PREMUIM COLEGE

TOPIC: MARKET Collage of business and economics

SEGMENTATION, MARKET
TARGETING AND MARKET
POSITIONING IN CASE OF
BGI BREWERIES ETHIOPIA
June 2013
Group name
Yared demissie
Lebeza kulualem
Nigus mesfin
Bayleyegn simegn
Esubalew asmamaw
Eyuel sahlu

1 introduction
Marketing is the key issue of a business we
conduct a business through marketing, markets are
places where producers and consumers meet. In
marketing the highest core principle is nothing but to
achieve maximum satisfaction for consumers and
granting maximum profit for producers and firms.
We now try to analyze marketing from the
producers’ side and try examine how firms (in our
case BGI Ethiopia) should segment, target and
position the market in order to achieve their one and
only goal, gaining maximum profit.

Before we begin we would want to inform that our

data source is from questioners, researches done on
the company and mostly interviews from the
company’s management team
 Before assessing the marketing strategies of BGI
Ethiopia let’s do a quick overview of what market
segmentation, targeting and positioning mean:
1. Market segmentation
Market segmentation refers to subdividing a market along
some commonality, similarity, or kinship. That is, the
members of a market segment share something in common.
The purpose of segmentation is the concentration of
marketing energy and force on the subdivision (or the market
segment) to gain a competitive advantage within the
segment. Concentration of marketing energy (or force) is the
essence of all marketing strategy.
There are many types of segmentation
 Demographic segmentation
Gender, age, income, housing type, and education level are
common demographic variables.
 Geographical segmentation
This is perhaps the most common form of market
segmentation, wherein companies segment
the market by attacking a restricted geographic area. For
example, corporations may choose
to market their brands in certain countries, but not in others.
A brand could be sold only in one market, one state, or one
region.
Geographic segmentation can take many forms (urban
versus rural, north versus south, seacoasts versus interior,
warm areas versus cold, high humidity areas versus dry
areas, high elevation versus low elevation areas, and so on).
 Behavioral Segmentation
Behavioral segmentation is based on actual customer
behavior toward products. Some behavioral variables
include: Benefits sought, Usage rate, Brand loyalty, User
status: potential, first time, regular, etc., Readiness to buy,
Occasions: holidays and events that stimulate purchases.
 Psychographic or Lifestyle Segmentation
Lastly, we come to psychographic (or lifestyle)
segmentation, based upon multivariate analyses of consumer
attitudes, values, behaviors, emotions, perceptions, beliefs,
and interests. Psychographic segmentation is a legitimate
way to segment a market if we can
identify the proper segmentation variables (or lifestyle
statements, words, pictures, etc.

2. Target Market Selection

 Targeting is the next step in the sequential
process and involves a business making choices about
segment(s) on which resources are to be focused. Targeting
is the actual selection of the
segment. "A set of buyers sharing common needs or
characteristics that the company decides to
serve." Companies use target marketing to tailor for specific
markets. There are three major
targeting strategies: undifferentiated, concentrated, and
differentiated. During this process the
business must balance its resources and capabilities against
the attractiveness of different
segments (Kotler, P, 2007, pp.360).
3. Positioning
Positioning is the use of marketing to enable people to form
a mental image of your product in their minds (relative to
other products). Positioning is how the product or service is
to be perceived by a target market compared to the
competition. It answers the question: “Why will someone in
the target market(s) buy my product or service instead of the
competitions?” An equivalent question is: “What should be
the perceived value of my offering compared to the
Competitions?”
 2. Marketing strategies of BGI Ethiopia
I. Market segmentation analysis
According to the data obtained from BGI’s
management team Responses in relation with the
basis of market segmentation
Basis of market
segmentation of Percentage
BGI
Geographic location 42.2%
Psycho graphical or
Lifestyle 20%
Segmentation
Economic situation 8.9%
Demographic 28.9%
Total 100%

And the analysis of this table means that the bases of the
company’s market segmentations are geographic location
and demographic segmentation which accounts 42.2%
and 28.8% respectively. Nearly 20% basis of segmentation is
psychographic or Lifestyle Segmentation.
From these information we can concluded that the basis
of the company’s market segmentation is the geographic
location that can take many forms i.e. from urban to rural,
north to south, warm areas to cold areas etc.
II. Market targeting analysis
Again, a data table obtained from BGI says:

