Chapter 3- Market Segmentation and Strategic-Targeting.docx

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University of Guelph
Marketing and Consumer Studies
MCS 2600
Nicole Mc Callum

Chapter 3- Market Segmentation and Strategic Targeting Marketing sementation is the opposite of mass marketing Marketing segmentation and targeting process is the identification of distinct segments within a given market or population, evaluation of each segment’s marketing potential, selection of the segments to be targeted, and the creation of a marketing mix, for each segment selected Positioning is the unifying element of each marketing mix because it expresses the offering’s value proposition which details the product’s or service’s capability to deliver specific benefits corresponding to consumers’ unfulfilled needs Why is Market Segmentation Necessary? - any company of consumer goods that offers a single product is unlikely to survice, unless the product offered is extremely specialized and designed for a very specific consumer niche - market segmentation, strategic targeting, and product (or service) positioning are the key elements of marketing most consumer goods - marketers use segmentation research to identify the most appropriate media in which to place advertisements Criteria for Effective Targeting - identifiable o to divide the maket into separate segments on the basis of common or shared needs or characteristics that are relevant to the product or service, a marketer must be able to identify these characteristics - sizeable o in order to be a viable market, a segment must consist of enough consumers to make targeting it profitable - stable o segments that are relatively stable in terms of lifestyles and consumption patterns and avoid “fickle” segments that are unpredictable - accessible o to be targeted, a segment must be accessible, which means that marketers must be able to reach that market segment in an economical way - congruent with the company’s objectives and resources Bases for Segmentation - the four groupings stem from dividing consumers’ characteristics along two criteria: o 1- facts, which can be determined from direct questioning and categorized by a single objective measure, versus cognitions, which are abstract, can be determined only through more complex questioning, and where most of the constructs measured have no single universal definitions o 2- consumer-rooted features stemming from the consumer’s physical, social, psychological characteristics versus consumption-specific usage-beahviors or attitudes and preferences towards specific productions or buying situations Consumer-rooted segmentation bases - includes 2 types of personal attributes o facts that are evidence-based and can be readily determined ad categorized along an objective criterion and o cognitions, which can mostly be determined through indirect, psychological tests and classified into subjective categories, depending on the researcher - demographics (age, gender, ethnicity, and income) are objective and empiricle, can be easily determined through questioning and enable a precise classification of each respondednt into a given category - similarly, social class if define by computing an index based on 3 quantifiable variables- income, education, and occupation - psychographics consist of activities, interests and opinions which are mostly at
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