2/20/2021

UNIT 5
MARKET SEGMENTATION –
TARGETING - POSITIONING
• Market segmentation
• Market targeting
• Market positioning

INTRODUCTION
Dividing market into distinct
Market segmentation
groups with distinct needs,
characteristics, or behavior
1. Identify bases for segmenting the market who might require separate
2. Develop segment profiles products or marketing mix

The process of evaluating

Target marketing each market segment’s
attractiveness & selecting
3. Develop measure of segment attractiveness one or more segments to
enter
4. Select target segments

Arranging for a product to

Market positioning
occupy a clear, distinctive, &
desirable place relative to
5. Develop positioning for target segments competing products in the
6. Develop a marketing mix for each segment minds of target consumers

1
 2/20/2021

ADVANTAGES OF STP
 Concentration of force: Focus core competencies
on relevant market segments
 Customer satisfaction: Consumers get what they
want
 Competitive advantage: Leverage our competitive
advantage to market segment which appreciate it
 Profitability: Different group place different values
on similar goods – People willing pay more for
unique products fulfilling their exact needs

SAMPLE MARKET SEGMENTS

 Quality-oriented segment: Rolex Swiss Watches
 Cost-oriented segment: GEICO insurance (palce
ads save 15% on auto insurance)
 Durability-oriented segment: Briggs and Riley
travelware
 Style-oriented segment: Apple computer

2
 2/20/2021

MARKET SEGMENTATION

MARKET DEFINITION
 To a Marketer
 Market is the set of all actual and potential buyers of
a product or service
 A market is set by buyers. An industry is the set of
sellers
 To an Economist
 Market describes all the buyers and sellers who
transact over some good and services

3
 2/20/2021

SEGMENTATION TYPES
 
 
 
   
 

No segmented Totally segmented

  
  
  
     
  

Segmented Segmented Segmented

by income by gender by income & gender

MARKET SEGMENTATION

 Dividing a market into distinct groups with distinct

needs, characteristics, or behavior who might
require separate products or marketing mixes.

Goal 2: List and discuss major bases for segmentation

4
 2/20/2021

KEY VARIABLES TO
SEGMENT CONSUMER MARKET

• Demographic: Age, income,

gender, family size, religion…

• Geographic: Country, region,

cities, climate, density…

• Psychographic: Lifestyle,
Interest, social class…

5
 2/20/2021

KEY VARIABLES TO
SEGMENT CONSUMER MARKET
• Functional: Performance,
Reliability, durability
• Service & convenience: Time
saving; convenience
• Financial: Cost saving; Revenue
gain
• Usage: Usage rate; usage
scenarios
• Psychological: Trust; self
esteem; status

KEY VARIABLES TO
SEGMENT BUSINESS MARKET
1. Demographic variables
• Industry: Which industries should we serve?
• Company size: What size companies should we serve?
• Location: What geographical areas should we serve?

2. Operating variables
• Technology: What customer technologies should we
focus on?
• User or nonuser status: Should we serve heavy users,
medium users, light users, or nonusers?
• Customer capabilities: Should we serve customers
needing many or few services?

6
 2/20/2021

KEY VARIABLES TO
SEGMENT BUSINESS MARKET
3. Purchasing approach
• Purchasing-function organization: Should we serve
companies with highly centralized or decentralized
purchasing organizations?
• Power structure: Should we serve companies that
are engineering dominated, financially dominated,
and so on?
4. Situational
• Urgency, specific application, size of order
5. Personal characteristics
• Buyer-seller similarity, attitudes toward risk, loyalty

BENEFITS OF
MARKET SEGMENTATION
▪ Identify the needs of customers within a sub
market
▪ With limited resources, the organization can
design products that really match customer needs
▪ This can allow the organization do a better job
and make more efficient use of marketing
resources
▪ With a focus, the organization can develop a
strong position in specialized market position and
achieve a rapid growth rate

7
 2/20/2021

LIMITATION OF
MARKET SEGMENTATION
▪ Production cost - it is cheaper to mass produce
one model of one colour, rather than a variety of
models, colour and sizes.
▪ Inventory cost - different varieties need to be
stocked
▪ Advertising cost - different advertisement is used
to appeal to different customer segments
▪ Administrative cost - management plan and
control different marketing programs

15

NICHE MARKET
2
Segment Niche market
1
3

• Small, specific group of customer that are poorly targeted or not

targeted at all
• Niches can be identified by dividing a segment into subsegments
or by defining a group seeking a distinctive mix of benefits
• Niches are fairly small and attract one or a few competitors
• Niche marketers understand their niches’ needs so well that their
customers willingly pay a price premium
• Both small and large companies can practice niche marketing

8
 2/20/2021

AN ATTRACTIVE NICHE MARKET

 The customers in the niche have a distinct set of
needs
 They will pay a premium to the firm best satisfying
their needs
 The nicher has the required skills to serve the
niche in a superior fashion
 The nicher gains certain economies through
specialization
 The niche has sufficient size, profit and growth
potential

SEGMENT SELECTION CRITERIA

 Differentiable: Internal homogeneity (individuals in
group respond similiarly); external heterogeneity
(one group different from another)
 Accessible: Segment can be effectively reached
& served
 Substantial: Segment must be large enough to
be profitable

9
 2/20/2021

MARKET TARGETING

TARGET MARKET

 Consists of a set of buyers who share common

needs or characteristics that the company
decides to serve

10
 2/20/2021

TARGET MARKET SELECTION

This is the evaluation and choosing of marketing

segments, and it is based on:
 Segment size and growth - segment sales,
growth rates, expected profitability, product life
cycle
 Segment attractiveness - competitors, power of
buyers and suppliers
 Company objectives and resources - resources
and constraint need to be considered, it must
also matches with its long term strategies

