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Chapter 6

Management and Organizational Studies 2320A/B Chapter 6: Chapter 6


Department
Management and Organizational Studies
Course Code
MOS 2320A/B
Professor
Ben Marcus
Chapter
6

This preview shows pages 1-3. to view the full 12 pages of the document.
SEGMENTATION, TARGETING, AND POSITIONING
THE SEGMENTATION-TARGETING-POSITIONING PROCESS
*see exhibit 6.1
Step 1: Establish Overall Strategy or Objectives
Articulate the mission and objectives if the company's marketing strategy
-
Then should derive the segmentation strategy from this ^ as well as a SWOT analysis
-
Step 2: Segmentation Bases
Use a formal approach to segment the market
-
Descriptions of the different segments, and their needs, wants, and characteristics
-
Distinguish customer similarities in a segment and differences across segments
-
Use various bases including geographic, demographic, psychographic, and behavioural
See exhibit 6.2
-
Geographic Segmentation
Grouping of customers based on where they live
-
Can be grouped by country, region, or climate
-
Most useful for companies whose products satisfy needs that vary by region
-
Better marketers make adjustments to the needs of smaller geographic groups
-
Demographic Segmentation
Grouping of customers according to easily measured, objective characteristics
-
Age, gender, income, education
-
Most common means of segmentation because they are easy to identify and easy to reach
-
Generational cohorts often targeted
-
Sometimes this doesn’t work
Nike had trouble when only targeted young athletic people, many different people wear their clothing
-
Psychographic Segmentation
Delves into how consumers describe themselves
-
Allows people to describe themselves by using those characteristics that help them choose how they occupy their time and what underlying
psychological reasons determine those choices
-
Self-values: goals for life (not just what someone wants to accomplish in a day)the overriding desires that drive how a person lives their life
Self-respect, sense of belonging
Causes people to develop self-images
Help determine what benefits of a product people are seeking
-
Self-concept: the image a person has of themselves
-
Lifestyles: how we live our lives to achieve goals
-
VALS - a psychographic tool developed by Strategic Business Insights, classifies consumers into eight segments
Innovators
-
Thinkers
-
Believers
-
Achievers
-
Strivers
-
Experiencers
-
Makers
-
Survivors
*see exhibits 6.3 and 6.4
-
On the vertical dimension described by resources
-
Horizontal dimensions shows their primary motivation
-
Shows correlations between psychology and lifestyle choices
-
Psychographics are a good compliment to demographics
-
Not as objective as demographics
-
Harder to identify potential consumers
-
Behavioural Segmentation
Groups consumers based on the benefits they derive from products, their usage rate, loyalty, and the occasion
-
Occasion segmentation: groups consumers based on when they purchase or consume a product/service
-
Benefit segmentation: groups consumers based on the benefits they derive from products/services
-
Loyalty segmentation: strategy of investing in retention and loyalty initiatives to retain the firm's most profitable customers
9/10 Canadians participate in at least one loyalty program
Usage rate often used to determine this
-
Using Multiple Segmentation Methods
Segmenting by demographics and geography is easy because information about who the customers are and where they are located in
readily available
-
Geodemographic segmentation - grouping of consumers based on geographic, demographic, and lifestyle characteristics
PSYTE clusters: the grouping of all neighbourhoods in Canada into 60 different lifestyle clusters
*see exhibit 6.5
-
Useful for retailers because people usually patronize the stores close to their neighbourhood
-
Step 3: Evaluate Segment Attractiveness
First determine whether a segment is worth pursuing
Is it identifiable, reachable, responsive, and substantial & profitable
-
Identifiable: who is within their market to be able to design products for
Ensuring the segment is distinct from others
-
Reachable: through persuasive communications and product distribution
Consumers must know the product or service exists, what it can do for them, and how they can buy it
-
Responsive: customers in the segment must react similarly and positively to the offering
-
Substantial & profitable: measure their size and growth potential
