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Lecture 3

Week 3

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Queen's University
COMM 131
Ethan Pancer

Week 3 Notes Chapter 7 Notes (258-276)  The largest, fastest growing segment may not be the best for all organizations  Structural factors that affect segment attractiveness are substitute products, aggressiveness of competitors, relative power of buyers, power of suppliers, and an organization’s long-term objectives  Target Market: set of buyers sharing common needs or characteristics that the company decides to serve  Undifferentiated (mass) Marketing: market-coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer  Differentiated (segmented) Marketing: market-coverage strategy in which a firm decides to target several market segments and designs separate offers for each  Concentrated (niche) Marketing: a firm goes after a large share of one or a few segments or niches, instead of a small share of a large segment  Micromarketing: the practice of tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments o Local Marketing: small group of people who live in the same city/neighbourhood, or who shop at the same store o Individual Marketing: tailoring products and marketing programs to the needs and preferences of individual customers  When choosing targeting strategies, company, resources, product variability, the stage of the product’s life cycle you’re in, market variability, and the competitor’s marketing strategies should all be taken into account  Product Position: the way the product is defined by consumers on important attributes – the place the product occupies in consumer’s minds relative to competing products  Consumers position products automatically, companies must simply plan positions that will give them the greatest advantage  Perceptual Positioning Maps show consumer perceptions of brands versus competing products on key buying criteria (luxury vs. performance cars)  When choosing a positioning strategy, companies must first identify possible value differences and competitive advantages (advantage over competitors gained by offering greater customer value, either through lower prices of by providing more benefits that justify higher prices)  Before enacting new marketing plans based on value proposition, company must live them  Advantages can be gained through product, services, channels, people, or a consistent image  Decisions on which competitive advantages to include in the value proposition involve how many and which ones  You may choose one focus and promote the shit out of it, or you can choose multiple; but if you do, make sure it’s still believable and that they’re related  Difference to promote must be: important to consumers, distinctive and superior to competition, communicable, pre- emptive, affordable to your target market, and profitable  Selecting an overall positioning strategy o Value Proposition: full positioning of a brand – the full mix of benefits upon which it is positioned o More for More: upscale (the best) products at a high price. These are generally well-received, but can be vulnerable against more for less tactics o More for the Same: introducing a competitor to luxury or quality products at a more affordable price o The Same for Less: offering the same brands, products for less money (Wal-Mart) o Less for Less: getting ride of extra features, and offering the product at a cheap price (*this does not mean bad quality, only an absence of luxury) o More for Less: this may be optimal in the short-term, but this is not a sustainable practice  Positioning Statement: statement that summarized the company or brand positioning – it takes this form: o To (target segment and need) our (brand) is (concept) that (point of difference) Chapter 7 LearningObjectives 3& 4 3) When evaluating marketing segments, a company must evaluate segment size and growth, structural attractiveness, and company objectives and resources. It also needs to assess for competitors, substitute products, and power of buyers and sellers. After choosing a segment, you choose a strategy; either undifferentiated (mass), differentiated (segmented), concentrated (niche), or micromarketing based on the needs and characteristics of your chosen target market, as well as your own resources and product offer. 4) Companies differentiate their products based off of advantages relating to product, services, channels, people, or image. They then choose which, and how many advantages to promote. Chosen advantages must be important, distinctive, superior, communicable, pre-emptive, affordable, and profitable. Winning value propositions include: more for more, more for the same, more for less, the same for less, and less for much less. (Losing are the same for more, less for more, and less for the same, with the same for the sa
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