...Introduction to Marketing Dahlia El-Manstrly Department of Management Marketing Concepts . Marketing dynamics . Consumer behaviour . Market segmentation . Marketing mix . Customer relationship management Marketing definition 'The management process responsible for identifying, anticipating and satisfying customer requirements profitably' (CIM) 'satisfying needs and wants through an exchange process' (Kotler,2009) Dissatisfied customers can tell up to eleven other people about their bad experiences, which is two to three times more people than a satisfied customer will talk to. Smith, 1993 Consumer Behaviour- Customers How do they buy? What are their choice criteria? Who is important? Where do they buy? When do they buy? D Jobber, Principles and Practice of Marketing, . 1998 McGraw-Hill Consumer Behaviour Cont. .What do customers wants? .Functional Value .Social Value .Emotional Value .Epistemic Value .Conditional Value .What role (s) do customers play? .Customer as a user .Customer as a buyer .Customer as a payer Decision making process I’m hungry Problem recognition What’s available? Information search Fruit or chocolate? Information evaluation Chocolate! Decision I should’ve had fruit. Post-purchase evaluation How do consumers make a purchase decisions? High involvement: the Fishbein and Ajzen model...
Words: 595 - Pages: 3
...Chapter Eight: Segmentation, Targeting, and Positioning Segmenting, Targeting, and Positioning Process Step 1: Establish Overall Strategy or Objectives * The segmentation strategy must be consistent with and derived from the firm’s mission statement and strategic objectives, as well as it’s current state * Current state involves SWOT Analysis (internal strengths and weaknesses, external opportunities and threats) Step 2: Profile Segments * The second step in the segmentation process is to describe the different segments (needs, wants, characteristics), which helps firms better understand the profile of the customers in each segment Segmentation Method | Sample Segments | 1. Geographic | Country, province, city, urban, rural, climate, continent: North America, Asia, Europe, Africa, Region: Atlantic, Central, Western Canada | 2. Demographic | Age, gender, income, education, occupation, ethnic background, religion, family life cycle | 3. Psychographic | Lifestyles, values, self concept | 4. Behavioural | Benefits derived, usage rates, user status. Loyalty | 1. Geographic Segmentation – the grouping of consumers on the basis of where they live * Divide market into separate geographic units of countries, regions, provinces, cities, neighbourhoods, climates, etc. * Then hey can develop appropriate marketing programs according to the areas * Geographic segmentation is most useful for companies who’s products satisfy...
Words: 1741 - Pages: 7
...The concept of market segmentation. The conception of market segmentation is a marketing approach that consists of dividing a wide target market into subcategories of consumers, who share common needs, by planning and applying strategies to target their needs and wants to utilize media channels and other promotional elements that facilitate reaching the focused customers. Additionally, market segments allow businesses to design different marketing approaches to target them. However, reaching a market by recommending different, desirable, and competing products, that is in the outlooks of the target consumers. In which, buyers behaviors in numerous markets diverge in their wants or needs, incomes, localities, purchasing attitude, and buying habits. Within market segmentation, corporations break up large, diverse markets into smaller sectors that can be influenced more effectively with products and services that are compatible their individual needs. Furthermore, a marketer has to point various segmentation variables, to obtain the safest technique to analyze the targeted market structure; where, these market segmentations are classified in four different variables that are geographic, demographic, psychographic, and behavioral (Kotler & Armstrong, 2010, p 191). An example is the Coca Cola Company; this company had expanded its business worldwide servicing over 200 countries and with a total of $35 billion in revenues annually (10-k: The Coca Cola Company). In fact...
Words: 504 - Pages: 3
...Marketing knowledge and the value of segmentation Sally Dibb Warwick Business School, University of Warwick, Coventry, UK Philip Stern Warwick Business School, University of Warwick, Coventry, UK Robin Wensley Warwick Business School, University of Warwick, Coventry, UK Keywords Market segmentation, Marketing theory, Customer profiling, Organizational performance Introduction Market segmentation is according to many textbooks, one of the fundamental principles of marketing (Kotler, 1997). Marketing theory suggests that businesses adopting a market segmentation approach can enhance their organisational performance (Kotler, 1997). Market segmentation is grounded in economic pricing theory, which suggests that profits can be maximised when pricing levels discriminate between segments (Frank et al., 1972). One reason for the widespread acceptance of the approach is the belief that organizations cannot normally serve all of the customers in a market. The leading textbook by Kotler (1997) states that, ``Customers are too numerous, and diverse in their buying requirements''. The implication is that segmentation helps to homogenize market heterogeneity and coincidentally allow for improved organisational performance by targeting specific segments of the market. Thus customers who have been aggregated according to similar buying needs and behaviour will tend to demonstrate a more homogeneous response to marketing programmes (Choffray and Lilien, 1978; Wind, 1978). The marketing...
