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 The focus of a successful marketing program is the

customer. Effectively marketing must fully understand the
needs.
 Customers with decent life and individualism have
Heterogeneous demands, This has given rise to need
segmenting.
 The process of understanding the customer and choosing
a group of customer you can serve best is targeting.
 So target a segmentation is core of the marketing process.
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Identify Total Market
Effective Segmentation
Bases for Segmentation
Select Target Segment
Positioning Strategy
Marketing Mix
Monitor, Evaluate and

ControlObjective 3
3
 The first step in the target market
selection process is to specifically define
the total market of all potential
customers for a product category.
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Effective
Segmentation
Marketing Mix

ControlObjective 3
5
 Segmenting means dividing a heterogeneous
demanding markets into homogenous groups
based on similar characteristics or traits
 Heterogeneous demand- different groups of
customers have differing needs from specific
products.
 Homogeneous segment- the separation of markets
into distinctive groups based on homogeneous
characteristics.
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Ac
i sti nc tive tio
D n ab
l le
t ia
tan
bs
Su
Me Acc
a
Ide sura ess
ible
ntif ble
iab
le
7
tive
Distinc •Clear differences
in consumer
preferences for a
product must
exist.
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•Difference
Me
a preferences for a
Ide sura
ntif ble
iab
le
product must be
identifiable and
capable of being
related to
measurable
variables.
9
Criteria for
successful segmentation
l
•The proposed
ti a
b sta
n
market segment
Su
must have enough
size and
purchasing power
to be profitable.
10
•Companies must
Act
io nab
le
be able to respond
to difference
preferences with
an appropriate
marketing mix.
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Acc
•The proposed
ess
ible market segment
must be readily
accessible and
reachable with
market programs.
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Effective Segmentation
Marketing Mix

ControlObjective 3
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 To divide a market into segments, firms use
segmenting criterion that describe the
characteristics of each part of the market.
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Demographic Benefits-Sought
Segmentation Segmentation
Geographic Situation
Psychographic Behavior/Usage
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Life-cycle Income Level
Social class
Education Ethnic
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 Localizes its marketing efforts to specific
geographic regions
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 Grouping customers together based on
social class, lifestyles and psychological
characteristics (attitudes, interests and
opinions)
 Useful but more difficult to identify and
measure compared to demographic
variables
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 Markets can be segmented
based on the benefits that
consumers desire from using a
specific product
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 Purchase situation or occasion
 Physical surroundings
 Social surroundings
 Temporal perspective
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25
 Occasions
 Benefits
 User status
 User range
 Loyalty status
 Attitude towards the product.
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 Information for segmenting
markets may be obtained from
database such as Census, State
Statistics, others
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 While the steps in the target market selection
process are essentially the same for business
markets, there are three major differences:
 The purchasing process, which differs greatly
from the household consumer market.
 The use of different segment variables, in simple
way, a Standard Industrial classification is often
employed
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 Segmentation variables used to segment business
markets:
 Size
 Industry
 Purchasing approaches
 Product usage
 Situational factors (seasonal trend)
 Geographic
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Determine Need for

Segmentation
Determine Bases for

Segmentation
Marketing Mix

ControlObjective 3
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 Targeting: choose the specific segment toward
which a firm directs its market efforts.
 Niche Marketing: the process of targeting a small
market segment with a specific, specialized
marketing mix.
 Micromarketing- the process of targeting smaller,
more narrowly defined market segments.
 On the individual consumer end of the continuum, a
firm may decide to target individual consumers and
personalize marketing efforts toward each.
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1.Undifferentiated marketing
2.Differentiated marketing
3.Concentrated marketing
4.Custom marketing
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Undifferentiated targeting
strategy
 Companies might
develop one
Concentrated strategy
marketing mix
Differentiated strategy strategy that is
appropriate for all
members of the
total market.
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strategy
 Only one
Concentrated strategy
marketing mix is
developed and
Differentiated strategy directed toward a
few, or perhaps
one, profitable
market segments.
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strategy  Exists when a firm
Concentrated strategy develops different
marketing mix
Differentiated strategy plans specially
tailored for each
of two or more
market segments.
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Effective
Segmentation
Determine Bases for

Segmentation
Targeting Segment
Marketing Mix

ControlObjective 3
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Positioning
 Kotler defined: “designing an offer

so that it occupies a distinct and
valued place in the minds of the
target customer.”
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Positioning
Image that customers have about a
product in relation to the
product’s competitors 41
 Key to developing the appropriate
marketing mix is the positioning
strategy of the product.
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 All products have object and subject
attributes
 Recognizable
 Comparable
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 Effective positioning
 What consumers currently think about the
product, especially in relation to competing
products
 What the marketer wants consumers to
think about the product
 Which positioning strategy will elevate the
consumers’ current product image to the
desired product image.
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 Position Mapping- creating a visual
description about consumer
perceptions of a product on two or
more dimensions in relation to
competitors.
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 The positioning strategy must determine where a
company wants to go
 And how to get there by positioning the product
according to any of the following ways:
 Price/Quality
 Product Attributes
 Product User
 Product Usage
 Product Class
 Competition
 Symbol
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Segmentation
Marketing Mix

ControlObjective 3
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 The final steps are to develop and a marketing
mix matched to the needs of the target market
 This must support the chosen positional
strategy in the selected target markets
 Therefore determine the ‘4Ps ’ or “7Ps” of its
marketing mix as a tool to achieve the desired
position
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 Productcustomer value
 Pricecost
 Placeconvenience
 Promotioncommunication
 Peopleconsideration
 Processesco-ordination
 Physical evidenceconfirmation
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Place
Product
(Distribution)
Marketing
Mix
Promotion Price
Objective 4
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Product
 Refers to goods, services, people, places and

ideas
 Household consumers
 Business-to-business customers
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Place
(Distribution)
 Marketing channel is the network of

organizations that create time, place and
ownership utilities for household
consumers and business customers.
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 Integrated Marketing Communication (IMC)
 System of management and integration of
marketing communication elements
▪ Advertising, publicity, sales promotion, personal
selling, sponsorship marketing, and point-of-
purchase communications
Promotion
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 Pricing decisions are complex and are driven by a
variety of considerations including:
 Customer demand, costs, information
availability, competition, profit motives,
product considerations, and legal considerations
Price
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1

 The focus of a successful marketing program is the

Bases for Segmentation

Select Target Segment

Monitor, Evaluate and

Bases for Segmentation

Select Target Segment

Monitor, Evaluate and

Bases for Segmentation

Select Target Segment

Monitor, Evaluate and

Determine Need for

Determine Bases for

Select Target Segment

Monitor, Evaluate and

Determine Bases for

Monitor, Evaluate and

 Kotler defined: “designing an offer

Bases for Segmentation

Select Target Segment

Monitor, Evaluate and

 Refers to goods, services, people, places and

 Marketing channel is the network of

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