If its too small or there's not a lot of buying power it wont generate sufficient profits
Market growth, market competitiveness, and market access important to consider for profitability
𝑠𝑒𝑔𝑚𝑒𝑛𝑡'𝑝𝑟𝑜𝑓𝑖𝑡𝑎𝑏𝑖𝑙𝑖𝑡𝑦 =(𝑠𝑒𝑔𝑚𝑒𝑛𝑡'𝑠𝑖𝑧𝑒'𝑥'𝑠𝑒𝑔𝑚𝑒𝑛𝑡'𝑎𝑑𝑜𝑝𝑡𝑖𝑜𝑛'%'𝑥'𝑝𝑢𝑟𝑐ℎ𝑎𝑠𝑒'𝑏𝑒ℎ𝑎𝑣𝑖𝑜𝑢𝑟'𝑥'𝑝𝑟𝑜𝑓𝑖𝑡'𝑚𝑎𝑟𝑔𝑖𝑛'%)𝑓𝑖𝑥𝑒𝑑'𝑐𝑜𝑠𝑡𝑠
Segment adoption % = % of customers likely to adopt the product
§
Purchase behaviour = purchase price x # of times purchased in a time period
§
Profit margin % = (selling price - variable costs) ÷ selling price
§
Useful to use this equation for customers' lifetime value
-
Step 4: Select Target Market
Key factor is a marketer's ability to pursue a target segment
-
Likely assess the attractiveness as well as SWOT
-
Undifferentiated Targeting Strategy/Mass Marketing
Used if the product or service is perceived to provide the same benefits to everyone with no need to develop separate strategies for
different groups
-
No need to develop different strategies for segments
-
Common among smaller firms that offer "indistinguishable"
-
Differentiated Targeting Strategy
Firm targets several market segments with a different offering for each
-
Helps them obtain a bigger share of the market and increase the market for their products overall
-
Helps diversify the company which in turn mitigates risk
-
Can be expensive
-
Concentrated (Niche) Targeting Strategy
Select a single primary target market and focus all energies on providing a product to fit that market's needs
-
Entrepreneurial start-ups often use this
Easier to employ limited resources efficiently
-
Micromarketing
Extreme form of segmentation that tailors a product or service to suit an individual customer's wants or needs
-
Small producers and service providers have this ability
-
Mass customization - the practice of interacting on a one-to-one basis with many people to create custom made products or services
Internet aids in this process and simplifies customer identification
-
Step 5: Identify and Develop Positioning Strategy
Positioning - the mental picture that people have about a company and its products or services relative to competitors
Thoughts, feelings, impressions relative to competing products
-
Formed from multiple sources such as friends/family, newspapers, reports, radio, TV, and internet
-
Consumers will form their own ideas and feelings about a product/brand
-
Can help communicate a firm's value proposition
-
Not easy to shape consumers' perceptions the way marketers might want to
-
Effective positioning requires marketers to evoke certain feelings keeping up with the dynamic marketplace
-
Process of defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what the
product does or represents in comparison with competing products
-
Letting consumers know what the companies unique value is
Clarity is essential
-
Positioning statement - expresses how a company wants to be perceive by consumers
Target market1.
Offering name or brand2.
Product/service category or concept3.
Unique point of difference/benefits4.
Positioning Methods
Value
The relationship of price to quality is of the most important considerations of customers when they make a purchase
-
Doesn’t necessarily mean low priced
-
A lot like to advertise that they're offering the same value for a lower price than competitors
-
Product Attributes
Things that are most important to the target market
-
Focus on product leadership and things like innovation, quality, performance, design, and reliability
-
Benefits and Symbolism
Benefits along with psychological meaning of the brand to consumers
-
For established companies a well-known symbol can be effective especially toward loyal customers
Really distinguishing from competitors
-
Competition
head-to-head strategy
Can lead to price wars - good for consumers but bad for businesses
Should be careful not to position too close or they could face legal consequences or confuse consumers
-
Differentiation strategy
Going after a less competitive, smaller market niche
-
Market Leadership
Emphasize their size and leadership in a market
-
Consumers perceive them as setting a standard
-
Positioning Using Perceptual Mapping
Perceptual map - displays, in one or two dimensions, the position of products or brands in a consumer's mind
Ideal point - the position at which the particular market segment's ideal product would lie on a perceptual map
Determine consumers' perception and evaluation of the firm's product or service in relation to competitors.
