Chapter Seven

Customer-Driven Marketing Strategy:

Creating Value for Target Customers

Copyright © 2009 Pearson Education, Inc.

Chapter 7- slide 1
Publishing as Prentice Hall
 Customer-Driven Marketing Strategy:
Creating Value for Target Customers
Topic Outline

• Market Segmenta-on
• Market Targe-ng
• Differen-a-on and Posi-oning

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 2
Publishing as Prentice Hall
 Market Segmentation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 3
Publishing as Prentice Hall
 Market Segmentation

Dividing a market into

distinct groups of buyers
who have different needs,
characteristics, or
behaviors and who might
require separate marketing
strategies or mixes

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 4
Publishing as Prentice Hall
 Benefits of Market Segmentation

• Increased understanding of customer

wants and needs
• Different products for different groups
• Maximize the use of available resources

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 6
Publishing as Prentice Hall
 Market Segmentation

• Segmenting consumer markets

• Segmenting business markets
• Segmenting international markets
• Requirements for effective segmentation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 7
Publishing as Prentice Hall
 Market Segmentation

Segmenting Consumer Markets

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 8
Publishing as Prentice Hall
 Geographic Segmentation

Segmenting Consumer Markets

Geographic segmenta0on divides
the market into different
geographical units:
• Na0ons
• Regions
• States
• Coun0es
• Ci0es
• Popula0on density (urban,
suburban, rural)

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 9
Publishing as Prentice Hall
 Geographic Segmentation
By nations: Customise the menus according to the local tastes and
ingredient availability of their areas

McDonald’s menu in India McDonald’s menu in Vietnam

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 10
Publishing as Prentice Hall
 Geographic Segmentation
By cities & climate: Apparel company splits its audience into two
segments, who live in colder or hotter areas.

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 11
Publishing as Prentice Hall
 Demographic Segmentation

Demographic segmentation divides the market into

groups based on variables such as age, gender, family size,
life cycle, income, occupation, education, religion, race,
generation, and nationality

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 12
Publishing as Prentice Hall
 Gender Segmentation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 13
Publishing as Prentice Hall
 Gender Segmentation
Gender segmentation divides the market based on sex
(male, female, LGBT+)

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 14
Publishing as Prentice Hall
 Gender Segmentation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 15
Publishing as Prentice Hall
 Demographic Segmentation
Age and life-cycle segmentation: dividing the market
into different age and life-cycle groups

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 16
Publishing as Prentice Hall
 Demographic Segmentation

Income segmenta3on divides the market into affluent or low-income consumers

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 17
Publishing as Prentice Hall
 Psychographic Segmentation
Psychographic segmentation divides buyers into different groups
based on social class, lifestyle, or personality traits

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 18
Publishing as Prentice Hall
 Psychographic Segmentation
Psychographic segmentation divides buyers into different groups
based on social class, lifestyle, or personality traits

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 19
Publishing as Prentice Hall
 Psychographic Segmentation

Lifestyle segmenta.on:
Panera caters to a healthy ea/ng
lifestyle segment of people who
want more than just good-tas/ng
food—they want food that’s good
for them, too.

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 20
Publishing as Prentice Hall
 Psychographic Segmentation

MUJI – a lifestyle-oriented brand:

•Simple lifestyle
•Like Japanese culture & design
•Environmentally conscious

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 21
Publishing as Prentice Hall
 Behavioral Segmentation

Behavioral segmentation
divides buyers into groups based
on their knowledge, attitudes,
uses, or responses to a product
• Occasions
• Benefits sought
• User status
• Usage rate
• Loyalty status

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 22
Publishing as Prentice Hall
 Behavioral Segmentation
Occasion segmenta1on: Dividing the market into segments
according to occasions when buyers get the idea to buy,
actually make their purchase, or use the purchased item.

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 23
Publishing as Prentice Hall
 Behavioral Segmentation
Occasion segmentation: Dividing the market into segments
according to occasions when buyers get the idea to buy,
actually make their purchase, or use the purchased item.

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 24
Publishing as Prentice Hall
 Benefit Segmentation
Benefit segmentation: grouping buyers according to
the different benefits that they seek from a product

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 25
Publishing as Prentice Hall
 Benefit Segmentation
Benefit segmenta1on: grouping buyers according to
the different benefits that they seek from a product

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 26
Publishing as Prentice Hall
 Benefit Segmentation
Benefit segmentation: grouping buyers according to
the different benefits that they seek from a product

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 27
Publishing as Prentice Hall
 Behavioral Segmentation

• User status: non- users, ex-users, potential users,

first-time users, and regular users
• Usage rate: light, medium, and heavy product users
• Loyalty Status

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 28
Publishing as Prentice Hall
 Market Segmentation

Segmenting Business Markets

Consumer and business marketers use many of the same variables
to segment their markets.

