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BMGT 411: Week #5
Kottler:
Chapters 8 - Creating Brand Equity
Chapter 9 - Brand Positioning
Wood:
Chapter 4 - Segmenting, Targeting and Positioning
Chapter 5 - Planning, Directing, and Support
1
Chapter 8 Questions
• What is a brand and how does branding work?
• What is brand equity and how is it built, measured, and managed?
• What are the important decisions in developing a branding strategy?
2
Steps in
Strategic Brand Management
• Identifying and establishing brand positioning
• Planning and implementing brand marketing
• Measuring and interpreting brand performance
• Growing and sustaining brand value
3
What is a Brand?
• A brand is a name, term, sign,
symbol or design, or a
combination of them, intended
to identify the goods or
services of one seller or group
of sellers and to differentiate
them from those of
competitors.
4
The Role of Brands
• Identify the maker
• Simplify product handling
• Organize accounting
• Offer legal protection
5
The Role of Brands
• Signify quality
• Create barriers to entry
• Serve as a competitive advantage
• Secure price premium
6
What is Branding?
•Branding is endowing products
and services with the power of
the brand.
•Teaching customers “who”
the product is
•Tells customers what the
product does
•Reinforces why consumers
should care
7
What is Brand Equity?
• Brand equity is the added value endowed on products and services, which
may be reflected in the way consumers, think, feel, and act with respect to
the brand.
8
Brand Equity
What comes to mind when you
think of these brand retailers?
Why?
9
Advantages of Strong Brands
• Improved perceptions of product
performance
• Greater loyalty
• Less vulnerability to competitive
marketing actions
• Less vulnerability to crises
• Larger margins
• More inelastic consumer response
• Greater trade cooperation
• Increased marketing
communications effectiveness
• Possible licensing opportunities
10
What is a Brand Promise?
• A brand promise is the marketer’s vision of what the brand must be and do
for consumers.
• What do you think the brand promise is for the retailers we discussed?
11
Brand Equity Models
Brand Asset Valuator (BAV)
Brandz
Brand Resonance
12
Brand Asset Valuator
(BAV)
Strong New Brands: Higher in
Energized Differentiation, low
esteem and knowledge
Leadership Brands: High in all
categories
Declining Brands: High
Knowledge, low everything
else
13
Figure 8.2
Brand Dynamics
BrandZ Model
14
Figure 8.3 Brand
Resonance Pyramid
Think of Brands in these
Stages?
15
Building Brand Equity
1.Identify Brand Elements (Name, Logo, URL, etc) and identities that make up
the brand
2.The Product, Service, and All Marketing Activities and Marketing Programs
3. Other associations indirectly transferred to the brand (Figure 8.4 Page 119)
16
Brand Elements
• Brand names
• Slogans
• Characters
• Symbols
• Logos
• URLs
• Social Media Presence
• Customer Service Strategy
17
Brand Element Choice Criteria
• Building the Brand
• Memorable: Is the elements easily
recalled and recognized at
purchase and consumption (Tide)
• Meaningful: Is the element credible
and suggestive of the category?
Does it suggest something about
an ingredient or brand user?
(Diehard)
• Likable: Is the element appealing
and likable visually or in other
ways? (iPad)
• Defending a Brand
• Transferrable: Can the element
introduce new products in the
same category or other
category? (Amazon, Soap.com,
Wag.com, diapers.com)
• Adaptable: Can the element be
adapted and updated (Betty
Crocker image)
• Protectable: Is the element
legally and competitively
protected? Google
18
Betty Crocker Images Brand of General Mills
19
Secondary Sources of
Brand Knowledge
20
Cult Brands: Building Equity
Without Promotions
http://www.youtube.com/watch?
v=ZUG9qYTJMsI&feature=playe
r_embedded#!
21
Measuring Brand Equity
• Brand audits: A consumer focused series of procedures to asses the health of
the brand, uncover its sources of equity, and suggest ways to improve and
leverage it’s equity.
