[MARKETING STRATEGY] 1

STPD- (Segmentation, Targeting, Positioning, Differentiation)

Concept

Short
definition

Example Moov

Identify different
needs & groups in
the market

Where to
compete

Pain segment

Targeting

Target markets it
can satisfy in a
superior way

Which product
for which
market

Back pain segment

within the pain
segment

Positioning

Occupy distinct
place in customers
mind

Locating brand Relief from back

in customers
aches Aah se aha
mind
tak

Differentiati
on

Communicate
valuable &
meaningful
differences

How to
compete

Lamitube, non
staining, effective in
back pain

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Segmentation

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Segmentatio
n

Where to compete
Divide market into distinct groups with distinct needs, characteristics, or
behaviors
Basis- competence, resources, potential (Features, service, convenience,
quality)

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Evaluate segment attractiveness

Segment size and growth, own objectives and resources
Structural Attractiveness- Level of competition, substitutes, buyers/
supplier power

Requirements for effective segmentation

Measurable- Size, purchasing power, and profile of segment
Accessible- Can be reached and served
Substantial- Large and profitable enough to serve
Differentiable- Respond differently
Actionable- Effective programs can be developed
Principles of market segmentation (Palmer & Miller 2004, Industrial Mktg
Mgt, 33(8), pp 779-85)
Market segments (Size, access, differentiated)
Who buys- Customer
characteristics
Hard

Soft

What is bought, why- Customer

behaviour
Objective

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Subjective

[SEGMENTATION, TARGETING, POSITIONING, DIFFERENTIATION)

Demo/
geographic

Psychographi
c

AEGIS

VALS

Behavioural
Usage

Benefits

Price sensitivity,
promo response,
loyalty, repeats

Perceptions,
preference
trade-offs

Segmentation matrix- Taj Hotels

Segments

Features

Luxury
Premium

Taj Hotels &

Palaces

Luxury

Vivanta by Taj

Premium

Gateway

Reso
rts

Wildlife
lodges

Self
service

Taj Exotica

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Mid-market
Budget

Palac Spa
es
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Full service
Hotels

Taj Safaris

Ginger

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Types of segmentation
4 types- geographic, demographic, psychographic, behavioural- ideal is to
integrate, mix

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[MARKETING STRATEGY] 3
Factors (examples)

Example

Country, area, region, climate

Coke-Chota-Rural, Bada Urban

Sweaters in HP, Kashmir
McDonalds menu adaptation in
India
Honda City- different models
globally
ITC Ashirwad atta diferrent
blends NEWS
India food habits- North wheat,
South rice

De
mo
gra
phi
c

Age (Hospitals, cycles, ,

toys)
Education
Income (Garments, car,
soaps)
Sex (Perfumes, hospital)
Religion, nationality
Marital status, family size,
family life cycle, generation,
ocupation
Social class- middle/lower/
upper

Ps
yc
ho
gra
phi
c

Benefits sought (costs,

service, quality)
Lifestyle, VALS (Values,
attitudes, lifestyle)
Personality, culture, social,
religion
AIO- what interests them,
view
Activities- Work, Hobby,
Shopping
Interests- Family, fashion,
food
Opinions- Self, PEST

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LIC, Hinduja hospital

Schools
Toyota- Lexus, Camry, Corolla
Gillette
Beef/Pork, Halal, Kosher foods
Mature 1945+, Baby boomers
1965+, Generation X 1976+,
Generation Y 1994+
DINK, ORCHID, YUP, WHOP

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Ge
ogr
ap
hic

Nano, Taj, Titan, Nokia

Clubs, Art, Wine Harley Davidson
owners

rA

Woodlands-rugged/extrovert
Niche magazines - food, fashion,
car, electronics, CRM

Occasions
Personality based
Benefit segmentation
Attitude (+ve/-ve, hostile)
Convenience (EMI, Home
Delivery)
Readiness (Informed,
interested, aware)

