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Group- 2:
Shrikant Bhole 6
Megharaj Birje 7
Sagar Chachondia 8
Rajeshwari Chintalwar 9
Satyaprakash Dubey - 10


DSTP + Marketing Mix = Marketing Strategy

Difficult to connect with large customer base
Identifying the right market is the key to success
Serves as the instrument of Value delivery.
Specifies following w.r.t. its products.
Differentiation strength?
Product-offer will it make?
Marketing programs to be carried out?
Market segment need to be served?
What are the growth paths?
What are the competitive advantage?



Understanding the heterogeneous market and dividing the market into

various segments
Distinguishes one customer group from another within the same market.
E.g. Ford motors modifies its models for Indian market like Higher ground
clearance for rougher road surface.


Evaluating the market segments and selecting the ones which is attractive
based on Size, growth and profitability.
Each segment gives distinct market opportunity.
E.g. Reebok shifted recently to much lower end of Consumers. Offer Classic
categories of shoes at 900/Pair.



Was popularized by two advertising executive Al Ries and Jack Trout

Act of designing the companies offering and image to consumers mind
Creation of Consumer-focused Value Proposition
E.g. 7-UP positioned itself as The UNCOLA


Task of Defining your Differences - Jack Trout

To define your brand differently; Competitive advantage.
A brand can be built and developed only through differentiation.
E.g. Videocon fridge has its differentiation on certain functional features.



Segmentation means the identification of customer groups that respond

differently from other groups to competitive offering
Consumers can be grouped together so that the behavior of group members is
similar to each other, and noticeably different from the behavior of other
groups. Groups of this nature- groups of consumers showing common patterns
of consumption behaviour- are called Market Segments, and the process of
dividing the market up into groups is called Segmentation
A segmentation strategy couples the identified segments with a program to
deliver an offering to those segments. Development of a successful
segmentation strategy requires the conceptualization, development and
evaluation of a targeted competitive offering
Segment is often the key to developing a sustainable competitive advantage
Segmentation strategy is judged on three dimensions
Can competitive offering be developed and implemented that will be
appealing to the target segment?
Can the appeal of the offering and the subsequent relationship with the target
segment be maintained over time despite competitive response?
Is the resulting business from the target segment worthwhile, given the
investment required to develop and market an offering tailored to it?



Segmentation in companies is a more complex and messy process than in

textbooks. The task of identifying segments is difficult, because in any given
context there are literally hundreds of ways to divide up the market
Markets must be continuously segmented and re-segmented to arrive at a
scheme that delivers actionable segment
Actionable segments share three characteristics
Distinctiveness, that is, different segments respond differentially to marketing
Identity, that is, the ability to reasonably profile which customer falls within
which segment
Adequate Size, so that the development of tailored marketing programs for
individual segments is economically viable for the firm

Examples of approaches to defining segments

Customer Characteristics- 1. Geographic 2. Type of Organization 3. Size of firm 4.
Lifestyle 5. Sex 6. Age 7. Occupation
Product-related- 1. User type 2. Usage 3. Benefits sought 4. Price sensitivity 5.
6. Application 7. Brand Loyalty



Aim of consumer market segmentation is to identify subgroups

within the overall market. When addressing organizational
markets the aim is the same, but rather than groups of individuals
or families, the marketing manager must identify coherent groups
of organizations
There are three easy to observe characteristics
Organizational Size- It is measured in terms of annual sales
turnover, number of employees or even volume of production
Industry Sector- This is measured in an informal way, simply by
referring to the banking sector or manufacturing industry
Geographical location- It simply allocates customers to domestic
and export markets

Multiple Segment vs Focus Strategy
Focus Strategy- It focuses on a single segment, which can be much
smaller than the market as a whole
Walmart, now the largest U.S retailer, started by concentrating on cities
with populations under 25,000 in eleven south central states. This rural
geographic focus strategy was directly responsible for several
significant SCAs, including an efficient and responsive warehouse
supply system, a low-cost, motivated work force, relatively inexpensive
retail space and a lean and mean, hands on management style
Multiple Segments Strategy- It involves multiple segments instead of
single segment
General Motors is a classic example. In the 1920s, the firm positioned
the Chevrolet for price-conscious buyers, the Cadillac for the high end
and the Oldsmobile, Pontiac and Buick for well-defined segments in


Targeting of target market selection is the process of deciding which market

segments the company should actively pursue to generate sales

After the segmentation process, each segment must be assessed to decide

whether it is a potentially profitable target

Evaluating segments for targeting based on the following characteristics for

attractiveness :