• Brand tracking: Qualitative Marketing Research that collects data from
consumers over time to provide baseline information on how brands and
marketing programs are performing
• Brand valuation: The actual financial value of a brand
22
Interbrand Retail US
Brand Valuations
http://www.interbrand.com/en/
BestRetailBrands/2013/Best-
Retail-Brands-Brand-View.aspx?
country=United%20States
23
Branding Terms (Page 122)
• Brand line
• Brand mix
• Brand extension
• Sub-brand
• Parent brand
• Family brand
• Line extension
• Category extension
• Branded variants
• Licensed product
24
Branding Decisions
• Individual or Separate Family Brand Names: Individual names of brands
across multiple categories, even though the company that makes the
products are the same
25
Branding Decisions
• Corporate Umbrella or Company Brand Name: Use one name across a variety
of products. Becoming very popular as a strategy of private label products.
26
Branding Decisions
• Sub Brand Names: Combines corporate umbrella brands with individual or
family brands
27
Brand Portfolios
• Flankers
• Cash cows
• Low-end, entry-level
• High-end prestige
28
Brand Portfolios
• Flankers: Fighter brands are positioned alongside competitor brands so that
more important and more profitable flagship brands can retain their desire
positioning
• Cash cows: Still profitable without much marketing, dwindling sales, but still
profitable
• Low-end, entry-level: Attract customers to the brand franchise with lower
prices
• High-end prestige: Higher priced, adds prestige and credibility to overall
portfolio
29
Brand Extensions
• Most products are Brand Extensions (80-90%) - as they create new demand
based on trends, customer tastes, without building the brand from scratch
each time a new product is launched.
30
BMGT 411: Chapter 9	
Crafting Brand Positioning
31
Chapter Questions
• How can a firm develop and establish an effective positioning?
• How are brands successfully differentiated?
• How do marketers identify and analyze competition?
• How can market leaders, challengers, followers, and nichers compete
effectively?
32
Brand Positioning Statement
• Positioning: The act of designing a company’s offering and image to
occupy a distinctive place in the minds of the target market
• Positioning Statement or Value Propositions
• For (target audience), (brand name) is the (frame of reference) that
delivers (benefit/point of difference).
• Frame of Reference: The category the brand name competes in
33
Examples
For (target audience), (brand name)
is the (frame of reference) that
delivers (benefit/point of
difference).
34
Examples
For (target audience), (brand name)
is the (frame of reference) that
delivers (benefit/point of
difference).
35
Examples
For (target audience), (brand name)
is the (frame of reference) that
delivers (benefit/point of
difference).
36
Defining Associations
• Points-of-difference: Attributes or benefits consumers strongly associate
with a brand, positively evaluate, and believe they could not find to the same
extent with a competitive brand
• Points-of-parity: Associations that are not necessarily unique to the brand
but may be shared with other brands
37
Point-of-Difference Criteria for POD
• Desirable to Consumer: Consumers must see the brand association as
personally relevant to them
• Deliverable: The company must have resources to feasibly and
profitably create and maintain the brand association in the minds
• Ex: If Walmart promised great customer service
• Differentiating from Competitors: Consumers must see the brand
association as distinctive and superior to competitors
38
Figure 9.1a Perceptual
Map: Current
Perceptions
Brand Repositioning
39
Figure 9.1b Perceptual
Map: Possibilities
Brand Repositioning
40
Dimensions of Differentiation for Competitive
Employee
Channel
Image
Services
41
Employee Differentiation
• Better trained
• Superior customer service
• Often premium priced vs
competition
42
Channel Differentiation
•Channel coverage, convenience
• Makes buying easier
• More enjoyable
• More rewarding
43
Image Differentiation
•Powerful brand images that
appeal to customers social and
psychological needs
• Often premium prices
44
Service Differentiation
•Delivering more effectively to
consumers
• Delivering more efficiently
45
Figure 9.1
Hypothetical
Market Structure
46
47
Protecting Market Share Continuous Innovation
48
Types of Defense Strategies - Market
