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Course: Marketing Planning (MP)

Summary of
Analyzing the Target Market, Part 2:
Consumer Behavior and the Target
Marketing Process
Chapter 4
Prepared By
Vivek Kumar Srivastava
Today, marketers are moving away from mass marketing and trying to sell a single marketing mix to all
potential customers in their markets. This may be because organizations may not have enough
resources to supply the whole market, customer needs and wants vary, customers are geographically
scattered, or their competitors are too strong in the industry. Marketers need to understand consumer
buying behavior to satisfy their customers by providing appropriate goods and services. Organizations
are increasingly moving toward target marketing. This involves identifying market segments, selecting
one or more of them to enter, and developing different marketing mixes to meet their needs. This
chapter continues analyzing the target market from the previous chapter and covers consumer buying
behavior, market segmentation, targeting, and positioning.

Marketing planners need to understand who buys their products; what they buy; and where, how, and
why people buy their company’s products. This insight can help marketers find how best to influence
customers’ buying decisions and activities and can result in the development of a more suitable
marketing mix for the customers targeted, leading to buyer satisfaction.

Factors which influencing consumer buying behavior are:

1. Personal factors
2. Psychological factors
3. Social factors

When analyzing consumer behavior, it is also essential to identify the level of importance of the
purchase to the consumer - the consumer’s level of involvement with the purchase and the associated
level of risk (financial, physical, and/or social) that is inherent in the purchase. Low-involvement
purchases occur for products such as toothpaste, cereals, and chocolate. High and low involvement
result in different types of decision making, and marketers need to take this into consideration when
planning.

Many buying decisions do not depend solely on an individual but are instead group decisions. For
instance, when buying a house, a property agent may advise the family on the area where to buy the
house, the wife may choose the type of house the family will live in, the children may like or dislike the
houses they visit and influence the finalization of the con- tract, and the husband may be the one to
make the final choice and make the purchase.

The target marketing process consists of three steps:

1. Market Segmentation
2. Market Targeting
3. Market Positioning

Four segmentation methods are commonly used in consumer markets, and these methods are useful in
describing market segments in the planning process:
1. Geographic segmentation
2. Demographic segmentation
3. Psychographic segmentation
4. Behavioral segmentation

Segmenting a market is simply dividing a total market into specific segments. For market segments to be
considered worthwhile, they should satisfy five criteria: Substantiality, Actionability, Measurability,
Responsiveness, Accessibility.
Market Targeting Strategies: After evaluating the different market segments and having found one or
more segments worth entering, the organization must now decide which strategy it will adopt to cover
the market. Typically, the three main market coverage strategies are an undifferentiated strategy, a
differentiated strategy, or a concentrated or niche strategy.

Market Positioning Strategies: Once marketers have decided which segment or segments of the market
to enter, they must then decide what position or positions the brand or product should occupy within
those segments. A product’s position is the place the product or service occupies in consumers’ minds
relative to competitors’ products or services.