MA

MAMARKET
RKETRKET SEGMENT
SEGMENTSEGMENTA
AATI
TITION,
ON,ON, T
TTARGETING
ARGETINGARGETING AN
ANAND POSITIONING
D POSITIONINGD POSITIONING
MA
MAMARKET
RKETRKET SEGMENT
SEGMENTSEGMENTA
AATI
TITION
ONON
IN
ININTRODUCT
TRODUCTTRODUCTION:
ION:ION: -
--The market for any product is normally made up of several
segments. A market after all is the aggregate of consumers of a given product.
And, consumer (the
thethe e
eend
ndnd use
useuser
rr), who makes a market, are of varying characteristics
and buying behavior. There are different factors contributing for varying mind s
et of
consumers. It is thus natural that many differing segments occur within a market
.
In order to capture this heterogeneous market for any product, marketers usually
divide or disintegrate the market into a number of sub-markets/segments and the
process is known as market segm
market segmmarket segment
ententation
ationation.
Thus we can say that market segmentation is the segmentation of markets into
homogenous groups of customers, each of them reacting differently to promotion,
communication, pricing and other variables of the marketing mix. Market segments
should be formed in that way that difference between buyers within each segment
is
as small as possible. Thus, every segment can be addressed with an individually
targeted marketing mix.
The importance of market segmentation results from the fact that the buyers of a
product or a service are no homogenous group. Actually, every buyer has individu
al
needs, preferences, resources and behaviors. Since it is virtually impossible to
cater
for every customer s individual characteristics, marketers group customers to
market segments by variables they have in common. These common characteristics
allow developing a standardized marketing mix for all customers in this segment.

Through segmentation, the marketer can look at the differences among the custome
r
groups and decide on appropriate strategies/offers for each group. This is preci
sely
why some marketing gurus/experts have described segmentation as a strategy of
dividing th
dividing thdividing the mar
e mare marke
kekets
tsts for
forfor conquerin
conquerinconquering them.
g them.g them.
MA
MAMARKETING
RKETINGRKETING S
SSTRA
TRATRATEGY
TEGYTEGY AN
ANAND
DD MA
MAMARKET
RKETRKET SEGMENT
SEGMENTSEGMENTA
AATION:
TION:TION: -
--When it
comes to marketing strategies, most people spontaneously think about the 4P
(Product, Price, Place, Promotion) maybe extended by three more Ps for
marketing services (People, Processes, Physical Evidence).
Market segmentation and the identification of target markets, however, are an
important element of each marketing strategy. They are the basis for determining
any particular marketing mix. Basic steps in marketing strategy are as follows:

~ 1~
·· A
AATTRIB
TTRIBTTRIBUTES OF
UTES OFUTES OF EFFECTIVE
EFFECTIVEEFFECTIVE SEGMENT
SEGMENTSEGMENTA
AATION
TIONTION
Market segmentation is resorted to for achieving certain practical purpose. For
example, it has to be useful in developing and implementing effective and practi
cal
marketing programmes. For this to happen, the segments arrived at must meet
certain criteria such:

a.Identi
IdentiIdentifiable
fiablefiable:
:: The differentiating attributes of the segments must be
measurable so that they can be identified.
~ 2~
b.Accessible
AccessibleAccessible:
:: The segments must be reachable through communication and
distribution channels.
c. Si
SiSiz
zzeable
eableeable: The segments should be sufficiently large to justify the resources
required to target them. A very small segment may not serve commercial
exploitation.
d.Pr
PrPro
oofit
fitfitable
ableable:
:: -There is no use in locating segments that are sizeable but not
profitable.
e.Unique
Uniqueneeds
needsneeds: To justify separate offerings, the segments must respond
differently to the different marketing mixes.
f. Durable
DurableDurable: The segments should be relatively stable to minimize the cost of
frequent changes.
g.Measurable
MeasurableMeasurable: The potential of the segments as well as the effect of a s
pecific
marketing mix on them should be measurable.
h.Comp
Compatible:
atible:atible: -Segments must be compatible with firm s resources and
capabilities.

