STP Segmentation Targeting Positioning

SEGMENTATION

Process of subdividing a total market into different subsets or groups. Where the marketer may select one or more segments. To be reached with an appropriate marketing mix.

Basis for market segmentation

On the basis of consumers personal characteristics (nonbehavioral correlates)

On the basis of consumer responses (behavioral correlates)

Geographic

Psychographic

Demographic

Socio-economic

Usage based

Benefits

Loyal status

Geographic Segmentation
Subdividing

the whole market into different geographical units which can be further sub-divided into smaller units. A national marketer may take whole nation as his market. For example-in the detergent market Hindustan Levers and Procter and Gamble are all national marketers in India. A multinational company may divide the global market on the basis of continents. Like Pepsi and Coca-cola.

Geographical features of India

1 2 Geographical area. Ranking in terms of geographical area in the world. Physical features 3,287,263 sq km. 7th largest country

Four major regions : A. The Great mountain zone. B. The Plains of the Ganga and the Indus region. C. The Desert region. D. The Peninsular India Tropical Monsoon types have four seasons A. Winter January to February B. Hot weather March to May C. Rainy (south western monsoon) June to September D. Rainy (north eastern monsoon) October to December

Climate

Source: India 2000, Publication Division, Government of India

Demographic Segmentation

Subdividing the market in terms of demographic features of a country or a region. Variables that may be considered are age, gender, marital status, family size, etc. Demographic data is essential for estimating the size of the target market.

Demographic features of India

1 Population size 846.30 million as per 1991 census Crossed 1000 million as per 2001 census

2 Sex ratio
3 Metro Cities

Females per 1000 males: 933/1000. 2001 census In Kerela State: 1036/1000 1991 census
1991 census Mumbai : 12.60 million Kolkata : 11.02 million Delhi : 08.42 million Chennai : 05.42 million Kolkata, Chennai, Greater Mumbai, Hyderabad, Delhi, Chandigarh, Mahe, Howrah, Kanpur, Banglore (All of them have a density of above 2000 persons per square km. 5.01% population lives in these 10 cities. Avg. density of these districts is 6885 persons)

4 Heavily populated districts

Source: Census of India,1991 and 2001

Socio-economic segmentation

Variables that may considered for market segmentation are Income, occupation, education, religion, social classes, etc. This segmentation is used for durable products such as automobiles, PCs, etc.

Psychographic segmentation
Sub division of different groups on the basis of personality, life style and values. Marketers of cosmetics, textiles, fast food providers etc. must understand the life style of the target market. Automobile manufacturers must consider different personality traits in dividing the market.

Benefit segmentation
Segmented on the basis of benefits sought by consumers
Toothpaste General benefits that consumers seek are cleanliness and hygiene in all segments. Other key benefits are:-

Cosmetic

Fluoride

Herbal

Protection against foul smell, modernity and cosmic value. EgColgate, Prudent

Family health, extra protection for children. EgColgate Fluoride, Cibaca Fluoride.

Family health and welfare. Traditionally good for health. Eg-Neem, Dabur.

Consumers perceived benefits of Two-wheelers

Motorcycle brands
Enfield Hero-Honda Kawasaki bajaj

Perceived benefits
sturdy, good for long rides and high resale value. Fuel efficient, high pick up and stylish High pickup, sleek model Fuel efficient, lifelong, high resale value

Scooter brands
Bajaj chetak cub

Kinetic Honda

Electronic ignition, easy to ride, trouble free.

Usage based segmentation

Market segmented into High buyers Medium buyers light buyers

Loyal buyers
Relationship seekers: buyers who want to develop long term relationships with their suppliers or retailers. Loyal buyers of particular brand: buyers who seek a particular brand among competing brands.

Evaluation of segmentation

Measurable Substantial Accessible Differentiable Actionable

Targeting

Once the firm has segmented the total market ,it should select the target market segment or segments for marketing. Investing in a particular segment should be sensible in terms of companys mission, objectives, skills and resources.

Targeting Strategies

Single segment concentration strategy

Multi segment strategy or differentiated marketing strategy

Undifferentiated marketing strategy

Single segment concentration strategy

The firm selects a single segment or market and fully concentrate its marketing efforts to try and seek maximum advantage.
Car maker Single marketing mix

Semi-luxury segment
(Expensive) Small car segment (affordable, less expensive) Luxury car segment (very expensive)

Multi-segmentsmore then two or may strategy Here the firm may select two or
Car maker

be all the segments and approach each segment with an appropriate marketing mix programme.

Marketing Mix

Marketing Mix

Marketing Mix

Small car segment

Semi-luxury segment

Luxury segment

Undifferentiated Marketing Strategy

The firm ignores the market segment differences and goes ahead with 1 single product offer for all segments.

Essential commodity manufacturer.

Single marketing mix

Market Positioning

Positioning of a product or service is creating an image in the consumers mind. Consumers generally buy images rather than actual product. Marketers mostly use advertising as a tool to build up brand or corporate image.

Positioning strategies
Sl. no. 1. Positioning strategies Customer benefits Price and quality Definition Advertising claims

Associate a brand or product with Benefit(s) customer benefits A product is highlighted in terms of service features or performance. Manufacturer charges high price Associating a product or service with a use or application Associating a product or service with a user or class of users. Value for money

2.

3.

Application

Use or application of a product or services. Cine stars or sports heroes using the product

4.

Product user

Positioning strategies
Sl. no. Positioning strategy Definition Advertising claims

Product class

Associating a product or service in a particular product class

Associating cultural symbols with a product or service to differentiate from competitors product Associating with competitors product or service by comparison

World class products

Cultural symbols

Royal

Competitors

Compares with competitors brand

Competing brands in the health drinks market Complan

Advertising claims complete planned food for growing children. Contains 23 vital nutrition The great nourisher-with extra calcium

Health drink market

Horlicks

Health

Bournvita

Health strength and energy.contains protiens,vitamins, menerals and carbohydrates. Energy Ah! Energy
Double action drink

Drink
Market

Boost Viva

Determining a competitive positioning strategy

Identification and selection of good positioning strategy With the help of marketing research

Steps in determining a competitive positioning strategy

Identify the strategy group Understand the consumers perception of competitive brands of strategy group Determine consumers needs and aspirations Select the best one for advertising campaign

Identify the strategic group

Strategic Groups I Hero Honda CD 100 Marketing Mix Target Consumer Groups Upper middle and middle income classes High Tech High styling High power High price

Kawasaki Bajaj
Yamaha & Bullet II Hero Honda TVS Suzuki III

High style High economy Medium price

Middle and lower middle income classes

TVS EXL Champ

Hero Puch

Low styling High economy Low price Low Tech

Lower income classes

Determine consumers need and aspirations Price

Fuel efficiency After-sales service Warranty Stylish looks Easy to ride High pick up and trouble free

Select the best one for advertising campaign

A sample of respondents can be asked to select the best among the alternatives and the same can be used for the advertising campaign

Thank you