Consumer Behavior And Market Segmentation PDF

CHAPTER THREE Market Segmentation and Strategic Targeting  Learning Objectives 1. To Understand Why Market Segmentation Is Essential. 2. To Understand the Criteria for Targeting Selected Segments Effectively. 3. To Understand the Bases for Segmenting Consumers. 4. To...

CHAPTER THREE Market Segmentation and Strategic Targeting  Learning Objectives 1. To Understand Why Market Segmentation Is Essential. 2. To Understand the Criteria for Targeting Selected Segments Effectively. 3. To Understand the Bases for Segmenting Consumers. 4. To Understand How Segmentation and Strategic Targeting Are Carried Out. Copyright 2010 Pearson Education, Inc. Chapter Three Slide 2  Why Segmentation is Necessary Consumer needs differs Differentiation helps products compete Segmentation helps identify media Copyright 2010 Pearson Education, Inc. Chapter Three Slide 3  Positioning The value proposition, expressed through promotion, stating the product’s or service’s capacity to deliver specific benefits. Copyright 2010 Pearson Education, Inc. Chapter Three Slide 4 Criteria for Effective Targeting Identifiable Sizeable Stable Accessible Congruent with the company’s objectives and resources Copyright 2010 Pearson Education, Inc. Chapter Three Slide 5  Bases for Segmentation Copyright 2010 Pearson Education, Inc. Chapter Three Slide 6 Consumer-Rooted Segmentation Bases Demographics Geodemographic Personality Traits Lifestyles Sociocultural Copyright 2010 Pearson Education, Inc. Chapter Three Slide 7 Demographic Segmentation Age Gender Family Life- Marital Status cycle Income, Education, and Occupation Copyright 2010 Pearson Education, Inc. Chapter Three Slide 8  Geodemographic Segmentation Based on geography and demographics People who live close to one another are similar “Birds of a feather flock together” C:\Documents and Settings\utter\Local Settings\Temporary Internet Files\Content.IE5\AJVCC7L6\MMj0283268 Copyright 2010 Pearson Education, Inc. Chapter Three Slide 9  Personality Traits People often do not identify these traits because they are guarded or not consciously recognized Consumer innovators – Open minded – Perceive less risk in trying new things Copyright 2010 Pearson Education, Inc. Chapter Three Slide 10  Lifestyles Psychographics Includes activities, interests, and opinions They explain buyer’s purchase decisions and choices Copyright 2010 Pearson Education, Inc. Chapter Three Slide 11  Two Views of Post-Retirement Lifestyle Table 3.6 (excerpt) AS AN OPPORTUNITY TO MAKE A NEW START This group regards retirement as an exciting time. Work will have been largely unrewarding, so the transition is seen as a freedom from the constraints of their former role. Retirement will invigorate such people and inspire them toward undertaking activities that work largely prevented them from pursuing. AS A CONTINUATION OF THEIR PRE-RETIREMENT LIFESTYLE To such people, retirement is not perceived as signaling a drastic change. Work life has not been as unsatisfying as for others, hence its ending is not greeted with euphoria. There is, however, some satisfaction that retirement permits more opportunity to devote time to existing activities outside of their working role. The future is likely to see an increase in such activities but no real desire to engage in new ones. Copyright 2010 Pearson Education, Inc. Chapter Three Slide 12  Socio-Cultural Values and Beliefs Sociological = group Anthropological = cultural Include segments based on – Cultural values – Sub-cultural membership – Cross-cultural affiliations Copyright 2010 Pearson Education, Inc. Chapter Three Slide 13  Consumption-Specific Segmentation Bases Usage rate Usage situation Benefit segmentation Perceived brand loyalty Brand relationship Copyright 2010 Pearson Education, Inc. Chapter Three Slide 14  Consumption-Specific Segmentation Usage-Behavior Usage rate – Awareness status – Level of involvement Copyright 2010 Pearson Education, Inc. Chapter Three Slide 15  Consumption-Specific Segmentation Usage-Behavior Usage-situation segmentation – Segmenting on the basis of special occasions or situations – Example : When I’m away on business, I try to stay at a suites hotel. Copyright 2010 Pearson Education, Inc. Chapter Three Slide 16  Benefits Segmentation Benefits sought represent consumer needs Important for positioning Benefits of media Copyright 2010 Pearson Education, Inc. Chapter Three Slide 28  Brand Loyalty and Relationships Brand loyalty includes: – Behavior – Attitude Frequency award programs are popular Customer relationships can be active or passive Retail customers seek: – Personal connections vs. functional features Banking customers seek: – Special treatment – Confidence benefits – Social benefits Copyright 2010 Pearson Education, Inc. Chapter Three Slide 18  Implementing Segmentation Strategies Micro- and behavioral targeting – Personalized advertising messages – Narrowcasting Email Mobile – Use of many data sources C:\Documents and Settings\utter\Local Settings\Temporary Internet Files\Content.IE5\AJVCC7L6\MMj0283268 Copyright 2010 Pearson Education, Inc. Chapter Three Slide 19 Sample Acxiom Clusters - Table 3.16 (excerpt) Shooting Stars Still relatively young at a mean age of 36, and with top rankings for income, college education, home value and net worth, these consumers have the world by the tail. Feeling financially secure with large investment portfolios, Shooting Stars spend their disposable Income making life a comfortable one, focusing on health, exercise, gourmet food, golf, and travel. Tots & Toys Two things—work and family—consume these professional working couples. They’re putting their college degrees into action, climbing the corporate ladder for lucrative careers, while saving for their children’s education through do-it-yourself home improvements and trips to the zoo for entertainment. With time at a premium, it’s not surprising that the radio is the most relied-upon source for news and entertainment. Copyright 2010 Pearson Education, Inc. Chapter Three Slide 20  Implementing Segmentation Strategies Concentrated Marketing – One segment Differentiated – Several segments with individual marketing mixes Countersegmentation Copyright 2010 Pearson Education, Inc. Chapter Three Slide 21