(Trgtng&positng) Market Targeting This is the evaluation of the various
segments identified during segmentation and deciding how many and which ones to serve
.Evaluating The Market Segments:
[Link] size and growth: Marketing segment has to be ‘right size’. Size can be measured
in terms of sales volume. [Link] structural attractiveness – Using Porter’s Five
Forces Analysis.:A segment might have desirable size and growth characteristics and still not
profitable.
The company should evaluate the long-run profitability of the market segment.
Michael Porter five forces- Threat of intense segment rivalry -Threat of new entrants -Threats
of substitute products -Threats of growing bargaining powers of buyers -Threat of growing
bargaining power and suppliers -
[Link] interrelationships
Segments selected should be inter-related in terms of costs, performance and technology for
effectiveness.
Target Market Strategies
There are several different target-market strategies that may be followed. Targeting strategies
usually can be categorized as one of the following:
[Link]-segment :strategy - also known as a concentrated strategy. One market segment
(not the entire market) is served with one marketing mix. A single-segment approach often is
the strategy of choice for smaller companies with limited resources.
[Link] specialization- this is a multiple-segment strategy, also known as a differentiated
strategy. Different marketing mixes are offered to different segments. The product itself may or
may not be different - in many cases only the promotional message or distribution channels
vary.
[Link] specialization- the firm specializes in a particular product and tailors it to different
market segments.
[Link] specialization- the firm specializes in serving a particular market segment and offers
that segment an array of different products.
Full market coverage - the firm attempts to serve the entire market. This coverage
can be achieved by means of either a mass market strategy in which a single undifferentiated
marketing mix is offered to the entire market, or by a differentiated strategy in which a separate
marketing mix is offered to each [Link] differentiated or multi-segment approach, the
marketer targets a variety of different segments with a series of differentiated products. This is
typical in the motor industry which has a variety of products such as diesel, four-wheel-drive,
sports saloons, and so on.
A firm that is seeking to enter a market and grow should first target the most attractive
segment that matches its capabilities. Once it gains a foothold, it can expand by pursuing a
product specialization strategy, tailoring the product for different segments, or by pursuing a
market specialization strategy and offering new products to its existing market segment.
Another strategy whose use is increasing is individual marketing, in which the marketing mix is
tailored on an individual consumer basis. While in the past impractical, individual marketing is
becoming more viable thanks to advances in technology.
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Market Positioning
This is the act of designing a company’s offering and image to occupy a
distinctive place in the target market’s mind. I.e. The act of creating a difference
between a company’s offer from those of competitors.
Positioning is the process of establishing and maintaining a distinctive place in
the market for the organizations’ product or brands. Positioning starts with the
product, but positioning is not what you do to a product. Positioning is what you
do to the mind of the customer. You should concentrate on the perception of the
customer and not the reality of the product. Positioning then is how the product is
perceived and evaluated by the target market, relative to competing products. To
the consumer perception is reality. That is why it is said that a marketing battle is
fought in the minds of consumers. Marketers who attain a superior position in
customers’ minds have won the marketing battle.
A difference is worth establishing to the extent that it satisfies the following
criteria.
Important: - The difference delivers a highly valued benefit to a sufficient number
of buyers.
Distinctive:- The difference is delivered in a distinctive way
Superior: The difference is superior to other ways of obtaining the benefit.
Pre-emptive: The difference cannot be easily copied by competitors.
Affordable - The buyer can afford to pay for the difference.
Profitable - The Company will find in profitable to introduce the difference.
Positioning strategies:-
Attribute positioning -A company positions itself on an attribute e.g. size, number
of years in existence.
Benefit positioning -The product is positioned as the leader in a certain benefit.
Use or application positioning -Positioning a product as the best for some use or
application.
User positioning -Positioning a product the best for some user group e.g. Bic
pen, food for consumption.
Competitor positioning -The product claims to be better in some way then a
named competitor.
Product category positioning -The product is positioned as the leader in a certain
product category
Quality or price positioning. -The product is positioned as offering the best value