Segmentation

Segmentation, Targeting, and Positioning: Building
the Right Relationships with the Right Customers
Based on: Philip Kotler et al., Principles of Marketing
International Marketing Prof. Dr. Thomas Laukamm

Objectives
- Be able to define the three steps of target

marketing: market segmentation, target
marketing, and market positioning.
- Understand the major bases for segmenting
consumer and business markets.
Fach,
Dozent,
International Semester
Marketing Prof. Dr. Thomas Laukamm 2/39
Objectives
- Know how companies identify attractive

market segments and how they choose a
target marketing strategy.
- Comprehend how companies position their
products for maximum competitive advantage.
Fach,
Dozent,
Definition
- Market Segmentation:
+ Dividing a market into distinct groups with distinct
needs, characteristics, or behavior who might
require separate products or marketing mixes.
Fach,
Dozent,
The need for market segmentation
- Marketers understand that

they cannot be all things to
all people, all of the time.
Buyers and markets are too
complex and diverse for one
simple marketing formula to
adequately address the
needs of all.
Fach,
Dozent,
Segmentation and positioning
- Target marketing
+ Identifies market segments that are bite sized
chunks that organisations can manage.
- Market segmentation
+ Identifies markets with common traits.
- Market targeting
+ Process of evaluation of the selected segments and
then deciding which market segments to operate
within.
- Market positioning
+ Process whereby marketers position the product to
occupy a clear and distinctive position relative to
other competing products.
Fach,
Dozent,
Market segmentation
- Markets are comprised of buyers

and they differ in wants,
resources, locations and buying
patterns.
- Market segmentation is the

process that marketers use to
divide up the market into smaller
segments that can be efficiently
addressed.
Fach,
Dozent,
Market segmentation
Figure 10.1 Six steps in market segmentation, targeting and positioning
Fach,
Dozent,
Market Segmentation
Topics - Geographical segmentation

+ Marketing mixes are
customized geographically
- Demographic segmentation
- Segmenting Consumer + Most popular segmentation
Markets + Demographics are closely related to
- Segmenting Business needs, wants and usage rates
Markets - Psychographic segmentation

+ Lifestyle, social class, and personality-
- Segmenting International based segmentation
Markets - Behavioral segmentation
- Requirements for Effective + Typically done first
Segmentation
Fach,
Dozent,
Market Segmentation
Topics - Demographic segmentation

+ Industry, company size, location
- Operating variables
- Segmenting Consumer + Technology, usage status, customer
Markets capabilities
- Segmenting Business - Purchasing approaches

Markets - Situational factors
+ Urgency, specific application, size of
- Segmenting International order
Markets - Personal characteristics
- Requirements for Effective + Buyer-seller similarity, attitudes toward
risk, loyalty
Segmentation
Fach,
Dozent,
Market Segmentation
Topics - Geographic segmentation

+ Location or region
- Segmenting Consumer - Economic factors

+ Population income or level of economic
Markets development
- Segmenting Business - Political and legal factors
Markets + Type / stability of government, monetary
regulations, amount of bureaucracy, etc.
- Segmenting International
- Cultural factors
Markets + Language, religion, values, attitudes,
- Requirements for Effective customs, behavioral patterns
Segmentation
Fach,
Dozent,
Market Segmentation
Topics - Measurable
+ Size, purchasing power, and profile of
segment
- Segmenting Consumer - Accessible
Markets + Can be reached and served
- Segmenting Business - Substantial

+ Large and profitable enough to serve
Markets
- Differentiable
- Segmenting International + Respond differently
Markets - Actionable
- Requirements for Effective + Effective programs can be developed
Segmentation
Fach,
Dozent,
Levels of market segmentation
+ Mass marketing
• Assumes market is homogenous and uses the same product, promotion
and distribution to all consumers.
+ Segment marketing
• Adapting a company’s offerings so they more closely match the needs
of one or more segments.
+ Niche marketing
• Adapting a company’s offerings to match the needs of one or more sub-
segments more closely where there is little competition.
+ Micro marketing
• Marketing programmes tailored to narrowly defined geographic,
demographic, psychographic behavioural segments.
Fach,
Dozent,
Micro marketing
¾ Local Marketing
o Tailoring brands and promotions to the needs and wants of local
customer groups.
¾ Individual marketing
o Tailoring products and marketing programmes to the needs and
preferences of individual customers.
¾ Mass customisation
o Preparing individually designed products and communication on a
large scale.
Fach,
Dozent,
Market segmentation
- There is no single way of segmenting a

market.
- Different market segmentation variables
to develop the most effective
segmentation method.
- Major variables used are geographic,
demographic, psychographic and
behavioural.
Fach,
Dozent,
Market segmentation
Table 10.1 Market segmentation variables for consumer markets