Sufficient current and potential sales and profits

Future growth potential
Not much competitive
Low entry and exit barriers
Has relatively unsatisfied needs that the company can serve well

The process of target marketing is the manipulation of the marketing mix

such that a distinctive marketing mix is designed for each chosen market


Five step process to choose attractive market segments for a firm based on
the segments future attractiveness and the firms strengths and

Step-1: Select Market-Attractiveness and Competitive-Position factors

Step-2: Weigh each factor

Step-3: Rate segments on each factor, plot results on matrices

Step-4: Project future position for each segment

Step-5: Choose segments to target, allocate resources


When there is a single marketing mix for all customers
Ford Model T: You can paint it any colour, as long as it is black
This kind of undifferentiated strategy is powerful when standardization lowers the
cost and opens up the industry to large no of new customers

When there are multiple marketing mixes for different market segments
Ford motor company has a portfolio of brands including Aston Martin, Ford,
Lincoln, etc.

Which has one marketing mix for a segment of the entire market
Rolex targets only the luxury segment of the watch market

Which attempts to satisfy each customers needs with an individual marketing mix
An Architect will design a house as per customer given specifications


about developing a unique selling

proposition for target segment
Positioning is not what you do to a
Positioning is what you do to the mind of
Positioning is also the first body of
thought that comes to grips with the
problems of getting heard in our over
communicated society

Implementation Playing the Positioning Game


must understand words

must understand people
must be careful of change
need vision
need courage
need objectivity
need simplicity
need subtlety
need patience
need a global outlook
need to be They -oriented


A powerful theme in developing business strategies, as well as in

Business concentrates on achieving superior performance in an important
customer benefit area valued by a large part of the market
Thus, a firm must be truly unique at something or be perceived so, if it is to
expect a premium price
It also has to see that the price premium is justified by the value generated
by its differentiation
Differentiation in business strategies:

Competitive Advantage
Competitiv Broad Target
e Scope

Lower Cost


Cost Leadership

n Strategy

Narrow Target Focus Strategy

( Cost- Based)

n- Based


Differentiation among Goods and Services:

- Differences are physical as well as perceptual
Done by offering either superior product quality, superior service, or both
Dimensions of product quality- what dimensions customers perceive to
underline differences across products
Dimensions of Service Quality: pertains to both the objective performance
dimensions as well as elements of the performance

-Performance Quality
-Conformance Quality

-Ordering Ease
-Customer Training
-Customer Consulting
-Maintenance & Repair


For a brand to be effectively positioned, customers must see any

competitive advantage as a customer advantage
Means of differentiation:
-Employee Differentiation
Pharmaceutical companies lay great emphasis on training their
medical representatives to improve credibility with the doctor
-Channel Differentiation
Companies can more effectively & efficiently design their
distribution channels
coverage, expertise & performance
-Image Differentiation
Companies can craft powerful, compelling images that appeal to
consumers social and psychological needs
-Services Differentiation
A service company can differentiate itself by designing a better &
faster delivery system that provides more effective and efficient
solutions to consumers


differentiation-oriented Strategy requires the firm to choose the attributes of

differentiation very carefully
Since differentiation can be shaped around a large variety of factors, there can be many
different types of differentiation-oriented strategies:
1.Differentiation with emphasis on Product:
- Product covers attributes such as its functionality, packing convenience, etc.
- For e.g.: Intel, e-Bay & Gillette
(a) Differentiating with emphasis on experience:
-Anything that is of value to the customer can be used as a base for
differentiating an offer
- For e.g.: Experiential brands- the new generation coffee cafes
(b) Differentiating with emphasis on Pack-Size:
- Pack size became the differentiator- bring it down to as low a unit as
possible so that a mini price could be tagged into it
- The objective was to break the price barrier that prevented even a trial
among the lower-end segments
-For e.g.: Chotta Coke, Godrej Cooklite
(c) Differentiating with emphasis on Service:
- Fairly big spectrum of airline companies

2. Differentiation with emphasis on Distribution:
- Reaching Indias village markets have always remained a problem for
business firms
- Maximum penetrating retail network in rural India belongs to HUL
- The new retail channel-> e- Choupal to unblock the demands lying in
rural India
3. Differentiation with emphasis on Promotion:
- Some companies/ brands resort more to promotion and rely more on
appeals with psychological/ emotional/ prestige/ status orientation than
rational, tangible, and benefit oriented ones
- For ex: LOreal, Ray Ban, Nike, etc.
- Following are the features:
Selling more of image/ status than a product
Showcasing the user
Suits image brands more
Promotion contributes to brand equity over time