Kotler Mm15e Inppt 09

(1)

CHAPTER

9

Identifying

Market Segments

and Targets

(2)

LEARNING

OBJECTIVES

1.

1. In what ways can a company divide theIn what ways can a company divide the

consumer market into segments? consumer market into segments?

2.

2. How should business markets be segmented?How should business markets be segmented?

3.

3. How should a company choose the mostHow should a company choose the most

attractive target markets? attractive target markets?

4.

4. What are the requirements for effectiveWhat are the requirements for effective

segmentation? segmentation?

5.

(3)

BASES FOR SEGMENTING

CONSUMER MARKETS

•

• Market segment

Market segment

–

– A group of customers wh A group of customers who share a similar seto share a similar set

of needs and wants

Geographic Geographic segmentation segmentation Demographic Demographic segmentation segmentation

(4)

GEOGRAPHIC

SEGMENTATION

•

• Geographical

Geographica

l units

units

–

– Nations, states, regions, counties, cities, orNations, states, regions, counties, cities, or

neighborhoods

•

• Nielsen Claritas’ PRIZM

Nielsen Claritas’ PRIZM

–

– Education and affluenceEducation and affluence

–

– Family life cycleFamily life cycle

–

(5)

GEOGRAPHIC

SEGMENTATION

(6)

DEMOGRAPHIC

SEGMENTATION

Age & Age & life-cycle stage

cycle stage Life stageLife stage

Gender Gender Income Income Generation Generation Race & Race & culture culture

(7)

DEMOGRAPHIC

SEGMENTATION

•

• Age and life-cycle stag

Age and life

-cycle stage

e

–

– Our wants and abilities change with ageOur wants and abilities change with age

•

• Life stage

Life stage

–

(8)

DEMOGRAPHIC

SEGMENTATION

•

• Gender

Gender

–

– Men and women haveMen and women have

different attitudes and

behave differently

•

• Income

Income

–

– Income segmentation isIncome segmentation is

a long-standing practice

(9)

DEMOGRAPHIC

SEGMENTATION

•

• Generation

Generation

Millennials (Gen Y) Millennials (Gen Y) Baby Boomers Baby Boomers Gen X Gen X Silent Generation Silent Generation

(10)

DEMOGRAPHIC

SEGMENTATION

•

• Race and culture

Race and culture

Hispanic Americans Hispanic Americans

African Ame

African Americansricans

Asian Ame

Asian Americansricans

LGBT LGBT

(11)

PSYCHOGRAPHIC

SEGMENTATION

•

• Buyers are divided into groups on

Buyers are divided into groups on the

the

basis of

basis of psychologic

psychological/personali

al/personality traits,

ty traits,

lifestyle, or values

(12)

FIGURE 9.1: VALS

SEGMENTATION SYSTEM

(13)

BEHAVIORAL

SEGMENTATION

•

• Marketers divide buyers into groups on the

Marketers divide buyers into groups on the

basis of their knowledge of, attitude

toward, use of, or response to a product

(14)

BEHAVIORAL

SEGMENTATION

•

• Needs and benefits

Needs and benefits

•

• Decision roles

Decision roles

– – Initiator Initiator – – Influencer Influencer – – Decider Decider – – Buyer Buyer – – User User

(15)

USER AND USAGE-RELATED

VARIABLES

O

Occccaassiioonnss UUsseer r ssttaattuuss

Usage rate Usage rate Attitude

(16)

FIGURE 9.2

MARKETING FUNNEL

(17)

FIGURE 9.3

BEHAVIORAL SEGMENTATION

BREAKDOWN

(18)

HOW SHOULD BUSINESS

MARKETS BE SEGMENTED?

✓

_Demographic

✓

_{Operating variables}

✓

_{Purchasing approaches}

✓

_{Purchasing approaches}

✓

(19)

MARKET TARGETING

(20)

EFFECTIVE

SEGMENTATION CRITERIA

✓ ✓

_Measurable

✓ ✓

_Substantial

✓ ✓

_Accessible

✓ ✓

_{Differentiable}

✓ ✓

_Actionable

(21)

PORTER’S FIVE FORCES

Threat of Rivalry Threat of Rivalry Threat of Threat of New Entrants New Entrants Threat of Threat of Substitutes Substitutes

(22)

EVALUATING & SELECTING

THE MARKET SEGMENTS

•

• Figure 9.4: Possible Levels of

Figure 9.4: Possible Levels of

Segmentation

(23)

ONE-TO-ONE MARKETING

Identify your prospects and customers Identify your prospects and customers

Differentiate customers in terms of their needs Differentiate customers in terms of their needs

and value to your company and value to your company

Interact to improve your knowledge about Interact to improve your knowledge about customers’ needs and to build relationships customers’ needs and to build relationships

(24)

LEGAL AND ETHICAL ISSUES

•

• Marketers must avoid

Marketers must avoid

consumer backlash

–

– Labeling consumersLabeling consumers

–

– Vulnerable groupsVulnerable groups

–

– Disadvantaged groupsDisadvantaged groups

–

– Potentially harmfulPotentially harmful

products

(25)