jan25 chapter 6.docx

3 Pages
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Department
Management and Organizational Studies
Course Code
Management and Organizational Studies 1021A/B
Professor
Maria Ferraro

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Description
January 25, 2012 Chapter 6: Segmentation and Targeting How are market segments identified from the data? - Finding best way to describe the market from the data - Statistical approaches - i.e. Harley-Davidson – female buyers now account for 13% of new Harley- Davidson purchases, new market could be emerging Where is the product image located? - In the mind of the consumer - Issue of objective and subjective properties of the product (Chapter 7) Why is repositioning relatively rare? - Gives up brand image that has been carefully cultivated over time - Risky - i.e. McDonalds trying to reposition themselves as a classy restaurant Market Segmentation - Consumers have diverse needs - Companies need to concentrate their resources and money efficiently - Involves aggregating prospective buyers into groups that have common needs and respond similarly to marketing programs 2 main market segments: 1. A consumer market consists of products, ideas and services that a person can purchase for personal use 2. A business market consists of products that are purchased either to run a business or to be used as a component in another g/s Product differentiation – positioning a product apart from the competition in the eyes of consumers (like adding a unique feature o minimizing all costs to provide a cheaper alternative) Forms of Marketing Segmentation Mass marketing - Marketing to the entire market with no differentiation - Ignoring differences with a one-size-fits-all offer - i.e. refined white sugar, propane Segment marketing - Designing different g/s to meet the needs of different target groups - Caters to the specific product needs of individual target markets but also has its own marketing programs to nsure that each target groups’ needs are properly met - Followed by companies in the business-to-business market - i.e. Kellogg’s cereal, Toyota (Yaris, Corolla, RAV4) January 25, 2012 Niche marketing - Focusing on a limited segment in the market - i.e. Kashi cereal, Sabian (Medictic, NB) Individual marketing - Use of technology to allow marketers to use database technology to track and predict future purchases - To offer customized offers and products - i.e. amazon.ca, Starbucks app for smartphones, store locator feature The key to successful product differentiation and market segmentation strategies is finding a balance between satisfying a customer’s individual wants and being able to do this profitably. Steps in Market Segmentation: 1. Review company objectives 2. Identify consumer needs and common characteristics in the market a. What drives the category? b. What future trends are evolving? 3. Cluster consumer variables to create meaningful market segments a. Stand
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