CHA PT ER 5

S E G M E N TAT I O N
TA R G E T I N G
POSITIONING

MSC. THIEN TRAN

A market is the set of
all actual and
potential buyers of a Market A group of people
product. These segmentation who share one or
buyers share a need more similar
or want that can be Dividing a market
characteristics
satisfied through into smaller
exchange. segments with
distinct needs,
characteristics, or
Market behavior that might Market segment
require separate
marketing strategies
or mixes.

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Segmentation – Targeting – Positioning
STP
Selection of a target market (or target markets) is part of the overall process known as S-T-P
Before a business can develop a positioning strategy, it must first segment the market and
identify the target (or targets) for the positioning strategy. This allows the business to tailor its
marketing activities with the needs, wants, aspirations and expectations of target customers in
mind.
 Market Segmentation

- Market Segmentation is the process of

dividing the market into market segments
(called market segments) based on
differences in product needs,
characteristics or consumer behavior

-A market segment is a collection of

customers with similar characteristics for a
marketing purpose
 Why do we need
Market se gmentatio n?

“A product for everybody is a product for

nobody”
Seth Godin

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 Why Market Segmentation?

Focus resources on
Understand target
potential market
customer
segment

Design efficient &

Ease the direct
Differentiation cost-saving
competition with
strategy marketing strategies
strong competitors
and plans
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 GEOGRAPHIC SEGMENT

Geographic segmentation divides the market into different geographical units such as nations,
regions, states, counties, or cities

• Market in Vietnam/Overseas

• Major cities in Vietnam (Hanoi, Da Nang, Ho Chi Minh City, Can Tho, Hai Phong)

• What is the population density?

• What is the weather/climate?

The demands of customers varies in different geographical locations.

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 DEMOGRAPHIC SEGMENT

Demographic segmentation divides the market into groups based on variables such as
age, gender, family size, family life cycle, income, occupation, education, religion, race,
generation, and nationality

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 DEMOGRAPHIC SEGMENT

• Age and life-cycle stage segmentation is the process of offering different products or
using different marketing approaches for different age and life-cycle groups

• Income segmentation divides the market into affluent, middle-income or low-income

consumers

• Gender segmentation divides the market based on sex (male or female)

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 PSYCHOGRAPHIC SEGMENT

Psychographic segmentation divides buyers into different groups based on lifestyle, or

personality traits

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Lifestyle refers to the major ways in which The personality of your customers is key to being
groups of people live their lives. able to effectively psychographically segment your
That can include specifics like athletics, contacts.
traveling, green living, minimalists, and other Examples of typical personalities can include those
types of activities and behaviors that define a who are creative, emotional, introverted,
large part of a person’s life and decisions. extroverted, opinionated, friendly, closed-off, and
organized.

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 BE HAVIOURA L SEG MENT

Behavioural segmentation divides buyers into groups based on their knowledge, attitudes, uses,
or responses to a product

Occas- Benefit User

ions sought status

Usage Loyalty
rate status

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 OCCASIONS

Buyers can be grouped according to occasions when they get the idea to buy,
actually make their purchase, or use the purchased item

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 BENEFITS SOUGHT

A powerful form of segmentation is grouping buyers according to the different benefits that
they seek from a product. Benefit segmentation requires finding the major benefits people
look for in a product class, the kinds of people who look for each benefit, and the major
brands that deliver each benefit.

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 U S E R S TAT U S
Markets can be segmented into nonusers, ex-users, potential users, first-time users, and
regular users of a product. Marketers want to reinforce and retain regular users, attract
targeted nonusers, and reinvigorate relationships with ex-users. Included in the
potential user group are consumers facing life-stage changes—such as new parents and
newlyweds—who can be turned into heavy users.

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 U S A G E R AT E
Markets can also be segmented into light, medium, and heavy product users. Heavy users are
often a small percentage of the market but account for a high percentage of total consumption.

LOYALTY STATUS
A market can also be segmented by consumer loyalty. Buyers can be divided into groups
according to their degree of loyalty. Some consumers are completely loyal—they buy one brand
all the time and can’t wait to tell others about it.

Other consumers are somewhat loyal—they are loyal to two or three brands of a given product
or favor one brand while sometimes buying others

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 Segmentation/Targeting/Positioning
(S-T-P)
Market Segmentation Selecting Target Market Positioning
Dividing a market into smaller Segments The way a product occupies
segments with distinct needs, Target market consists of a set of in consumers’ minds relative
characteristics, or behavior. buyers who share common to competing products
needs or characteristics that the
company decides to serve
 Target Market
- A target market is a group of customers (individuals, households,
or organizations), for which an organization designs, implements
and maintains a marketing mix suitable for the needs and
preferences of that group.
- A target market may be broadly categorized by age range,
location, income, and lifestyle. Many other demographics may be
considered such as their stage of life, their hobbies, interests, and
careers, all may be considered.
 C H O O S I N G A TA R G E T M A R K E T

Depends on:

✓ Company resources

✓ Product variability

✓ Product life-cycle stage

✓ Market variability

✓ Competitor’s marketing strategies

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 Brand Positioning

- Brand Positioning is the act of designing the

company’s offering and image to occupy a
distinctive place in the mind of the target
market. (Phillip Kotler)

- Brand position is the space your brand and

products hold in the market and in the minds
of your customers
 Brand Positioning
A good "brand positioning" will include the following four elements:
+ Establish an emotional connection
+ Emphasize the brand's distinguishing qualities from competitors.
+ Show the value of the product to the customer - What is the company's
product solution to the customer's problem?
+ Show the company's characteristics – What are the company's core
values?
 POSITIONING MAP

Positioning maps show

consumer perceptions of their
brands versus competing
products on important buying
dimensions

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 C H O O S I N G A P O S I T I O N I N G S T R AT E G Y

• Identifying a set of possible competitive advantages to build a

position

• Choosing the right competitive advantages

• Selecting an overall positioning strategy

• Communicating and delivering the chosen position to the market

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 C O M P E T I T I V E A D VA N TA G E
Competitive advantage is an advantage over competitors gained by offering consumers
greater value, either through lower prices or by providing more benefits that justify
higher prices

Unique selling point

Unique Selling Point (USP): is the one feature or the perceived benefit of a good which
makes it unique from the rest of the competing brands in the market. It is that very
reason which motivates a buyer to purchase that product even though it might be
costlier than other products.

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Value proposition is the full mix of benefits upon
which a brand is positioned
 T H A N K YO U

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