Asking consumers a series of questions about their product
How they use it, likes/dislikes, their alternative sources to satisfy the need
1.
Identify the market's ideal points and size.
Size of current and potential markets
2.
Identify competitors' positions.
How its consumers view its brand relative to competitors
3.
Determine consumer preferences.
What the customer really wants
The ideal product or service that appeals to each market
4.
Select the position.
Maybe develop a new product, adjust its positioning or marketing approach, or ignore what one target market wants and hope that
the original product is enough
5.
Monitor the positioning strategy.
Always view the first three steps as ongoing
6.
Repositioning
Trying to change their positioning
-
Good marketers constantly re-evaluate their brand's position
If not it takes years to rebuild and huge budgets
-
Brand repositioning - a strategy in which marketers change a brand's focus to target new markets or realign the brand's core emphasis with
changing market preferences
Always some costs and risks
-
Can change the quality image
-
Chapter 6
Monday, January 29, 2018
12:16 PM

Only pages 1-3 are available for preview. Some parts have been intentionally blurred.

SEGMENTATION, TARGETING, AND POSITIONING
THE SEGMENTATION-TARGETING-POSITIONING PROCESS
*see exhibit 6.1
Step 1: Establish Overall Strategy or Objectives
Articulate the mission and objectives if the company's marketing strategy
-
Then should derive the segmentation strategy from this ^ as well as a SWOT analysis
-
Step 2: Segmentation Bases
Use a formal approach to segment the market
-
Descriptions of the different segments, and their needs, wants, and characteristics
-
Distinguish customer similarities in a segment and differences across segments
-
Use various bases including geographic, demographic, psychographic, and behavioural
See exhibit 6.2
-
Geographic Segmentation
Grouping of customers based on where they live
-
Can be grouped by country, region, or climate
-
Most useful for companies whose products satisfy needs that vary by region
-
Better marketers make adjustments to the needs of smaller geographic groups
-
Demographic Segmentation
Grouping of customers according to easily measured, objective characteristics
-
Age, gender, income, education
-
Most common means of segmentation because they are easy to identify and easy to reach
-
Generational cohorts often targeted
-
Sometimes this doesn’t work
Nike had trouble when only targeted young athletic people, many different people wear their clothing
-
Psychographic Segmentation
Delves into how consumers describe themselves
-
Allows people to describe themselves by using those characteristics that help them choose how they occupy their time and what underlying
psychological reasons determine those choices
-
Self-values: goals for life (not just what someone wants to accomplish in a day)the overriding desires that drive how a person lives their life
Self-respect, sense of belonging
Causes people to develop self-images
Help determine what benefits of a product people are seeking
-
Self-concept: the image a person has of themselves
-
Lifestyles: how we live our lives to achieve goals
-
VALS - a psychographic tool developed by Strategic Business Insights, classifies consumers into eight segments
Innovators
-
Thinkers
-
Believers
-
Achievers
-
Strivers
-
Experiencers
-
Makers
-
Survivors
*see exhibits 6.3 and 6.4
-
On the vertical dimension described by resources
-
Horizontal dimensions shows their primary motivation
-
Shows correlations between psychology and lifestyle choices
-
Psychographics are a good compliment to demographics
-
Not as objective as demographics
-
Harder to identify potential consumers
-
Behavioural Segmentation
Groups consumers based on the benefits they derive from products, their usage rate, loyalty, and the occasion
-
Occasion segmentation: groups consumers based on when they purchase or consume a product/service
-
Benefit segmentation: groups consumers based on the benefits they derive from products/services
-
Loyalty segmentation: strategy of investing in retention and loyalty initiatives to retain the firm's most profitable customers
