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Mktg Notes Chp 3.docx

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MKTG 2030
Neil Smith

MKTG CHAPTER 3 MARKET SEGMENTATION AND POSITIONINGTHE CONCEPT OF SEGMENTATION In our complex society everyone has different needs and priorities in products Understanding these needs is complex because technological and cultural advances Market fragmentation occurs when peoples diverse interests and backgrounds have divided them into different groups with distinct needs and wantso Ex Sports shoes went from being divided into athletic and nonathletic to all sorts of different athletic needs jogging basketball soccerskateboardersvans airwalk DCTarget marketing strategy instead of trying the sell the same thing to all customers they divide the total market into different segments based on customer characteristics select one or more segment and develop products particular to that segment Five step process 1 Select marketsDefine your marketUnderstand customers needs and wants benefits and features sought purchase and consumption behaviour2 Market segmentationIdentify groups geographic behavioural psychographic and demographic segmentationDescribe and profile the groups who what when where why 3 Market targetingEvaluate segment attractiveness size growth strategic fit competitivecomparative advantage level of competitiondefendabilityDecide which ones to target 4 Market positioningHow to compete be differentiated and be known for value creation5 Create and execute marketing mix programs Segmentation dividing a larger market into subgroups with fairly homogeneous needs and wants that and between groups would have very different NW and would find different products and marketing programs appealingo Key groups are chosen target decisions on how they want to brand they product positioning and design marketing programs with products that uniquely appeal to target Selecting and Segmenting a MarketChallenge of a market strategy is knowing what market youre in and which u should be segmentingo Decision is done at exec level strategic planning of an organizationCriteria for identifying market segments1 Similar enough within the groupSane needs and wants 2 Different enough between the groupsSegment differences should be actionable diff product pricing distributionWithout such differences firms may use mass marketing strategy ex Useless to develop separate lines of skin care for working and nonworking women if they have the same needs 3 Large enough
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