Segmentation, Targeting & Positioning
University of Zimbabwe Graduate School of Management *Marketing Ma*nagement Question: Kotler (1988) has stated that: “The heart of modern strategic marketing can be described as STP – segmenting, targeting and positioning.’’ Discuss this statement using appropriate examples.
Introduction Market segmentation By definition market segmentation is the division of a market into different groups of customers with similar needs. Or to express it in another way, market segmentation is the division of a mass market into identifiable and distinct groups or segments, and each has common characteristics and needs and displays similar response to marketing actions. ‘’In essence it is the process of dividing a varied and differing group of buyers or potential buyers into smaller groups, within which broadly similar patterns of buyers exist.’’ (Wilson and Gilligan, 2007, p. 318). There are several ways in which companies can segment their markets. Just as you can divide an orange up into segments you can divide the population as a whole into different groups of people or segments that have something in common. Marketers therefore look for variables they can use to divide up the population. According to Kotler (1997) the commonly used variables are: Geographic segmentation, demographic segmentation, psychographic segmentation and behavioural segmentation. Products can be aimed at a lifestyle. People are grouped according to the way they lead their lives and the attitudes they share. For example, young professionals may drive a sports car because of the image they want to portray. Married parents might want the same things, but have to provide for their children, which is a large extra cost. They will need a family car to suit their lifestyle. Thus you will find a couple that has just married and have no children, will go for a Mazda 3, while older couples with three or so children will go for a Mazda BT-50 because it is bigger and can accommodate the
Introduction Market segmentation By definition market segmentation is the division of a market into different groups of customers with similar needs. Or to express it in another way, market segmentation is the division of a mass market into identifiable and distinct groups or segments, and each has common characteristics and needs and displays similar response to marketing actions. ‘’In essence it is the process of dividing a varied and differing group of buyers or potential buyers into smaller groups, within which broadly similar patterns of buyers exist.’’ (Wilson and Gilligan, 2007, p. 318). There are several ways in which companies can segment their markets. Just as you can divide an orange up into segments you can divide the population as a whole into different groups of people or segments that have something in common. Marketers therefore look for variables they can use to divide up the population. According to Kotler (1997) the commonly used variables are: Geographic segmentation, demographic segmentation, psychographic segmentation and behavioural segmentation. Products can be aimed at a lifestyle. People are grouped according to the way they lead their lives and the attitudes they share. For example, young professionals may drive a sports car because of the image they want to portray. Married parents might want the same things, but have to provide for their children, which is a large extra cost. They will need a family car to suit their lifestyle. Thus you will find a couple that has just married and have no children, will go for a Mazda 3, while older couples with three or so children will go for a Mazda BT-50 because it is bigger and can accommodate the
References: Aaker A. David, (1995). Strategic Market Management, 4th Edition, John Wiley & Sons, Inc. Armstrong J. Scott, (2006). Strategic Marketing Management – A Business Process Approach. Brand pros available at http/www.s-m-a-r-t.com/Exp_brandpros. Accessed 3 September 2009. Grahame Dowling, (2004). Creating Corporate Reputation. Identity, Image and performance. Oxford University Press Inc. Kotler P, (1997). Marketing Management, Analysis, Planning, Implementation and Control, 9TH Edition, Prentice Hall. Malcolm H.B. McDonald, (1996) Marketing Plans, How to prepare them how use them, 3rd Edition, Butterworth-Heinemann. Wilson and Gilligan