Segment at I On Process

Chapter 4
Prof. Richardson
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Chapter 4
Vinyl Records
Wax is back ! !
Some bands release on wax first
DJs use wax in clubs to spin a unique sound
bands want their music played in the clubs
so people will buy the CDs
example of a market segment being recreated by the market
Prof. Richardson
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Chapter 4
Chpt 3 discussed ROLE of mkt

segmentation in developing a marketing
strategy, and explained what are the bases
In Chpt 4 we look at the PROCESS of
market segmentation
We will look at the reasons for, and process
of matching product offerings to specific
mkt segments
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Chapter 4
Mkt segmentation can take many forms

you can have one whole market
you can have many small segments with a
different marketing plan for each segment
THE CORE of the firms strategy is to
make sure the products they want to sell
(the product offerings) is what the people
want to buy, in each market segment
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Prof. Richardson
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Chapter 4
To make sure you have the best

Market Matching Strategy - you have
to take the following factors into
consideration
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Prof. Richardson
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Chapter 4
Market Matching Strategy?

1. Company Resources
2. Differentiability
3. Stage in Product Life Cycle
4. Competitors Strategies
5. Size of Segment
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Prof. Richardson
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Chapter 4
Single-Offer Strategy
The attempt to satisfy a large or a

small market with one product and a
single marketing program.
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Prof. Richardson
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Chapter 4
Usually this strategy is done by a

company that does not have the
money to be able to support the
production and sales of many different
types of products.
Eg. VW bug
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Chapter 4
Danger It is very easy for a competitor

company to copy your single product,
and sell it at a lower price, and take
away all your customers.
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Chapter 4
Multi-Offer Strategy
Sometimes called Differentiated Marketing
The attempt to satisfy several

segments of the market very well
with specialized products and
unique marketing programs aimed
at each segment.
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Chapter 4
Multi-Offer Strategy
Levis - in the beginning - a singleoffer strategy. As jeans became

more popular, different styles
shapes and also different types of
clothing, (shirts, jackets etc.)
jeans - slim, bootcut, hiphugger,
bells, flare, painter pants etc.
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11
Chapter 4
Prof. Richardson
Figure 4.1 Market Segmentation Decision Process
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12
Chapter 4
Market Segmentation Decision Process - STAGES
Stage I: Identify Market Segmentation

Bases
The process starts when a company looks at the

potential customers and identifies those
customers as having particular characteristics these characteristics will allow the marketing
company to classify them into market segments.
The segments should be selected so that you

can group together customers who have similar
needs.
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Chapter 4
Stage II Develop Relevant Profiles for each

Segment
Once the segments have been identified should develop a profile of the relevant customer
needs and behaviors in each segment.
What does your customer look like (profile) !!
What do they like !!
What do they do !!
- you need this description to be very precise in
order to make your marketing match the needs
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of the customer
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Chapter 4
Stage III
Forecast Market Potentials
You create a Forecast of the market potential within

each segment.
This is the go, no-go stage. When you are at this

stage you gather the information on sales potential to
determine whether you can go further ahead and
justify further analysis.
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Forecast - what if - an expectation of future action.
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Chapter 4
Stage I V
Forecast Probably Market Share
Once the market potential has been estimated,

you have to determine how much of that market
you can obtain (what market share can you
capture.
Then you develop specific marketing strategy for

the segments you are trying to develop.
(text eg. P&G outselling Colgate, therefore Colgate strategy
changes so it doesnt compete directly)
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Chapter 4
Stage V Select Specific Market Segments

Finally, you take all this information, and identify
specific target markets.
ie. University students who have part-time jobs, and

do not have credit cards
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Chapter 4
Target Market Decision Analysis

The purpose of doing this is to allow
management (the bosses) to effectively
employ marketing efforts
clearly delineated target markets
=
specifically identified groups of potential
customers
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Chapter 4
Figure 4.2 The Divide-the-Box Procedure
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Chapter 4
Figure 4.3 Market for Airline Passenger Travel
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Chapter 4
Figure 4.3 Market for Airline Passenger Travel
A tool (method) for outlining the scope (size and

range) of the market.
Allows you to look at all possible market segments AND then pick which ones you want to focus on.
Once you make this grid, you can then evaluate the
aspects (wants, needs and motivations) of each market
segment.
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Chapter 4
Using Target Market Decision

Analysis in Assessing a Product Mix
Product Mix
the assortment of product lines available
target market decision analysis can be
used to determine the product mix being
offered
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Chapter 4
Using Target Market Decision

Analysis in Assessing a Product Mix
Example - shoes
3 types of cross trainers
4 types of basketball shoes
2 types of jogging shoes
3 types of soccer cleats
etc.
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Chapter 4
Product Positioning
Developing a marketing program in
such a way that the product is
perceived to be very different from
competitors products
eg. Wendys square hamburgers
eg. Taco Bell
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Chapter 4
Applying The Concepts
Page 70 - 71
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Chapter 4
Figure 4.6 Positioning Map of Cola Market
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Segment at I On Process

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Segment at I On Process

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Chapter 4

Chpt 3 discussed ROLE of mkt

Mkt segmentation can take many forms

To make sure you have the best

Market Matching Strategy?

The attempt to satisfy a large or a

Usually this strategy is done by a

Danger It is very easy for a competitor

The attempt to satisfy several

Levis - in the beginning - a singleoffer strategy. As jeans became

Figure 4.1 Market Segmentation Decision Process

Market Segmentation Decision Process - STAGES

Stage I: Identify Market Segmentation

The process starts when a company looks at the

The segments should be selected so that you

Market Segmentation Decision Process - STAGES

Stage II Develop Relevant Profiles for each

Market Segmentation Decision Process - STAGES

Forecast Market Potentials

You create a Forecast of the market potential within

This is the go, no-go stage. When you are at this

Market Segmentation Decision Process - STAGES

Forecast Probably Market Share

Once the market potential has been estimated,

Then you develop specific marketing strategy for

Market Segmentation Decision Process - STAGES

Stage V Select Specific Market Segments

ie. University students who have part-time jobs, and

Target Market Decision Analysis

Figure 4.2 The Divide-the-Box Procedure

Figure 4.3 Market for Airline Passenger Travel

Figure 4.3 Market for Airline Passenger Travel

A tool (method) for outlining the scope (size and

Using Target Market Decision

Using Target Market Decision

Applying The Concepts

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