9/10 Canadians participate in at least one loyalty program
Usage rate often used to determine this
-
Using Multiple Segmentation Methods
Segmenting by demographics and geography is easy because information about who the customers are and where they are located in
readily available
-
Geodemographic segmentation - grouping of consumers based on geographic, demographic, and lifestyle characteristics
PSYTE clusters: the grouping of all neighbourhoods in Canada into 60 different lifestyle clusters
*see exhibit 6.5
-
Useful for retailers because people usually patronize the stores close to their neighbourhood
-
Step 3: Evaluate Segment Attractiveness
First determine whether a segment is worth pursuing
Is it identifiable, reachable, responsive, and substantial & profitable
-
Identifiable: who is within their market to be able to design products for
Ensuring the segment is distinct from others
-
Reachable: through persuasive communications and product distribution
Consumers must know the product or service exists, what it can do for them, and how they can buy it
-
Responsive: customers in the segment must react similarly and positively to the offering
-
Substantial & profitable: measure their size and growth potential
If its too small or there's not a lot of buying power it wont generate sufficient profits
Market growth, market competitiveness, and market access important to consider for profitability
𝑠𝑒𝑔𝑚𝑒𝑛𝑡'𝑝𝑟𝑜𝑓𝑖𝑡𝑎𝑏𝑖𝑙𝑖𝑡𝑦 =(𝑠𝑒𝑔𝑚𝑒𝑛𝑡'𝑠𝑖𝑧𝑒'𝑥'𝑠𝑒𝑔𝑚𝑒𝑛𝑡'𝑎𝑑𝑜𝑝𝑡𝑖𝑜𝑛'%'𝑥'𝑝𝑢𝑟𝑐ℎ𝑎𝑠𝑒'𝑏𝑒ℎ𝑎𝑣𝑖𝑜𝑢𝑟'𝑥'𝑝𝑟𝑜𝑓𝑖𝑡'𝑚𝑎𝑟𝑔𝑖𝑛'%)𝑓𝑖𝑥𝑒𝑑'𝑐𝑜𝑠𝑡𝑠
Segment adoption % = % of customers likely to adopt the product
§
Purchase behaviour = purchase price x # of times purchased in a time period
§
Profit margin % = (selling price - variable costs) ÷ selling price
§
Useful to use this equation for customers' lifetime value
-
Step 4: Select Target Market
Key factor is a marketer's ability to pursue a target segment
-
Likely assess the attractiveness as well as SWOT
-
Undifferentiated Targeting Strategy/Mass Marketing
Used if the product or service is perceived to provide the same benefits to everyone with no need to develop separate strategies for
different groups
-
No need to develop different strategies for segments
-
Common among smaller firms that offer "indistinguishable"
-
Differentiated Targeting Strategy
Firm targets several market segments with a different offering for each
-
Helps them obtain a bigger share of the market and increase the market for their products overall
-
Helps diversify the company which in turn mitigates risk
-
Can be expensive
-
Concentrated (Niche) Targeting Strategy
Select a single primary target market and focus all energies on providing a product to fit that market's needs
-
Entrepreneurial start-ups often use this
Easier to employ limited resources efficiently
-
Micromarketing
Extreme form of segmentation that tailors a product or service to suit an individual customer's wants or needs
-
Small producers and service providers have this ability
-
Mass customization - the practice of interacting on a one-to-one basis with many people to create custom made products or services
Internet aids in this process and simplifies customer identification
-
Step 5: Identify and Develop Positioning Strategy
Positioning - the mental picture that people have about a company and its products or services relative to competitors
Thoughts, feelings, impressions relative to competing products
-
Formed from multiple sources such as friends/family, newspapers, reports, radio, TV, and internet
-
Consumers will form their own ideas and feelings about a product/brand
-
Can help communicate a firm's value proposition
-
Not easy to shape consumers' perceptions the way marketers might want to
-
Effective positioning requires marketers to evoke certain feelings keeping up with the dynamic marketplace
-
Process of defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what the
product does or represents in comparison with competing products
-
Letting consumers know what the companies unique value is
Clarity is essential
-
Positioning statement - expresses how a company wants to be perceive by consumers
Target market1.