Words: 4286 - Pages: 18
...attract new target markets while still catering to their existing customer. New promotion will be attract a lot of people and T.G.I Fridays will continue working to create an atmosphere friendly to every race, gender, age and others. Market Segmentation Market segmentation is the process of defining and divide a large heterogeneous market into clearly identifiable segments having similar needs, wants, or demand characteristics. Its objective is to design a marketing mix that just matches the expectations of customers in the targeted segment. Few companies are big enough to supply the need of an whole market, most of them must break down the total demand into segments and choose those that the company is best fit out to handle. Clear identification of the segment, measurability of its valid size, its accessibility through promotional efforts and appropriateness to the policies and resources of the company are the four basic factors that affect market segmentation. In this section, it has four important segmentation topics, it is segmentation consumer markets, segmentation business markets, segmentation international markets, and the requirements for affective segmentation. (Philip Kolter,2010) Segmentation Consumer Markets The segmentation of consumer markets requires the founding of sub-groups from a larger population to more specifically target for them. There is no single way to segment the market. There are essentially dozens of ways that market might be segmented...
Words: 1585 - Pages: 7
...Benefit Segmentation: A Dedsion-oriented Research Tool RUSSELL I. HALEY been center M ARKETassegmentation has passessteadily moving towardresearch stage a topic of discussion in marketing and circles. Hardly a conference without at least one session devoted to it. Moreover, in March the American Management Association held a three-day conference entirely concerned with various aspects of the segmentation problem. According to Wendell Smith. "Segmentation l^ based upon developments on the demand side of the market and represents a rational and more precise adjustment of product and marketing effort to consumer or user requirements."^ The idea that all markets can be profitably segmented has now received almost as widespread acceptance as the marketing concept itself. However, problems remain. In the extreme, a marketer can divide up his market in as many ways as he can describe his prospects. If he wishes, he can define a left-handed segment, or a blue-eyed segment, or a German-speaking segment. Consequently, current discussion revolves largely around which of the virtually limitless alternatives is likely to be most productive. According to this ar+icle, mos+ techniques of market segmentation rely only on DESCRIPTIVE factors pertaining to purchasers and are not efficient predictors of future buyer behavior. The author proposes an approach whereby market segments are delineated first on the basis of factors with a CAUSAL relationship to future purchase behavior. The belief underlying...
Words: 4229 - Pages: 17
...Introduction As our question is “Select three different shampoo products. Discuss the market segmentation and targeting of these products with reference to the pricing, packaging, and advertised selling points and themes. Explain the positioning strategies of each product”, we become marketers of Rejoice’s company (P&G). As we know that our company is facing three problems – decreasing profit, many new competitors appear in the existing market, and losing our market shares. So, we need to plan the strategies again to solve these problems and create customers equity. According to the marketing process, understanding the marketplace (i.e. knowing the competitors’ status) and customers’ needs and wants is the first thing that we should do when start to plan the suitable strategies. Then, we can redo our market segmentation, targeting and positioning. In this research, we are going to analysis two main competitors for our products – Vidal Sassoon and Asience. Background information of Rejoice Rejoice is one of product in P&G which is a global brand. The major function of it is reducing the dandruff problem and gives out a natural product. Market segmentation of Rejoice Demographic segmentation In family size, we analyze this reference to packing, customers usually buy either small size prefer 400ml with$25.9 or premium size prefer 1000ml with $52 that is determined by the family size. In income aspect, the customers usually determine the brand of shampoo based on...
