Levels of Market Segmentation
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Transcript of Levels of Market Segmentation
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Levels of Market Segmentation
JohnV. Balanquit
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Mass Marketing
• Mass production, mass distribution, and mass promotion to create largest potential market, thus reducing cost resulting to lower prices or higher profits.
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Micromarketing
• Adopting strategies that will reach segments, niches, local areas or individuals
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Segment Marketing
• Addressing to the needs of a group of customers who share similar needs and wants
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Segment Marketing
• Flexible market offering– A process which contains
two parts, a naked solution containing the product and service element that all segment members value and a discretionary option that some segment members value
• Homogeneous preferences– All members roughly
have the same preference
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Segment Marketing
• Diffused preferences– Members have varied
preferences
• Clustered preferences– Natural market
segments emerge from groups of customers with shared preferences
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Niche Marketing
• Addressing to needs of a narrowly defined customer group seeking distinctive mix of benefits. This is done by dividing segments into subsegments
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Local Marketing
• Preparing marketing programs tailored to the needs and wants of local customer groups in trading areas, neighborhoods, or individual stores
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Individual Marketing
• Also termed “segments of one”, “customized marketing”, or “one-to-one marketing”
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Individual Marketing
• Customerization– Empowering customers to design the product and
service offering of their choice
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Bases for Segmenting Customer Markets
• Geographical Segmentation– Dividing the market into different geographical
units such as nations, regions, countries, cities, or neighborhoods
• Demographic Segmentation– Dividing the market into groups based on variables
such as age, family size, family life cycle, gender, income, occupation, education, religion, race, generation, nationality, and social class
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Bases for Segmenting Customer Markets
• Psychographic Segmentation–Dividing the market into different groups on
the basis of personality traits, lifestyle, or values. This method uses data from demographics and psychology–VALS• This system classifies people into 8 groups:
innovators, thinkers, achievers, experiencers, believers, strivers, makers, survivors
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Bases for Segmenting Customer Markets
• Behavioral Segmentation–Buyers are groups according to their
knowledge of, attitude towards, use of, or response to a product. This method is affected by two factors, the decision role and the behavioral variables
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• Decision roles- initiator, influencer, decider, buyer, user.
• Behavioral Variables- occasions, benefits, user status, usage rate, buyer-readiness stage, loyalty status, and attitude
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• The Conversion Model– It measures the strength of consumers’
psychological commitment to brands and their opened to change. Users are grouped as convertible, shallow, average and entrenched. Non-users are grouped as strongly unavailable, weakly unavailable, ambivalent, and available.
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Bases of Segmenting Business Markets
• Demographic– Industry– Company size– Location
• Operating Variables– Technology– User or Non-user status– Customer capabilities
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Bases of Segmenting Business Markets
• Purchasing Approaches– Purchasing- function organization– Power structure– Nature of existing relationship– General purchasing policies– Purchasing criteria
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Bases of Segmenting Business Markets
• Situational Factors– Urgency– Specific application– Size or order
• Personal Characteristics– Buyer-seller similarity– Attitude toward risk– Loyalty
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Market Targeting
• This process is the selection of a particular market after identifying segment opportunities.
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Steps in Needs-based Market Segmentation Approach by Roger Best
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Market Targeting
• Effective Segmentation Criteria– Measurable– Substantial– Accessible– Differentiable– Actionable
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Market Targeting
• Evaluating and Selecting the Market Segment
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Market Targeting
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Market Targeting
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Additional Consideration
• Segment by Segment Invasion Plan
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Additional Consideration
• Megamarketing–The strategic coordination of
economic, psychological, political, and public relations skills, to gain the cooperation of a number of parties in order to enter or operate in a given market.
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Additional Consideration
• Ethical Choice of Market Targets