Leaders
• Position Defense: Continuing to occupy the most desirable position
through marketing and continued innovation
• Flank Defense: Developing brand extensions to compete at lower price
points to try to meet attackers (Luv’s Diapers Vs Private Label)
• Preemptive Defense: Announce new products at a pace competitors
cannot keep up with
49
Types of Defense Strategies Market Leaders
• Counteroffensive Defense: Lowering prices so competitors cant
compete, even at a loss, while gaining profits off other products
• Mobile Defense: Enters new territories or market diversifications
• Contraction Defense: Letting go, or sunsetting unprofitable products to
focus on more profitable ones
50
General Attack Strategies - Challengers
• Frontal attack: Matches opponents product, price, and marketing (Usually
loses in retail)
• Flank attack: Targets underperforming geographic areas, or to serve
uncovered market needs
• Encirclement attack: Launching an attack in several areas at once, requires
great resources
• Bypass attack: Diversifying products, innovating, shifting messaging where
challenger has advantage
• Guerrilla warfare: Grassroots marketing efforts meant to surprise the market
leader
51
Specific Attack Strategies
• Price discounts
• Lower-priced goods
• Value-priced goods
• Prestige goods
• Product proliferation
• Product innovation
• Improved services
• Distribution innovation
• Manufacturing-cost reduction
• Intensive advertising promotion
52
Market Follower
Strategies
53
Market Nicher Strategies
• End-User Specialist
• Vertical-Level Specialist
• Customer-Size Specialist
• Specific-Customer Specialist
• Geographic Specialist
• Product-Line Specialist
• Job-Shop Specialist
• Quality-Price Specialist
• Service-Specialist
• Channel Specialist
54
Wood: Chapter 4
Segmenting, Targeting and Positioning
55
Fragmented and
Diverse Markets
 Customers exhibiting a
wider variety of:
 Needs
 Attitudes,
 Behaviors,
 Tastes, and Interests.
56
The Need for Segmentation, Targeting, and Positioning
 A move away from mass
marketing.
 A move towards segment
marketing.
 Allows marketers to focus
their resources on the most
promising opportunities.
 Improves marketing efficiency
and effectiveness.
 Enables marketers to notice
changes in the segment and
to respond more quickly.
57
Market Segmentation
 Definition: the process of grouping customers within a
market according to similar needs, habits, or attitudes
that can be addressed through marketing.
 Even within a large segment, marketers often can identify
niches.
58
Steps in the Segmentation Process
1. Select the market:
Eliminate markets that
have no need for the
product or are
inappropriate for other
reasons.
2. Apply segmentation
variables.
3. Assess and select
segments for targeting.
59
Step 1: Select the Market
 For purposes of
segmentation, the overall
market may be defined on
the basis of:
 The market definition,
 Situational analysis,
 SWOT analysis, and
 Eliminate general markets
that have no need for your
offerings or are inappropriate
for other reasons.
60
Step 2: Apply Segmentation Variables
 Marketers can isolate groupings within consumer markets
using the following types of variables:
 Behavioral and Attitudinal
 Demographic
 Geographic
 Psychographic
61
Type of Variable Examples
Behavioral and
Attitudinal
Benefits sought, rate of usage, attitude
toward product and usage, price
sensitivity.
Demographic
Age, gender, family status, household
size, income, occupation, education.
Geographic Location, distance, climate.
Psychographic Lifestyle, activities, interests.
4-8
62
Consumers: Segmenting by Behaviors and Attitudes
In many ways, the best way
to segment:
 Help marketers analyze the
specific value that a particular
group expects from the offering.
 Include variables like:
 Benefits required or expected
 Usage occasion and status
 Loyalty status
 Technological orientation
 Attitudes toward products or
usage
63
Consumers: Segmenting by Demographics
 Popular because they are
common and easily
identified.
 Often point to meaningful
differences in:
 Consumer needs and wants
 Product consumption
 Media usage
4-10
64
Consumers: Segmenting by Geography
 By certain areas or
climates.
 Targeting promising new
markets.
 Reluctance to sell in
certain areas due to
environmental threats or
unfavorable climate.
65
Consumers: Segmenting by Psychographics
 Lifestyles, activities, and
interests.
