Session 6 Flashcards
How to you evaluate attractiveness of a target segment?
3 Factors:
- Segment size and growth: Relative matter; the largest and fastest growing is not always most attractive!
- Segment structural attractiveness: segment is less attractive if there are too many competitors
- company objective and resources
What is the strategy of undifferentiated marketing aka mass marketing when choosing targets?
Strategy that a firm can use if the product/service is perceived ot provide same benefits to everyone, no need to develop separate strategies for different groups. DOES NOT use segmentation process
What is the strategy of
Differentiated marketing when choosing targets?
Numerous products are offered to different segments through differential use of the 4Ps. (Opposite of undifferentiated strategy)
What is the strategy of Concentrated aka Niche Marketing when choosing targets?
Most often used by small firms that direct the firm’s effrots toward serving a very small segment
What is the strategy of individual marketing aka customized marketing when choosing targets?
Extreme verison of differentiated marketing when the company strives to meet the needs to individual customers by customizing their offering to fit the customers’ needs (AKA one-to-one marketing, it has arisen due to availabiity of more detailed data)
What are the trade offs involved in targeting narrowly?
- INcreased costs: Fixed costs, distribution systems, manufacuritng efficiency, promotion, admin, COGS
- Increased Revenues: Satisfying specific needs through the 4Ps, customizing leads to increased unit volume and price
How do companies execute marketing strategies to reach their target segments?
Through positioning: the place occupied by a product in a customer’s mind relative to competing products, it implants a unique benefit and differentiation
What are the three steps of the Positioning process?
- Identifying a set of differentiating competitve advantages
- Choosing the right competitive advantage
- Selecting overall positioning strategy
What is a competitive advantage?
Advantage over competitors gained by offering greater customer value through lower prices or providing more benefits that justify higher prices
Givean outline of what a positioning statement should look like
For the customer X, who has unmet need/desired outcome Y, our Brand has key benefit Z, unlike our competitors, our brand offers this key point of difference or competitive advantage
What are sources of differentiation?
Products, services, channels, people, image
What does a positioning statement present?
Tells customer story fo why they should buy our solution, states competitive advantage, should appear in some form in many types of media outlets, should be consistent with our level of value extraction
What tool is used to position?
Through a perceptual map:It shows consumers the perception of a firm’s product versus competing products.
What is positioning?
A firm positions its porducts in consumers’ perceptual map through marketing activities
How are perceptual maps constructued?
It is attributed based:
- Determine important product attributes
- Analyze consumers ratings of how brands do on each attritue
- plot consumers’ perceptions of existing products
- Analyze consumers ratings of ideal points
- plot consumer’s preferences regarding their ideal productWh
