Wednesday, January 13, 2010

Top 10 Concepts: Ch8 Identifying Market Segments and Targets

1. Target marketing includes three activities: market segmentation, market targeting, and market positioning.
2. Mass marketing is when seller engages in the mass productions, mass distribution, and mass promotion of one product for all buyers.
3. We can target markets at four levels (micromarketing):
a. Segments
b. Niches
c. Local areas
d. Individuals
4. Consumer characteristics and consumer responses are the two bases for segmenting consumer markets. The major segmentation variables for consumer markets are geographic, demographic, psychographic, and behavioural.
5. Business marketers use all these variables along with operating variables, purchasing approaches, and situational factors as their bases for segmenting business markets.
6. Roger Best proposed the seven step approach in the segmentation process, also known as the “needs-based market segmentation approach”: (a) Needs-Based Segmentation, (b) Segment Identification, (c) Segment Attractiveness, (d) Segment Profitability, (e) Segment Positioning, (f) Segment “Acid Test”, and (g) Marketing-Mix Strategy
7. To be useful, market segments must be measurable, substantial, accessible, differentiable, and actionable.
8. A firm must evaluate the various segments and decide how many and which ones to target: (a) a single segment or single-segment concentration, (b) several segments or selective specialization, (c) a specific product or product specialization, (d) a specific market or market specialization, and (e) the full market or full market coverage. If it serves the full market, it must choose between differentiated and undifferentiated marketing.
9. Firms must also monitor segment relationships and seek economies of scope and the potential for marketing to super segments. Companies should be cautious about over segmenting their markets. If this happens, they may want to turn to counter segmentation to broaden the customer base
10. Marketers must develop segment-by-segment invasion plans and choose target markets in a socially responsible manner at all times (ethical choice of market targets)

Elaine R. Buday (December 01, 2009)