Offering name or brand2.
Product/service category or concept3.
Unique point of difference/benefits4.
Positioning Methods
Value
The relationship of price to quality is of the most important considerations of customers when they make a purchase
-
Doesn’t necessarily mean low priced
-
A lot like to advertise that they're offering the same value for a lower price than competitors
-
Product Attributes
Things that are most important to the target market
-
Focus on product leadership and things like innovation, quality, performance, design, and reliability
-
Benefits and Symbolism
Benefits along with psychological meaning of the brand to consumers
-
For established companies a well-known symbol can be effective especially toward loyal customers
Really distinguishing from competitors
-
Competition
head-to-head strategy
Can lead to price wars - good for consumers but bad for businesses
Should be careful not to position too close or they could face legal consequences or confuse consumers
-
Differentiation strategy
Going after a less competitive, smaller market niche
-
Market Leadership
Emphasize their size and leadership in a market
-
Consumers perceive them as setting a standard
-
Positioning Using Perceptual Mapping
Perceptual map - displays, in one or two dimensions, the position of products or brands in a consumer's mind
Ideal point - the position at which the particular market segment's ideal product would lie on a perceptual map
Determine consumers' perception and evaluation of the firm's product or service in relation to competitors.
Asking consumers a series of questions about their product
How they use it, likes/dislikes, their alternative sources to satisfy the need
1.
Identify the market's ideal points and size.
Size of current and potential markets
2.
Identify competitors' positions.
How its consumers view its brand relative to competitors
3.
Determine consumer preferences.
What the customer really wants
The ideal product or service that appeals to each market
4.
Select the position.
Maybe develop a new product, adjust its positioning or marketing approach, or ignore what one target market wants and hope that
the original product is enough
5.
Monitor the positioning strategy.
Always view the first three steps as ongoing
6.
Repositioning
Trying to change their positioning
-
Good marketers constantly re-evaluate their brand's position
If not it takes years to rebuild and huge budgets
-
Brand repositioning - a strategy in which marketers change a brand's focus to target new markets or realign the brand's core emphasis with
changing market preferences
Always some costs and risks
-
Can change the quality image
-
Chapter 6
Monday, January 29, 2018
12:16 PM

Only pages 1-3 are available for preview. Some parts have been intentionally blurred.

