MARKETING MANAGEMENT

CHAPTER 6a

SEGMENTING – TARGETING - POSITIONING

Le Nguyen Hau
School of Industrial Management – HCMUT

2019
1
CONTENT

1. Identifying market segments

2. Selecting target market

3. Brand positioning

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I. IDENTIFYING MARKET SEGMENTS

Market segmentation: divides a

market  well-defined slices.

A market segment: a group of

customers who share a similar
set of needs & wants.

 Marketer’s task: to identify

the appropriate number and
nature of market segments and
decide which one(s) to target.

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I. IDENTIFYING MARKET SEGMENTS (con’t)

Two major segmentation bases:

1. Based on descriptive characteristics

 Geographic segmentation
 Demographic segmentation
 Psychographic segmentation
2. Based on customer behavior.
How, when, where, what, etc.
Regardless of which
type of segmentation
criterion we use, the
key is adjusting the
marketing program to
recognize customer
differences.

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I. IDENTIFYING MARKET SEGMENTS (con’t)

Based on Descriptive Characteristics

Base Variable Example
Geographic nations, states, regions, ?
cities, etc.

Demographic age, gender, income, ?

occupation, etc.

Psychographic psychological, ?
personality traits,
lifestyle, values, etc.

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I. IDENTIFYING MARKET SEGMENTS (con’t)

Based on Psychographic Characteristics

Base Variable Example
based on needs and benefits ?
customer
knowledge,
attitude, use, or
decision roles ?
response to an
offer.

User and usage ?

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I. IDENTIFYING MARKET SEGMENTS (con’t)

Segmenting business markets:

• Demographic: industry, size, location, etc.

• Operating variables: technology, usage, etc.

• Purchasing approaches: procedure, criteria, org, etc.

• Situational factors: size of order, speed of delivery, etc.

• Personal characteristics: relationship, attitude tw risk, etc.

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I. IDENTIFYING MARKET SEGMENTS (con’t)

Criteria of an effective segmentation:

1. Measurable: The size, purchasing power, and characteristics
of the segments can be measured.

2. Substantial: large and profitable enough.

3. Accessible: can be effectively reached and served.

4. Differentiable: distinguishable and respond differently to

different marketing programs.

5. Actionable: effective programs can be formulated for serving.

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II. SELECTING TARGET SEGMENTS
Evaluating a segment attractiveness (Porter’s 5 forces):

1. Intense rivalry: several, strong, or aggressive competitors ?

2. New entrants: high or low entry / exit barriers ?

3. Substitutes: actual or potential substitutes for the product ?.

4. Buyers’ bargaining power: strong/growing bargaining power ?

5. Suppliers’ growing bargaining power: firm’s suppliers raise prices

or reduce quantity supplied ?
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II. SELECTING TARGET SEGMENTS (con’t)
Evaluating market segments:

Based on: (1) external - the segment’s attractiveness

(2) internal - the firm’s objectives and resources.

 How well does a segment score on the Porter’s five criteria?

 Does it have characteristics that make it more attractive

(size, growth, profitability, scale economies, and low risk)?

 Does investing in it make sense given the firm’s objectives,

competencies, and resources?

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 II. SELECTING TARGET SEGMENTS (con’t)
Target market strategies

Marketers have a continuum of possible levels of segmentation

that can guide their target market decisions.

Mass market - multiple segments - single segments - individuals.

.

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II. SELECTING TARGET SEGMENTS
Target Market strategies:

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III. BRAND POSITIONING

Brand Positioning:
The act of designing a company’s offering and image to occupy
a distinctive place in the minds of the target market.

 A good positioning: (+) clarifying the brand’s essence, (+) telling

the goals it helps the consumer achieve, and (+) showing how it
does so in a unique way.

 A good positioning  creation of a value proposition (a clear

reason why the target market should buy a product or service).

 A value proposition captures the way a product or service’s key

benefits provide value to customers by satisfying their needs.

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 III. BRAND POSITIONING (con’t)
Example of value proposition:
Company and Target Customers Value Proposition
Product
Hertz (car Busy professionals Fast, convenient way to rent the
rental) right type of a car at an airport
Volvo (station Safety-conscious The safest, most durable wagon
wagon) upscale families in which your family can ride
Domino’s Convenience- A delicious hot pizza, delivered
(pizza) minded pizza lovers promptly to your door
? ?
CoopMart
Cà phê Trung ? ?
nguyên
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III. BRAND POSITIONING (con’t)
Brand Positioning tasks:

Defining and communicating similarities and differences

between the brand and its competitors:

1. Choosing a competitive frame of reference by identifying

the target market and relevant competition.

2. Identifying the optimal points-of-parity and points-of-

difference brand associations given that frame of reference.

3. Creating a brand mantra summarizing the positioning and

essence of the brand.
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III. BRAND POSITIONING (con’t)

Step 1. Choosing a Competitive frame of reference:

+ Defines which other brands a brand competes with and

which should be the focus of competitive analysis (ie.
direct/main competitors);

+ Analyzing competitive brands:

What is each competitor seeking in the marketplace?
What drives each competitor’s behavior?
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 III. BRAND POSITIONING (con’t)

Step 2. Identifying Points-of-Difference & Points-of-Parity

Points-of-Difference (POD) Points-of-Parity (POP)
 Attributes or benefits that  Attributes or benefits that are
consumers strongly associate
not necessarily unique to the
with our brand, positively
brand but may be shared
evaluate, and believe they could
with other brands.
not find to the same extent with
a competitive brand.
 Must be desirable – deliverable
– differentiating.

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 III. BRAND POSITIONING (con’t)

Step 2. Identifying Points-of-Parity and Points-of-Difference

Choosing specific POPs & PODs

 Competitive advantage

 Means of differentiation
 Perceptual map
 Emotional branding

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 III. BRAND POSITIONING (con’t)

Step 3. Creating the brand mantra:

a 3-5 word articulation of the heart and soul of the brand &
closely related to other branding concepts like “brand
essence” and “core brand promise.”

3 criteria for a brand mantra:

 Communicate: clarify what is unique about the brand.
 Simplify: memorable - short, crisp, and vivid in meaning.
 Inspire: meaningful and relevant to as many as possible.
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 End of Ch.6a

Thanks for your attention !

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