 Provides a deeper
understanding of what
and why consumers buy.
 When consumer activities
or interests cross
demographic and/or
geographic lines.
66
Business Segmentation
Variables
Type of Variable Examples
Behavioral and
Attitudinal
Purchasing patterns and process, user
status, benefits expected, order size/
frequency, buyer/influencer/user attitudes.
Demographic Industry, business size, business age,
ownership structure.
Geographic Location, distance, climate.
67
Businesses: Segmenting by Behaviors and Attitudes
 Purchasing patterns
 User status
 Attitude toward
technology
 Loyalty status
 Price sensitivity
 Order size/frequency
 Attitudes
 Benefits expected
68
Businesses: Segmenting by Demographics
Common business
demographic variables
used:
 Industry
 Business size
 Business age
 Ownership structure
69
Businesses: Segmenting by Geography
 Utilizes such variables as
nation, region, state, city,
and climate.
 Allows for the grouping of
potential customers
according to:
 Concentration of outlets
 Location of headquarters
 Geography-related needs or
responses
70
Step 3: Assessing and Selecting Target Markets
 Target Market: The
segment of the overall
market that a company
chooses to pursue.
 Each potential segment
must be evaluated based
upon fit with the firm’s:
 Resources
 Goals
 Mission
 Priorities
71
Assessing Segment
Attractiveness
Source: Graham Hooley, Nigel F. Piercy, and Brigitte Nicoulaud, Marketing Strategy and Competitive Positioning, 5th ed. (Harlow, England: FT Prentice Hall
2012), Fig. 10.3, p. 245.
72
Segment Personas
 Personas: Detailed but
fictitious profiles
representing how
individual customers in
their targeted segments
behave, live, and buy.
 Give marketers a deeper
understanding of what
shapes each segment’s
needs, preferences,
buying behavior, and
consumption patterns.
73
Next week
• October 1: No Class. Invited to hear Guest Speaker on Wednesday Night
(10.2)
• PNC Chief Marketing Officer Karen Larrimer
• Bring a few questions to ask for participation
• Guest Speaker October 2: Point Park University, Academic Hall, 601
• Written Assignment #3: Develop a positioning statement using the equation
developed in class. Show an example on the blog of how this brands
advertising supports this positioning.
74

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Bmgt 411 week5

  • 1. BMGT 411: Week #5 Kottler: Chapters 8 - Creating Brand Equity Chapter 9 - Brand Positioning Wood: Chapter 4 - Segmenting, Targeting and Positioning Chapter 5 - Planning, Directing, and Support 1
  • 2. Chapter 8 Questions • What is a brand and how does branding work? • What is brand equity and how is it built, measured, and managed? • What are the important decisions in developing a branding strategy? 2
  • 3. Steps in Strategic Brand Management • Identifying and establishing brand positioning • Planning and implementing brand marketing • Measuring and interpreting brand performance • Growing and sustaining brand value 3
  • 4. What is a Brand? • A brand is a name, term, sign, symbol or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors. 4
  • 5. The Role of Brands • Identify the maker • Simplify product handling • Organize accounting • Offer legal protection 5
  • 6. The Role of Brands • Signify quality • Create barriers to entry • Serve as a competitive advantage • Secure price premium 6
  • 7. What is Branding? •Branding is endowing products and services with the power of the brand. •Teaching customers “who” the product is •Tells customers what the product does •Reinforces why consumers should care 7
  • 8. What is Brand Equity? • Brand equity is the added value endowed on products and services, which may be reflected in the way consumers, think, feel, and act with respect to the brand. 8
  • 9. Brand Equity What comes to mind when you think of these brand retailers? Why? 9
  • 10. Advantages of Strong Brands • Improved perceptions of product performance • Greater loyalty • Less vulnerability to competitive marketing actions • Less vulnerability to crises • Larger margins • More inelastic consumer response • Greater trade cooperation • Increased marketing communications effectiveness • Possible licensing opportunities 10
  • 11. What is a Brand Promise? • A brand promise is the marketer’s vision of what the brand must be and do for consumers. • What do you think the brand promise is for the retailers we discussed? 11
