Segmentation, Targeting & Positioning

University of Zimbabwe Graduate School of c atomic number 18 * marketing Ma*nagement Question Kotler (1988) has stated that The heart of modern strategical merchandising go off be described as STP segmenting, purposeing and bewildering. handle this statement using appropriate theoretical accounts. Introduction Market air division By definition grocery segmentation is the division of a securities industry into polar 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 authorisation buyers into sm solelyer groups, within which broadly similar patterns of buyers exist. (Wilson and Gilligan, 2007, p. 318). There are several(prenominal) ways in which companies freighter seg ment their markets.Just as you can divide an orange up into segments you can divide the population as a exclusively into different groups of people or segments that bring in something in common. Marketers therefore look for variables they can use to divide up the population. correspond 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 class according to the way they lead their lives and the attitudes they share. For example, young professionals whitethorn drive a sports car because of the image they want to portray.Married parents cogency want the alike things, but have to provide for their children, which is a large extra cost. They volition need a family car to suit their lifestyle. Thus you leave al single let a couple that has just married and have no children, allow 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 whole family. However the range and variety of marketing decisions suggest that any exertion to use a superstar basis for segmentation whitethorn go out in incorrect marketing decisions as well as a waste of resources.Thus increasingly today you will settle marketing strategies combining two or more basis for segmentation of their market. TARGETING at one time the firm is satisfied that the segments warrants attention there are various ways in which a firm can then direct a market. The first is a single harvest saying. In other words, the seller targets a single increase offering at a single segment in a market with many segments. For example, British air lanes Concorde is a high value intersection aimed specific all in ally at business people and tourists willing to pay more for speed.Identifying marketing targets enables organisations to find opportunities and tap into them. It gives f irms the information needed to focus on the buyers that are arouse in what they have to offer. This saves both time and money in an dynamical society. However if you pursue one segment of your target market and the submit for your fruit decreases, so will your financial strength. In essence, you are putting all your eggs in one basket. When your firm becomes well formal in a particular market segment, it may be onerous for you to move to another segment. This may occur due to your market spirit or popularity.For example, if Lorimark HR Consultants becomes k straight offn for helping college graduates find jobs, unemployed professionals may perceive them as only having the expertise to serve that market. another(prenominal) downside of target marketing may that a large segment of the population may be left out in the cold. Though demographics and segmentation might give an overall view of the intended market, consumer spending habits change greatly, depending on trends and e conomic factors. With society taking on more of a androgynous lifestyle businesses should be careful when using for example gender to target market.An example of a product that was traditionally targeted at women and is now world targeted with variations in strategy at men is hair colouring. Men now pay particular attention to their hair in much the corresponding way as woman. Thus target marketing should be through with extra care taking into account all factors that may have an effect on the organizations profitability and the perception or ready it wants to bring into being in the market. POSITIONING Thus lay is all about perception and is inextricably linked to segmentation. It cannot be defined until the market has been divided into unique segments, and target segments have been selected.As perception differs from psyche to person, so do the results of the set map. Positioning reflects the place a product occupies in a market or segment. A successful position has charac teristics that are both differentiating and all important(predicate) to consumers and the characteristic may or may not reflect reality. A position is effectively built by communicating a consistent message to consumers about the product and where it fits into the market in terms of the features, performance, quality, conformance, durability, reliability, style and design through advertising, brand name, and furtherance and all the other elements of marketing mix. Kotler, 1997, p. 301) For years OK Zimbabwe has constantly and consistently bombarded the minds of consumers with the message . where your money buys you more. Thereby creating in the mind of the consumer that OK has the trump prices and your dollar with OK can take you a long way. Another example will be that of Colgate and Surf by Unilever, these products are stuck in the minds of consumers (positioned), such that if someone is buying any other toothpaste or lavation powder, not necessarily Colgate or surf, they wi ll still refer to the product as Colgate or surf respectively. It is the product in mind of the consumers.That is positioning. What is our catamenia position? What does the space look like what are the virtually important dimensions in the category? What are the other products in that space and where are they? What are the gaps, unfilled positions or holes in the category? Which dimensions are most important? How do these attitudes differ by market segment? What position do we want to have? Some of the positioning opportunities for a product include Finding an unmet consumer needs or at least one that is not being adequately met now by completion? Identifying product strength that is both unique and important.Determining how to correct a product weakness and thereby enhance a products appeal. For example Ponds new and improved. Changing consumer usage patterns to include different or additional uses for the product. Identifying market segments, which represent the best targets f or a product. How do we create a new positioning? Physical product differences. Communications- finding a memorable and meaningful way to describe the Positioning is not what you do to a product positioning is what you do to the mind of the prospect. (www. s-m-a-r-t. com/Exp_brandpros. ) Accessed 3 September 2009.Other questions that the marketer should contend with in terms of positioning are whom do I have to defeat to own the position, do I have the resources to do it, can I persist until I get there and are my tactics supporting the positioning objectives I have set. The positioning map below will show how the drive industry positions their products in the market. Positioning map +High (price) From the above positioning map it can be concluded that products tend to bunch in the high price/low economy (fast) sector and also in the low price/high economy sector. There is an opportunity in the low price/low economy (fast) sector.Maybe Hyundai or Kia can consider introducing a low cost sport saloon. However it is all down to the perception of the market about the product. Conclusion Undertaking a Segmentation, Targeting and Positioning process is probably one of the most important processes concern should undertake both at the onset of a new offer creation as well as part of a annual revision of the portfolio of offers and strategies used by organization. A market research is incessantly the starting point in the STP process otherwise the organizations resources will be misdirected. 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, writ of execution and C ontrol, 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