Targeting and

Positioning
 Target Marketing
 Target Market
 Consists of a set of buyers who share
common needs or characteristics that the
company decides to serve
 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
 Target Marketing
 Selecting Target Market Segments
 Undifferentiated (mass) marketing
 Differentiated (segmented) marketing
 Concentrated (niche) marketing
 Micromarketing (local or individual)
 FIVE PATTERNS OF TARGET
MARKET SELECTION
 Single Segment targeting
 Market Specialization
 Product Specialization
 Selective Specialization
 Full Coverage
Basic Target Marketing Strategies

Exhibit 6.6
Single-segment concentration
Porsche concentrates on the sports car market. Through
concentrated marketing, the firm gains a strong
knowledge of the segment’s needs and achieves a
strong market presence.
Furthermore, the firm enjoys operating economies through
specializing its production, distribution and promotion.
If it captures segment leadership, the firm can earn a high
ROI.
However, concentrated marketing involve risks. A
particular market segment may turn sour. A competitor
may invade the segment.
 Selective Specialization
 The firm selects a number of segments,
each objectively attractive and
appropriate. There may be little or no
synergy(co-operation) among the
segments, but each promises to be a
money maker.
 This multi segment strategy has the
advantage of diversifying the firm’s risk.
 Product specialization
 The firm makes a certain product that it sells to
several segments. An example would be a
microscope manufacturer who sells to university,
government, and commercial laboratories. The
firm makes different microscopes for the
different customer groups and builds a strong
reputation in the specific product area. The
downside risk is that the product may be
supplanted(take the place of) by an entirely new
technology.
 Market specialization
 The firm concentrates on serving many
needs of a particular customer group. An
example would be a firm that sells an
assortment(various) of products only to
university laboratories.
 The downside risk is that the customer
group may suffer budget cuts.
 Full market coverage
 The firm attempts to serve all customer
groups with all the products they might
need.
 Only very large firms such as
Nokia(mobile phone market),
Toyota(vehicles market), and coca-cola
(drinks market) can undertake a full
market strategy.
FACTORS CONSIDERED IMPORTANT IN
THE SELECTION OF TARGET MARKET
STRATEGY
 1. Company’s Resources
 2. Product Homogeneity (of the
same kind)
 3. Product Stage in the Life Cycle
 4. Market Homogeneity
 5. Competitive Marketing Strategy
 Positioning(place occupied)
 Positioning:
 The place the product occupies in consumers’
minds relative to competing products.
 Typically defined by consumers on the basis
of important attributes.
 Involves implanting the brand’s unique
benefits and differentiation in the customer’s
mind.
 Positioning maps that plot perceptions of
brands are commonly used.
 POSITIONING STRATEGIES
 Identifying possible competitive
advantages

Differentiation can be based on

Products
Services
Channels
People
Image
 Product Differentiation
 Form- size, shape or physical structure
 Features- supplement to basic function.
 Performance Quality-the level at which the product’s
primary characteristics operates.
 Conformance Quality- the degree to which all the produced
units are identical and meet the promised specifications.
 Durability- a measure of the product’s expected operating life
under natural or stressful conditions.
 Reliability- a measure of the probability that a product will not
malfunction within a specified time period.
 Reparability- a measure of the ease of fixing a product when it
fails
Style
Quality can be communicated by choosing
physical signs and cues
 Services Differentiation
 Ordering ease
 Delivery
 Installation
 Customer training
 Customer consulting
 Maintenance and repair
 Personnel Differentiation
 Competence
 Courtesy
 Credibility
 Reliability
 Responsiveness
 Communication
 Channel Differentiation
 Coverage
 Expertise
 Performance
 Image Differentiation
 Image is the way the public perceives the
company or its products.
 Identity is the way a company aims to
identify or position itself or its products.
 Symbols, colours, slogans, atmosphere,
 Events and employee behaviour
 Choosing the right competitive
advantage
How many differences to promote?
•Unique selling proposition
•Several benefits
Which differences to promote? Criteria include:
•Important
•Distinctive
•Superior
•Communicable
•Preemptive(prevent)
•Affordable
•Profitable
 Developing and communicating a
positioning strategy
All products can be differentiated to some
extent. But not all differences are meaningful
or worthwhile. A difference is worth
establishing to the extent that it satisfies the
following criteria :
 Important : The difference delivers a highly
valued benefit to a sufficient numbers of
buyers.
 Distinctive : The difference is delivered in a
distinctive way.
 Developing and communicating a
positioning strategy
 Superior : The difference is superior to
other ways of obtaining the benefit.
 Preemptive : The difference cannot be
easily copied by competitors.
 Affordable : The buyer can afford to
pay for the difference.
 Profitable : The company will find it
profitable to introduce the difference.