Phillip
Kevin Lane
Kotler • Keller Marketing Management • 14e
Identifying Market Segments and Targets
Discussion Questions 1. What are the different levels of market segmentation? 2. In what ways can a company divide a market into segments?
3. What are the requirements for effective segmentation? 4. How should business markets be segmented? 5. How should a company choose the most attractive target markets? Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall
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Target Marketing Requirements 1. Identify and profile distinct groups of buyers (market segmentation). 2. Select one or more market segments to enter (market targeting). 3. For each, establish and communicate benefits of offering (market positioning).
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Bases for Segmenting Consumers
Geographic
Demographic
Psychographic Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall
Behavioral Slide 5 of 26
Geographic Segmentation
Geoclustering
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Demographic Segmentation Age and Life-cycle Stage Life Stage Gender Income Generation Race and Culture
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Age and Life-Cycle Stage
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Life Stage
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Gender Women: Influence 80% of consumer purchases Make 75% of new home decisions Purchase 60% of cars
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Income
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Generation Gen X (1964-1978) Baby Boomers (1946-1964) Silent Generation (1925-1945)
Millennials (Gen Y) – (1979-1994) -78 Million people -$187 annual spending power
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U.S. Generation Cohorts Cohort
Size
Defining Features
Millennials
78 m
Raised in affluence, tech savvy, perceived immunity from marketing
50 m
Parents relied on day care, accepts diversity, pragmatic and individualistic
(1979-1994)
Gen X (1964-1978)
Baby Boomers (1946-1964)
Control 3/4th of the wealth in the U.S, 76 m seek fountain of youth (hair color, hair replacement), home exercise equipment
Silent Generation 42 m Lead vibrant lives, spend money and (1925-1945) time on grandchildren. Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall
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Race and Culture
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Multicultural Market Profile
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Psychographic Segmentation • Personality traits • Lifestyle • Values
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VALS Segmentation System
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Behavioral Segmentation Usage occasions
Initiator
User status User
Influencer
Usage rate Buyer-readiness
Buyer
Decider
Decision Roles
Loyalty status
User and Usage
Needs and Benefits Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall
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Brand Funnel
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Consumer Attitudes
Enthusiastic
Positive
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Indifferent
Negative
Hostile
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Behavioral Segmentation
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Bases for Segmenting B2B Markets Demographic
Industry, company size, location
Operating Variables
Technology, user status, customer capabilities
Purchasing Approach
Power structure, nature of existing relationship
Situational Factors
Urgency, specific application, size of order
Personal Characteristics
Buyer-seller similarity, loyalty, risk attitude
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Market Targeting Effective Segmentation Criteria Measurable Substantial Accessible Differentiable Actionable
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Market Targeting Porter’s Five Force
Substitute Products
Buyer Power Supplier Power
New Entrants
Rivals Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall
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Evaluating and Selecting Segments
Multiple segment specialization
Full market coverage
Single-segment concentration Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall
Individual marketing Slide 25 of 26
Levels of Segmentation
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