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Chapter 3

Chapter 3 BU412.docx

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Department
Business
Course
BU412
Professor
Lisa Giguere
Semester
Fall

Description
BU412Chapter 3Positioning Services in Competitive MarketsWeek 2CustomerDriven Services Marketing StategyAs competition intensifies in the service sector it is becoming ever more important for service organizations to differentiate their products in ways that are meaningful to customers Managers need to think systematically about all aspects of the service offering and emphasize competitive advantage of those attributes that will be valued by customers in their target segments Customer Competitor and Company Analysis 3 CsCustomer AnalysisTypically done first Includes an examination of the overall market characteristics followed by an indepth exploration of customer needs and related customer characteristics and behaviours The market analysis tries to establish the attractiveness of the overall market and potential segments within Specifically it looks at the overall size and growth of the market the margins and profit potential and demand levels and trends affecting the market Firms should consider alternative ways of segmenting the market and make an assessment of the size and potential of different market segments The customer needs analysis involves answering a few questionsWho are the customers in that market in terms of demographics and psychographicsWhat needs or problems do they haveAre there potentially different groups of customers with differing needs and who therefore require different service products or different levels of serviceWhat are the benefits of the service each of these groups values the mostSometimes research will show that certain market segments are underservedCompetitor AnalysisIdentification and analysis of competitors can provide a marketing strategist with a sense of competitors strengths and weaknesses SWOTTogether with the company analysis they should suggest what might be opportunities for differentiation and competitive advantage This analysis should consider both direct and indirect competition Company AnalysisIn an internal corporate analysis the objective is to identify the organizations strengths in terms of its current band positioning and image and the resources the organization has Segmentation Targeting and Positioning STPLinking customer and competitor analysis to company analysis allows the service organization to develop an effective positioning strategy SegmentationInvolves dividing the population of possible customers into groups Customers within the same segment share common servicerelated needs Once customers with similar needs are grouped together demographic geographic psychographic and behaviour variables can be used to describe them Customers in the same segment should have as similar needs as possible and between segments their needs should be as different as possible TargetingOnce the customers are segmented the firm has to decide which segment would most likely be interested in its service and focus on serving them well
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