Download Market segmentation

Principles of Marketing
The Course Objectives

LEARN PRACTICAL MARKETING
KNOWLEDGE AND PRACTICES
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Module 1 (Day 1)
• Marketing Definition
• STP, Principle of Real World Mktg.

Module 2 (Day 2 & 3)
• Marketing Tools
• From Online Marketing to Direct Marketing

Module 3 (Day 4)
• Marketing Program – Workshop
• Learn How To Design a Marketing Program
Today’s Objectives
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What is marketing?
STP
The Marketing Mix
Principles of real world marketing
Exercise
What is Marketing?

It is not just “selling and advertising”; It is the process
by which companies create value for customers and
build strong customer relationships in order to
capture value from customers in return.

“The Whole Firm Taken From A Customer
Perspective” Peter Drucker

EVERYTHING THAT TOUCHES THE CONSUMER
IS MARKETING
What Marketing Does?
Reach customers
 Motivate Them To Buy
 Use
 AND REBUY The product

What Marketers Do?
Reach customers
 Motivate Them To Buy
 Use
 AND REBUY The product

Marketers Should March To The Drums Of
The Customers
STP (Segmentation, Targeting
&Positioning)
Market
segmentation
1. Identify bases
for segmenting
the market.
2. Develop
segment profiles
Target marketing
3. Develop measure
of segment
attractiveness
4. Select target
segments.
Market positioning
5. Develop
positioning
(differentiation) for
target segments.
6. Develop a
marketing mix for
each segment.
1. Market segmentation

Dividing a market into smaller groups
of buyers distinct needs,
characteristics, or behavior who might
require separate products or
marketing mixes
Market segmentation
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Buyers differ in
 Wants
 Resources
 Locations
 Buying attitudes
 Buying practices
Through market segmentation,
companies divide large, heterogeneous
(different) markets into smaller segments
that can be reached more efficiently and
effectively with products and services that
match their unique needs
Geographic segmentation
Dividing a market into different
geographical units such as nations,
states, regions, counties, cities or
neighborhoods
 Al-wasset classifieds (maadi)

Demographic segmentation
Dividing the market into groups based
on demographic variables such as age,
gender, family size, family life cycle,
income, occupation, education, religion,
race and nationality
 Most popular because our needs, wants
and usage rates depend on the
demographics

Age and life cycle
segmentation
Dividing a market into different age and
life cycle groups
 Kids (corn flakes), adults, magazines
(teen stuff)

Gender segmentation
Dividing a market into different
groups based on gender
 Clothing, cosmetics, perfumes

Income segmentation
Dividing the market into different
income groups
 Cars, financial services

Psychographic
segmentation

Dividing a market into different groups
based on social class, lifestyle or
personality characteristics
Behavioral segmentation
 Dividing
a market into groups
based on consumer knowledge,
attitude, use, or response to a
product
 Occasion segmentation
 Dividing
the market into groups
according to occasions when
buyers get the idea to buy
Behavioral segmentation
(cont’d)
 Benefit
sought segmentation
 Dividing
the market into groups
according to the different benefits
that consumers seek from the
product (detergent)
Using multiple segmentation
bases

Using multiple segmentation bases in
an effort to identify smaller, better
defined target groups
Requirements for effective
segmentation
Measurable
 Accessible
 Differentiable (segment is unique)
 Actionable (can perform marketing
mix to reach this segment)

STP
Market
segmentation
1. Identify bases
for segmenting
the market.
2. Develop
segment profiles
Target marketing
3. Develop measure
of segment
attractiveness
4. Select target
segments.
Market positioning
5. Develop
positioning
(differentiation) for
target segments.
6. Develop a
marketing mix for
each segment.
Target marketing

The process of evaluating each
market segment’s attractiveness and
selecting one or more segments to
enter
Evaluating market segments
Segment size
 Growth
 Segment attractiveness
 Company objectives and resources
 Competitors
 Buying power
 Supplier power

Selecting target market
segments
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Target market

A set of buyers sharing common needs or
characteristics that the company decides to
serve
Targeting Strategies
Undifferentiated Strategy
One marketing mix for the
whole market
Chipsy
Concentrated (niche)
Strategy
One marketing mix and
one segment
BMW
Differentiation Strategy
Two marketing mix and 2
different segment
STP
Market
segmentation
1. Identify bases
for segmenting
the market.
2. Develop
segment profiles
Target marketing
3. Develop measure
of segment
attractiveness
4. Select target
segments.
Market positioning
5. Develop
positioning
(differentiation) for
target segments.
6. Develop a
marketing mix for
each segment.
Product positioning