Words: 2112 - Pages: 9
... 1 DUE DATE 23/O4/2015 COURSE CODE CUIM 137 INTRODUCTION According to Bruce R Jewel, 2000, he defines marketing as disaggregating the market into discreet groups or segments of customers. There are many different reasons for a business to segment their market. In its simplest form, the needs of individual customers differ, so it makes sense that a business creates separate offers for each segment of the market. This gives customers a better solution (whether it’s a product or a service), and helps raise profitability in the entire business. Market segmentation is also a very effective means of discovering how to reach your customers. If you break down the large market into smaller groups, specific sets of customers – you can target the exact strategies needed to reach each group of customers. This can give you a competitive edge, as you are focused on customer needs, while allowing you to stay on top of the latest trends and opportunities in the market. There are several basis we can use to segment a market. These are the use of geographic segmentation, demographics, psychographics, and...
Words: 1411 - Pages: 6
...Thuy Linh - FB4A Market segmentation case study “SILVERJET – A fallen star” Market segmentation is one of significant tools in business which divides consumers into groups based on common needs; it not only brings a number of benefits to both the consumer and the organization but also causes the failure of organization. SilverJet is a typical example; it was found by Lawrence Hunt in 2006 and bankrupted in 2008. Even though it gained some achievements, it was ended because of some serious mistakes. Before explaining about the reasons of failure of SilverJet, we should know about the segmentation bases used by airline and SilverJet, and the importance of carbon offset fee added to the ticket price. There are four types of market segmentation: geographic, demographic, and psychographic and behavior. Nowadays, the airlines do not segment anymore on geographic, but on demographic, psychographic and behavior criteria. (1) The airlines divide first their customers with variables such as age, income, social class and life style. Those are variables that consumer wants, preferences and usage rates are often associated with. Demographic variables are popular for segmenting market because they are common and easily identified consumer characteristics. Further segmentation could be done through various behavior criteria such as purpose of travel, price and time, service orientation. Thus, the better an airline does the segmentation the better it will...
Words: 848 - Pages: 4
...Market Segmentation in B2B Markets Written by Paul Hague and Matthew Harrison Satisfying people’s needs and making a profit along the way is the purpose of marketing. However, people’s needs differ and therefore satisfying them may require different approaches. Identifying needs and recognising differences between groups of customers is at the heart of marketing. What Is Marketing If It Is Not About Segmentation? CVS Pharmacy is one of the most successful drug store chains in America. What is the reason for this success? They understand their market and have approached it through segmentation and targeting. The company looked at its customer base and found that 80 percent are women. With this in mind, CVS redesigned 1,200 of its 6,200 stores to meet the needs of busy, multi-tasking women by offering shorter wait times for prescriptions, wider and better-lit shopping aisles, and more beauty products. In doing so it fulfilled the requirement of all good marketing orientated companies – it identified the needs of its customers and organised its offer to better meet them. This is at the heart of all good marketing – meeting customers’ needs profitably, and allocating finite resources in such a way that profit is maximised. This means not wasting time or resources on customers who would be less profitable, and treating the key targets not as one homogenous population but as distinct groups with distinct needs. It is very rare for even two customers to have identical needs to...
Words: 3879 - Pages: 16
...Adjei Mensah This paper is submitted in partial fulfillment of the requirements for International Marketing SMC University School of Management Professor (Dr.) Babu P George January 6, 2014 (Submission Date) Unit – 2 What is the role of the creativity in the segmentation process, Why can we say that having an excellent global positioning is one of the principal assets of a brand, What criteria should global marketers consider when making product design decisions, Identify several global brands. What are some of the reasons for the global success of the brands you chose? Abstract The study identifies segmentation processes and how it can be introduced to management to accept them. Often than not if management do not understand the process of segmentation and found out that what has been presented differ from what they know they quickly reject the proposed segmentations (Yankelovich & Meer, 2006). In segmentation, it allows the researcher to knowing how important a product or service is to the customers and this help in deciding what their expectations and are most likely to reveal their willingness to purchase your product. The study further identifies reasons why segmentations fail and steps needed to be taken to correct these errors. The literature elaborate on brand positioning and settling the confusion of brand positioning by managers straight. Consumer culture both local and global is also considered with it effect on brand positioning showing the...
