Customer-Driven Marketing Strategy:

Creating Value for Target Customers

2012 Principles of Marketing: An Asian Perspective

7.1
Market Segmentation

7.1

2012 Principles of Marketing: An Asian Perspective

Quiz about Alter Ur Ego

-

Use the clickers provided to you in class to input your answer

The following questions are based on the case posted under
preparation for lecture folder on BB
You were required to read the case before coming to class
Get Ready!!! GO!!!

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What is distinctive about the jeans profiled in the

article and produced by Alter Ur Ego:

They are designed by a

young entrepreneur
2. They are designed for
paraplegic customers who
are wheelchair bound
3. They are made in the
U.S.
4. They are made of quality
materials
1.

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What are some of the unique features of the Alter Ur

Ego jeans:

1.
2.
3.

4.
5.
5

High Rise in the back

Have an opening for a
catheter
Accessible front
pockets, with no back
pockets
Longer in length
All of the above

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Which aspects of the STDP can you see evidence of

in the article about Alter Ur Ego jeans?

1.
2.
3.
4.
5.

Segmentation
Targeting
Differentiation
Positioning
All of the above

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2012 Principles of Marketing: An Asian Perspective

Unilever in Vietnam

Why would Unilever introduce several brands

in one category instead of concentrating its
resources on a single brand?

7-8

Market Segmentation
is the process that companies use to divide large heterogeneous
markets into small markets that can be reached more efficiently and
effectively with products and services that match their unique needs

7-9

Market Segmentation

10

Geographic
segmentation

Demographic
segmentation

Psychographic
segmentation

Behavioral
segmentation

Geographic Segmentation

11

Why does Coca Cola have

different bottles/can designs in
some countries?

Why is Coca Cola sweeter or

less sweet in some countries?

Demographic Segmentation
Divides the market into groups
based on variables such as age,
gender, family size, family life
cycle, income, occupation,
education, religion, race,
generation, and nationality.

Demographic factors are the most popular bases

for segmenting customer groups.

12

Demographic Segmentation

13

Market Segmentation
Psychographics Segmentation
Divides buyers into different groups based
lifestyle or personality characteristics.
Marketers also use personality variables to
segment markets.

14

on

Psychographic segmentation

iPod Silhouette Campaign

15

Behavioural Segmentation

Occasion
Benefit
User status
Usage rate
Loyalty

16

7.1 Market Segmentation

Behavioral Segmentation
Occasion segmentation means grouping buyers according to
occasions when they get the idea to buy, actually make their purchase,
or use the purchased item.
Benefit segmentation means grouping buyers according to the
different benefits that they seek from the product.

17 2012 Principles of Marketing: An Asian Perspective

7.1 Market Segmentation

Behavioral Segmentation
User Status means segmenting markets into nonusers, ex-users,
potential users, first-time users, and regular users of a product.
Usage Rate means grouping markets into light, medium, and heavy
product users.
Loyalty Status means dividing buyers into groups according to their
degree of loyalty.

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Different usage of OMO: Behavioural

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7.1 Market Segmentation

Useful segments are...

20 2012 Principles of Marketing: An Asian Perspective

7.1 Market Segmentation

Measurable
Measurable: The size, purchasing power, and profiles of the
segments can be measured.

21 2012 Principles of Marketing: An Asian Perspective

7.1 Market Segmentation

Substantial
Substantial: The market segments are large or profitable enough
to serve.

22 2012 Principles of Marketing: An Asian Perspective

7.1 Market Segmentation

Accessible
Accessible: The market segments can be effectively reached and
served.

23 2012 Principles of Marketing: An Asian Perspective

7.1 Market Segmentation

Actionable
Actionable: Effective programs can be designed for attracting and
serving the segments.

24 2012 Principles of Marketing: An Asian Perspective

7.1 Market Segmentation

Differentiable
Differentiable: The segments are conceptually distinguishable and
respond differently to different marketing mix elements and
programs.

25 2012 Principles of Marketing: An Asian Perspective

Identify as many segments for this

shampoo product

Segment 1

Segment 2

7-26

Geographic

Demographics

Psychographics

Behavioural

- location?
etc.

- age, gender?
etc.

- personality?
etc.

- occasion?
benefits sought?
etc.

