UNIT-2: Segmentation, Targeting, and Positioning

Segmentation

Concept:

Segmentation is the process of dividing a broader market into smaller, distinct groups of customers with shared characteristics, needs, or behaviors. These groups are targeted separately to improve the effectiveness of marketing efforts.

Basis of Segmentation:

Marketers can segment markets based on:

1. Demographic Factors: Characteristics such as work status, place of living, gender, age, marital status, and level of education that influence individuals' attitudes and decisions regarding various interventions and behaviors.
2. Geographic Factors: A component that competently complements a marketing strategy to target products or services on the basis of where their consumers reside. Division in terms of countries, states, regions.
3. Psychographic Factors: Qualitative methodology of studying consumers based on psychological characteristics and traits such as values, social status, desires, goals, interests, and lifestyle choices.
4. Behavioural Factors: The actions, habits, and responses of individuals that can influence their learning and development. These factors play a significant role in how people interact with their environment and the social context around them.

Importance in Marketing:

• → Enhanced Customer Understanding: Identifies diverse customer needs and preferences. The aim is to establish a deeper understanding of the customer's activities.
• → Efficient Use of Resources: Focuses marketing efforts on profitable segments. It involves carefully planning, allocating, and managing marketing budgets.
• → Customized Marketing Strategies: Allows businesses to design tailored products and messages that account for company goals and target audience.
• → Competitive Advantage: Distinguishes the brand from competitors in niche markets through factors that allow superior production or pricing.

Targeting

Concept:

Targeting involves selecting specific market segments to serve based on their attractiveness and the company's ability to meet their needs effectively.

Types of Targeting:

1. Undifferentiated (Mass) Marketing: The advertising or promotion of a product to a wide variety of audiences with the expectation of appealing to as many as possible.
2. Differentiated Marketing: An approach that appeals to a niche market or different types of customers through different marketing campaigns.
3. Concentrated (Niche) Marketing: Focuses messages and resources on a demographic with specific needs, preferences, and traits that differentiate it from the mass market.
   • Micromarketing: An advertising strategy that allows targeting a niche group with a particular product or service.

Importance:

Positioning

Importance:

• • Differentiation: Allows marketers to create distinction of their product offerings in the minds of their target market.
• • Clarity of Brand Identity: How clear your brand's message is, consisting of the brand's values, vision, mission and Unique Selling Points.
• • Emotional Connection: Design features that establish a bond with the user on a subconscious level, leading to positive emotional responses.
• • Competitive Advantage: Focus on identifying a method for delivering value to gain advantage in positioning.

Brand Positioning:

• The process of creating a strong, clear, and consistent image for a brand in the consumer's mind.
• Example: Apple positions itself as a premium, innovative technology brand.

Repositioning:

• Modifying an existing position to adapt to market changes or reach new target segments.
• Example: Dominos shifted from "fast food pizza" to "quality handmade pizza delivered quickly."