Starbucks partner with Delta Airlines Starbucks at health-care center

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 31
Publishing as Prentice Hall
 Market Segmentation

Segmenting International markets

Geographic Economic
location factors

Political- Cultural
legal factors factors

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 32
Publishing as Prentice Hall
 Market Segmentation

Segmenting International markets

Geographic
location

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 33
Publishing as Prentice Hall
 Market Segmentation

Segmen?ng Interna?onal markets

Economic
factors

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 34
Publishing as Prentice Hall
 Market Segmentation
Segmenting International markets

Political-
legal factors

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 35
Publishing as Prentice Hall
 Market Segmentation
Segmen?ng Interna?onal markets

Cultural
factors

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 36
Publishing as Prentice Hall
 Market Segmentation
Segmenting International Markets
Intermarket segmentation divides consumers into
groups with similar needs and buying behaviors even
though they are located in different countries

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 37
Publishing as Prentice Hall
 Market Segmentation

Requirements for Effective Segmentation

• To be useful, market segments must be:

Measurable Accessible

Substantial Differentiable

Actionable

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 38
Publishing as Prentice Hall
 GROUP DISCUSSION

Each group discuss Market segmentation of

Biti’s Hunter and Nike in Vietnam.
1. Geographic segmentation
2. Behavioral segmentation
3. Demographic segmentation
4. Psychographic segmentation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 39
Publishing as Prentice Hall
 Market Segmentation

Segmenting Consumer Markets

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 41
Publishing as Prentice Hall
 Market Targeting

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 42
Publishing as Prentice Hall
 Market Targeting

Evaluating Market Segments

• Segment size and growth

.
• Segment structural attractiveness
• Company objectives and resources

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 43
Publishing as Prentice Hall
 Market Targeting

Selecting Target Market Segments

Target market consists of a set of buyers who
share common needs or characteristics that the
company decides to serve

What is target market of Coke zero?

Copyright © 2021 Pearson Education, Inc.
Chapter 7- slide 44
Publishing as Prentice Hall
 Market Targeting

Target Marketing Strategies

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 45
Publishing as Prentice Hall
 Market Targeting
v Market Coverage Options:

Undifferentiated Concentrated

Differentiated

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 46
Publishing as Prentice Hall
 Market Targeting

Target Marketing Strategies

Undifferentiated marketing targets the

whole market with one offer
– Mass marketing
– Focuses on common needs rather than whatʼs
different

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 47
Publishing as Prentice Hall
 Undifferentiated Marketing

Ignore segment differences and offer just one product or service to

entire market

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 48
Publishing as Prentice Hall
 Market Targeting

Target Marketing Strategies

Differentiated marketing targets several

different market segments and designs
separate offers for each
• Goal: higher sales and stronger position
• More expensive

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 49
Publishing as Prentice Hall
 Differentiated Marketing
Marketing in a
number of segments,
developing separate
marketing strategies
for each

Levi’s Jeans
uses
differentiated
marketing
strategies for
each segment

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 50
Publishing as Prentice Hall
 Differentiated Marketing
Differentiated marketing: With more than 30 differentiated hotel brands, Marriott
International dominates the hotel industry, capturing a much larger share of the
travel and hospitality market than it could with any single brand alone.

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 51
Publishing as Prentice Hall
 Market Targeting

Target Market Strategies

Concentrated marketing
targets a large share of one or
a few smaller segments or
niches
• Limited company resources
• Knowledge of the market
• More effective and efficient

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 52
Publishing as Prentice Hall
 Concentrated Marketing
Firm selects one or a
few smaller segment
and attempts to
capture large share of
this market

https://www.youtube.com/watch?v=pLhzf7beHIM
Copyright © 2021 Pearson Education, Inc.
Chapter 7- slide 53
Publishing as Prentice Hall
 Concentrated Marketing

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 54
Publishing as Prentice Hall
 Market Targeting

Target Market Strategies

Micromarketing is the practice of tailoring

products and marketing programs to suit
the tastes of specific individuals and
locations
• Local marketing
• Individual marketing

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 55
Publishing as Prentice Hall
 Market Targeting

Target Market Strategies

Local marketing involves tailoring brands and
promotion to the needs and wants of local
customer groups
• Cities
• Neighborhoods
• Stores

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 56
Publishing as Prentice Hall
 Market Targeting
Local Marketing

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 57
Publishing as Prentice Hall
 Market Targeting

Target Market Strategies

Individual marketing involves

tailoring products and
marketing programs to the
needs and preferences of
individual customers
• Also known as:
– One-to-one marketing
– Mass customization

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 59
Publishing as Prentice Hall
 Market Targeting
Individual marketing
- Mass customization

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 60
Publishing as Prentice Hall
 Market Targeting
Individual marketing
• Marketers also
customize their
marketing messages to
engage customers on a
one-to-one basis.

https://www.youtube.com/wat
ch?v=y2o8gFwt4Xs&t=53s

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 61
Publishing as Prentice Hall
 Market Targeting

