Target Marketing and Customer Relationship Management

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Target Marketing and Customer Relationship
Management

• MARKETING 360
• Brian Gillespie

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Target Marketing

• Dividing the total market into multiple segments
  based on consumer characteristics, selecting
  specific segments, and developing products or
  services to meet the needs of the specific
  segments
• Why Segment?
• Fragmentation Different groups have different
  needs and wants
• Allows marketers to establish appropriate
  marketing mix for a given segment

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Target Marketing Today

• http//www.cb.wsu.edu/bgillespie/mktg360/targetma
  rketing.html
• http//www.nytimes.com/2011/06/02/business/media/0
  2adco.html?_r3pagewanted2seidautosmidtw-nyt
  imes

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Steps in Target Marketing

• Segmentation
• Dividing larger markets into smaller pieces based
  on meaningful shared characteristics
• Targeting
• Evaluation of segments and determination of which
  to pursue
• Positioning
• Designing a product or service to meet the
  segments needs and develop a marketing mix for
  the targeted market

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Segmentation

• Markets can be segmented by demographics
• Age
• Size
• Gender
• Education
• And usage
• Cell phones
• Cigarette papers

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Successful Segmentation

• Sustainable
• Large enough to justify its own marketing mix
• Identifiable and Measurable
• If not, it can not be determined whether its
  sustainable
• Accessible
• Must be able to reach the segment with the
  marketing mix
• Responsive
• The segment needs to respond differently than
  other segments
• If not, there is no need to develop a unique
  marketing mix

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Generational Marketing

• Marketing to members of a generation who tend to
  share the same outlook and priorities
• The greatest generation
• Baby boomers
• Generation X
• Millenials (Generation Y)

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Generational Marketing
If born in this decade teens in this decade Young adult (settling down) in this decade Now how old are they? People are predisposed to .A) drive what?, B) eat what? C) do what for exercise/leisure? D) dating whom? E) read what, how? F) watch what? G) current lifecycle happenings
1930s 1940s 1950s 70-80 It wasnt all good, but we survived
1940s 1950s 1960s 60-70 Elvis Lives! Retired!!
1950s 1960s 1970s 50-60 Golden Years?
1960s 1970s 1980s 40-50 Parents of graduates
1970s 1980s 1990s 30-40 Married with children (or not)
1980s 1990s 2000s 20-30 College, grads, entering the workforce, marriage
1990s 2000s 2010s 10-20 Tweens, teens, college, texters
2000s 2010s 2020s 0-10 Kids, tweens (3000 texts/month)
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Gender Segmentation

• Women
• Take care of 75 of family finances
• 80 consumer purchases, 65 of new cars, 51
  electronics
• Variety of companies stereotypically masculine
  are now directing marketing efforts toward women
• Men
• Companies that used to target women are now
  targeting men

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Geographic Segmentation

• Geodemography
• Combination of geographic and demographic
  information
• Looking for clusters of similar people
• Geocoding
• Tailoring web advertising according to logon zip
  code

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PRIZM Segment Descriptions

• 66 predefined segments created by Nielsen
  Claritas
• Based on income
• Geographic location
• Purchase habits
• www.mybestsegments.com

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Psychographics

• Uses psychological, sociological and
  anthropological factors to develop segments
• Personality
• Motives
• Lifestyles

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Benefit and Usage Segmentation

• Benefit Segmentation
• Segment by benefit people seek
• Usage-Rate Segmentation
• Former, potential, first time, low, medium and
  high users
• 80/20 principle
• 20 of customers make up 80 of demand
• Loyalty programs

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Targeting

• Evaluate market segment
• Once identified, decide if the segment is a
  viable target
• Develop segment profile
• Create the typical customer
• Choose targeting strategy
• Undifferentiated (appeal to masses)
• Differentiated (different strokes for different
  folks)
• Concentrated (go after just one segment)
• One-to-One marketing
• Tailored to individuals and creating long-term
  relationships

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Positioning

• Evaluate (direct and indirect) competition
• Create a product or service with a competitive
  advantage
• Attribute
• Price/quality
• Use or application
• Product user
• Product class
• Competitor
• Emotion

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Positioning

• Develop marketing mix to appeal to target segment
• 4 Ps
• Measure response and adapt the strategy if needed
• May need to reposition the product or service
• Repositioning may involve bringing an old brand
  back to life
• Retro brand

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Customer Relationship Marketing

• Management strategy that utilizes information
  systems to capture and analyze every interaction
  with customers in order to enable better customer
  care
• web, store, kiosk, affiliate, sponsored event,
  etc.
• Marketers compile customer data, categorize
  customers and treat each category differently
• Create different marketing campaigns for each
  category

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Segmented Products

• What type of segmentation is it?
• Gender segmentation
• Generational segmentation
• Geographical segmentation
• Physiographic segmentation
• Benefit and usage segmentation
• Etc
• Which segment are they trying to reach?
• Baby boomers
• Females
• Etc

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