Gilbert A. Churchill, Jr. J. Paul Peter

1
Marketing
Chapter 8
Market Segmentation
Gilbert A. Churchill, Jr. J. Paul Peter
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Basic Definitions
Slide 8-1
Definition
Approach
Individuals or organizations with the desire and
ability to buy goods and services
Market
MarketSegmentation
The process of dividing a market into groups of
potential buyers who have similar needs and
wants, value perceptions, or purchasing behavior
The particular market segment that the
organization selects to serve.
TargetMarket
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Approaches to Serving Markets
Slide 8-2
Table 8.1
Description
Examples
Approach
A single marketing mix for the entire market
Mass Marketing
Phone service, WEB pages
Women's Workout World (exercise facilities for
women) American Association for Retired Persons
(lobbying and membership services for people over
50)
Niche Marketing A single marketing mix for one
segment of the market
SegmentMarketing
McDonalds (Happy Meals for young children, Big
Macs for Teens, Arch Deluxe for adults) Toshiba
copiers (several sizes and features to meet
different levels of business needs)
Differentiated Marketing Separate marketing mixes
for two or more segments of the market
Personalized amenities for repeat guests at
Ritz-Carlton hotels management consulting
services tailored to an organizations needs
IndividualMarketing
A marketing mix customized for an individual or
organization
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Market Segmentation used to develop a
competitive advantage
Slide 8-3
Market Potential - the total purchases that
buyers in a segment will likely make during a
specified period of time, given a specified level
of marketing activity
Measurability - be able to measure its size and
characteristics
Criteria for Successful Market Segmentation
Accessibility - be able to reach members of
target segment with customized marketing mixes
Responsiveness - respond differently to some
aspect of the 4P than other segments
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P G Segmentation - Detergent Market53
market share of the 3.2 billion market
Slide 8-4
TIDE - Tides in, dirt out
IVORY SNOW - mild, gentle soap for baby clothes
ARIEL - tough cleaner
CHEER - all temperature - Cheer
DREFT - a clean you can trust
BOLD - cleans, soften,and controls static
SOLO - liquid detergent with fabric softener
GAIN - freshens like sunshine
ERA - built-in stain remover
DASH - attack tough dirt
OXYDOL - makes clothes bright
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Mass/Undifferentiated Marketing
Slide 8-5
The Market
Product
Price
Everyone
Placement
Promotion
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Niche Marketing
Slide 8-6
The Market
Product
Price
MarketSegment
Placement
Promotion
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Differentiated Marketing
Slide 8-7
The Market
Product
Price
MarketSegment
Promotion
Placement
Product
Price
MarketSegment
Promotion
Placement
9
Individual Marketing
Slide 8-8
The Market
Product
Price
Customer
Placement
Promotion
Product
Price
Customer
Placement
Promotion
Product
Price
Customer
Placement
Promotion
Product
Price
Customer
Placement
Promotion
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Some Bases for Segmenting Consumer Markets
Slide 8-9
Table 8.2
LevisDockers
Demographic
Geographic
SouthwestAirlines
CampbellSoup
Behavior
Segmentation
Psychological
Benefit
Frito-LaySnacks
ColgateToothpaste
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VALS2 Lifestyle Categories - Consumer Markets
Slide 8-10
Figure 8.2
Resources
Abundant
Actualizers
Achievers
Fulfilleds
Experiencers
Strivers
Makers
Believers
Strugglers
Minimal
Self-Orientation
PrincipalOriented
StatusOriented
ActionOriented
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Some Bases for Segmenting Organizational Markets
Slide 8-11
Table 8.3
IntelComputer Chips
Geographic
Segmentation
OrganizationalBuyerBehavior
CustomerType
Flowers IndustriesBaked Goods
Apple ComputerNewton PocketComputer
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The Process of Market Segmentation
Slide 8-12
Figure 8.5
Analyze CustomerProduct Relationship
Investigate Segmentation Bases
Develop ProductPositioning
Select Segmentation Strategy
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Product Position
Slide 8-13
Attribute BMW - performance
The perception of the product relative to
competing products in the minds of potential
buyers.
Price and Quality Dillards VS KMart
Use or Application Gatorate
Positioning Bases
Product User JJ Baby Shampoo
Product Class Parkay, Caress
Competitor VISA VS AMEX
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Sample Positioning Map Automobiles
Slide 8-14
Figure 8.6
Luxurious
Lexus
Mercedes
Cadillac
Porsche
BMW
Lincoln
Chrysler
Pontiac
Buick
Oldsmobile
Traditional
Sporty
Chevrolet
Ford
Mercury
Nissan
Dodge
Toyota
Saturn
Plymouth
VW
Functional