Words: 4993 - Pages: 20
...Market Segmentation Market segmentation is the fundamental component of a market-based strategy. Market segmentation refers to a process researchers or managers utilize to identify groups, participants or consumers with similar needs or characteristics. Identifying market segments is critical to the successful development of management strategies based on marketing mix components (i.e., product, distribution, price, and promotion)(Kyle, 2002). By categorizing markets into sub sectors, targeting marketing effort in such a way as to meet the technical and other requirements of each of these, organizations maybe able to secure greater competitive position than if they attempted to satisfy the general requirements of the market as a whole. There are four criteria that are crucial to an effective marketing segmentation. A market segment should be identifiable, substantial, accessible and stable. Identifiable, at which there should be observable indicators that enable the segment to be defined and quantified. Substantial, meaning that the segment should be of enough size to make the effort involved in segmentation worthwhile. Accessible, that is, it should be probable to target specifically the segment using existing communication and distribution channels. Stable, so that after classification of the segment there should be sufficient time to capitalize on the investment implicated in segmentation. (Baker, 1995) Markets can be segmented using a variety of philosophical approaches...
Words: 1583 - Pages: 7
...change their market segmentation identification over time? Market segmentation is the process of placing the buyers in a product-market into subgroups so that the members of each segment display similar responsiveness to a particular positioning strategy (Cravens & Piercy, 2006). Once the companies had identified the market segmentation, the marketing effort should focus on the segment of interest and not be wasted on non-segment buyers. However, the companies need to change their market segmentation over time due to the several reasons. It is included the changing of buyers’ needs and preferences, changing of environment, ensure the stability over time and revenues and cost combination. First, the companies need to change their market segmentation due to the changing of response and perception from the consumers. Determine the response from the consumers is essential to form the market strategy for each of the market segments according to the different responsiveness from the buyers. It is important to monitor the response from the buyers constantly because the buyers’ wants and needs will change it over time. If the buyers’ needs change too fast, a group with similar response patterns at one point may display quite different patterns several months later. When there is a changing of the wants and needs, the responsiveness from the buyers were changing also. Thus, the companies can not position with the same marketing strategy to the same group of market segmentation. So, the companies...
Words: 669 - Pages: 3
...Market Segmentation To reach different markets or to promote your products to different locations or people one has to use a method called market segmentation. "Market segmentation describes the division of a market into homogenous groups which will respond differently to promotions, communications, advertising and other marketing mix variable" (Cumming). Market segmentation is extremely important for companies around the world. If a company doesn't research the area in which they are going to market or they put a product that is either to expensive or to elaborate in an area that can't afford that then they will fail as a company. In my paper I will discussion why market segmentation is used in around the world, the types of segmentation, some techniques used to make segmentation work the best. Market segmentation is to divide the market into smaller segments. The reason for dividing the market is to make it easier to address the needs of smaller groups of customers, particularly if they have many characteristicsin common (Breen). It is easier if you find things in common that are the same such age, gender, benefits, lifestyles, etc. We also use market segmentation to find niches or to identify under-served or un-served markets. "Using niche marketing, segmentation can allow a new company or new product to target less contested buyers and help a mature product seek new buyers" (Cumming). Niche marketing can also take a normally large, identifiable group...
Words: 321 - Pages: 2
...Segmentation in B2B Markets A White Paper by Paul Hague and Matthew Harrison of B2B International WHAT IS MARKETING IF IT IS NOT ABOUT SEGMENTATION? CVS Pharmacy is one of the most successful drug store chains in America. What is the reason for this success? They understand their market and have approached it through segmentation and targeting. The company looked at its customer base and found that 80 percent are women. With this in mind, CVS redesigned 1,200 of its 6,200 stores to meet the needs of busy, multi-tasking women by offering shorter wait times for prescriptions, wider and better-lit shopping aisles, and more beauty products. In doing so it fulfilled the requirement of all good marketing orientated companies – it identified the needs of its customers and organised its offer to better meet them. This is at the heart of all good marketing – meeting customers’ needs profitably, and allocating finite resources in such a way that profit is maximised. This means not wasting time or resources on customers who would be less profitable, and treating the key targets not as one homogenous population but as distinct groups with distinct needs. It is very rare for even two customers to have identical needs to each other. In a perfect world, we would identify those customers that we deem to be profitable, and then treat each one of those individually according to their unique needs. In any market with a sizeable target audience, even this is likely to require more resources...
Words: 4148 - Pages: 17