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Segmentation and Targeting

In: Business and Management

Submitted By shegzzyjos
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Chapter 8: Segmentation, Targeting, and Positioning * Marketing is about satisfying customers’ wants and needs * Segmentation: dividing the market into groups of customers who have different needs, wants, characteristics, who would appreciate products/services specifically geared towards them

The Segmentation-Targeting-Positioning (STP) process includes: * 1. Establish Overall Strategy or Objectives * 2. Profile Segments * 3. Evaluate Segment Attractiveness * 4. Select Target Market * 5. Identify and Develop Positioning Strategy

Step 1: Establish Overall Strategy or Objectives * Planning process * Vision or objectives of the company’s marketing strategy * Segmentation strategy must be consistent with firm’s mission and objectives and with its SWOT

Step 2: Profile Segments * Describe different segments with their needs, wants, and characteristics * Helps firms better understand the profile of the customers in each segment, customer similarities within a segment, customer dissimilarities across segments * Benefits consumers derive from the products, break down groups of consumers * Segmentation methods based on: * Geographic * Demographic * Psychographic * Behavioural * Composite 1. Geographic Segmentation * The grouping of consumers on the basis of where they live * Ex. by country, region, province, neighbourhoods, climate, urban, rural * Most useful for companies whose products satisfy needs that vary by region * Can use same product/service just adjust to meet needs of smaller geographic groups * Ex. Loblaws varies by region based on the consumers in that region (asian, Italian)

2. Demographic Segmentation * The grouping of consumers according to easily measured, objective characteristics such as age, gender, income,...

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