Lecture 3 Flashcards
Trend of individualism
Consumers become more and more individualistic.
- Difficult to place them in one target group and describe them.
- Different needs at different moments and locations
- Challenge for retail
Market segmentation
Dividing the market into more or less homogenous groups of individuals with common characteristics and a similar purchasing behaviour
Segmentation criteria
Heterogeneity of needs
▪ Measurable
▪ Approachable
▪ Sizeable
Segmentation strategies
A-priori segmentation:
▪ Classifying based on general characteristics and then assessing
whether there are differences in behavioural characteristics
between or among groups
▪ Methodology disadvantage is that the segments are not
homogeneous in terms of their product requirements,
purchasing behaviour and use of the product
Segmentation strategies
Ex-post segmentation:
▪ Groups of customers behave differently towards products and
homogenous segments are based on the similarity in
requirements, behaviour and use
▪ The advantage is that the requirements of homogeneity and
heterogeneity are met and there is a direct relationship to
purchasing behaviour
Functions of a brand
Brands represent value because consumers drive certain meanings from them → functions:
▪ Recognition
▪ Certainty
▪ Emotional value
Positioning is a systematic process:
▪ To make a brand occupy a distinct position….
▪ …..relative to competing brands
▪ …..in the mind of the consumer
Customer expectations due to the
development of e-commerce
- Equal prices everywhere
- Order through any channel
- Everything always in stock
- Multiple payment options
- Free delivery and return policy
- Cross-channel return policy
Store Compass: the rules
▪ Score the highest on one or two aspects
▪ Score on average on one or two aspects
▪ You can score below average on two or three aspects
