Marketing of Financial Products & Services - Market Segmentation, Targeting & Positioning - STP

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Lecture - 3
Parveen Sharma
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TKW’s
Marketing of
Financial
Products

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Contents
Market Segmentation
 The Concept
 Significance of Market Segmentation
 Segmentation Strategy
 Criteria for Segmentation
 Requirements For Effective Segmentation
 Limitation to Segmentation
 Targeting & Positioning
 STP Steps
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 All customers have their likes & dislikes but they possess some
element of uniqueness
 FI’s need to satisfy different customer of rural – urban, small sized –
large sized, low income high income etc.
 Satisfaction of customer needs and wants has prime focus in
marketing but it is not easy task as we cannot use same marketing
strategy for all.
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Market Segmentation – The concept
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 ‘Market segmentation is the sub-division of a market into homogenous
subsets of customers where any subset may be selected on a market
target to be reached with a distinct marketing mix’.(Philip Kotler)
 Segmentation is a device to…
…formulating a sound marketing mix
…identify level of expectations of segments
…to be proactive and increase profitability
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Market Segmentation – The concept
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TKW’s

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 Small is beautiful
 Small is identifiable
 Divide and rule
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Market Segmentation – The concept
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TKW’s

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Significance of Market Segmentation
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 Design product-line parallel to demands of market
 To catch first sign of major trend
 To design companies advertising appeal
 To understand market and customers
 To formulate sound marketing strategy
 To achieve organizational goals faster and to utilize resources optimally.
 Differentiating from competition
 Becoming less sensitive to the price competition
 Direct appropriate amount of attention to respective segments
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Basic Approach of Segmentation
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 One(Products) to One(Segments)
 One(Products) to Many(Segments)
 Many(Products) to Many(Segments)
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Segmentation Strategy
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 Mass Marketing or Undifferentiated Strategy
(Generally most competitive and least profitable)
 Selective Marketing or Differentiated Strategy
(More focused, expensive and increased profitability)
 Concentrated or Niche Marketing
(Small segment but most profitable)
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Criteria for Segmentation
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 Segmenting Consumer
Markets
 Segmenting Business
Markets
 Segmenting
International Markets
• Geographic segments
(Distance, Region, Terrain, Density etc)
– Marketing mixes customized
geographically
• Demographic segmentation
(Age, Gender, Family Life Cycle, Income,
Occupation, Education etc)
– Most popular type
– Demographics are closely related to
needs and wants
• Psychographic segmentation
(Lifestyle, Values and personality-based
segmentation)
– Birds of same feather flock together
• Behavioral segmentation
(Benefits, Loyalty, Usage Rate, Buyers
Readiness)
Key Topics

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Criteria for Segmentation
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TKW’s

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Criteria for Segmentation
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 Segmenting Consumer
Markets
 Segmenting Business
Markets
 Segmenting
International Markets
• Demographic segmentation
– Industry, company size, location
• Operating variables
– Technology, usage status,
customer capabilities
• Purchasing approaches
• Situational factors
– Urgency, specific application, size
of order
• Personal characteristics
– Buyer-seller similarity, attitudes
toward risk, loyalty
Key Topics

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Segmentation Variables for Business Markets
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Criteria for Segmentation
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Criteria for Segmentation
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 Segmenting Consumer
Markets
 Segmenting Business
Markets
 Segmenting
International Markets
• Geographic segmentation
– Location or region
• Economic factors
– Population income or level of
economic development
• Political and legal factors
– Type / stability of government,
monetary regulations, amount of
bureaucracy, etc
• Cultural factors
– Language, religion, values,
attitudes, customs, behavioral
patterns
Key Topics

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Criteria for Segmentation
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Requirements For Effective Segmentation
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 Measurable
– Size, purchasing power, and profile of segment
 Accessible
– Can be reached
 Substantial
– Large and profitable enough to serve
 Differentiable
– Respond differently
 Actionable
– Effective programs can be developed

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Limitations of segmentation
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 Lack of information and data
 Difficulty in measuring and predicting consumer behavior
 Hard to reach customer segments once identified

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Targeting & Positioning
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Targeting
Market targeting is a process of evaluating each market segment’s
attractiveness and selecting one or more segments to enter
Positioning
Creating an identity in the minds of target market
Structural
AttractivenessSize & Growth
Company
Resources &
Objective

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STP: Steps
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 Identify basis of segmenting the market
 Develop profile of resulting segments
 Develop measures of segments attractiveness
 Select the target segments
 Develop positioning for each target segment
 Develop marketing mix for each target segment
Segmentation
Targeting
Positioning

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TKW’s
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? ueriesQ
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Contact me @ +91-9050050288
or
Email to parveen_72@yahoo.in

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Term for the Lecture
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Biogenic & Psychogenic needs
Cognition & Perception

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Thank
You
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