·· RE
REREASONS FOR MA
ASONS FOR MAASONS FOR MARKET
RKETRKET SEGMENT
SEGMENTSEGMENTA
AATION
TIONTION
Segmentation is the basis for developing targeted and effective marketing plans.
Furthermore, analysis of market segments enables decisions about intensity of
marketing activities in particular segments.
~ 3~
A segment-orientated marketing approach generally offers a range of advantages f
or
both, businesses and customers.
1.
1.1. Fa
FaFacilita
cilitacilitates pr
tes prtes proper
operoper ch
chchoice of
oice ofoice of ta
tatarge
rgerget ma
t mat marke
rkerketing
tingting:
::Segmentation
helps the marketers to distinguish one customer group from another
within a given market and thereby enables him to decide which segment should
form his target market.
2.
2.2. Hi
HiHigher
ghergher Pr
PrProf
ofofits:
its:its: It
is often difficult to increase prices for the whole market. Nevertheless, it is
possible to develop premium segments in which customers accept a higher price
level. Such segments could be distinguished from the mass market by features lik
e
additional services, exclusive points of sale, product variations and the like.
A
typical segment-based price variation is by region. The generally higher price l
evel
in big cities is evidence for this. When differentiating prices by segments,
organizations have to take care that there is no chance for cannibalization betw
een
high-priced products with high margins and budget offers in different segments.
This risk is the higher, the less distinguished the segments are.
3.
3.3. Fa
FaFacilita
cilitacilitates
testes ta
tatapping
ppingpping of
ofof th
ththe
ee mar
marmarke
keket,
t,t, ad
adadapting
aptingapting the
thethe offer
offeroffer t
tto
oo t
tthe
hehe ta
tatarg
rgrget
etet:-
:-:-
Segmentation also enables the marketer to crystallize the needs of target buyers
.
It also helps him to generate an accurate prediction of the likely responses fro
m
each segment of the target buyer. Moreover, when buyers are handled after
careful segmentation, the responses for each segment will be homogeneous. This
in turn, will help the marketer develop marketing offer/programmers that most
suited to each groups. He can achieve specialization that is required in product
,
distribution, promotion and pricing for matching the particular customer group
and develop offers and appeals for the segmented group.
Example
ExampleExample of
ofof Fo
FoFord:
rd:rd: -Ford has gained useful insights through segmentation and
adapted its offer to suit the Indian target market. For the Indian segment Ford
made some changes in its cars in comparison to their European version.
Modifications such as:

a. Higher gr
grground
oundound clea
cleaclearance
rancerance to
toto ma
mamake
keke th
ththe
ee ca
cacar
rr c
cco
oom
mmp
ppa
aat
tti
iib
bbl
lle
ee t
tto
oo t
tth
hhe
ee r
rro
oou
uug
ggh
hhe
eer
rr r
rro
ooa
aad
dd
s
ssu
uur
rrf
ffa
aac
cce
ee i
iin
nnI
IIn
nnd
ddi
iia
aa.
..
~ 4~
b
bb. S
. S. St
tti
iif
fff
ffe
eer
rr r
rre
eea
aar
rr s
ssp
ppr
rri
iin
nng
ggs
ss t
tto e
o eo en
nna
aab
bbl
lle n
e ne ne
eeg
ggo
oot
tti
iia
aat
tti
iin
nng
gg t
tth
hhe
ee u
uub
bbi
iiq
qqu
uui
iit
tto
oou
uus
ss p
ppo
oot
tth
hho
ool
lle
ees
ss o
oon
nn I
IIn
nnd
ddi
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aan
nn
r
rro
ooa
aad
dds
ss.
..
c
cc.
.. C
CCh
hha
aan
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gge
ees
ss i
iin
nn c
cco
ooo
ool
lli
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rre
eem
mme
een
nnt
tt,
,, w
wwi
iit
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hh g
ggr
rre
eea
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tte
eer
rr a
aai
iir
rrf
ffl
llo
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ww t
tto
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tth
hhe
ee r
rre
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aar
rr.
..
d
dd.
.. H
HHi
iig
ggh
hhe
eer
rr r
rre
ees
ssi
iis
sst
tta
aan
nnc
cce
ee t
tto
oo d
ddu
uus
sst
tt.
..
e
ee.
.. C
CCo
oom
mmp
ppa
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tti
iib
bbi
iil
lli
iit
tty
yy o
oof
ff e
een
nng
ggi
iin
nne
ee w
wwi
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tth
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ee q
qqu
uua
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lli
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tty
yy o
oof
ff f
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f
ff.
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LLo
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cca
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nn o
oof
ff h
hho
oor
rrn
nn b
bbu
uut
ttt
tto
oon
nns
ss o
oon
nn t
tth
hhe
ee s
sst
tte
eee
eer
rri
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nng
gg w
wwh
hhe
eee
eel
ll.
.. A
AAs
ss I
IIn
nnd
ddi
iia
aan
nn m
mmo
oot
tto
oor
rri
iis
sst
tts
ss u
uus
sse
ee h
hho
oor
rrn
nn
f
ffa
aar
rr m
mmo
oor
rre
ee f
ffr
rre
eeq
qqu
uue
een
nnt
ttl
lly
yy t
tth
hha
aan
nn t
tth
hhe
ee E
EEu
uur
rro
oop
ppe
eea
aan
nn w
wwh
hhe
eer
rre
ee t
tth
hhe
ee h
hho
oor
rrn
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ss a
aar
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ee l
llo
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cca
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tte
eed
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oon
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tth
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lle
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vve
eer
rr.
..
4.
4.4.Stimulatin
StimulatinStimulating Innov
g Innovg Innovati
atiation: -
on: -on: -
An undifferentiated marketing strategy that targets at all customers in the tota
l
market necessarily reduces customers preferences to the smallest common basis.
Segmentations provide information about smaller units in the total market that
share particular needs. Only the identification of these needs enables a planned
development of new or improved products that better meet the wishes of these
customer groups. If a product meets and exceeds a customer s expectations by
adding superior value, the customers normally is willing to pay a higher price f
or
that product. Thus, profit margins and profitability of the innovating
organizations increase.
5.
5.5.Mak
MakMakes
eses th
ththe
ee m
mmark
arkarketing
etingeting effort
efforteffort mor
mormore
ee efficient
efficientefficient a
aand
ndnd e
eecon
conconomic:
omic:omic: -
--Segmentation
ensures that the marketing effort is concentrated on well defined and carefully
chosen segments. After all, the resources of any firm are limited and no firm ca
n
normally afford to attack and tap the entire market without any delimitation
whatsoever. It would benefit the firm if the efforts were concentrated on
segments that are more profitable and productive ones.
Segmentation also helps the marketer assess as to what extend existing offer
from competitors match the needs of different customer segments. The
marketer can thus identify the relatively less satisfied segments and succeed
by concentrating on them and satisfying their needs.
6.
6.6.Bene
BeneBenefits th
fits thfits the customer
e customere customer as w
as was well
ellell:
:: -
~ 5~
Segmentation brings benefits not only to the marketer, but to the customer as
well. When segmentation attains higher levels of sophistication and perfection,
customers and companies can conveniently settle down with each other, as at
such a stage, they can safely rely on each other s discrimination. The firm can
anticipate the wants of the customers and the customers can anticipate the
capabilities of the firm.
7.
7.7.Sustainable
SustainableSustainable custom
customcustomer
erer r
rrel
elelati
atiationsh
onshonships
ipsips in
inin all
allall phases
phasesphases of
ofof custom
customcustomer
erer life
lifelife c
ccy
yycle
clecle:
:: -
--
Customers change their preferences and patterns of behavior over time.
Organizations that serve different segments along a customer s life cycle can
guide their customers from stage to stage by always offering them a special
solution for their particular needs. For example, many car manufacturers offer a
product range that caters for the needs of all phases of a customer life cycle:
first
car for early teens, fun-car for young professionals, family car for young
families, etc. Skin care cosmetics brands often offer special series for babies,
teens, normal skin, and elder skin.
8.
8.8.T
TTar
arargeted
getedgeted communica
communicacommunication:
tion:tion: -
--
It is necessary to communicate in a segment-specific way even if product
features and brand identity are identical in all market segments. Such a targete
d
communications allows to stress those criteria that are most relevant for each
particular segment (e.g. price vs. reliability vs. prestige).
9.
9.9.Hi
HiHigher
ghergher mar
marmarke
keket Shar
t Shart Shares:
es:es: -
--
In contrast to an undifferentiated marketing strategy, segmentation supports the
development of niche strategies. Thus marketing activities can be targeted at
highly attractive market segments in the beginning. Market leadership in
selected segments improves the competitive position of the whole organization
in its relationship with suppliers, channel partners and customers. It strengthe
ns
the brand and ensures profitability. On that basis, organizations have better
chances to increase their market shares in the overall market.
~ 6~
··BASES FO
BASES FOBASES FOR SEGMEN
R SEGMENR SEGMENT
TTA
AATION
TIONTION
Markets can be segmented using several relevant bases. There are huge number
of variables which leads to market segmentation. They comprise easy to
determine demographic factors as well as variables on user behavior or customer
preferences. Segmentation is done for consumer m
consumer mconsumer market
arketarket and industr
industrindustrial
ialial mar
marmarket.
ket.ket.
.
..Bases
BasesBases for
forfor segment
segmentsegmentati
atiation in consumer
on in consumeron in consumer m
mmark
arkarket:
et:et:-
--
Consumer market can be segmented on the following customer characteristics
1.
1.1. Geograph
GeographGeographic Seg
ic Segic Segme
mementat
ntatntation.
ion.ion.
2.
2.2. De
DeDem
mmographic
ographicographic Seg
SegSegm
mmentation.
entation.entation.
3.
3.3. Psy
PsyPsychographic
chographicchographic Seg
SegSegm
mmentation.
entation.entation.
4.
Behavioura
BehaviouraBehaviouralistic
listiclistic Seg
SegSegmentation
mentationmentation.
..
1) Geograph
GeographGeographic
icic Seg
Segme
mementat
ntatntation
ionion: -Potential customers are in a local, state,
regional or national marketplace segment. If a firm selling a product such
as farm equipment, geographic location will remain a major factor in
segmenting your target markets since their customers are located in
particular rural areas. While for retail store, geographic location of the store
is one of the most important considerations, in this case city areas are
preferred. Segmentation of customers based on geographic factors are:

a.
Region:
Region:Region: -
--Segmentation by continent / country / state / district / city.
b.
Si
SiSiz
zze:
e:e: -Segmentation on the basis of size of a metropolitan area as
per its population size.
~ 7~
c.
Populat
PopulatPopulation
ionion density
densitydensity: -Segmentation on the basis of population
density such as urban / sub-urban / rural etc.
d.
Cli
CliClimate:
mate:mate: -Segmentation as per climatic condition or weather.
2) De
DeDem
mmographic
ographicographic Seg
Segme
mementat
ntatntation
ionion:
:: -
--Segmentation
SegmentationSegmentation of customers based on
demographic factors are:

a.Age
AgeAge (
((do
dodominant
minantminant factor
factorfactor):-Segmentation is done on the basis of age of
person. Example Titan has segmented its product according to different
age group of person.
T
TTitan
itanitan
s pr
s prs product
oductoduct seg
segsegm
mmentat
entatentation on the bases
ion on the basesion on the bases of age:-
of age:-of age:-
T
TTit
ititan
anan created a sub brand, Fastrack. These watches are specifically
for young, vibrant, and cool outgoing young generation. While for
older person and professional it has created the steel series watches
and also the famous, Sonata.

T
TTit
ititan Fas
an Fasan Fastra
tratrack
ckck( for
( for( for th
ththe y
e ye yo
oou
uunger
ngernger se
sesegment
gmentgment)
))
~ 8~
Steel
SteelSteel-10
-10-1077SM
77SM77SM01
0101(
((for
forfor elder
elderelder person a
person aperson and pr
nd prnd professional)
ofessional)ofessional)
a. Income
IncomeIncome (d
(d(dominant
ominantominant fact
factfactor
oror):-Segmentation is done on the basis of
income level of a person.
Example of Titan watches can be citied such as Titan offered Aurum
and Royale in the gold/jewellery watch range with price ranges
between Rs. 20000 to Rs.1 lakh.

