Chapter Objectives After reading this chapter you should be able to Appreciate the importance of market segmentation for specific consumer groups and realize that the targeting decision is the initial and most fundamental of all ID: 556376
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Slide1
Segmentation, Targeting, and PositioningSlide2
Chapter Objectives
After
reading this chapter you should be able
to:Appreciate the importance of market segmentation for specific consumer groups and realize that the targeting decision is the initial and most fundamental of all marcom decisions.Understand the role of behavior segmentation in targeting consumer groups.Describe the nature of psychographic segmentation.Appreciate major demographic developments such as changes in the age structure of the population and ethnic population growth.
2Slide3
Chapter Objectives (cont’d)
Explain
the meaning of
geodemographics
and understand the role for this form of
targeting.
Recognize
that any single characteristic of consumers—whether their age, ethnicity, or income level—likely is not solely sufficient for sophisticated marcom targeting.Appreciate the concept and practice of brand positioning.
3Slide4
Positioning McDonald’s versus Starbucks
4Slide5
Major Steps in the Market Segmentation Process
Following a consideration of
customer needs
and benefits sought, the following are the major steps in the market segmentation process:Market segmentation:Identify bases (e.g., behavior, demographics) to segment the marketDevelop profiles of resulting segmentsMarket targeting:
Develop measures of segment attractiveness
Select the target segment(s
)
Market positioning:Develop positioning for each target segmentDevelop marketing mix for each target segment5Slide6
Segmentation Bases
Behavior Segmentation
Demographics
Psychographics
Geodemographics
Measurable
Consumer
Characteristics
6Slide7
Figure 5.1: Classification of Four General Targeting Characteristics
7Slide8
Behavior Segmentation Issues
Behavior Segmentation
Describe how people behave with respect to a particular product category or class of related products
Assume that the best predictor of future behavior is past behaviorOnline Behavioral TargetingTracks the online site-selection behavior of users so as to enable advertisers to serve targeted adsPrivacy ConcernsTechnological advances increase the ability to serve consumers at the risk of invading their privacy8Slide9
Figure 5.2: An Illustration of the Online Ad Process
9Slide10
Psychographic Segmentation
Psychographics
Describe aspects of consumers’ psychological make-ups and lifestyles as they relate to buying behavior in a particular product category
AttitudesValuesMotivations10Slide11
Types of Psychographic Profiles
Customized Psychographic Profiles
Are typically customized to the client’s specific product category
Contain questionnaire items related to the unique characteristics of the product categoryGeneral Purpose Psychographic ProfilesCan be purchased as “off-the-shelf” psychographic data from services that develop psychographic profiles of people independently of any particular product or service11Slide12
Illustrative Statements Used In a Customized Banking-Related Psychographic Study
12Slide13
Psychographic Study of Consumers’ Banking Practices
Worried
Traditionalists
Bank
Loyalists
Secured
Investors
Thrifty
Bankers
Psychographic Segments
of Banking Behaviors
13Slide14
MindBase Segments
14Slide15
MindBase Segments (Table 15.2 cont’d)
15Slide16
Figure 5.2:
The 8 VALS
Segments
16Slide17
VALS Psychographic Segments
17Slide18
VALS Psychographic Segments
18Slide19
Geodemographic Segmentation
Geodemographics
Consumers who reside within geographic clusters such as zip codes or neighborhoods and also share demographic and lifestyle similarities
Typical Clusters (PRIZM NE)Bohemian MixWhite Picket FencesSuburban Pioneers19Slide20
Demographic Segmentation
Age structure
of the population
Change in
household
composition
Ethnic population
developments
Major Demographic
Aspects
20Slide21
Demographic Trends
