Chapter 12 - Segmentation & positioning strategies Flashcards
Competitive positioning
How customers perceive alternative offerings on market, compared with each other
Market segmentation
Divide market into groups of similar customers
Identify different segments
Develop segment descriptions
Important differences between these groups
Customer needs
Customer benefits that matter most to different types of customer
Iteration
1) Understanding competitors’ positioning and possible positioning strategies open
2) Influences thinking about attractiveness of different market segments and choice of market targets
3) May change way market is segmented
4) Leads to revised target choices and positioning approaches
Kotler, 1997
Importance of clear, strong competitive positioning
Warning of major positioning errors that can undermine company’s marketing strategy
Under-positioning
Customers only have vague ideas about company or its products
Do not perceive anything special about it
Over-positioning
Customers have too narrow an understanding of company/product/brand
“All Mont Blanc pens cost several thousands pounds”
Confused-positioning
Frequent changes and contradictory messages confuse customer about company’s positioning
e.g. Sainsbury indecisive about loyalty card (vs Tesco) and price level
Doubtful-positioning
Claims made for company/product/brand not accepted whether or not they are true
BHS vs M&S for “first choice store for dressing modern woman and family’
3 underlying requirements for market segmentation
1) Customers must differ from one another in important respect that can be used to divide total market: are the differences important to how we develop marketing strategy?
(extent to which differences are related to different behaviour patterns/susceptibility to different marketing mixes)
2) IDENTIFIED BY MEASURABLE CHARACTERISTICS: enable potential value as market target to be estimated and for segment to be identified
3) ISOLATED from remainder of market so they can be targeted with distinct, clear market offering
Who suggested 4 major issues in marketing segmentation?
Piercy and Morgan, 1993
Piercy and Morgan, 1993
4 major issues in marketing segmentation
What are the 4 major issues in market segmentation?
1) Methodology of market segmentation
2) Criteria for testing segments as robust market targets
3) Strategic segmentation decision itself
4) Implementation of segmentation strategies
What 3 variables can be used in segmenting consumer market?
1) Background customer characteristics
2) Customer attitudes
3) Customer behaviour
Consumer life cycle
Composite demographic variable
Stage of family life cycle
Incorporates age, martial status, family size
Help identify types of people most likely to be attracted to a product field and when they will be attracted