Age: 15 18
Studying in high
school
Interested in a low
maintenance look
Washes hair 5 times
a week
Price sensitive (no
income, only pocket
money)

7-27

Age: 25 30
Working
High purchasing
power
Single or married
but no children
Busy lifestyle (work
and social life)
Loves to go out
Very conscious
about how she
looks
Cares about quality

Woman aged 35 45
Working or stay at
home mom
Has children aged
over 5
Buys products for
the whole family
Is price conscious
but also cares about
quality
Has to manage the
needs of all family
members

Age: 21 30
Working
Interested in looking
good
Fashion and image
conscious
Has high disposable
income
Very active social life
Has different
products for different
occasions

Copyr
7-28
ight

Owners or
Managers of hair
saloons or Hair
stylists
High purchasing
power
Will buy products
based on customer
needs (so high
quality products as
well as day to day
products)
Needs to buy
frequently and in
large amount

Mums with young

children aged 0 5
Family has middle
to high income ( 21
mill VND or above)
Looking for gentle
products for
children
Care very much
about ingredients
and quality of the
product
Not price sensitive
and can be very
brand loyal

7.2
Market Targeting

7.2

29 2012 Principles of Marketing: An Asian Perspective

7.2 Market Targeting

Target market
A target market consists of a set of buyers who share common
needs or characteristics that the company decides to serve.

30 2012 Principles of Marketing: An Asian Perspective

Who will you choose to sell to?

7.2 Market Targeting

Target Marketing Strategies

32 2012 Principles of Marketing: An Asian Perspective

Targeting
Undifferentiated Marketing

MARKETING MIX

33

Whole market

You choose to sell the same product to all segments

Same
shampoo for
all with no
modifications

Targeting
Using Differentiated marketing) strategy, a firm decides to target
several market segments and designs separate offers for each.

MARKETING MIX 1

Segment 1

MARKETING MIX 2

Segment 2

MARKETING MIX 3

Segment 3

MARKETING MIX 4

Segment 4

35 RMIT University MKTG 1199 Marketing Principles

Differentiated marketing Colgate and

LOral target different market
segments with different types of
products.

You choose to sell to all or many segments but you modify the
product to fit the needs of each segment

Shampoo for
everyday use
for women

Mild shampoo

Natural ingredients
for high shine.
Higher priced as
well. Gives polished
look

Mens shampoo,
gives rich shine
and easy to style

Suitable for
children

Shampoos for
coloured hair,
everyday use,
styling, bigger
bottles

Unisex
shampoos, for
everyday use

Is this better than undifferentiated

marketing?

How is this better than undifferentiated

marketing?

Targeting
Concentrated Marketing
Or Niche Marketing

Segment 3
Segment
Segment 22

MARKETING MIX

39

Segment 1

You choose to focus on 1 or a few small segments

Focus on 1 or
a few small
segments

7-40

How is this different from

differentiated marketing?

Targeting
Micro Marketing is the practice of tailoring products and marketing
programs to suit the tastes of specific individuals and locations.

Local marketing

42

Individual marketing is
the

Personalized
laptop skin

43

Make your own shampoo

Each customer can choose different ingredients,

flavours, add their name to the packaging etc

What is the targeting strategy used by Toyota in this case?

1.
2.
3.
4.
5.

Undifferentiated marketing
Differentiated marketing
Concentrated marketing
Local marketing
Individual marketing

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Toyota launched the Lexus brand to target the upper income

and wealthier segments. Which strategy did they use with the
Lexus

1.
2.
3.
4.
5.

Undifferentiated marketing
Differentiated marketing
Concentrated marketing
Local marketing
Individual marketing

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7.3
Differentiation and Positioning

7.3

47 2012 Principles of Marketing: An Asian Perspective

Steps in Market Segmentation, Targeting,

Differentiation and Positioning

48

What do you think of these brands? What is

your perception?

49

Positioning
Positioning: A market offering occupying a:
Clear, distinctive, and desirable place relative to competing products in
the minds of target consumers.
A products position is the way the product is defined by consumers
on important attributes.

50

How to Position the brand?

Positioning Map
Perceptual positioning maps show consumer perceptions of
their brands versus competing products on important buying
dimensions.

Identify the gaps

51

51

Are there any opportunities?

RMITRMIT University10/22/16
Intern

52

How would you create a positioning map for

beer?
What are the important attributes you would consider when buying
beer?

Price

Country of origin

Level of alcohol

Taste (bitter, sweet)

Type of beer (lager, draft etc)

Try NOT to use Quality!! Too broad

53

Comparing alcohol content with price

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Comparing occupation with country of origin

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Differentiation and Positioning

Choosing a differentiation and positioning Strategy

IDENTIFY COMPETITIVE
ADVANTAGES
Differentiation
CHOOSE RIGHT COMPETITIVE
ADVANTAGE

SELECT POSITIONING STRATEGY

56

56

Differentiation and Positioning

Possible Value propositions

57

57

Summary
To create Customer driven strategies :
1. Segment the market
2. Choose your target customer
3. Identify the gaps
4. Differentiate your product from the competitors
5. Offer customers a value proposition
6. Position the product in the customers

58

Preparation

Preparation for tutorial this week:

Watch the video on Differentiation and Positioning before going
to the tutorial. The videos are available under Preparation (Before
tutorial)
Do the quiz on Differentiation and Positioning on BB
Read two real cases in the wrap up session to see practical
application of STDP
Preparation for lecture next week:
Watch video on 3 levels of product before coming to the lecture.

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Thank you