Target Marketing

Opportunity Analysis:
Segmentation and Positioning

•Your Host:
•Jorge Quiroz Rodríguez

•Universidad de
Guadalajara
 Issues in Evaluating Target Marketing
Opportunities

• The search for breakthrough opportunities

• Positioning and differentiation
• Narrowing from generic markets to product markets
• Market segmentation
• Allocating effort across alternative strategies or
opportunities
 Start with the concept of a market
• A market is a group of
potential customers with
Customers similar needs who are willing to
Needs and other exchange something of value
Segmenting with sellers offering various
Dimensions
products (goods and/or
services)--that is ways of
Company satisfying those needs.
Mission, Objectives,
& Resources
• Firm must decide which
customers to target, and how to
Competitors try to satisfy their needs…and
Current &
answering those questions
Prospective
defines what business it’s in!
 Think about four basic types of
opportunities

Present Products New Products

Present Market Product

Customers Penetration Development

Market
New Development Diversification
Customers

•Note: hybrid combinations are common

Breakthrough opportunities are hard to copy

A Breakthrough opportunity is one

that helps innovators develop
hard-to-copy marketing strategies
that will be profitable for a long time.

Breakthrough opportunities are the

opportunities to go after.
Competitive advantage must be from
customers’ perspective

Competitive advantage means that a

firm has a marketing mix that the
target market sees as better than
a competitor's mix.
Competitive advantage can be
achieved through excellence in
any area of the four Ps or because of
a firm’s other resources.

Competitive advantage is a necessity

for long-run success.
 Product space (positioning) for bar soaps

High moisturizing
Zest
Tone 7
4
Lever 2000
Dove
5 2

Safeguard
Coast
Lux 8
Nondeodorant 3 Deodorant

1
Dial
Lifebuoy
Lava
6

Low moisturizing
 Positioning

• As a start, you need real differentiation that matters to

target customers (i.e., delivers superior value)

• Then, you must be consistent in communicating the chosen

position to establish the difference in the minds of the
target customer

• Objective is to be included when the target customer

thinks about the product-market, and be considered in the
right way!
Narrowing down to focus on a target market

Broad generic market

Broad product
market

Specific market
segment(s)

Target
Segment(s)
 Examples of some generic markets, relevant
customer needs, and specific product-markets

Generic market … Relevant product- Some specific

and potential needs types for some brands within
broad product- narrower
markets submarkets
Firms worldwide Cameras, computer Cameras: Nikon
that want to capture scanners or 35 mm, Sony
images … printers, Mavica, Polaroid
Accuracy, duplicating Instant, RCA video,
convenience, machines, magnetic Kodak 70 mm
flexibility, self- resonance imaging movie camera
expression, speed,
artistic capabilities
Segmentation Dimensions for
Consumer Markets

Needs & other

behavioral Geographic

Demographic
 Segmentation Dimensions for
Business/Organizational Markets

Kind of
Relationship

Purchasing Type of
Method Customer
Possible
Segmentation
Dimensions
Buying
Demographics
Situation

Product
Use
Market Segmentation

Homogeneous Heterogeneous
Within Between

Criteria for
Good
Segments

Substantial Operational
 Developing Market-Oriented
Strategies in Broad Product-Markets

Single Target Multiple Target Combined Target

Market Approach Market Approach Market Approach

The
Strategy
This approach segments the market
and picks one of the homogeneous
segments as the firm's target market.

The segmenter here aims at one

submarket with one marketing mix.
 Developing Market-Oriented
Strategies in Broad Product-Markets

Single Target Multiple Target Combined Target

Market Approach Market Approach Market Approach

Strategy
1
This approach segments the market
and chooses two or more Strategy
segments as the firm's target market. 3
The segmenter here aims at two or
more submarkets with a different
marketing mix for each.
Strategy 2
 Developing Market-Oriented
Strategies in Broad Product-Markets

Single Target Multiple Target Combined Target

Market Approach Market Approach Market Approach

The This approach combines two or more

Strategy submarkets into a larger target market
as a basis for one strategy.

The combiner here aims at two

submarkets with one marketing mix.
Segmenting Product-Markets
Name Broad Product-
Market

List Customer Needs

Narrow Product-Markets

Identify
Determining Dimensions

Process Name Possible

Market segments
for
Segmenting
Evaluate Segments
Product-Markets
Estimate Size
 Strengths, weaknesses, opportunities and threats

• Possible marketing mixes and target markets (strategies)

must be evaluated in light of
- Company mission, objectives and resources
- Competitive situation
- Trends in the external market environment
• Internal strengths and weaknesses and external
opportunities and threats must be weighed
• S.W.O.T. analysis sets up analysis of pros and cons of
alternative strategies
The Competitive Environment

Competitive
intensity

Key areas
Information on to Competitor
competitors consider analysis
in
the competitive
environment

Competitive Competitive
barriers rivals
 Trends in external market variables impact
opportunities

Cultural and social Economic

Four basic
variables that shape
the environment of
marketing strategy
planning

Political and
Legal Technology
 Screening criteria lead the way

• Set up criteria on which alternatives are to be evaluated

• Some criteria should be qualitative and some should be

quantitative--i.e., based on analysis

• Be complete and logical in thinking through the relevant

criteria and when/why they should apply

• Criteria allow you to explain you choices

 Evaluating Opportunities
Industry Attractiveness
High Medium Low
High
Business Strength

Medium

No Growth
Low

Borderline

Growth
Key reasons for pursuing international
opportunities

World is getting smaller -- easier trade, faster response

Leverage competitive advantage

Early start in a new market ?

Better trends abroad on key business variables