Target customers Percentage

Individual
51.1%
customers
Hotels, Restaurants
and 40%
groceries
Other
8.9%
intermediaries
Total 100%

The interpretation of the above table shows 51.1% of

targeted markets are individual customers. 40% targeted
markets are hotels, restaurants and groceries, whereas the
rest of 8.9% of targeted market are customers and other
intermediaries like retailers and whole sellers.
Now from additional points obtained from the management
teams, as a policy of the company, the target customers are
any individual:
• Who are more than 20 years old; hence, below 20 years
old, they were tanagers and not allowed to drink beer at this
stage.
• Who have a good income level
• Who have not any medical problems
• Who are not prohibited by religion
• Who are living in city (for city residents), are targeted, this
implies that those target customers are more users/drinkers
of the company products.
III. Market positioning
Since one of the ways of product positioning is promotion so
BGI is using social media platforms to advertise its products
to position them in the market and also paint a visual picture
in consumers mind about the products.
Lets look at the data table about its promotion

Best strategy of advertising Percentage

Media (TV, Radio, Newspaper) 35.6%
Word of mouth 28.9%
Free sampling 13.3%
Internet 8.9%
Billboard 13.3%
Total 100%

The table clearly reveals that the best strategy of advertising

is through media communication (TV, Radio, newspaper) is
35.6% and 28.9% of advertising strategy is word of mouth.
And 26.6% of the best advertising strategy of the
company is through free sampling and billboard. The
remaining 8.9%responded as the preeminent way of
advertising means is through internet websites.
From this we can concluded that the best way of advertising
means of the company’s products is through media
advertisement. This media advertisement includes TV shows
the facial expression, Radio reaches at least in all regions, and
newspapers. Generally advertising can reach geographically
dispersed buyers efficiently

3. Conclusion
The company’s Selection of target customers is that its
provides its products to those individuals who are more than
20 years old, who have good income level, who have not any
medical problems and to whom for city residents. This shows
that those target customers are more users of the company
products.
It segmented the market based on a classified profile of
the customer characteristics such as demographic,
geographic, behavioral and psychographic or lifestyle
segmentation. However, among those segmentation bases
the company uses geographic location as a major form of
segmentation variables. In addition to geographic
segmentation, the company market segmentation is based
on the facility of infrastructures like water, electricity,
telecommunication, cultures, values, religion and urban
areas.

The company’s promotional tools are advertising, personal

selling, sales promotion and public relation. The St. George
Brewery promotes its products by means of erecting artistic
notice board in towns, at main public squares, sight catching
places, major outlets and inlets, public service stations and
on vehicles etc. and contributing to popular events by means
of sponsoring various exhibitions, music festivals, public
gatherings, research forums, religious events etc. The
company’s promotional mix strategies create a good image
for the brewery and gained popularity as the company’s
perspectives of quality products. Moreover, the company
gives emphasis for social marketing activities like;
constructing roads, schools, clinics, Bridges etc. and
participating in HIV/AIDS prevention as major promotional
tools. The best way of advertising means of the company is
media advertisement. This media advertisement includes TV,
Radio and newspapers.
 4. Recommendation
• What makes the most economic sense, what makes the
most community sense, and what makes the most common
sense and constitutes the highest and best use of marketing
strategy is to simply let includes all the parameters of the
population. It is to mean that the target customers of the
company, the one who are above 20 years old and not
prohibited by religion. The company simply ignores under 20
years old and religious prohibited customers. So, it is better
to include those customers by producing Alcohol free
Breweries.
• A company, whether it is a business or non- business, needs
to have a mission, vision statement or reason for being came
in to existence. However, St. George Brewery does not have
those statements. Therefore, the company should develop
and put its mission, vision and value statements for all
stakeholders. Since these statements are a frame for the
marketing strategy activities to be achieved in the long run.

. According to the new law passed by the parliament of the

country promoting alcoholic beverages is prohibited so the
company need to find another mechanisms such as social
media marketing and social marketing as stated on the
conclusion.
So far in general marketing STPs play a vital role in marketing
environments.