T
TTitan N
itan Nitan Nebula (Luxur
ebula (Luxurebula (Luxury
yy se
sesegment w
gment wgment wa
aatch
tchtch)
))
For
ForFor mi
mimiddl
ddlddle
ee segme
segmesegment
ntnt, Titan offered Exacta range in stainless steel, aimed
at withstanding the rigours of daily life. There were 100 models in the
range. Price ranges within Rs500-700.
For
ForFor t
tthe
hehe t
tthir
hirhird
dd segme
segmesegment
ntnt, Titan offered the Sonata range. The price range
was between Rs.350 to 500.
~ 9~
T
TTitan Sona
itan Sonaitan Sonata (W
ta (Wta (Watch f
atch fatch fo
oor
rr the t
the tthe third seg
hird seghird segme
mement
ntnt)
))
b. Pur
PurPurchasing
chasingchasing p
ppower
owerower (d
ddomina
ominaominant
ntnt factor
factorfactor):-Segmentation done on
the basis of purchasing power of the customer. Examples of different
car segment based on purchasing power are :-
Bu
BuBudg
dgdget car se
et car seet car segme
gmegment
ntnt-
It is the largest segment in Indian market. Here the entry level starts
from Rs 1.5 to 3 lakh. Maruti
MarutiMaruti 8
8800
0000 and O
OOmni
mnimni are the dominant players
in these segments. With the launch of T
TTata
ataata Nano
NanoNano with a price range
of 1lakh the outlook of this segment has changed. This segment is
sometimes referred to as the small car segment. Competition in this
segment is extreme in Indian market.
~ 10~
Marut
MarutMaruti 800 (Budget Car
i 800 (Budget Cari 800 (Budget Car Seg
SegSegme
mement
ntnt)
))
Compact car
Compact carsegment
segment-
It lies between budget car and family car. Preferred price range is
between Rs 3 to 4.5 lakh. Maruti Zen, Fiat Uno, Tata Indica,
Santro, Matiz is some of the dominant players in this segment.

~ 11~
Maruti
MarutiMaruti Z
ZZen
enen (Co
(Co(Com
mmpact car
pact carpact car seg
segsegment)
ment)ment)

Dae
DaeDaewoo Mat
woo Matwoo Mati
iiz
zz (Co
(Co(Com
mmpact car
pact carpact car seg
segsegm
mment)
ent)ent)
Cars
CarsCars of compact segment
of compact segmentof compact segment
Family car
Family carFamily car segment
segmentsegment-
--
The purchasing capacity of buyers of this segment is somewhat
higher than that of the budget and compact car segment. Price
ranges between Rs 4.5 to 6 lakhs. Maru
MaruMaruti
titi Estee
EsteeEsteem,
m,m, D
DDaewoo
aewooaewoo Cielo,
Cielo,Cielo,
and
andand HM
HMHM Contessa
ContessaContessa belongs to this segment. In India cars that are
sold in India as Budget Car and Compact Car do not meet their
purpose, especially in term of space, that they turn to the family
car segment .
~ 12~
Dae
DaeDaewoo Cielo
woo Cielowoo Cielo (Fa
(Fa(Famil
milmily Car
y Cary Car seg
segsegm
mment)
ent)ent)
Pr
PrPremium car segment
emium car segmentemium car segment-
This segment represents the buyer who require true world class
luxury car. Price ranges between Rs 6 to 8 lakh. Ford
FordFord Escort,
Escort,Escort,
Honda
HondaHonda City
CityCity,
,, Honda
HondaHonda City
CityCity,
,, M
MMitsub
itsubitsubishi
ishiishi Lancer
LancerLancer,
,, A
AAudi
udiudi 1800
18001800,
,, Opel
OpelOpel
Astra
AstraAstra etc are some of the major cars in this segment.