Be
ha
vio
ur
al

Greeting cards, tour operators,

weddings
Blackberry addicts
Maggi convenience, Maruti
service, value
User (1st time, regular)
Usage (light, heavy consumption)
Loyalty (HML, switchers) Titanedge for formal, fastrack for
casual, Raga for ethnic; Bisleri
pack sizes
By occasions, product usage,
benefits sought, brand loyalty
Occasionswww.dramitrangnekar.com

[SEGMENTATION, TARGETING, POSITIONING, DIFFERENTIATION)

Exercise
1. Outline a segmentation matrix for mobiles (users v features)
2. Sports Shoes Market (Exercise) Which segments should Nike, Adidas &
Reebok target

Targeting
Which product for which market
Measure segment attractiveness, select target segments
Set of buyers sharing common needs or characteristics that a
company decides to serve
Targeting factors- resources, competence, degree of product
variability, PLC stage, competitors strategies

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rA

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Targeting choices (Derek F Abell, 1980)

Targeting strategy

Strategy

Mass
marketing

What it
means

Example

Target
marketing
mix towards
the entire
market, not
specific to
any segment

Amul
Butter,
Parle G,
Coke

Illustration

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[MARKETING STRATEGY] 5
UB group
whisky,
Cadbury
chocolates,
HUL

Market
concentratio
n

Concentratin
g mix on any
one segment
of the market

Ferrariluxury
sports cars,
Nirma
economy
detergents,
Big Bazaar

Niche
Marketing

Target small
market
segment with
specific,
specialized
marketing
mix

Travel
agents
focused
only on
Shirdi, HP,
Nepal
Sports
shops,
Florists

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Differentiate Target
d marketing different
(segmented) marketing
mixes
towards
different
segments

Positioning

Locate brand in the customers mind

Design firms offering & image to occupy distinct place in target
customers mind
Represent a distinctive big idea in the mind of the target market
Positioning anomalies

Attribute-Longevity-Since
1904
Benefit- Sea view, service,
speed
Use-ICICI- Fast A/c
opening
User-Louis Philipe-Upper
crust
Category- Big small carIndica
Quality-Benz-Future of the
automobile

Under-Fridge-PUF
Over- Casio start @ Rs 500, perceived
expensive earlier
Confused- Top Ramen
Noodles-Smooth
Doubtful- Tall promises-Teak
plantations, Ponzi schemes
Value-Budget Hotels, Maruti

rA

Positioning types

Positioning strategies
Single

Camry-Touch Perfection
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[SEGMENTATION, TARGETING, POSITIONING, DIFFERENTIATION)

Double

Tavera-Comfortable family car

Triple

Liquidity, safety, returns-MFs

Multiple- same
product to various
segments with
intact central
positioning

A chocolate-based health drink- Central positioningnutrition, Active people- Energy, Elderly- Dietary
supplement, Pregnant ladies- essential supplement,
Kids- Growth & nutrition, Executives- revitalize

Price
ShoppersStop
LifeStyle

Low

Runwal
Crossroad

Giants
Range

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High

BigBazaar

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Perceptual mapping
Brands 'mapped' together on 'positioning map', compared across
parameters
Identify weak/strong/absent competitive positions
Price v range for Mumbai super stores, distinguish by competitive
offerings
Gaps regarded as opportunities for positioning/repositioning/launch

Globus

ApnaBazar

Akbarallys

Low

rA

High

Exercise: Walmarts India entry strategy based on above perceptual

map
Crafting the brand positioning
Positioning requires determining a competitive frame of reference, which
defines associations that consumers use to evaluate directly/ broadly competing
brands, as under:
Frame of reference What it means

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Example iPad

[MARKETING STRATEGY] 7
Identify target
market

Which brand for which market

Enthusiasts,
innovators

Understand
Considerations in choosing
consumer behavior brands- attitudes, preferences

Price insensitive,
must-have,
advocacy,

Nature of
competition

Intensity, dominance, PLC,

differentiation

CE/ technology
firms

Points-of-parity
(POP)

Associations consumers view

essential to be credible,
common category traits,
conditions necessary but not
sufficient for brand choice