Fach,
Dozent,
Table 10.1 Market segmentation variables for consumer markets (continued)
Fach,
Dozent,
Segmentation (1)
- Geographic segmentation
+ Dividing a market into different geographical units such as
countries, states, regions, towns.
- Demographic segmentation
+ Age and life-cycle segmentation.
+ Ethnic segmentation.
+ Gender segmentation.
+ Income segmentation.
- Geo-demographics
+ Study of relationship between geographical location and
demographics.
Fach,
Dozent,
Segmentation (3)
- Behavioural segmentation
+ Markets segmented based upon consumer knowledge, attitude, use
or response to a product.
• Occasion segmentation
• Benefit segmentation
• User status
• Usage rate
• Loyalty status
• Buyer readiness stage
• Attitude towards product
Fach,
Dozent,
Benefit segmentation of the toothpaste market
Source: Adapted from Russell J. Haley, ‘Benefit segmentation: a decision-oriented research tool’, Journal of Marketing (July 1968), pp. 30–5; see
also Haley, ‘Benefit segmentation: backwards and forwards’, Journal of Advertising Research (February–March 1984), pp. 19–25; and Haley,
‘Benefit segmentation – 20 years later’, Journal of Consumer Marketing, 1 (1984), pp. 5–14.
Fach,
Dozent,
Segmenting business markets
Primary segmentation variables for business markets

Source: Adapted from Thomas V. Bonoma and Benson P. Shapiro, Segmenting the Industrial Market (Lexington, MA: Lexington Books, 1983); see
also John Berrigan and Carl Finkbeiner, Segmentation Marketing: New methods for capturing business (New York: Harper Business, 1992).
Fach,
Dozent,
Primary segmentation variables for business markets (continued)
Source: Adapted from Thomas V. Bonoma and Benson P. Shapiro, Segmenting the Industrial Market (Lexington, MA: Lexington Books, 1983); see
also John Berrigan and Carl Finkbeiner, Segmentation Marketing: New methods for capturing business (New York: Harper Business, 1992).
Fach,
Dozent,
Customer
Groups
Defining & Segmenting Businesses
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Dozent,
International Marketing
Fach,
1
Requirements for effective segmentation
- Measurability
+ Degree to which size, purchasing power and profits of a market
segment can be measured.
- Accessibility
+ Degree to which a market segment can be reached and served.
- Substantiality
+ Degree to which a market segment is sufficiently large or
profitable.
- Actionability
+ Degree to which effective programmes can be designed for
attracting and serving the given market segment.
Fach,
Dozent,
Target Marketing
- Evaluating Market Segments

+ Segment size and growth
+ Segment structural attractiveness
• Level of competition
• Substitute products
• Power of buyers
• Powerful suppliers
+ Company objectives and resources
Fach,
Dozent,
Target Marketing
- Target Marketing Strategies

+ Undifferentiated (mass) marketing
+ Differentiated (segmented) marketing
+ Concentrated (niche) marketing
+ Micromarketing (local or individual) marketing
Fach,
Dozent,
Target Marketing
- Choosing a Target-Marketing Strategy Requires

Consideration of:
+ Company resources
+ The degree of product variability
+ Product’s life-cycle stage
+ Market variability
+ Competitors’ marketing strategies
Fach,
Dozent,
Positioning
- Positioning:
+ The place the product occupies in consumers’
minds relative to competing products.
+ Typically defined by consumers on the basis of
important attributes.
Fach,
Dozent,
Positioning
- Choosing a Positioning Strategy:

+ Identifying possible competitive advantages
• Products, services, channels, people or image can be
sources of differentiation.
+ Choosing the right competitive advantage
• How many differences to promote?
¾ Unique selling proposition
¾ Positioning errors to avoid
• Which differences to promote?
Fach,
Dozent,
Positioning
+ Selecting an overall positioning strategy
• More for More Value Proposition
• More for the Same Value Proposition
• The Same for Less Value Proposition
• Less for Much Less Value Proposition
• More for Less Value Proposition
Fach,
Dozent,
Positioning

+ Developing a positioning statement
• Positioning statements summarize the company or
brand positioning
• EXAMPLE: To (target segment and need) our (brand)
is (concept) that (point-of-difference).
+ Communicating the chosen position
Fach,
Dozent,
Differentiating markets
- Value positioning
+ A range of positioning alternatives based on the value an offering delivers
and its price.
• More for more
¾ Premium product and premium price, supported by a premium image. E.g. Mont Blanc
pens
• More for the same
¾ Brand offering comparable quality at a lower price. E.g. Lexus versus the Mercedes-Benz.
• The same for less
¾ Value proposition e.g. Amazon.com
• Less for much less
¾ Trade off between luxury and necessity. E.g. Five star hotel versus a budget hotel. Lower
performance for much lower cost.
• More for less
¾ No-name house brands versus the big brands.
Fach,
Dozent,
Common and serious positioning errors
- Under-positioning
+ A positioning error referring to failure to position a company, its product or
brand.
- Over-positioning
+ A positioning error referring to too narrow a picture of the company, its
products or a brand being communicated to target customers.
- Confused positioning
+ Leaves consumers with a confused image of the company, its product or
brand.
- Implausible positioning
+ Making claims that stretch the perception of the buyers too far to be
believed.
Fach,
Dozent,
Essential criteria to accomplish
a good positioning strategy
• Features and benefits must be important to the consumer.

• Must be distinctive from the competition.
• Must deliver superior quality or service.
• Difference must be communicable and visible to buyers.
• Pre-emptive and competitors unable to replicate.
• Affordable
• Profitable
Fach,
Dozent,
Segmentierung
Conrad Electronic will jetzt auch Frauenbedürfnisse stillen

[27.10.04]
(iBusiness) Conrad meint zu wissen, was Frauen wünschen: einen Technik-
und Lifestyle-Onlineshop, in dem sie einfach und bequem in angenehmer
Gesellschaft nach Herzenslust stöbern können, in dem es umfangreiche
Service- und Beratungsangebote gibt und der origineller gestaltet ist, als die
männerdominierten Sites anderer Technik-Versender. Deshalb hat der
Elektronikhändler nun Conrad-Sisters.de gestartet.
Seither besteht die Conrad-Kundenstruktur zu 95 Prozent aus Männern. Das soll sich
nun ändern. Nach dem Motto 'Shopping goes Sitcom' geht Conrad Electronic nun mit
seinem ersten Onlinshop speziell für Frauen online. Für eine frauengerechte
Einkaufsatmosphäre sollen Hausfrau Helga, Karrierefrau Corinna, die freche Göre
Gina und die Blondine Bonnie sorgen, die "vier Conrad-Sisters als schrecklich nette
Familie" und als Charaktere an Stil-Ikonen wie Sex-and-the-City-Protagonistin Carry
Bradshaw oder TV-Darling Ally McBeal angelehnt.
Die Conrad-Sisters sollen die Kundinnen als Presenter und Beraterinnen durch die
wöchentlich wechselnden Aktionswelten begleiten. Da der höchste Frauenanteil bei
den Internet-Nutzern insbesondere in den jungen Altersgruppen zu verzeichnen ist,
ist laut Macher die Ansprache bei den Conrad-Sisters "entsprechend jugendlich und
frech".
Fach,
Dozent,
Segmentierung
Das Shopkonzept stützt sich dabei auf aktuelle Studien, denen zufolge von den bis
19-jährigen Nutzern die Frauen einen Anteil von 51,2 Prozent ausmachen. Bei den
20- bis 29-Jährigen sind es schon 53,9 Prozent (Quelle: W3B-Studie 'Frauen im
Internet' vom November 2003). Außerdem geben Frauen beim Onlineshopping sogar
mehr Geld aus als Männer: Laut einer Studie von Verdict Research (02/2004) haben
Frauen im vergangenen Jahr in England zum ersten Mal durchschnittlich mehr Geld
online ausgegeben als Männer.
Auch auf der Suche nach einem Onlineshop gehen Frauen andere Wege als
Männer. Persönliche Kommunikation spielt für sie dabei eine wichtige Rolle.
Während über ein Drittel der Online-Kundinnen den ersten Shop über Freunde,
Bekannte und Kollegen kennen lernen, lassen sich die männlichen Käufer lieber über
Suchmaschinen zum Onlineshop leiten, so die Ergebnisse von 'eCommerce Facts
3.0', einer Studie der Deutschen Post zum Onlineshopping in Deutschland. So tun
Männer, was sie seit der Steinzeit tun: Männer sind Jäger, Männer kaufen gezielt.
Frauen sind Sammlerinnen, Frauen stöbern gerne. Männer wollen knappe,
faktenorientierte Texte. Für die Damen darf es bei Produktbeschreibungen schon mal
etwas stimmungsvoller zugehen. Überhaupt schätzen Frauen beim Einkaufen eine
inspirierende, freundliche und emotionale Atmosphäre. Und: Frauen suchen mehr
Informationen rund um das Produkt, lassen sich lieber beraten, sie vertrauen
verstärkt auf die Informationen anderer. Diese Bedürfnisse will Conrad Electronic mit
seinem neuen Shop bedienen.
Fach,
Dozent,
Segmentierung
Bei Conrad-Sisters.de soll es deshlab wöchentlich wechselnde Sitcom-Folgen geben