The way that product is defined by
consumers on important attributes the place the product occupies in
consumer’s minds relative to
competing products
Perceptual Positioning Map for
Automobiles
Stylish, prestigious, distinctive
Volvo 850R
Mercedes 400SE
Porsche 914
•
•
TM3
•
TM2
• Lexus LS400
Buick Park Avenue •
Jeep Grand Cherokee
•
Oldsmobile L35 •
• Acura Integra
Honda Accord •
Taurus
Fun,
• Ford Saturn
SC2 •
Chrysler LHS
Staid,
conservative,
older
•
Nissan Sentra
Plymouth Voyager
Dodge Caravan
sporty,
fast
•
•
•
Geo Metro
• Honda Civic
Dodge Neon•
•
Kia Sephia
•
Practical, common, economical
TM1
Developing the marketing
mix

Marketing mix: the set of controllable
tactical marketing tools: product,
price, place and promotion that the
firm blends to produce the response it
wants in the target market
Consumer
Principles of Real
products
World
Marketing
Principles of Real World
Marketing
Your Customers Aren’t Listening To
You
 Everybody Else Is Shouting At Your
Customers
 The Rest Of Your Organization thinks
you are crazy BUT
 You Cant execute your program
without the rest of the company

Principles of Real World
Marketing
The More You Give; The More You Get
 Being Good Is Never Good Enough;
You Have To Be Better
 Marketing Should Be The Most Creative
and Most Logical Part Of Your Business
 Everything Is Marketing
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Integrated Marketing
Communications (IMC)
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The concept under which a company
carefully integrates and coordinates
its many communications channels to
deliver a clear, consistent, and
compelling message about the
organization and its products
IMC
Marketing communications mix
- promotion mix
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The mix of
Advertising
 Personal selling
 Sales promotion
 Public relations
 Direct Marketing
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That the company uses
a. Advertising
Any paid form of non-personal
presentation and promotion of ideas,
goods, or services
 Advertising tools
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Print (newspapers, magazines)
 TV
 Radio
 Outdoor
 Online
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1. Setting advertising
objectives
A specific communication task to be
accomplished with a specific target
audience during a specific period of
time
 Objectives

