TARGETING AND POSITIONING

Market segment – A group of individuals, groups or organizations sharing one or more similar characteristics that
cause them to have relatively similar product needs and buying characteristics.

Segmentation variable Some examples Comments

of variables Measured

Geography  Region of product Geographic segmentation is one of

distribution the oldest and most basic of
 Cultural differences market descriptors. In most cases, it alone
 Mobility of is note sufficient for a meaningful
consumers consumer segmentation

Demographic  Age Also basic and included as a variable

 Sex in most segmentation
 Income analyses. Demographic profiles of
 Educational level segments are important especially when
 Social status making later advertising media decisions

Psychographic  Personality traits Psychographic variables are more

 Perceptual styles useful because there is often no direct
 Attitudes link between demographic and
 Reference groups market behaviour variables. These
 Social roles consumer profiles are often tied more
directly to purchase motivation and
product usage

General life-style  Correlation of Provides a rich, multi-dimensional

demographic and profile of consumers that integrates
psychographic individual variables into clearer pattern
variables that describes the consumer’s routines
 Activities and and general ‘way of life’
interests
TARGET MARKET A set of buyers sharing common needs or characterisitics that the company decides to serve.

The list below refers to what’s needed to evaluate the potential and commercial attractiveness of
each segment.

Criteria Size: The market must be large enough to justify segmenting. If the market is small, it may make it
smaller.

Difference: Measurable differences must exist between segments.

Money: Anticipated profits must exceed the costs of additional marketing plans and other changes.

Accessible: Each segment must be accessible to your team and the segment must be able to receive your
marketing messages

Focus on different benefits: Different segments must need different benefits.

There are 3 types of market coverage strategies:

1. Undifferentiated - which a firm decides to Ignore market segment differents and goes after the whole market

2. Differentiated - where a firm decides to target several markets and designs different offers for each

3. Concentrated - Where a firm goes after a large share of one or a few sub-markets

Market Positioning

This is the act of designing a company’s offering and image to occupy a distinctive place in the target market’s
mind. I.e. The act of creating a difference between a company’s offer from those of competitors.

Positioning is the process of establishing and maintaining a distinctive place in the market for the organizations’
product or brands. Positioning starts with the product, but positioning is not what you do to a product. Positioning
is what you do to the mind of the customer. You should concentrate on the perception of the customer and not the
reality of the product. Positioning then is how the product is perceived and evaluated by the target market, relative
to competing products. To the consumer perception is reality. That is why it is said that a marketing battle is
fought in the minds of consumers. Marketers who attain a superior position in customers’ minds have won the
marketing battle.

A difference is worth establishing to the extent that it satisfies the following criteria.

1) Important: - The difference delivers a highly valued benefit to a sufficient number of buyers.

2) Distinctive:- The difference is delivered in a distinctive way

3) Superior: The difference is superior to other ways of obtaining the benefit.

4) Pre-emptive: The difference cannot be easily copied by competitors.

5) Affordable - The buyer can afford to pay for the difference.

6) Profitable - The Company will find in profitable to introduce the difference.

Positioning Identities

Positioning is creating an identity to your product. This identity is a cumulative of the following four positioning
identities.

1. Who am I?

It refers to the corporate credentials like the origin, family tree and the ‘stable’ from which it comes from. For
instance, think of the mental associations when a buyer buys a Japanese car and it is a Honda!

2. What am I?

It refers to the functional capabilities. The perceived brand differentiation is formed using the brand’s capabilities
and benefits. For instance, the Japanese cars are known for their fuel-efficiency, reasonable-price and utility-value.

3. For whom am I?

It refers to the target segment for the brand. It identifies the that market segment for which his brand seems to be
just right and has competitive advantage. For instance, the Japanese car makers have traditionally focused on the
qualityconscious, value-seeking and rather-serious car buyer

4. Why me?

It highlights the differential advantage of the brand when compared to the competing brands. It gives reasons as
to why the customer should select this brand in preference to any other brand. For instance, Japanese car makers
have tried to score a competitive advantage on the lines of quality and technology