Segmentation and Positioning Principles Buku MARKETING STRATEGY

Segmentation and Positioning Principles Buku : MARKETING STRATEGY AND COMPETITIVE POSITIONING Bab 10

Key issues • Competition positioning • Market segmentation • Customer needs 2

Competitive positioning and market segmentation Competitive positioning Customer needs How customers perceive alternative Market offerings How marketers identify groups of customers Market segmentation Market 3

Positioning and segmentation • • Market segmentation Choice of target markets Competitive positioning Iteration 4

Segmentasi Pasar Pemilihan Pasar Sasaran Posisi Berdayasaing Stages in segmentation and positioning 5

Principles of competitive positioning Positioning is the act of designing the company’s offering and image so that they occupy a meaningful and distinct competitive position in the target customers’ minds (Kotler, 1997) 6

Principles of competitive positioning The essential principle of competitive positioning is that it is concerned with how customers in different parts of the market perceive the competing companies, products / services or brands. It is important to bear in mind that positioning may apply to any of these levels: • Companies • Products and services • Brands 7

Criteria to create differentiation • Importance • Distinctive and pre-emptive • Superior • Communicable • Affordable • Profitable 8

The four pillars of company’s distinctive value proposition : • Direct • Hassle free • Peace of mind • Courtesy 9

• Under-positioning • Over-positioning • Confused positioning • Doubtful positioning Kesalahan Utama Positioning 10

Positioning risk and errors Uniqueness claimed Narrow Believable Credibility Broad Over-positioning Too exclusive or narrow Under-positioning Nothing special Doubtful positioning Less Improbable claims believable Confused positioning Unclear what the position is 11

The underlying premises of market segmentation – three basic propositions 1. Differ from one another 2. Identified by measurable characteristics 3. Isolate 12

Major issues in market segmentation 1. The methodology of market segmentation 2. The criteria for testing segments as robust market targets 3. The strategic segmentation decision itself 4. The implementation of segmentation strategy in the company 13

Segmenting consumer markets 1. Background customer characteristics Objective measures subculture, etc. Socio economics Occupation, income, education Marketing specific 2. 3. Consumer life cycle ACORN media usage Psychographics Non-marketing Demographics Sex, age, geography, specific Subjective measures Personality inventories lifestyle Customer attitudes Customer behaviour 14

The Warner index of status characteristics Class name Description Consumption characteristics Upperupper Elite social class with inherited social position Expensive, irrelevant, but purchase decision not meant to impress; conservative Lowerupper Nouveau riche; highly successful business and professional; position acquired through wealth Conspicuous consumption to demonstrate wealth, luxury cars, large estates, etc. Uppermiddle Successful business and professional Purchases directed at projecting successful image Lowermiddle White-collar workers, small businesspeople Concerned with social approval; purchase decisions; conservative; home and family oriented Upperlower Blue-collar workers, technicians, skilled workers Satisfaction of family roles Lowerlower Unskilled labour, poorly educated Attraction to cheap, ‘flashy’, lowpoorly off quality items; heavy exposure to TV 15

Stages of the family life cycle Stage Bachelor Young, single, not living at parental home Newly wed Young couples, no children Full nest 1 Youngest child under 6 Full nest II Financial Circumstances And Purchasing Characteristics Few financial burdens, recreation oriented; holidays; entertainment outside home Better off financially, two incomes; purchase home, some consumer durables Home purchasing peak; increasing financial pressures, may have only one income earner; purchase of household ‘necessities’ Financial position improving; some working spouses Youngest child over 6 Full nest III Older married couples with dependent children Empty nest I Older married couples, no children at home Empty nest II Financial position better still; update household products and furnishings Home ownership peak; renewed interest in travel and leisure activity; buy luxuries Drastic cut in income; medical services bought Older couples, no children at home, retired Solitary survivor Income good, but likely to sell home Still in labour force Solitary survivor Retired Special needs for medical care, affection and security 16

Customer attitudinal characteristics for segmentating markets • Benefit segmentation • Perceptions and preferences • Summary of attitudinal bases of segmentation 17

Customer behavioural characteristics for segmenting markets • Purchase behaviour Innovators Brand loyalty • Consumtion behaviour • Communication behaviour • Response to element of the marketing mix • Relationship – seeking characteristic * • Summary of behavioural bases for segmentation 18

Relationship – seeking characteristic * Variables Segments • Relationship seekers • Deal-makers • Relationship exploiters • Loyal buyers • Price-seekers • Arm’s – length transaction customers • Brand loyalists • Luxury innovator 19

Segmenting business markets • • Background company characteristics Industry type Company size Customer location Company technology Customer capabilities Purchasing organisation Power structures Purchasing policies Product application Attitudinal characteristics Behavioural characteristics Buyer-seller similarity Buyer motivation Buyer risk perceptions Summary of bases for segmenting business markets 20

Identifying and describing market segments First order and second order segmentation The benefits of segmenting markets • Segmentation is a particularly useful approach to marketing for the smaller company • It helps to identify gaps in market • In mature or declining markets it may be possible to identify specific segments that are still in growth • Segmentation enables the marketer to match the product or service more closely to the needs of the target market • The dangers of not segmenting the market when competitors do should also be emphasised 21

IMPLEMENTING MARKET SEGMENTATION 1. The scope and purpose of market segmentation Strategic intent, vision and mission Strategic segmentation Managerial segmentation Marketing planning, budgeting and resource allocation Operational segmentation Operational sales, marketing and distribution management Levels of segmentation 22

IMPLEMENTING MARKET SEGMENTATION 2. Strategic, managerial and operational levels of segmentation • Strategic segmentation • Managerial segmentation • Operational segmentation 23

IMPLEMENTING MARKET SEGMENTATION 3. Sources of implementation problems • Organisation structure • Internal politics • Corporate culture • Information and reporting • Decision-making processes • Corporate capabilities • Operational systems 24

MARKET SEGMENT ATTRACTIVENESS AND ORGANISATIONAL RESOURCE STRENGTH Organisational resource strength High Market segment attractiveness Low Best prospects Attractive segments that fit well with organisational resources Build strength first Attractive markets but with poor fit with organisational resources Poor prospects Unattractive Low segments that fit well with organisational resources Worst prospects Unattractive segments with a poor fit with organisational resources High 25

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