Midway Laptop/
mobile, touch
screen, phone, net,
1GB ram, handy
Apple, apps,
design, gaming

Position

Resolutionary

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Points-of-difference Associations, attributes,

(POD)
benefits consumers associate,
positively evaluate & believe
they cannot find to the same
extent with others

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The position to be located in

the customers mind

rA

Test the position on Relevant- customers want high

customers for RUB
resolution
or 2D test
Unique- no one else is claiming
it
Believable- Apple had
delivered in the past
OR
Desirable- customers want high
resolution
Deliverable- Apple has
credibility

iPad positioning should include POD+ RTB

Design

32GB

Safari

Apple

Face Time

Apps

5MP Cam

Gaming

Weight

iPod

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iOS

HD Video

[SEGMENTATION, TARGETING, POSITIONING, DIFFERENTIATION)

Exercise- POPs & PODs for Apple i-Phone 4s
Exercise- How Should Maruti position itself with respect to the Tata Nano?

Positions that firms have successfully claimed in India

Beauty

Lux

Range

C r o m a , Reach
Titan

ITC, HUL,
GSK

Premiu Bose, Benz

m

Youth

Pepsi, Nike

Kids

McDonalds

Thanda

Fever

Crocin

Econom Big Bazaar

y

Coke

M a r u t i ,
Flipkart

Deliver Dabbawallas
y

Macho

Goa, Kerala,

Service Maruti

Performan N o k i a , Search
ce
Titan

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Generic C a d b u r y / Innovation Apple, Intel Value

Xerox

Tourism

Google

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Enfield

F a s t V a d a P a v , Salesmen
food
Udipi

EurekaForb Headach S a r i d o n /
es
e
Anacin

HUL- Axe and Rexona, (both HUL), operate in the same segment- deos.
Rexona targets working population, positioned against body odour, Axe
targets youth, positioned on seduction. Both contain a similar formula,
target the same segment, but use completely different communication
strategies, do not cannibalise.

rA

P&G Positioning: distinct positions, even in same segments (Aaker &

Joakimsthaler)
Segment

Position

Head & Shoulders

Shampoos

Anti-Dandruff

Pert Plus

Shampoos

Conditioner + shampoo

Pantene

Shampoos

Healthy + shiny hair

Ariel

Detergent

High Tech Detergent

Tide

Detergent

Tough cleaning

Cheer

Detergent

All-temperature
cleaning

Bold

Detergent

Fabric softener

Brand

Differentiation
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[MARKETING STRATEGY] 9
How to compete (STP undertaken to help differentiate)
Add meaningful & valuable differences to distinguish offering from
competitors
Differentiation Criteria- important, distinct, superior, preemptive,
affordable
By form / features- Coke bottle shape, Heinz thick ketchup, iPhone 4sSiri
Differentiated on why customers buy- perception of PQRSTUV, usage and
experience

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Brands differentiate on irrelevant features/benefits- many mobile phones

features hardly used, newer management book editions- bigger & costlier,
not always better

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Identify tangible differences -conscious, rational benefits like PQRSTUV-,

Performance (Titan), Quality (Apple), Rate (Big Bazaar), Range (Cadbury),
Service (Maruti), Technology (Intel), Utility (Swiss knife), Value (Titan),
Convenience (Maggi)
Intangible Benefits - emotional, sub-conscious benefits a brand ownsStatus (Benz, BMW), Prestige (Mont Blanc, Rolex)- most important
leverage for brand dominance, unique (Sony, Apple), sustainable benefits
(Amul, Toyota low cost)
Differential variables

Performance, features, form, conformance, reliability, style,

design, quality

Service

Delivery, ease of ordering & installation, customer training

People

Competence, credibility, reliability, responsiveness,

communication

Channel

Coverage, expertise, cost effectiveness, performance

Image

Symbol, colour, slogan, ambience, atmosphere

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Brand

Exercise- i-phone 4s
Key success factor? STPD?
Where is iphone vulnerable? Economical competitors, imitators,
technology
What should it watch out for? Changing preferences, value, new trends
Key improvement areas? Price, promotion, features, customer service

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