Segmenting and Targeting by UzLj3VMZ

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									Segmenting and Targeting
      Carving Up the Market
Trying to reach “everyone” with a marketing message
   costs money and sends unwanted messages to
   people who aren’t customers or prospects.
It makes more sense to narrow the audience to
   people who are most likely to buy the brand.
Segmenting is used to identify these groups of people.
Targeting is the planning strategy for reaching and
   communicating with them.

                                                         1
Reasons for
Segmenting and Targeting


Segmenting is grouping customers or
  prospects according to common
  characteristics, needs, wants, and/or
  desires.
Targeting is analyzing, evaluating, and
  prioritizing those market segments deemed
  most profitable to pursue.

                                              2
    Moving Away from Mass
    Marketing
Mass marketing attempts to sell the same thing to
  everyone.
Segmenting became more important as marketing
  moved away from mass marketing.
Niche markets are defined by very distinct
  commonalities among their members.
One-to-one marketing means customizing products
  and marketing communication for an individual
  person or company according to individual needs.
                                                     3
Screening Criteria and Size of
Segment
Figure 7-2,
 p.240




                                 4
Steps in Segmenting and
Targeting
Figure 7-3,
 p.242




                          5
    Current Customers
Segmentation starts by identifying and profiling
  current customers.
Three main principles behind this:
 It is cheaper to sell to already existing customers.

 Some customers are more profitable than others.

 Common characteristics of the high-profit segment

  may be used to identify high-probability prospects.


                                                     6
Customer Profile Variables




                             7
    Types of Market Segmentation
 Behavioral segments
 Benefit segments

 Demographic segments

 Ethnic segments

 Geodemographic segments

 Psychographic segments

 Lifestyle segments

 Life stage segments

 Relationship Segments

 Adopter Segments             8
     How Targeting Works
   Targeting is done by using profile characteristics of
    segments to draw boundaries around a particular
    group of customer or prospects that are projected
    to respond well to a brand and its marketing
    communication.
   Then, marketers estimate the group’s size.
   The next step is to prioritize the segments.
   A company then develops message strategies and
    media plans for select segments.
                                                       9
      Ethics of Targeting
   Criticisms of marketing and marketing
    communication arise from controversial
    targeting decisions related to special groups.
   Many people feel that children should not be
    a targeted for certain kinds of products.
   Minority groups feel they are bombarded
    with “sin product” ads.

                                                 10
    Balancing Acquisition and
    Retention
Most companies seldom have a proper balance of
  targeting current customers (for retention) and
  prospective customers (for acquisition).
Many marketing programs have not been as cost
  effective as they could be because they are based
  on the traditional methods of focusing on
  transactions rather than relationships.
Strategic segmenting and targeting allow a company
  to use marketing communication tools more
  efficiently.
                                                  11

								
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