu1@gmail.com
1.1.Definition away from mass marketing and
1.2. Segmenting consumer market toward target marketing:
1.3. Segmenting business market
1.4. Segmenting international market
identifying market segments,
selecting one or more of them, and
1.5. Requirements for effective segmentation
developing products and
2. Market targeting marketing programs tailored to
2.1. Definition each.
2.2. Evaluating market segments
2.3. Market targeting strategies
3. Positioning
3.1. Definition
3.2. Positioning maps
3.3. Choosing a differentiation and positioning
strategy

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1. Market segmentation 1. Market segmentation

1.1.Definition 1.2. Segmenting consumer market
Dividing a market into distinct groups of buyers who
have different needs, characteristics, or behaviors and nations, states, regions,
Geographic counties, cities, or even
who might require separate marketing strategies or
neighborhoods
mixes. lifestyle or
personality Psychographic
characteristics.
WHY?
Demographic age, life-cycle stage,
Companies must identify the parts of the market they gender, income,
can serve best and most profitably. consumer occupation, education,
knowledge, Behavioral
religion, ethnicity, and
attitudes, uses or generation.
responses to a
product.
Marketers often use multiple segmentation bases in an effort to
identify smaller, better-defined target groups

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1. Market segmentation 1. Market segmentation

1.3. Segmenting Business Market
Business buyers can be segmented geographically, demographically 1.4 Segmenting
(industry, company size) international market
Additional variables, such as customer operating characteristics, purchasing intermarket (cross-market)
approaches, situational factors, and personal characteristics. Geographic Economic
segmentation involves location factors
forming segments of
consumers who have
Starbucks has developed distinct marketing programs for each of its two
business segments: the office coffee segment and the food service similar needs and buying
segment. (airlines, restaurants, colleges, and hospitals behaviors even though Political-
they are located in different legal Cultural
countries. factors factors

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1. Market segmentation 2. Market targeting

1.5. Requirements for effective segmentation: 2.1. Definition:
Measurable The size, purchasing power, and profiles of the segments can be
measured.
• Target market consists of a set of buyers who
Accessible
The market segments can be effectively reached and served. share common needs or characteristics that a
company decides to serve
Substantial
The market segments are large or profitable enough to serve.

Differentiable
The segments are conceptually distinguishable and respond • After evaluating different segments, the
differently to different marketing mix elements and programs. company must decide which and how many
segments it will target.
Actionable Effective programs can be designed for attracting and serving the
segments.

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2. Market targeting
2. Market targeting 2.3 Market- targeting strategies

2.2 Evaluating Market Segments

• Segment size and growth

• Segment structural attractiveness
• Company objectives and resources
- ignore - target a few tailoring
market several smaller products for
segment market segments individuals
- whole segments or niches and local
market with - separate customer
one offer. offers for segments;
each.

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2. Market targeting 2. Market targeting

2.5 Mix marketing strategy and target market
2.4 Target market selection:Product market metrix
Undifferentiated MM
Whole market
Marketing
Single-segment Full market
concentration coverage
MM 1 Segment 1
Differentiated
Discussion
Marketing
MM 2 Segment 2

MM3 Segment 3

Segment 1
Concentrated
Marketing MM
SEGMENT 2
Selective specialization Market specialization Product specialization
Segment 3

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3. Positioning
• COCACOLA PEPSI
3.1 Definition
• Coke Pepsi
Position is the place the product occupies in
consumers’ minds relative to competing
• Sprite 7-up
product. Products are made in factories, but • Fanta Orange- crush
brands happen in the minds of consumers
• Dasani Aquafina
A product’s position is the complex set of
perceptions, impressions, and feelings that
consumers have for the product compared
with competing products.

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3. Positioning
3.2 Positioning maps
show consumer perceptions of marketer’s brands versus competing
3. Positioning
products on important buying dimensions.
3.3. Choosing a Differentiation and Positioning Strategy:

Identifying a set of differentiating

competitive advantages
choosing the right competitive
advantages
Competitive advantage is an
advantage over competitors
gained by offering consumers
greater value, either through lower
prices or by providing more
benefits that justify higher prices.

selecting an overall positioning

strategy.

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3. Positioning 3. Positioning
3.3. Choosing a Differentiation and Positioning Strategy:
3.3. Choosing a Differentiation and Positioning Strategy
• Identifying a set of possible competitive advantages to differentiate
Choosing the Right Competitive Advantage
Product brands can be differentiated on features, performance, or
differentiation style and design A competitive advantage should be:
Services differentiation speedy, convenient service.

Channel differentiation the way they design their channel’s coverage, expertise,
and performance

People differentiation: hiring and training bet- ter people than their competitors do

Image differentiation buyers may perceive a difference based on company or

brand image differentiation

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3. Positioning 3. Positioning
3.3. Choosing a Differentiation and Positioning Strategy 3.4. Repositioning
Selecting an Overall Positioning • is the redefining of a product's position in the customer's mind to
Strategy match the competitive situation or changes in the market and the
Ø Value proposition is the full mix of business strategy of the enterprise.
benefits upon which a brand is positioned.
Ø In the figure, the five green cells
represent winning value propositions— Medicine breath
differentiation and positioning that gives
the company a competitive advantage
“The taste you hate, twice a day”

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3. Positioning
3.4. Depositioning
Is the positioning of a product compared to competitors'
products in the minds of customers in order to weaken the
competitor's positioning.

New
Generation

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