Segmentation and Targeting

Market Segmentation
Target Marketing and

Positioning
Dr Smitha Ranganathan
Content Coverage
MARKET SEGMENTATION DIFFERENTIATION AND

AND TARGET MARKETING POSITIONING
Marketing Involves -
The process of –
- Creating
- Communicating
- Delivering Value
- Capturing Value from the customer
Segmentation, Targeting and Positioning (STP)
• The marketing process of segmentation, targeting, and positioning (or STP)
identifies –
a) firm’s potential customers,
b) selects which customers a firm should pursue,
c) formulates its value proposition for its target customers.
Targeting Vs Discrimination
Understanding STP
SEGMENTATION
Group Customers based

on Similar needs
Profile Each Segment
Benefits of Segmentation to Organizations and
Customers
Benefits to the Customer
❑ Convenience and Time Saving

❑ Tailored Products and Services
❑ Relevant Offers
❑ Personalized Experience
Compelling Customer Experiences

How to Segment Consumers? – B2C Context
Variables/Criteria Illustrative Breakdown
Geographic Country, Region, City, urban/rural, Climate
Demographic Age, Income, Gender, Generation, Marital Status,

Family Size, Occupation, Education, Ethnicity,
Religion
Behavioural and Benefits Sought Usage Rate, Loyalty, Product Knowledge,
Involvement, Purchase occasion, Buying Stage.
Convenience, Value, Safety, Status
Psychographics Lifestyle, personality, activities, Interests, Opinions

Taking
Advantage of
Opportunities
Market Segmentation Defines Possible Target
Markets – Occasion of Usage
Submarket 1
(Exercisers) Submarket 3 Submarket 4
(Transportation riders) (Socializers)
Submarket 2
(Off-road Submarket 5
adventurers)
(Environmentalists)
Family Tech Market
Family Tech Market
Family Tech Market
The Enabler
The
Limiters
The Mentor
How will you
bo about
segmenting
the market?
Same Product – Two different
Consumer Contexts
Hopeful Vs Fearful
Segmenting the Market for Early Pregnancy Test Devices
Novel
Segmentation
Model for
BFSI
Segments of MFC Hotel Users
Homogeneous (similar) within—the customers
in a market segment should be as similar as
possible with respect to their likely responses
to marketing mix variables and their
segmenting dimensions.
Heterogeneous (different) between—the

Criteria for customers in different segments should be as
different as possible with respect to their likely
Segmentation responses to marketing mix variables and their
segmenting dimensions.
Substantial—the segment must be big enough

to be profitable.
Targeting involves evaluating the attractiveness of each segment, selecting one
or more segments to pursue, then designing marketing programs to serve them.
Goal – Select segments that help improve organization’s long-term profitability

in those segments
Understanding Targeting
Selecting Target Segments
Segment Characteristics
• Segment Size
• Growth Rate
• Profitability
Competition Company Fit

• Competitors’ Strengths Target • Objectives
• Competitive Intensity Market • Competencies
• Competitors’ resources Selection • Resources
https://www.youtube.com/watch?v=1c9FS5Myn4k
https://www.youtube.com/watch?v=7GaUReEdHeM
Targeting - Approach
A segmenter Single target

market approach The
develops a Strategy
different
marketing
mix for each Strategy two
segment. Multiple target
market approach Strategy
one Strategy three
A combiner aims at two or The

more submarkets with the strategy
same marketing mix.
Market Leadership
https://www.youtube.com/watch?v=84OT0NLlqfM
Ethics in Targeting
Understanding STP
SEGMENTATION
Group Customers based

on Similar needs
Profile Each Segment
Positioning and Differentiation
Positioning
• Positioning is the process of creating a desired
image/association for a company and its products in the
minds of a chosen user segment.
Differentiation
• How the marketer tries to distinguish her or his offering in the
marketplace—how it is set off from the competition.
• There are a number of differentiation dimensions.
What really matters is that the consumer perceives the

marketer’s product to be different.
Sourced from the mountain springs of
northern California, the premium water
claims to be crafted with natural minerals
using a "proprietary patent-pending
formula" that results in a 7.5 pH alkalinity
for a "silky smooth," crisp, fresh taste
profile that's supposed to appeal to the
broad consumer spectrum.
Price - $100,000 A Bottle Only

Brand Positioning helps Answer 3
critical questions
Who Should be Targeted? What goal does the brand Why should the brand be
allow the target to chosen over other brands
achieve? that help achieve the same
goal?
Brand Positioning helps Answer 3
critical questions
Who Should be Targeted? What goal does the brand Why should the brand be
allow the target to chosen over other brands
achieve? that help achieve the same
goal?
Target Group/TA Frame of Reference Point of Difference
Professionals Vs Amateurs
Endangered
by Gender?
It guides the
Competitive frame
choice of targets,
of reference is
identify situations
defined by the
in which brand
product category
might be used,
that one is
define relevant
competing in.
competitors
Frame of Reference
An assertion regarding why the brand is
superior to alternatives in the frame of
reference.
Point of
Difference Superiority could be in terms of functional or
emotional benefits.
Performance
attributes Technological Imagery Superior Low cost or
(USP – Rosser features associations quality economy
Reeves)
Segmenting
Business
Markets
Positioning Framework
Positioning Framework

Segmentation and Targeting

Uploaded by

Copyright:

Available Formats

Segmentation and Targeting

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Segmentation and Targeting

Uploaded by

Copyright:

Available Formats

Market Segmentation

Target Marketing and

MARKET SEGMENTATION DIFFERENTIATION AND

Group Customers based

Benefits to the Customer

❑ Convenience and Time Saving

Compelling Customer Experiences

Variables/Criteria Illustrative Breakdown

Geographic Country, Region, City, urban/rural, Climate

Demographic Age, Income, Gender, Generation, Marital Status,

Psychographics Lifestyle, personality, activities, Interests, Opinions

Heterogeneous (different) between—the

Substantial—the segment must be big enough

Goal – Select segments that help improve organization’s long-term profitability

Competition Company Fit

A segmenter Single target

A combiner aims at two or The

Group Customers based

What really matters is that the consumer perceives the

Price - $100,000 A Bottle Only

You might also like