Market intelligence:

Internal records:
• Order to payment cycle must be fast and
efficient
•Sales data, which must be interpreted in the right
way for your future planning
•Marketing Intelligence System: Developments
happening in the external market
 Macro Environment

• Demographic: includes population growth, population-

age mix, literacy rate
• Economic environment: How is the income distributed
• Socio-cultural environment
• Natural environment
• Technological environment
• Political-legal environment
 Macro-environment of India

• Demographic:
Population: 1.1 billion (2006 est.)
Rural: 742.61 million
Urban: Age structure:
0–14 years: 30.8%
15–64 years: 64.3%
65 years and over: 4.9% (2006 est.)
Average age of Indians is 26 years
Population growth rate: 1.38%
Unemployment rate: 9.2%
Religions, languages, etc.
 Macro environment in India (contd.)

Economic environment
• GDP: Crossed $1 trillion in 2007 and growing at 7-8%
• Forex reserves: $310.68 billion (RBI)
• FDI target for 2008-09: $35 billion, China 42.78 billion in
1st five months
• Indian middle class is approx. 30% of its population more
than entire population of USA
• Rural population is now moving upwards too and
becoming a huge potential market e.g. Hero Honda
 Macro environment in India (contd.)
• Income distribution (2006-07)

Income class Households Estimated

(Rs. p.a.) population
Rich (>215K) 5.2 30
Consuming 75.5 432
Class (45-215K)

Climbers (22k- 81.7 472

45k)
Aspirants (16- 20.2 117
22k)
Destitute (<16k) 16.5 95
 Macro environment in India (contd.)

Socio-Cultural Environment:
• General views that people hold about themselves, the environment, society,
world, etc.
• Diversity in tastes and preferences in your target markets has to be taken
into account for products

e.g. Spencer Retail has different types of atta in local market in Gujarat, while in
Bengal, they have to cater to people’s leanings towards non-veg food
Apollo Tyres separate for North & South
Dominos is looking to customise its pizza offerings
 Macro environment in India (contd.)

Natural Environment:
• Companies have to abide either by regulation or when
markets become hostile e.g. Coca Cola in Plachimada,
Bharat 2 norms followed by car makers.
Four trends to be careful about:
• Shortage of raw materials
• Increasing energy costs
• Anti-pollution pressures
• Changing role of Government
 Segmentation, targetting & Positioning
(STP)
Mass Marketing: Mass production, distribution &
promotion
Market segment: Group of customers with similar needs &
wants. Customers may have homogenous,
heterogenous or diffused preferences
Niche: A more narrowly defined customer group seeking a
distinctive set of benefits
Local marketing: Customised to local needs
Customerisation: Segments of 1 in the market
 STP (Contd.)

• Segmenting consumer markets:

1) Geographic segmentation: Assumes that people in same area share
similar needs and wants.
• India has 5,000 towns and 6,38,000 villages. How to reach this
market?
• What are the consumption patterns and awareness levels, et al?
Prahlad’s Bottom of the Pyramid focus
• Also zones and state-wise segmentation
• HLL brought in sachets for rural markets
 STP (Contd.)

2) Demographic segmentation:

• Age & life cycle stage (marital status)

• Gender
• Income, education, occupation
• Generation: Baby Boomers: 1946-64; Gen X: 1965-76, Gen Y: 1977-1994. It
gives rise to cohort effects, what time you grew up in affects your behaviour.
Most of that behaviour is defined in growing up years.
• Social class, normally associated with wealth now.
• Culture & Subculture
• Cross cultural segmentation
 STP (Contd.)

3) Psychographic segmentation:
• Based on psychology, personality traits, lifestyle & values

• High income groups of four types:

a) Innovators: Niche oriented products

b) Thinkers: Utility based
c) Achievers: Products that demonstrate success
d) Experiencers: Young and impulsive; spend on Fashion, entertainment,
socialising
 STP (Contd.)

3) Psychographic segmentation (Contd.)

• Low income groups of 3 types:

• Believers: Conservative, conventional, traditional, loyal to established

brands
• Strivers: Trendy, fun-loving; favour stylish products and try to emulate the
rich
• Makers: Practical and down to earth; favour functionality
• Survivors: Elderly, passive people, loyal to their favourite brands
 STP (Contd.)

• Behavioural segmentation:
• Five roles in decision making: Initiator, influencer,
decider, buyer, user
• Behavioural variables:
i. Occasion
ii. Benefits sought
iii. User status (non-user, ex-user, potential user, first-
time user & regular user)
 STP (Contd.)

• Behavioural variables (Contd.)

iv. Usage rate (light, medium, heavy)
v. Buyer readiness stage: Unaware, aware, informed,
interested, desire, ready to buy
vi. Loyalty status: Hardcore loyals, split loyals (2-3
brands), shifting loyals and switchers
vii. Attitude: Enthusiastic, positive, indifferent, negative
and hostile
Targeting

Identifying the worthiness of segments:

1) You should be able to measure the potential
2) You should be able to profitably do business as well as serve
the needs of the segment
3) You should be able to adopt unique marketing strategies for
the segments
 Targetting (Contd.)

M1 M2 M3 M1 M2 M3

P1 P1

P2 P2

P3 P3

Single segment concentration Selective specialisation

 Targetting (Contd.)

M1 M2 M3 M1 M2 M3

P1 P1

P2 P2

P3 P3

Product specialisation Market specialisation

 Targetting (Contd.)

M1 M2 M3

P1

P2

P3

Full market coverage

 Positioning

Definition:
The act of designing the company’s offering and image to
occupy a distinctive place in the mind of the target
market
Positioning (continued)

Marketers are supposed to

• Points-of-Difference (POD): Attributes that consumers
believe cannot be found with another brand.
• Points-of-Parity (POP): Associations that are found in other
brands as well. Of two types:
a) Category POPs: Automatically associated with the product
category.
b) Competitive POPs: Used to negate competitor’s points of
difference.-
Advisable to establish category membership before
establishing PODs
Positioning (continued)

• PODs should be desirable, distinctive and believable.

• They should be feasible, enduring
• Multiple PODs may be negatively correlated or unrelated, so
marketers have to ensure customers do not get confused or
alienated
 Positioning

Changing lifestyles of people Style, practicality &

economy

Small MPV for family

Safety features, space

Concept, mileage, design

Looks, power, luxury. style
Positioning (continued)

• Product differentiation
• Image differentiation
• Channel Differentiation
• Personnel differentiation
Segmentation (contd)