TARGET MARKET STRATEGIES

11
 2/20/2021

TARGET MARKETING STRATEGIES

Marketing mix Toàn bộ thị trường Undifferentiated

Marketing

Phân khúc 1

Marketing mix Phân khúc 2 Concentrated

Marketing
Phân khúc 3

Marketing mix 1 Phân khúc 1

Phân khúc 2 Differentiated

Marketing
Marketing mix 3 Phân khúc 3

TARGET MARKET SELECTION STRATEGIES

M1 M2 M3 M1 M2 M3
M1 M2 M3
P1 P1
P1
P2 P2 P2
P3 P3
P3
Single segment Concentration Selective specialization
Market specialization
M1 M2 M3
M1 M2 M3
P1
P1
P2 P2
P3 P3
Product specialization Full Market coverage

12
 2/20/2021

POSITIONING

POSITIONING
 Positioning:
 the act of designing the company’s offering and
image to occupy a distinctive place in the target
market’s mind
▪ E.g. Toyota is positioned on economy
Mercedes is positioned on luxury
BMW is positioned on performance
Volvo is positioned on safety

13
 2/20/2021

Why have a positioning plan?

• Company: Does not want to leave

product’s positions to chance
Must plan positions
• Consumers: Product position is a in order to have greatest
complex set of perceptions, impression Advantage in selected
and feelings compared with competing target market
products

POSITIONING PROCESS
1. Identifying possible competitive advantages
2. Choosing the right competitive advantage
3. Choosing a positioning strategy

14
 2/20/2021

1. IDENTIFYING POSSIBLE
COMPETITIVE ADVANTAGES
 Differentiation can be based on:
 Goods: quality, functions, design
 Service: easy to place the order, delivery,
guarantee…
 People: capabilities, expertise, politeness,
communication…
 Channels: Geographical coverage
 Image: Combine many factors

IDENTIFYING POSSIBLE
COMPETITIVE ADVANTAGES

Product Services
Differentiation Differentiation

(Features, Performance, Style (Delivery, Installation,

& Design, or Attributes) Repair Services, Customer
Training Services)

Image Personnel
Differentiation Differentiation

(Symbols, Atmospheres, (Hiring, Training Better

Events) People Than Competitors
Do)
30

15
 2/20/2021

2. CHOOSING THE RIGHT

COMPETITIVE ADVANTAGE
 How many differences to promote?
 The more differences, the more doubt from
customers
 Criteria used to select the differences to
promote:
 Important to customer
 Distintive
 Superior
 Communicable
 un-imitative
 Affordable

3. POSITIONING STRATEGY
 More for more
 More for the same
 More for less
 The same for less
 Less for much less

16
 2/20/2021

POSITIONING STRATEGIES
Price
Competitor

Quality

EXAMPLES - toothpaste
▪ One benefit: Anti- cavity or anti tooth decay
▪ Two benefits: Anti tooth decay and fresh
breath
▪ Three benefits: Anti cavity, fresh breath and
whitening
▪ The more benefits, the less clear and the
more difficult to persuave customers
▪ Check “colgate total” positioning?

17
 2/20/2021

EXAMPLES
▪ Định vị theo thuộc tính:
▪ Có flour và canxi – làm chắc răng và không sâu răng
▪ Định vị theo lợi ích:
▪ Vì sao chúng ta dùng Colgate? – Không sâu răng
▪ Học hỏi điều hay, ngại gì vết bẩn - OMO
▪ Định vị theo ứng dụng:
▪ Khi bạn bị cảm cúm hãy dùng Decolgen
▪ Định vị theo người sử dung:
▪ Anlene trắng cho con, Anlene vàng cho mẹ

EXAMPLES
▪ Định vị theo đối thủ:
▪ Bạn đã tin chưa? (quảng cáo của Viso trắng sáng so
sánh với nhãn hiệu bột giặt khác)
▪ So với đệm lò xo và đệm mút, đệm cao su tỏ ra ưu việt
hơn (đệm Kymdan)
▪ Định vị theo chất lượng/giá trị:
▪ 178 – mã số tiết kiệm của bạn
▪ Định vị theo hình ảnh:
▪ Một nét văn hóa của người Hà nội (bia Hà nội)
▪ Đi trước một bước (bia Laser)

18
 2/20/2021

ISSUES IN POSITIONING AND

REPOSITIONING
 Confused positioning: Too complicated, frequently
change; inconsistent/vague message
 Doubtful positioning: Low credibility
 Over-positioning: Buyers have too narrow an
image brand
 Under-positioning: No clear benefit

 If re-positionning poorly managed, can be worse

off than before

POSITIONING MAP
 Positioning map is a tool used to positioning
market
 Used to identify the position of the company,
product in the mind of customer
 To plot perception of company, product in a
diagram
 Normally two important criteria for electing
product will be used
▪ The information used to plot in the diagram will be
collected from market, customers

19
 2/20/2021

POSITIONING MAP - PRICE – QUALITY

High price

B A
C

D
Low quality High quality

Low price

POSITIONING MAP - SERVICE

LEVEL- PRICE

High price

B
A
C

D
Low service High serice
level level

Low price

20
 2/20/2021

ĐỊNH VỊ CỦA KS tại Belleville:

PRICE>< SERVICE LEVEL

Positioning of Belleville Hotels:

Service Level vs. Price (Fig. 3.15)

21
 2/20/2021

Positioning of Belleville Hotels:

Location vs. Physical Luxury (Fig. 3.16)

Future Positioning of Belleville

Hotels: Service Level vs. Price (Fig. 3.18)

22
 2/20/2021

Future Positioning of Belleville

Hotels: Location vs. Physical Luxury
(Fig. 3.19)

23