Informative (new product category)
 Persuading (when competition
increases, comparative advertising,
comparative advertising AUDI ad)
 Reminding (coca cola, Pepsi)
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2. Developing advertising strategy
a. Creating advertising messages
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Message execution
 Slice of life: one or more “typical” people
using the product in a normal setting.
Samna and Oil ads)
 Lifestyle: how a product fits in with a
particular lifestyle. Nescafe
 Fantasy: creates fantasy around the
product or its use. Galaxy (girl in the big
chair), 7up tropical
 Musical: one or more people or cartoon
characters singing about the product.
(Sunsilk)
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Message execution
Technical expertise: shows the
company’s expertise in making the
product. Chipsy
 Scientific evidence: presents surveys
or scientific evidence that the brand is
better or better liked than one or more
other brands. Crest and the egg ad
 Testimonial evidence or endorsement
Highly believable or likeable source
endorsing the product –CelebrityNancy Agram
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2. Developing advertising strategy
b. Selecting advertising media
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Deciding on reach, frequency
Reach: measure of the percentage of people in
the target market who are exposed to the ad
campaign during a given period of time
 Frequency: measure of how many times the
average person in the target market is
exposed to the message
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Choose Your Media Type
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Question
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How to choose the best medium?
Answer
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Whatever Works for your campaign and
reaches your target market
• Primary Medium
• Secondary Medium
• Spread your budget equally on more than
one medium
Profiles of major media types
Medium
Advantages
Limitations
Print Newspaper
Television
Flexibility; timeliness; good local market
coverage; broad acceptability; believability
Short life; poor production
quality
Good mass-market coverage; low cost per
exposure; combines sight, sound, and motion;
appealing to the senses
Good local acceptance; high geographic and
demographic selectivity; low cost
High absolute cost; high clutter;
less audience selectivity
High geographic and demographic selectivity;
credibility and prestige; quality production;
long life; good pass-along
Flexibility; high repeat exposure; low cost; low
message competition; good positional
selectivity
High selectivity; low cost; immediacy;
interactive capabilities
high cost; no guarantee of
position
Radio
Print Magazine
Outdoor
Online
Audio only; low attention (“half
heard”); fragmented audiences
Little audience selectivity;
creative limitations
Small, demographically skewed
audience; low impact; audience
controls exposure
Print Advertising (Newspapers,
Magazines)
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Most Advertisers budget more for print than any other
media
Works mainly to promote sales promotions
Anatomy:
 Headline
 Sub headline
 Copy – choose the font that serves the message
 Visual
 Caption
 Trademark
 Signature
 Slogan
Exercise
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Each Team chooses a print ad from the
newspaper or magazine and analyze it
Television
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Used When You Need To Evoke
Emotions – surprise, anxiety,
excitement, happiness, …
Radio
Rely On Sounds – choose cool sound
effect, interesting voice, catchy
musical phrase, …
 Choose One Strong Idea
 Talk To Your Market Right Away – i.e.
if you want to advertise for salon’s
service; start right away with ex. :”not
another bad hair day”
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Outdoor – Billboards,
Banners and Signs
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It must be read in a hurry
It is geographically specific
It directs people to your business location
Placing it in front of competitor location IS
SMART 
Design should include 2 main sections: 1Header to catch attention from far, 2essential information
Outdoor – Billboards,
Banners and Signs
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Forms:
Vinyl
 Hand Painted
 Wood
 Metal
 Light Boxes
 Electronic Display
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Online Advertising
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Types:
Website = company brochure
 Banner Ads = billboard where you use
your logo, one simple message and
max. couple lines of body copy
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N.B
• Refresh Your Content Regularly
• Deliver fascinating and attractive content
Other Forms of Indirect
Advertising
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Point Of Purchase POP
Flags
 Danglers
 Roll ups & pop ups
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Word Of Mouth
Virtual WOM
 Face To Face
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b. Sales promotion
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Short-term incentives to encourage
the purchase or sale of a product or
service
Major sales promotion tools for
consumers
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Sample: a small amount of a product
offered to customers for trial. (perfumes)
Coupon: certificate that gives buyers a
saving when they purchase a specified
product
Price off (cents-off deal): reduced price
that is marked by the producer directly on
the label or package. (10 instead of 12)
Premiums: prizes, gifts consumers receive
when purchasing products. (shampoo with
shower gel, vodafone)
Major sales promotion tools for
consumers (cont’d)
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Contests and sweepstakes
Contests: solve questions and you win
something (who would win the million)
 Sweepstakes: depend on luck
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Bonus packs: additional or extra
number of items is placed in a special
product package (3 with price of 2,
20%extra)
Major sales promotion tools for
trade
Discount: a straight reduction in price
on purchases during a stated period
of time
 Allowances: promotional money paid
by manufacturers to retailers in return
for an agreement to feature the
manufacturer's products in some way
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c. Public relations
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Building good relations with the company’s
various publics by obtaining favorable
publicity, building up a good “corporate
image”, and handling or heading off
unfavorable rumors, stories, and events
It is unpaid advertising
PR tools
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Press releases
Sponsorships (Mc Donald’s and the hospital
53753)
Special events (Vodafone and the charity
complex)
d. Personal selling
Personal presentation by the firm’s
sales force for the purpose of making
sales and building customer
relationships
 Personal selling tools
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Personal presentation
 Trade shows (exhibitions and fairs.
Le marche)

e. Direct marketing
Direct communications with carefully
targeted individual consumers-the use
of telephone, mail, fax, e-mail, the
internet, and other tools to
communicate directly with specific
consumers
 Direct marketing
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Sending catalogues
 Telemarketing
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Push strategy
A promotion strategy that calls for
using the sales force and trade
promotion to push the product through
channels.
 The producer promotes the product to
wholesalers, the wholesalers promote
to retailers, and the retailers promote
to consumers

Pull strategy
A promotion strategy that calls for
spending a lot on advertising and
consumer promotion to build up
consumer demand.
 If the strategy is successful,
consumers will ask their retailers for
the product, the retailers will ask the
wholesalers, and the wholesalers will
ask the producers
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Push Vs Pull strategy
1. Affordable method

Setting the promotion budget at a
level management thinks the
company can afford
2. Percentage of sales
method

Setting the promotion budget at a
certain percentage of current or
forecasted sales or as a percentage of
unit sales price
3. Competitive-parity method
Setting the promotion budget to match
competitors’ outlays
 Get Data from reports such as PARC

Mobinil and Vodafone
 Pepsi and coca cola
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4. Objective and task
method

Developing the promotion budget by
Defining specific objectives
 Determining the tasks that must be
preformed to achieve these objectives
 Estimating the costs of performing
these tasks

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The sum of these costs is the
proposed promotion budget