Ope
OpeOpel
ll Astra (Pr
Astra (PrAstra (Pre
eemiu
miumium
mm car
carcar seg
segsegment)
ment)ment)
~ 13~
Super
SuperSuper luxury saloon
luxury saloonluxury saloon segment-
segment-segment-
Buyer in this segment looks for a real super premium segment car.
Mercede
MercedeMercedes
ss Benz
BenzBenz E229,
E229,E229, E-250,
E-250,E-250, Rover
RoverRover Montego,
Montego,Montego, Audi
AudiAudi 6,
6,6, BMW
BMWBMW are
the players in this segment. Obviously, this is a tiny segment in the
Indian context.

Audi 6 (Super
Audi 6 (SuperAudi 6 (Super Lu
LuLux
xxury
uryury sa
sasaloon)
loon)loon)
c.
Oc
OcOccupa
cupacupation
tiontion.
..
d. Gender
GenderGender (
((domi
domidominant
nantnant f
ffactor
actoractor)
)):
::-
--Product can be segmented for male
and female.
e.
e.e. Famil
FamilFamily Siz
y Sizy Size.
e.e.
f.
f.f. Famil
FamilFamily life c
y life cy life cycl
yclycle.
e.e.
g.
g.g. Natio
NatioNationality
nalitynality.
..
h.
h.h. Relig
ReligReligion
ionion.
..
i.
Education
EducationEducation:
::-
--Primary, High School, Secondary, College,
Universities.
~ 14~
Many of these variables have standard categories for their values.
For example family lifecycle often is expressed as bachelor,
married with no children, full-nest, and empty-nest or solitary
survivor.
3) Psyc
PsycPsychographic
hographichographic Seg
Segmenta
mentamentation
tiontion: -Psychographic Segmentation groups
customers according to their life-style and buying psychology. Many
businesses offer products based on the attitudes, beliefs and emotions of
their target market. The desire for status, enhanced appearance and more
money are examples of psychographic variables. They are the factors that
influence your customers' purchasing decision. A seller of luxury items
would appeal to an individual's desire for status symbols Psychographic
Segmentation includes variables such as:

a.
a.a. Activities.
Activities.Activities.
b.
b.b. Inter
InterInterests.
ests.ests.
c.
c.c. Opinions
OpinionsOpinions.
..
d.
d.d. At
AtAttitu
titutitudes.
des.des.
e. V
VValues
aluesalues.
Activities
ActivitiesActivities,
,, Inte
InteInterests
restsrests, and O
OOpinions
pinionspinions (
((AIO)
AIO)AIO) surveys are one tool of measuring
lifestyle.
4) B
BBehaviouralistic
ehaviouralisticehaviouralistic Seg
Segmentatio
mentatiomentation
nn: -Markets can be segmented on the
basis of buyer behaviour as well. Since all Segmentation is in a way related
to buyer behavior, one might be tempted to ask why buyer behavior-based
segmentation should be a separate method. It is because there is some
distinction between buyer s characteristics that are reflected by their
geographic, demographic and psychographic profiles, and their buying
behaviour. Marketers often find practical benefit in using buying behaviour
as a separate segmentation base in addition to bases like geographic,
demographics, and psychographics.
~ 15~
The primary idea in buyer behaviour segmentation is that different
customer groups expect different benefits from the same product and
accordingly, they will be different in their motives in owing it and their
behavior in buying it. Variables of buyer behavior are:

a.
Benefit sought: -Quality / economy / service / look etc of the
product.
b.
Usage rate: -Heavy user / moderate user / light user of a product.
c.
User status: -Regular / potential / first time user / irregular
/occasional.
d.
Brand Loyalty: -Hard core loyal / split loyal / shifting / switches.
e.
e.e. Readiness to
Readiness toReadiness to bu
bubuy
yy.
..
f.
Occ
OccOccasion
asionasion: -Holidays and occasion stimulate customer to purchase
products.
g.
At
AtAttitude to
titude totitude tow
wward offering:
ard offering:ard offering: - Enthusiastic / positive attitude / negative
attitude / indifferent / hostile.
.
Bases
BasesBases for
forfor segment
segmentsegmentati
atiation
onon in
inin indu
induindustri
stristrial
alal mar
marmarket
ketket-
--In contrast to consumers,
industrial customers tend to be fewer in number and purchase larger quantities.
They evaluate offerings in more detail, and the decision process usually
involves more than one person. These characteristics apply to organizations
such as manufacturers and service providers, as well as resellers, governments,
and institutions.
~ 16~
Many of the consumer market segmentation variables can be applied to
industrial markets. Industrial markets might be segmented on characteristics suc
h
as:
1.
1.1. Lo
LoLocation
cationcation.
..
2.
2.2. Com
ComCompan
panpany
yy t
ttype
ypeype.
..
3. B
BBehavioral
ehavioralehavioral characte
charactecharacteristi
ristiristics
cscs.
..
1) Lo
LoLocation
cationcation In
industrial markets, customer location may be important in some cases. Shipping
costs may be a purchase factor for vendor selection for products having a high
bulk to value ratio, so distance from the vendor may be critical. In some
industries firms tend to cluster together geographically and therefore may have
similar needs within a region.
2) Com
ComCompan
panpany
yy T
TType:
ype:ype: Business customers can be classified according to type as
follows :
a.Co
CoCom
mmpany
panypany si
sisiz
zze
ee:-Whether the company is a large scale industry / a small
scale industry. Large industry always tries to order in bulk commodities
while opposite for small scale sector.
b.Indus
IndusIndustr
trtry:
y:y: -Whether the industry is manufacturing industry / service
industry. Also sometime differentiation is done between public sector
industry or a private sector industry.
c.
c.c. Decision
DecisionDecision m
mma
aaking
kingking unit.
unit.unit.
d.
d.d. Pur
PurPurchase Criter
chase Criterchase Criteria.
ia.ia.
3)
3)3) B
BBehavioral
ehavioralehavioral Ch
ChChara
araaracteri
ctericteristics
sticsstics
In industrial markets, patterns of purchase behavior can be a basis for
segmentation. Such behavioral characteristics may include:

·· Usage rate
Usage rateUsage rate
~ 17~
··Buy
BuyBuying sta
ing staing status:
tus:tus: potentia
potentiapotential, firs
l, firsl, first-t
t-tt-ti
iim
mme, r
e, re, regula
egulaegular
rr, etc.
, etc., etc.
··Pur
PurPurchase pr
chase prchase procedur
ocedurocedure:
e:e: sealed bid
sealed bidsealed bids, negotia
s, negotias, negotiations,
tions,tions, etc.
etc.etc.
Mult
MultMulti-
i-i-level
levellevel Seg
SegSegm
mmentat
entatentation:
ion:ion: A
AA Market
MarketMarket can
cancan be
bebe seg
segsegm
mmented,
ented,ented, using
usingusing severa
severaseveral
ll
bases
basesbases in
inin success
successsuccession-
ion-ion-While discussing about bases of segmentation we must
discuss about multi-level segmentation, as it is not as through segmentation
bases discussed above are mutually exclusive and a market can be segmented
only with one particular base, on either / or basis. Since customer
characteristic are spread over several variables, any market can be segmented
through several bases. Different bases can be used in combination in
segmenting a given market. They just have to be relevant for the concerned
market. Actually, the different bases can be used in succession in a suitable
order, and the market can be segmented at multi-levels.
For example, a market can be segmented using the demographic base in the
first instance, followed by the psychographic base and the buyer
behavior/benefit base. Or, the market can be segmented using volume as the
base in the first instance, followed by the demographic/psychographic/buyer
behavior/benefit base. Assuming for example, that the firm first carries out
volume segmentation of its market, it can know who the heavy user of its
product are, but it cannot know the purpose for which they buy the product.
The firm can then pick up the heavy users and carry out a multi-level
segmentation, and continue its probe more deeply.
Since each of these bases has several sub-bases, the numbers of levels in
which a market can be segmented are indeed numerous. Actually, the aim
should always be to go as deep as possible in segmenting the market so that
segments that are most attractive and most suited can be chosen.