mit "flotten Sprüchen und schrillen Inszenierungen" - von 'Die Conrad-Sisters tischen
auf', 'Die Conrad-Sisters sind winterfest' bis 'Männergeschenke von den Conrad-
Sisters'. Neben einer extra für Frauen geschalteten Beratungshotline und der Option,
Beratungen per E-Mail abzurufen, sollen turnusmäßig fachspezifische Themen wie
'Optimale Sicherheit im Haus' oder 'Schluss mit der 0900/0190-Abzocke' ausführlich
und gut verständlich besprochen werden. Außerdem gibt es laut Shopbetrieber "extra
großzügige Garantie- und Rückgaberegelungen sowie einen Fundus von etwa
65.000 Produktdatenblättern".
Fach,
Dozent,
Segmentierung
Fach,
Dozent,
Segmentierung in der Praxis
Segmentierung "XtendCourse"
Bedürfnisse
eLearning
eTraining
Bewerberauswahl
Quizz
WebSiteTest
Marktforschung
Guided Tours
Industrie+Handel
Kundentyp
Banken + Vers.
Mittelstand
Behörden
Hochschulen
Lehrinstitute
MaFo-Institute
Lizenzvertrieb
End User
Software
Produkte/
- nachgelagert
- vorgelagert
Service incl.
Services
gering Softwaregeschäft
mittel Servicegeschäft
stark beides
Fach,
Dozent,

Segmentation

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Segmentation

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Segmentation, Targeting, and Positioning: Building

the Right Relationships with the Right Customers

Based on: Philip Kotler et al., Principles of Marketing

International Marketing Prof. Dr. Thomas Laukamm

- Be able to define the three steps of target

- Know how companies identify attractive

- Marketers understand that

- Markets are comprised of buyers

- Market segmentation is the

Figure 10.1 Six steps in market segmentation, targeting and positioning

Topics - Geographical segmentation

Markets - Psychographic segmentation

Topics - Demographic segmentation

- Segmenting Business - Purchasing approaches

Topics - Geographic segmentation

- Segmenting Consumer - Economic factors

- Segmenting Business - Substantial

- There is no single way of segmenting a

Table 10.1 Market segmentation variables for consumer markets

Primary segmentation variables for business markets

Prof. Dr. Thomas Laukamm

- Evaluating Market Segments

- Target Marketing Strategies

- Choosing a Target-Marketing Strategy Requires

- Choosing a Positioning Strategy:

- Choosing a Positioning Strategy:

• Features and benefits must be important to the consumer.

Conrad Electronic will jetzt auch Frauenbedürfnisse stillen

Bei Conrad-Sisters.de soll es deshlab wöchentlich wechselnde Sitcom-Folgen geben

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