Professional Documents
Culture Documents
Segmentation
Market segmentation is the process of dividing a heterogeneous market into homogenous sub units. Need for segmentation To be able to compete in a highly competitive market. To position itself as segment leader. To gain competitive edge.
9.2
(a) Customer based segmentation (b) Product related segmentation (c) Competition related segmentation
9.4
Demographic Characteristic Age Gender Income Occupation Education Marital Status Family Size & Structure Psychographic Variables Life Style Personality Buyer Readiness
9.6
c) Light users
9.7
Decision Criteria Used by customer to evaluate and buy a brand or the product. Following four parameters are considered in consumer decision making today Price Perceived quality of the product/ service Service offered by the firm Technology
9.8
9.9
b)
c)
9.10
9.11
a) b) c) d) e) f)
9.12
Consumer/Buyer Behaviour
Demographic Factors The Consumer Buying Process Maslows hierarchy of needs Types of buyer behaviour The Buying Decision Process Organisational Buyer Behaviour
Demographic Factors
Age Stage in family life cycle Occupation Economic circumstances Lifestyle social influence variables
family background reference groups roles and status
Purchase Decisions
Product Choice
Consumer
Learning
Perception
Purchase decision
Product Positioning
Developing schematic representations that reflect how products or services compare to competitors on dimensions are most important to success in the industry
Product Positioning
2. Diagram Map
Firm 1
High Customer Loyalty
Firm 2
Low Customer Loyalty
Firm 3
Low Convenience
PRODUCT DIFFERENTIATION
The challenge before the product marketers is to create relevant and distinctive product differentiation. The product differentiation may be based on : Physical Differences ( eg., features, performance, conformance, durability, reliability, design, style, packaging ) Availability Differences ( eg., available from stores or orderable by phone, mail, fax, internet )
Positioning Strategies
1. By attribute or benefitThis is the most frequently used positioning strategy. For a light beer, it might be that it tastes great. For toothpaste, it might be the mint taste .
2. By use or applicationThe users of Apple computers can design and use graphics more easily than with Windows or UNIX. Apple positions its computers based on how the computer will be used.
3. By userFacebook is a social networking site used exclusively by college students. Only college students may participate with their campus email IDs.
4. By product or service classMargarine competes as an alternative to butter. Margarine is positioned as a lower cost and healthier alternative to butter, while butter provides better taste and wholesome ingredients.
5. By competitorBMW and Mercedes often compare themselves to each other segmenting the market to just the crme de la crme of the automobile market. Ford and Chevy need not apply.
6. By price or qualityTiffany and Costco both sell diamonds. Tiffany wants us to believe that their diamonds are of the highest quality, while Costco tells us that diamonds are diamonds and that only a chump(fool) will pay Tiffany prices.