  • 12. Brand Equity Models Brand Asset Valuator (BAV) Brandz Brand Resonance 12
  • 13. Brand Asset Valuator (BAV) Strong New Brands: Higher in Energized Differentiation, low esteem and knowledge Leadership Brands: High in all categories Declining Brands: High Knowledge, low everything else 13
  • 15. Figure 8.3 Brand Resonance Pyramid Think of Brands in these Stages? 15
  • 16. Building Brand Equity 1.Identify Brand Elements (Name, Logo, URL, etc) and identities that make up the brand 2.The Product, Service, and All Marketing Activities and Marketing Programs 3. Other associations indirectly transferred to the brand (Figure 8.4 Page 119) 16
  • 17. Brand Elements • Brand names • Slogans • Characters • Symbols • Logos • URLs • Social Media Presence • Customer Service Strategy 17
  • 18. Brand Element Choice Criteria • Building the Brand • Memorable: Is the elements easily recalled and recognized at purchase and consumption (Tide) • Meaningful: Is the element credible and suggestive of the category? Does it suggest something about an ingredient or brand user? (Diehard) • Likable: Is the element appealing and likable visually or in other ways? (iPad) • Defending a Brand • Transferrable: Can the element introduce new products in the same category or other category? (Amazon, Soap.com, Wag.com, diapers.com) • Adaptable: Can the element be adapted and updated (Betty Crocker image) • Protectable: Is the element legally and competitively protected? Google 18
  • 19. Betty Crocker Images Brand of General Mills 19
  • 21. Cult Brands: Building Equity Without Promotions http://www.youtube.com/watch? v=ZUG9qYTJMsI&feature=playe r_embedded#! 21
  • 22. Measuring Brand Equity • Brand audits: A consumer focused series of procedures to asses the health of the brand, uncover its sources of equity, and suggest ways to improve and leverage it’s equity. • Brand tracking: Qualitative Marketing Research that collects data from consumers over time to provide baseline information on how brands and marketing programs are performing • Brand valuation: The actual financial value of a brand 22
  • 23. Interbrand Retail US Brand Valuations http://www.interbrand.com/en/ BestRetailBrands/2013/Best- Retail-Brands-Brand-View.aspx? country=United%20States 23
  • 24. Branding Terms (Page 122) • Brand line • Brand mix • Brand extension • Sub-brand • Parent brand • Family brand • Line extension • Category extension • Branded variants • Licensed product 24
  • 25. Branding Decisions • Individual or Separate Family Brand Names: Individual names of brands across multiple categories, even though the company that makes the products are the same 25
  • 26. Branding Decisions • Corporate Umbrella or Company Brand Name: Use one name across a variety of products. Becoming very popular as a strategy of private label products. 26
  • 27. Branding Decisions • Sub Brand Names: Combines corporate umbrella brands with individual or family brands 27
  • 28. Brand Portfolios • Flankers • Cash cows • Low-end, entry-level • High-end prestige 28
  • 29. Brand Portfolios • Flankers: Fighter brands are positioned alongside competitor brands so that more important and more profitable flagship brands can retain their desire positioning • Cash cows: Still profitable without much marketing, dwindling sales, but still profitable • Low-end, entry-level: Attract customers to the brand franchise with lower prices • High-end prestige: Higher priced, adds prestige and credibility to overall portfolio 29
  • 30. Brand Extensions • Most products are Brand Extensions (80-90%) - as they create new demand based on trends, customer tastes, without building the brand from scratch each time a new product is launched. 30
  • 31. BMGT 411: Chapter 9 Crafting Brand Positioning 31
  • 32. Chapter Questions • How can a firm develop and establish an effective positioning? • How are brands successfully differentiated? • How do marketers identify and analyze competition? • How can market leaders, challengers, followers, and nichers compete effectively? 32
  • 33. Brand Positioning Statement • Positioning: The act of designing a company’s offering and image to occupy a distinctive place in the minds of the target market • Positioning Statement or Value Propositions • For (target audience), (brand name) is the (frame of reference) that delivers (benefit/point of difference). • Frame of Reference: The category the brand name competes in 33