SEGMENTATION, TARGETING, AND POSITIONING
THE SEGMENTATION-TARGETING-POSITIONING PROCESS
*see exhibit 6.1
Step 1: Establish Overall Strategy or Objectives
Articulate the mission and objectives if the company's marketing strategy
-
Then should derive the segmentation strategy from this ^ as well as a SWOT analysis
-
Step 2: Segmentation Bases
Use a formal approach to segment the market
-
Descriptions of the different segments, and their needs, wants, and characteristics
-
Distinguish customer similarities in a segment and differences across segments
-
Use various bases including geographic, demographic, psychographic, and behavioural
See exhibit 6.2
-
Geographic Segmentation
Grouping of customers based on where they live
-
Can be grouped by country, region, or climate
-
Most useful for companies whose products satisfy needs that vary by region
-
Better marketers make adjustments to the needs of smaller geographic groups
-
Demographic Segmentation
Grouping of customers according to easily measured, objective characteristics
-
Age, gender, income, education
-
Most common means of segmentation because they are easy to identify and easy to reach
-
Generational cohorts often targeted
-
Sometimes this doesn’t work
Nike had trouble when only targeted young athletic people, many different people wear their clothing
-
Psychographic Segmentation
Delves into how consumers describe themselves
-
Allows people to describe themselves by using those characteristics that help them choose how they occupy their time and what underlying
psychological reasons determine those choices
-
Self-values: goals for life (not just what someone wants to accomplish in a day)the overriding desires that drive how a person lives their life
Self-respect, sense of belonging
Causes people to develop self-images
Help determine what benefits of a product people are seeking
-
Self-concept: the image a person has of themselves
-
Lifestyles: how we live our lives to achieve goals
-
VALS - a psychographic tool developed by Strategic Business Insights, classifies consumers into eight segments
Innovators
-
Thinkers
-
Believers
-
Achievers
-
Strivers
-
Experiencers
-
Makers
-
Survivors
*see exhibits 6.3 and 6.4
-
On the vertical dimension described by resources
-
Horizontal dimensions shows their primary motivation
-
Shows correlations between psychology and lifestyle choices
-
Psychographics are a good compliment to demographics
-
Not as objective as demographics
-
Harder to identify potential consumers
-
Behavioural Segmentation
Groups consumers based on the benefits they derive from products, their usage rate, loyalty, and the occasion
-
Occasion segmentation: groups consumers based on when they purchase or consume a product/service
-
Benefit segmentation: groups consumers based on the benefits they derive from products/services
-
Loyalty segmentation: strategy of investing in retention and loyalty initiatives to retain the firm's most profitable customers
9/10 Canadians participate in at least one loyalty program
Usage rate often used to determine this
-
Using Multiple Segmentation Methods
Segmenting by demographics and geography is easy because information about who the customers are and where they are located in
readily available
-
Geodemographic segmentation - grouping of consumers based on geographic, demographic, and lifestyle characteristics
PSYTE clusters: the grouping of all neighbourhoods in Canada into 60 different lifestyle clusters
*see exhibit 6.5
-
Useful for retailers because people usually patronize the stores close to their neighbourhood
-
Step 3: Evaluate Segment Attractiveness
First determine whether a segment is worth pursuing
Is it identifiable, reachable, responsive, and substantial & profitable
-
Identifiable: who is within their market to be able to design products for
Ensuring the segment is distinct from others
-
Reachable: through persuasive communications and product distribution
Consumers must know the product or service exists, what it can do for them, and how they can buy it
-
Responsive: customers in the segment must react similarly and positively to the offering
-
Substantial & profitable: measure their size and growth potential
If its too small or there's not a lot of buying power it wont generate sufficient profits
Market growth, market competitiveness, and market access important to consider for profitability
𝑠𝑒𝑔𝑚𝑒𝑛𝑡'𝑝𝑟𝑜𝑓𝑖𝑡𝑎𝑏𝑖𝑙𝑖𝑡𝑦 =(𝑠𝑒𝑔𝑚𝑒𝑛𝑡'𝑠𝑖𝑧𝑒'𝑥'𝑠𝑒𝑔𝑚𝑒𝑛𝑡'𝑎𝑑𝑜𝑝𝑡𝑖𝑜𝑛'%'𝑥'𝑝𝑢𝑟𝑐ℎ𝑎𝑠𝑒'𝑏𝑒ℎ𝑎𝑣𝑖𝑜𝑢𝑟'𝑥'𝑝𝑟𝑜𝑓𝑖𝑡'𝑚𝑎𝑟𝑔𝑖𝑛'%)𝑓𝑖𝑥𝑒𝑑'𝑐𝑜𝑠𝑡𝑠
Segment adoption % = % of customers likely to adopt the product
§
Purchase behaviour = purchase price x # of times purchased in a time period
§
Profit margin % = (selling price - variable costs) ÷ selling price
§
Useful to use this equation for customers' lifetime value
-
Step 4: Select Target Market
Key factor is a marketer's ability to pursue a target segment
-
Likely assess the attractiveness as well as SWOT
-
Undifferentiated Targeting Strategy/Mass Marketing