Choosing a Target Market

Depends on:
• Company resources
• Product variability
• Product life-cycle stage
• Market variability
• Competitorʼs marketing strategies

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 64
Publishing as Prentice Hall
 Market Targeting

Choosing a Target Market

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 65
Publishing as Prentice Hall
 Market Targeting
Socially Responsible Target Marketing

• Benefits customers with

specific needs
• Concern for vulnerable
segments
• Children
– Alcohol
– Cigarettes
– Internet abuses
Copyright © 2021 Pearson Education, Inc.
Chapter 7- slide 66
Publishing as Prentice Hall
 Differentiation & Positioning
Product position is the way
the product is defined by
consumers on important
attributes—the place the
product occupies in
consumersʼ minds relative to
competing products
–Perceptions
–Impressions
–Feelings

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 68
Publishing as Prentice Hall
 Differentiation & Positioning

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 69
Publishing as Prentice Hall
 Differentiation & Positioning

Product position

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 70
Publishing as Prentice Hall
 Differentiation & Positioning

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 71
Publishing as Prentice Hall
 Differentiation & Positioning

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 72
Publishing as Prentice Hall
 Differentiation & Positioning

Positioning maps
show consumer
perceptions of
their brands
versus competing
products on
important buying
dimensions

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 75
Publishing as Prentice Hall
Copyright © 2021 Pearson Education, Inc.
Chapter 7- slide 76
Publishing as Prentice Hall
Copyright © 2021 Pearson Education, Inc.
Chapter 7- slide 77
Publishing as Prentice Hall
Copyright © 2021 Pearson Education, Inc.
Chapter 7- slide 78
Publishing as Prentice Hall
 Differentiation & Positioning
Choosing a Differentiation and Positioning
Strategy

• Identifying a set of possible competitive

advantages to build a position
• Choosing the right competitive advantages
• Selecting an overall positioning strategy
• Developing a positioning statement

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 79
Publishing as Prentice Hall
 Differentiation & Positioning

Identifying Possible Value Differences and

Competitive Advantages
Competitive advantage is an advantage over
competitors gained by offering consumers
greater value, either through lower prices or by
providing more benefits that justify higher prices

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 80
Publishing as Prentice Hall
 Differentiation & Positioning
Choosing a Differentiation and Positioning
Strategy
Identifying a set of possible competitive
advantages to build a position by
providing superior value from:

Product differentiation
Service differentiation
Channel differentiation
People differentiation
Image differentiation
Copyright © 2021 Pearson Education, Inc.
Chapter 7- slide 81
Publishing as Prentice Hall
 Differentiation & Positioning
Product Differentiation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 82
Publishing as Prentice Hall
 Differentiation & Positioning
Service Differentiation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 83
Publishing as Prentice Hall
 Differentiation & Positioning
Channel Differentiation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 84
Publishing as Prentice Hall
 Differentiation & Positioning
People Differentiation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 85
Publishing as Prentice Hall
 Differentiation & Positioning
Image Differentiation

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 86
Publishing as Prentice Hall
 Differentiation & Positioning
Choosing the Right Competitive Advantage

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 87
Publishing as Prentice Hall
 Differentiation & Positioning
Choosing the Right Competitive Advantage
Difference to promote should be:

Important Distinctive Superior

Communicable Preemptive Affordable

Profitable

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 88
Publishing as Prentice Hall
 Differentiation & Positioning
Selecting an Overall Positioning strategy

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 89
Publishing as Prentice Hall
 Differentiation & Positioning
Selecting an Overall Positioning strategy

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 90
Publishing as Prentice Hall
 Differentiation & Positioning

Developing a Positioning Statement

• To (target segment and need) our (brand) is
(concept) that (point of difference)

Company Market-Oriented Definition

We make the Internet buying experience fast, easy, and
enjoyable— weʼre the place where you can find and
discover anything you want to buy online

We create fantasies—a place where dreams come true

and America still works the way itʼs supposed to

We bring inspiration and innovation to every athlete* in the

world
Web link
Copyright © 2021 Pearson Education, Inc.
Chapter 7- slide 91
Publishing as Prentice Hall
 Delivering & Communicating the
Chosen Position

Choosing the
positioning is often
easier than
implementing the
position.

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 92
Publishing as Prentice Hall
 Group Discussion

Each group pick a new or existing local

shoes/sneaker brand in Vietnam.
1. What is the market segment of the brand?
2. What is the target market of the brand?
3. What is the positioning strategy of the
brand?
Each group will have 3-5 minutes to present
your answers.

Copyright © 2021 Pearson Education, Inc.

Chapter 7- slide 93
Publishing as Prentice Hall
All rights reserved. No part of this publication may be reproduced, stored in a
retrieval system, or transmitted, in any form or by any means, electronic,
mechanical, photocopying, recording, or otherwise, without the prior written
permission of the publisher. Printed in the United States of America.

Copyright © 2021 Pearson Education, Inc.

Publishing as Prentice Hall