  • 34. Examples For (target audience), (brand name) is the (frame of reference) that delivers (benefit/point of difference). 34
  • 35. Examples For (target audience), (brand name) is the (frame of reference) that delivers (benefit/point of difference). 35
  • 36. Examples For (target audience), (brand name) is the (frame of reference) that delivers (benefit/point of difference). 36
  • 37. Defining Associations • Points-of-difference: Attributes or benefits consumers strongly associate with a brand, positively evaluate, and believe they could not find to the same extent with a competitive brand • Points-of-parity: Associations that are not necessarily unique to the brand but may be shared with other brands 37
  • 38. Point-of-Difference Criteria for POD • Desirable to Consumer: Consumers must see the brand association as personally relevant to them • Deliverable: The company must have resources to feasibly and profitably create and maintain the brand association in the minds • Ex: If Walmart promised great customer service • Differentiating from Competitors: Consumers must see the brand association as distinctive and superior to competitors 38
  • 39. Figure 9.1a Perceptual Map: Current Perceptions Brand Repositioning 39
  • 40. Figure 9.1b Perceptual Map: Possibilities Brand Repositioning 40
  • 41. Dimensions of Differentiation for Competitive Employee Channel Image Services 41
  • 42. Employee Differentiation • Better trained • Superior customer service • Often premium priced vs competition 42
  • 43. Channel Differentiation •Channel coverage, convenience • Makes buying easier • More enjoyable • More rewarding 43
  • 44. Image Differentiation •Powerful brand images that appeal to customers social and psychological needs • Often premium prices 44
  • 45. Service Differentiation •Delivering more effectively to consumers • Delivering more efficiently 45
  • 47. 47
  • 48. Protecting Market Share Continuous Innovation 48
  • 49. Types of Defense Strategies - Market Leaders • Position Defense: Continuing to occupy the most desirable position through marketing and continued innovation • Flank Defense: Developing brand extensions to compete at lower price points to try to meet attackers (Luv’s Diapers Vs Private Label) • Preemptive Defense: Announce new products at a pace competitors cannot keep up with 49
  • 50. Types of Defense Strategies Market Leaders • Counteroffensive Defense: Lowering prices so competitors cant compete, even at a loss, while gaining profits off other products • Mobile Defense: Enters new territories or market diversifications • Contraction Defense: Letting go, or sunsetting unprofitable products to focus on more profitable ones 50
  • 51. General Attack Strategies - Challengers • Frontal attack: Matches opponents product, price, and marketing (Usually loses in retail) • Flank attack: Targets underperforming geographic areas, or to serve uncovered market needs • Encirclement attack: Launching an attack in several areas at once, requires great resources • Bypass attack: Diversifying products, innovating, shifting messaging where challenger has advantage • Guerrilla warfare: Grassroots marketing efforts meant to surprise the market leader 51
  • 52. Specific Attack Strategies • Price discounts • Lower-priced goods • Value-priced goods • Prestige goods • Product proliferation • Product innovation • Improved services • Distribution innovation • Manufacturing-cost reduction • Intensive advertising promotion 52
  • 54. Market Nicher Strategies • End-User Specialist • Vertical-Level Specialist • Customer-Size Specialist • Specific-Customer Specialist • Geographic Specialist • Product-Line Specialist • Job-Shop Specialist • Quality-Price Specialist • Service-Specialist • Channel Specialist 54
  • 55. Wood: Chapter 4 Segmenting, Targeting and Positioning 55
  • 56. Fragmented and Diverse Markets  Customers exhibiting a wider variety of:  Needs  Attitudes,  Behaviors,  Tastes, and Interests. 56
  • 57. The Need for Segmentation, Targeting, and Positioning  A move away from mass marketing.  A move towards segment marketing.  Allows marketers to focus their resources on the most promising opportunities.  Improves marketing efficiency and effectiveness.  Enables marketers to notice changes in the segment and to respond more quickly. 57