Used if the product or service is perceived to provide the same benefits to everyone with no need to develop separate strategies for
different groups
-
No need to develop different strategies for segments
-
Common among smaller firms that offer "indistinguishable"
-
Differentiated Targeting Strategy
Firm targets several market segments with a different offering for each
-
Helps them obtain a bigger share of the market and increase the market for their products overall
-
Helps diversify the company which in turn mitigates risk
-
Can be expensive
-
Concentrated (Niche) Targeting Strategy
Select a single primary target market and focus all energies on providing a product to fit that market's needs
-
Entrepreneurial start-ups often use this
Easier to employ limited resources efficiently
-
Micromarketing
Extreme form of segmentation that tailors a product or service to suit an individual customer's wants or needs
-
Small producers and service providers have this ability
-
Mass customization - the practice of interacting on a one-to-one basis with many people to create custom made products or services
Internet aids in this process and simplifies customer identification
-
Step 5: Identify and Develop Positioning Strategy
Positioning - the mental picture that people have about a company and its products or services relative to competitors
Thoughts, feelings, impressions relative to competing products
-
Formed from multiple sources such as friends/family, newspapers, reports, radio, TV, and internet
-
Consumers will form their own ideas and feelings about a product/brand
-
Can help communicate a firm's value proposition
-
Not easy to shape consumers' perceptions the way marketers might want to
-
Effective positioning requires marketers to evoke certain feelings keeping up with the dynamic marketplace
-
Process of defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what the
product does or represents in comparison with competing products
-
Letting consumers know what the companies unique value is
Clarity is essential
-
Positioning statement - expresses how a company wants to be perceive by consumers
Target market1.
Offering name or brand2.
Product/service category or concept3.
Unique point of difference/benefits4.
Positioning Methods
Value
The relationship of price to quality is of the most important considerations of customers when they make a purchase
-
Doesn’t necessarily mean low priced
-
A lot like to advertise that they're offering the same value for a lower price than competitors
-
Product Attributes
Things that are most important to the target market
-
Focus on product leadership and things like innovation, quality, performance, design, and reliability
-
Benefits and Symbolism
Benefits along with psychological meaning of the brand to consumers
-
For established companies a well-known symbol can be effective especially toward loyal customers
Really distinguishing from competitors
-
Competition
head-to-head strategy
Can lead to price wars - good for consumers but bad for businesses
Should be careful not to position too close or they could face legal consequences or confuse consumers
-
Differentiation strategy
Going after a less competitive, smaller market niche
-
Market Leadership
Emphasize their size and leadership in a market
-
Consumers perceive them as setting a standard
-
Positioning Using Perceptual Mapping
Perceptual map - displays, in one or two dimensions, the position of products or brands in a consumer's mind
Ideal point - the position at which the particular market segment's ideal product would lie on a perceptual map
Determine consumers' perception and evaluation of the firm's product or service in relation to competitors.
Asking consumers a series of questions about their product
How they use it, likes/dislikes, their alternative sources to satisfy the need
1.
Identify the market's ideal points and size.
Size of current and potential markets
2.
Identify competitors' positions.
How its consumers view its brand relative to competitors
3.
Determine consumer preferences.
What the customer really wants
The ideal product or service that appeals to each market
4.
Select the position.
Maybe develop a new product, adjust its positioning or marketing approach, or ignore what one target market wants and hope that
the original product is enough
5.
Monitor the positioning strategy.
Always view the first three steps as ongoing
6.
Repositioning
Trying to change their positioning
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Good marketers constantly re-evaluate their brand's position
If not it takes years to rebuild and huge budgets
-
Brand repositioning - a strategy in which marketers change a brand's focus to target new markets or realign the brand's core emphasis with
changing market preferences
Always some costs and risks
-
Can change the quality image
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Chapter 6
Monday, January 29, 2018 12:16 PM
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