CHAPTER: MARKET TARGETING

AND STRATEGIC POSITIONING

Topics to be covered:
Market Targeting Strategy
Targeting in Different Market Environments
Global Markets
Positioning Strategy
Developing the Positioning Strategy
Determining Positioning Effectiveness
Market Targeting Strategy
• The market targeting decision identifies the
people or organizations in a product-market
toward which an organization directs its
positioning strategy initiatives. Targeting and
positioning strategy consists of (1) identifying and
analyzing the segments in a product-market; (2)
deciding which segment(s) to target; and (3)
designing and implementing a positioning
strategy for each target.
(continued…)
• Targeting Alternatives: The targeting decision determines
which customer group(s) the organization will serve. A specific
marketing effort (positioning strategy) is directed toward
each target market that management decides to serve. The
following figure shows the various market targeting
approaches:
(continued…)
• Factors Influencing Targeting Decisions:
Management needs to decide if it will target a
single segment, selectively target a few
segments, or target all or most the segments in
the product-market. Several factors may influence
the choice of the targeting strategy:
• Stage of product-market maturity
• Extent of diversity in buyer value requirements
• Industry structure
• The firm’s capabilities and resources
• Opportunities for gaining competitive advantage
Targeting in Different
Market Environments

• Four life cycle stages illustrate the range of product-

market structures:
• Emerging: Product-markets which are newly formed and
categorized as emerging, and are created by factors such as new
technology, the changing needs of buyers, and the identification of
unmet needs by suppliers.
• Growing: These product-markets are experiencing rapid growth.
Competition consists of several firms and one or more may be
gaining a leading market position.
• Mature Market: These product markets are shifting from growth to
maturity characterized by high level of household penetration.
• Declining: A Declining product-market is actually fading away
instead of experiencing a temporary decline or cyclical changes.
 Global Markets

• Understanding global market is important regardless of

where an organization decides to compete, since
domestic markets often attract international competitors.
In selecting strategies for global markets, the following
two primary options must be considered with care:
• Global Integration: This strategy considers the extent
to which standardized products and other strategy
elements can be designed to compete on a global
basis.
• Local Responsiveness: Local responsiveness implies
being relevant to the local socio-cultural environment of
the country markets.
Positioning Strategy
• Positioning may focus on an entire company, a
mix of products, a specific line of products, or a
particular brand. The major initiatives necessary
in strategic positioning are shown in the figure
given below:
(continued…)
Selecting the Positioning Concept
• The positioning concept indicates how
management wants buyers to receive the
company’s brand. The related aspects of
positioning concept are:
• Positioning Concepts
• The Positioning Decisions
(continued…)
• Positioning Concepts: The positioning concept
should be linked to buyers’ value requirements.
The following three options are available:
• A functional concept applies to products that solve
consumption-related problems for externally generated
consumption needs.
• Symbolic positioning relates to the buyer’s internally
generated need for self-enhancement, role position,
group membership, or ego identification.
• The experiential concept is used to position products
that provide sensory pleasure, variety, and/or cognitive
stimulation.
(continued…)
• The Positioning Decision: In deciding how to
position a brand, it is useful to study the
positioning of competing brands using attributes
that are important to existing and potential buyers
of the competing brands. The objective is to try to
determine the preferred (ideal) position of the
buyers in each market segment of interest and
then compare this preferred position with actual
positions of the competing brands.
Developing the Positioning Strategy
• Developing the positioning strategy includes
determining the activities and results for which
each marketing program components (product,
distribution, price, promotion) will be responsible,
choosing the amount to spend on each program
component, and deciding how much to spend on
the entire program. The following issues are to be
addressed here:
• Scope of Positioning Strategy
• Marketing Program Decisions
(continued…)
• Scope of Positioning Strategy: Whether
the strategy is brand-specific or greater in
scope depends on such factors as the size
of the product-market, characteristics of the
good or service, the number of products
involved, and product interrelationships in
the consumer’s use situations.
(continued…)
• Marketing Program Decisions: The following
marketing program decisions are to be made by
the marketers in accordance with the positioning
strategy:
• Product Strategy
• Value Chain Strategy
• Pricing Strategy
• Promotion Strategy
• Competitive Advantage
Determining Positioning Effectiveness
• The following methods are available for
assessing positioning effectiveness:
• Customer and Competitors Research
• Test Marketing
• Analytical Positioning Techniques
(continued…)
• Faulty positioning can subvert a company’s
marketing strategy. Positioning errors
include:
• Underpositioning
• Overpositioning
• Confused Positioning
• Doubtful Positioning
Thank You!