World Population Growth
6.95 billion (2012) to 8 billion (2025)
to 9.5 billion (2050)Changing Age Structure in United StatesMedian age will increase to 38 by 2025More middle-aged Baby BoomersFewer children, teenagers, and young adults due to decreased birthrates21Slide22
World’s 25 Largest Countries as of 2011
22Slide23
Population of the United States by Age Group, as of 2010
23Slide24
Demographic Segments by Age Group
Preschoolers (5 years or younger)
Elementary-school-age children (6-11 years)
Tweens (8-12 years)Teenagers (13-19 years)Millennial Generation or Generation YHighly conformist, narcissistic, and fickle consumersYoung adults (20-34 years)Generation X (Baby Busters)Yup & Comers, Bystanders, Playboys, and Drifters24Slide25
Figure 5.4: An Appeal to Preschoolers’Parents
25Slide26
Figure 5.5:
An Appeal to
Teenagers
26Slide27
Demographic Segments: Age
Middle-Aged (35-54 years)
Younger baby boomers and older Gen
XersTarget category for luxury goods and youthMature Consumers (55 years or older)Are 25% of the total U.S. populationHave highest discretionary income and most assetsCensus Bureau classification: Olders (55 to 64); Elders (65 to 74); and the Very Old (75 and over)Descriptive groups: Healthy Hermits, Ailing Outgoers, Frail Recluses, and Healthy Indulgers27Slide28
The Ever-Changing American Household
Household Defined
An independent housing entity, either rental property or owned property.
U.S. HouseholdsGrowing in number, shrinking in size, and changing in character.Married couples with children younger than 18 now represent less than one-third of all households.Single-person and unrelated-person households are a growing market.28Slide29
Ethnic Population Developments
Changes in the U.S. Melting Pot
More diversity in the overall population
Growth in all ethnic groupsImplication for MarketersNeed to devise marcom strategies to meet ethnic groups’ unique wants/needs29Slide30
Ethnic Groups’ Population Representation in the United States, 2000–2050 (in millions
)
30Slide31
Ethnic Population Developments
African Americans
Are of an average age that is considerably younger than that for Caucasians
Are geographically-concentrated, with three-fourths of all African-Americans living in 16 statesTend to purchase prestige and name-brand products in greater proportion than do CaucasiansHave spending power that totals nearly $1.1 trillion annually31Slide32
Figure 5.6:
African-American Models
Appeal to
African American Consumers
32Slide33
Ethnic Population Developments (cont’d)
Hispanic Americans (Latinos)
Are the largest U.S. minority population segment
Are not a single unified marketAre underserved by current marketing effortsAre responsive to advertising in their dominant language
33Slide34
Top 10 U.S. Hispanic Markets (estimates as of 2010)
34Slide35
Ethnic Population Developments (cont’d)
Asian-Americans
Represent many nationalities
Are the newest “hot” ethnic marketAre better educated than averageHave higher incomes than averageOccupy more prestigious jobsSpeak a variety of languagesAre heavy users of the InternetRespond to marketing programs that reflect their values and lifestyles35Slide36
Market Targeting
The 5 Criteria for Effective Segmentation:
Measurable
SubstantialAccessibleDifferentiableActionableTarget Market Selection Strategies:Undifferentiated marketingDifferentiated marketingConcentrated marketing
36Slide37
Figure 5.7: A Framework for Brand Positioning
37Slide38
Benefit Positioning
Functional
Needs
Symbolic
Needs
Experiential
Needs
Appealing to
Consumer Needs
38Slide39
Categories of Appeals to Consumer Needs
39Slide40
Figure 5.8:
Croc
Advertisement Illustrating Appeal to Functional Needs
40Slide41
Figure 5.9:
Dove
Advertisement Illustrating
Appeal to Experiential Needs41Slide42
Attribute Positioning
Product-Related
Non-Product Related:
Usage and User Imagery
Attribute
Positioning
42Slide43
Figure 5.10:
Highlander
Advertisement Illustrating
Product-Related Attribute Positioning43Slide44
Figure 5.11: Ralph Lauren Advertisement Illustrating User Imagery Positioning
44