CH5 • Describe your target market in detail, including information on the geographic, demographic, psychographic and behavioral factors used to choose your market segment.
CH5 • Identify the needs that cause your target market to buy.
Marketing Plan Strategy (PART 2)– WHO IS YOUR CUSTOMER?
Cultural Factors –
This is shifting – need to continually monitor a TOTAL MARKETING STRATEGY
Culture is the most basic cause of a person’s wants and behavior.
Subcultures are groups of people with shared value systems based on common life experiences and situations. For example, the African American market is growing in affluence and sophistication. The U.S. Hispanic market consists of more than 59 million consumers and is one of the fastest growing. Asian Americans are the most affluent U.S. demographic segment.
Social classes are society’s relatively permanent and ordered divisions whose members share similar values, interests, and behaviors..
Social Factors
Groups and Social Networks. A person’s behavior is influenced by many small groups.
Reference groups
serve as direct (face-to-face interactions) or indirect points of comparison or reference in forming a person’s attitudes or behavior.
Opinion leaders are people within a reference group who, because of special skills, knowledge, personality, or other characteristics, exert social influence on others.
Word-of-mouth influence is the impact of the personal words and recommendations of trusted friends, associates, and other consumers on buying behavior.
Influencer marketing
involves enlisting or creating opinion leaders to serve as “brand ambassadors” who spread the word about a company’s products. Electronics purchasers is a big segment. 70% seek advice before purchasing.
Online social networks
are online communities where people socialize or exchange information and opinions, YELP, Facebook, Twitter…(How credible are these?)
Family is the most important consumer buying organization in society. Do you agree? Changing Husband/Wife roles & Children Influencers
Personal Factors
Occupation. A person’s occupation affects the goods and services bought.
Age and Life Stage.
People change the goods and services they buy over their lifetimes. Tastes in food, clothes, furniture, and recreation are often age related.
Economic Situation. A person’s economic situation will affect product choice.
Lifestyle is a person’s pattern of living as expressed in his or her psychographics – VAL’s
Personality and Self-Concept.
Personality refers to the unique psychological characteristics that lead to relatively consistent and lasting responses to one’s own environment.
The basic self-concept (self-image) premise is that people’s possessions contribute to and reflect their identities; that is, “we are what we have.”
Psychological Factors
Motivation. A motive (or drive) is a need that is sufficiently pressing to direct the person to seek satisfaction.
Perception is the process by which people select, organize, and interpret information to form a meaningful picture of the world.
Learning describes changes in an individual’s behavior arising from experience.
Beliefs and Attitudes.
A belief is a descriptive thought that a person has about something.
Attitude
describes a person’s relatively consistent evaluations, feelings, and tendencies toward an object or idea.
** Market segmentation is most effective based on consumer not producer point of view – and Dynamic Segmentation means that criteria need to change – segmentation is NOT static
Geographic Segmentation calls for dividing the market into different geographical units such as nations, regions, states, counties, cities, or even neighborhoods.
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.
Psychographic Segmentation divides buyers into different groups based on social class, lifestyle, interests, opinions, priorities or personality characteristics. (Examples include couch potatoes, status seekers, outdoor enthusiasts)
Requirements for Effective Segmentation
“Can we make money?” Is it lucrative – This will drive the 4 P’s!
To be useful, market segments must be:
Measurable: The size, purchasing power, and profiles of the segments can be measured
Accessible: The market segments can be effectively reached and served.
Substantial: The market segments are large or profitable enough to serve
Differentiable: The segments are conceptually distinguishable and respond differently to different marketing mix elements and programs.
Actionable: Effective programs can be designed for attracting and serving the segments.
Target Market, Differentiation and Positioning
Market targeting involves evaluating each market segment’s attractiveness and selecting one or more segments to enter.
A company with limited resources might serve only a few “market niches.”
Market niches are segments that major competitors overlook or ignore.
Most companies enter a new market by serving a single segment. If this proves successful, they add segments.
Market Differentiation and Positioning
Product position is the place the product occupies relative to competitors in consumers’ minds.
Positioning is arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers. Volvo = safe cars, Disney = wholesome entertainment, Apple = technology leader
Positioning begins with differentiation—differentiating the company’s market offering so that it gives consumers more value.
POSITIONING STATEMENT “Fill in the blanks”
WE ARE (describe firm) ____________________and WE WILL (what will be accomplished) _________
BY (how it will be achieved)
TO ACHIEVE (end benefit(s)) FOR (targeted audience) ____________________________________
