Segmentation, Positioning, and Target Market PDF

SEGMENTATION, POSITIONING AND TARGET MARKET Chapter 6 THREE APPROACHES TO MEET THE NEEDS OF THE CUSTOMER UNDIFFERENTIATED STRATEGY- all customers are treated the same. Ex. Generic and standardized products CONCENTRATED STRATEGY-chooses to focus, specialized and target only one segmen...

SEGMENTATION, POSITIONING AND TARGET MARKET Chapter 6 THREE APPROACHES TO MEET THE NEEDS OF THE CUSTOMER UNDIFFERENTIATED STRATEGY- all customers are treated the same. Ex. Generic and standardized products CONCENTRATED STRATEGY-chooses to focus, specialized and target only one segment of the market while leaving other segments to competitors. Ex. Beauty parlors- female customers Differentiated Strategy- trying to sell to two or more specific market segments customers that are treated in different ways. Ex. Vitamins supplements- maybe use for a gender TWO TYPES OF SEGMENTATIONS APPROACHES NEED BASED APPROACH- market are segregated into different segments according to similar nature of needs. PROFILERS APPROACH- Profilers are descriptive in nature and measurable in terms of customer characteristics (such as location, nationality, age, sex, income) CRITERIA FOR SUCCESFUL SEGMENTATION Segment must be measurable Segment must be accessible Segment must be substantial Segment must be actionable/ responsive Segment must be differentiable USAGE RATE 1. Heavy users - These are the most reliable customers who provide a company with a volume of consumer-generated revenue. A company relies on them for revenue, but they also greatly rely on the company for the services it provides. For instance, Cebu Pacific with continued patronage of the frequent fliers of its airline services typically awards these individuals with free upgrades and other discounts fairly often. 2. Mid-level users These are customers who can be depended on to generate purchases at regular but not frequent intervals. Mid-level users make purchases during times that are momentous to them, like birthdays or anniversaries. Companies that present birthday freebies recognize the significance of contacting mid-level users during such occasions to remain interested and connected with their brand. USAGE RATE 3. Light users - These are likely being one-off customers except if the company makes an offer they cannot turn down. This is the reason many companies present discounts and other freebies for first-time customers. They know they need to give instant value that keeps individuals coming back for more.  FIVE LEVELS OF CUSTOMER LOYALTY: 1. Applicant He comes and is interested in the products of the enterprise (organization). 2. First-time buyer He is a customer who knows about the products of the enterprise and buys them first time. 3. Frequent buyer - He is a customer who may be satisfied with products and buy them repeatedly. 4. Promoter - He is satisfied and loyal and wants to share his good experience with enterprise's products with others. 5. Loyal customer - He is highly loyal customer who consistently maintains his relationship with the enterprise and he is a permanent user of enterprise's products. Positioning Strategy Product Characteristic/Customer Benefits Pricing Quality Use or Application Product User Product class Cultural Symbol Competitors  COMMUNICATING POSITIONING STRATEGY A positioning statement is a brief and concise description of a target market and a compelling picture of how a company wants its targeted market to perceive its brand.  six important factors to remember in writing a good positioning statement: 1. It is straightforward, impressive, and fitted to the target market. 2. It offers an instantly recognizable and simply understood picture of a brand that differentiates it from its competitors. 3. It is believable, and the brand can fulfill on its promise. 4. A brand can be the only occupier of this particular position in the market, so "own" it. 5. It helps a company evaluates whether or not marketing decisions are reliable with and supportive of its brand. 6. It provides opportunity for growth.