Class Notes (836,673)
Canada (509,870)
Business (634)
BUSI 2208 (16)
Irfan Butt (11)

Chapter 8.docx

5 Pages
Unlock Document

BUSI 2208
Irfan Butt

Marketing Chapter 8 Segmentation, Targeting and Positioning Step 1: Establish overall strategy or Objectives  First step is to articulate the vision or the objectives of the company’s marketing strategy clearly.  Segmentation strategy must be consistent and derived from the firm’s mission and objectives as well as the firms SWOT Step 2: Profile Segments: Describe the different segments (needs, wants, and characteristics), which help firms better understand the profile of the customers in each segment as well as the customers similarities within a segment and dissimilarities across segments  Geographic Segmentation- The grouping of consumers on the basis of where they live o Grouped by country, city, urban, rural, climate and topography. o Good for companies with products that satisfy needs that vary by region  Demographic Segmentation – The grouping of consumers according to easily measured, objective characteristics such as age, gender, income, and education o Represent most common means to define segments because they are easy to identify  Psychographics – Used in segmentation; delves into how consumers describe themselves; allows people to describe themselves using those characteristics that help them chose how they occupy their time (behaviour) and what underlying psychological reasons determine those choices o Self values: Goals for life, not just the goals one wants to accomplish in a day; refers to overriding desires that drive how a person lives. (Status etc.) o Self-concept: The image a person has of him or herself; a component of psychographics  How the underlying goals affects the individual  A person who has a goal to belong, may see themselves as a fun-loving type that people with to be around o Life styles: Refers to the way a person lives his or her life to achieve goals.  Strong sense of belonging might want to live in a highly populated area  Wants to keep in shape, and in style etc. o VALS: A Psychographic tool developed by SRI consulting Business Intelligence;  Classifies consumers into eight segments  Innovators: successful, emerging business leaders , cultivated taste for finer things  Thinkers: Mature, satisfied like durability and clear value  Believers: Conservative, conventionalists; choose familiar products and established brands  Achievers: Goal-oriented lifestyles, deep commitment to career and family; favour prestige products that demonstrate their success, time saving products  Strivers: Trendy and fun loving, money defines success, favour stylish products, spend as much money as they can  Experiencer’s: Seek variety and excitement. Active socially and in sports, spend high proportion of income on fashion  Makers: Practical people with constructive skills, value self-sufficiency, suspicious of new ideas, prefer value over luxury  Survivors: Believe world is changing quickly, concerned with safety and security, cautious consumers, loyal to favourite brands, love a good deal  Behavioural segmentation: group consumers based on the benefits they derive from products or services, their usage rate, their user status and their loyalty, o Benefit Segmentation: Grouping of consumers on basis of the benefits the derived from products or services- value or benefit customer receives for using product o Loyalty Segmentation: Strategy of investing in loyalty initiatives to retain the firms most profitable customers  Customers who feel so strongly that the firm can meet their needs best that any competitors are virtually excluded from their considerations  Most profitable long term  High cost of finding new customers o Usage Rate/ User Status: Heavy users or light users / current users or ex-users  Using Multiple Segmentation Methods: Companies use a combination of geographic, demographic and lifestyle characteristics called... o Geodemographic Segmentation: The grouping of consumers on the basis of a combination of geographic, demographic, and lifestyle characteristics.  PSYTE Cluster – system groups all neighbourhoods in Canada into 60 different lifestyle clusters with specific locations (page 212)  Geodemographic segmentation can be used particularly be retailers because customers typically patronize stores close to their neighbourhood  Tailor each stores assortment to the preferences of local community Step 3: Evaluate Segment Attractiveness  Identifiable:Firms must determine who is within their market to be able to design products or services to meet their needs o Equally important to ensure that the segments are distinct from one another because too much over-lap between segments means that distinct marketing strategies aren’t necessary to meet segment members needs  Reachable: The best product or service cannot have any impact if the market cannot be reached or accessed through persuasive communications and product distribution o The consumer must know the product exists, understand what it can do for them, and recognize how to buy it  Responsive: The customers must react similarly and positively to the firms offering. o If through the firms distinctive competencies, it cannot provide products to that segment, it should not target it  Substantial and Profitable: Need to measure their size and growth potential o If market is too small or its buying power is insignificant, it won’t generate sufficient profits or be able to support the marketing mix activities Segment Profitability = (Segment size) x (Segment adoption percentage) x (Purchase
More Less

Related notes for BUSI 2208

Log In


Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.