  • 58. Market Segmentation  Definition: the process of grouping customers within a market according to similar needs, habits, or attitudes that can be addressed through marketing.  Even within a large segment, marketers often can identify niches. 58
  • 59. Steps in the Segmentation Process 1. Select the market: Eliminate markets that have no need for the product or are inappropriate for other reasons. 2. Apply segmentation variables. 3. Assess and select segments for targeting. 59
  • 60. Step 1: Select the Market  For purposes of segmentation, the overall market may be defined on the basis of:  The market definition,  Situational analysis,  SWOT analysis, and  Eliminate general markets that have no need for your offerings or are inappropriate for other reasons. 60
  • 61. Step 2: Apply Segmentation Variables  Marketers can isolate groupings within consumer markets using the following types of variables:  Behavioral and Attitudinal  Demographic  Geographic  Psychographic 61
  • 62. Type of Variable Examples Behavioral and Attitudinal Benefits sought, rate of usage, attitude toward product and usage, price sensitivity. Demographic Age, gender, family status, household size, income, occupation, education. Geographic Location, distance, climate. Psychographic Lifestyle, activities, interests. 4-8 62
  • 63. Consumers: Segmenting by Behaviors and Attitudes In many ways, the best way to segment:  Help marketers analyze the specific value that a particular group expects from the offering.  Include variables like:  Benefits required or expected  Usage occasion and status  Loyalty status  Technological orientation  Attitudes toward products or usage 63
  • 64. Consumers: Segmenting by Demographics  Popular because they are common and easily identified.  Often point to meaningful differences in:  Consumer needs and wants  Product consumption  Media usage 4-10 64
  • 65. Consumers: Segmenting by Geography  By certain areas or climates.  Targeting promising new markets.  Reluctance to sell in certain areas due to environmental threats or unfavorable climate. 65
  • 66. Consumers: Segmenting by Psychographics  Lifestyles, activities, and interests.  Provides a deeper understanding of what and why consumers buy.  When consumer activities or interests cross demographic and/or geographic lines. 66
  • 67. Business Segmentation Variables Type of Variable Examples Behavioral and Attitudinal Purchasing patterns and process, user status, benefits expected, order size/ frequency, buyer/influencer/user attitudes. Demographic Industry, business size, business age, ownership structure. Geographic Location, distance, climate. 67
  • 68. Businesses: Segmenting by Behaviors and Attitudes  Purchasing patterns  User status  Attitude toward technology  Loyalty status  Price sensitivity  Order size/frequency  Attitudes  Benefits expected 68
  • 69. Businesses: Segmenting by Demographics Common business demographic variables used:  Industry  Business size  Business age  Ownership structure 69
  • 70. Businesses: Segmenting by Geography  Utilizes such variables as nation, region, state, city, and climate.  Allows for the grouping of potential customers according to:  Concentration of outlets  Location of headquarters  Geography-related needs or responses 70
  • 71. Step 3: Assessing and Selecting Target Markets  Target Market: The segment of the overall market that a company chooses to pursue.  Each potential segment must be evaluated based upon fit with the firm’s:  Resources  Goals  Mission  Priorities 71
  • 72. Assessing Segment Attractiveness Source: Graham Hooley, Nigel F. Piercy, and Brigitte Nicoulaud, Marketing Strategy and Competitive Positioning, 5th ed. (Harlow, England: FT Prentice Hall 2012), Fig. 10.3, p. 245. 72
  • 73. Segment Personas  Personas: Detailed but fictitious profiles representing how individual customers in their targeted segments behave, live, and buy.  Give marketers a deeper understanding of what shapes each segment’s needs, preferences, buying behavior, and consumption patterns. 73
  • 74. Next week • October 1: No Class. Invited to hear Guest Speaker on Wednesday Night (10.2) • PNC Chief Marketing Officer Karen Larrimer • Bring a few questions to ask for participation • Guest Speaker October 2: Point Park University, Academic Hall, 601 • Written Assignment #3: Develop a positioning statement using the equation developed in class. Show an example on the blog of how this brands advertising supports this positioning. 74