GLOBAL SEGMENTATION

AND POSITIONING

Chapter Seven

John Wiley & Sons, Inc c 1998 1

 7. Global Segmentation and Positioning

• Overview
• 1. Reasons for International Market Segmentation
• 2. International Market Segmentation Approaches
• 3. Bases for Country Segmentation
• 4. Country Segmentation Tools
• 5. Issues in International Market Segmentation
• 6. International Positioning Strategies

John Wiley & Sons, Inc c 1998 2

 Overview

John Wiley & Sons, Inc c 1998 3

 1. Reasons for International Market
Segmentation
• properties
– Measurable, Sizable, Accessible, Actionable, Competitive
Intensity, Growth Potential
• Country Screening
• Global Market Research
• Entry Decisions
• Positioning Strategy
• Marketing Mix Policy
– Exhibit 7-1 “Think” and “Feel” Country Clusters
John Wiley & Sons, Inc c 1998 4
 2. International Market Segmentation
Approaches
• Exhibit 7-2 Macro-Level Country Approaches
• Exhibit Two- and Three- Segment Solutions
• Exhibit 7-4 Different Segment Scenarios
• Target Market Strategies
– Universal Segment
– Diverse Segment
– Mixture of Universal and Diverse Segments
– Exhibit 7-5 What Matters to Young Europeans

John Wiley & Sons, Inc c 1998 5

 3. Bases for Country Segmentation

• Demographics
• Socioeconomic Variables
– stages of economic development
1. Traditional Societies
2. Preconditions for take-off
3. The take off
4. The drive to maturity
5. High mass-consumption
John Wiley & Sons, Inc c 1998 6
 3. Bases for Country Segmentation
(cont)
• caveats in using per capita income
• Monetization of transactions within a country
• Gray and Black Market sections of the country
• Income disparities
• Exhibit 7-6 Latin-American Markets: Many
Latin Households have Lots of Spending
Money

John Wiley & Sons, Inc c 1998 7

 3. Bases for Country Segmentation
(cont)
• Culture
– 1. Individualism vs Collectivism (IND)
– 2. Power Distance (PD)
– 3. Uncertainty Avoidance (UA)
– 4. Masculinity - Feminism (MA)
• Exhibit 7-7 Culture Based Clustering of
Euroconsumers
• Political Conditions
John Wiley & Sons, Inc c 1998 8
 3. Bases for Country Segmentation
(cont)
• Behavior-Based Segmentation
– Exhibit 7-8 European Market Classification as
of December 31,1994
– Exhibit 7-9 Segment Assignments Based on
New Product Penetration Patterns
• Life Style
– Exhibit 7-10 Frame 2 International Typology

John Wiley & Sons, Inc c 1998 9

 4. Country Segmentation Tools

• Cluster Analysis
– Exhibit 7-11 Principles of Cluster Analysis
– Exhibit 7-12 Plot of Concentration Versus
Category Growth: Chocolate Industry
– Exhibit 7-13 Cluster Analysis - Two Cluster
Solution, Three Cluster Solution
• Regression

John Wiley & Sons, Inc c 1998 10

 5. Issues in International Market
Segmentation
• Technical Issues
– Poor Quality Data
– “Noisy” Variables
– Presence of Outliers
• Managerial Issues
– Stability of Segments Over Time
– Managerial Usefulness

John Wiley & Sons, Inc c 1998 11

 6. International Positioning Strategies

• Exhibit 7-14 Global Positioning and

Segmentation Strategies
– Universal Segment / Uniform Positioning
Theme
– Universal Segment / Different Positioning
Themes
– Different Segment / Different Positioning
Themes

John Wiley & Sons, Inc c 1998 12

 Summary

1. Keep things simple.

2. Consider several levels of aggregation, not
just one.
3. Two ways to fine tune an existing
segmentation scheme.
4. Pursue “creative” ways to segment your
market.
John Wiley & Sons, Inc c 1998 13