Mult
MultMulti-
i-i-level
levellevel seg
segsegm
mmentat
entatentation
ionion enables
enablesenables better
betterbetter selec
selecselection
tiontion of
ofof target
targettarget m
mma
aarket
rketrket and
andand
better
betterbetter choice of
choice ofchoice of m
mma
aarketing mi
rketing mirketing mix
xx:
Multi-level segmentation enables the marketers to choose his target market
better. It also helps him to make the winning strategy and strike the right
product offer and the right marketing mix. With the information generated
~ 18~
from multi-level segmentation, he can obtain a deeper understanding of the
customers in each segment, their needs, buying motives and buying behaviour.
He can understand in what way each of the different segments want the
product to be, he can then tailor his product, marketing offer and promotional
appeal, to fit the individual segment; he can select the priced, distribution
method/channels, media vehicles, advertising massages and sales appeal,
which will be appropriate.
E
EExa
xaxam
mmple
pleple of General
of Generalof General Motors:-
Motors:-Motors:-
GM has identified about 40 different customer needs and correspondingly, 40
different market segments in which it would present with its vehicles. For
example, it has targeted the Pontiac at active, sports-oriented, young couples,
the
Chevrolet at price-conscious young families, the Oldsmobile at affluent families
,
and the Buick at older, more conservative couples.

·· APPROAC
APPROACAPPROACHES IN
HES INHES IN SEGMENT
SEGMENTSEGMENTA
AATION
TIONTION
Geor
GeorGeorge
gege D
DDa
aay
yy (1980) describes models of segmentation as the top-down
top-downtop-down
appr
apprapproach
oachoach: In this approach firms starts with the total population and divide it
into segments . He also identified an alternative model which he called the
bottom
bottombottom-up
-up-up appr
apprapproach
oachoach. In this approach, firms starts with a single customer and
build on that profile . This typically requires the use of customer relationship
management software or a database of some kind. Profiles of existing customers
are created and analysed. Various de
dedem
mmographic
ographicographic, behavioura
behaviourabehavioural
ll, and
psychographic
psychographicpsychographic patterns
patternspatterns are built up using techniques such as cluster analysis.
This process is sometimes called database marketing or micro-marketing. Its use
is most appropriate in highly fragmented markets. McKenna (1988) claims that
this approach treats every customer as a "micro majority". Pine (1993) used the
bottom-up approach in what he called "segment of one marketing". Through this
process mass customization is possible.

·· ADV
ADVADVANT
ANTANTAGES OF
AGES OFAGES OF M
MMARKET
ARKETARKET S
SSEGMENT
EGMENTEGMENTA
AATION
TIONTION
~ 19~
Various advantages of market segmentation are:

1.
1.1. Helps distinguish one customer group from another within a given
market.
2.
2.2.Facilitates proper choice of target market.
3.
3.3.Facilitates effective tapping of the market.
4.
4.4.Helps divide the markets and conquer them.
5.
5.5.Helps crystallize the needs of the target buyers and elicit more
predictable responses from them ; helps develop marketing
programmes on a more predictable base; helps develop market offer
that are most suited to each group.
6.
6.6.Helps achieve the specialization required in product; distribution,
promotion, and pricing for matching the customer group and develop
marketing offers and appeal that match the need of each group.
7.
7.7.Makes the marketing effort more efficient and economic.
~ 20~
8.
8.8.Helps concentrate efforts on the most productive and profitable
segment, instead of frittering them over irrelevant, or unproductive, or
unprofitable segment.
9.
9.9.Helps spot the less satisfied segments and succeed by satisfying such
segments.
10
1010.
..Brings benefits not only to the marketer but also to the customer as
well.
1
111
11.
..When segmentation attains high sophistication, customers and companies
can choose each other and stay together.
··EV
EVEVALUA
ALUAALUAT
TTION
IONION OF
OFOF THE SEGMEN
THE SEGMENTHE SEGMENTS
TSTS
Whether market segmentation is successful or not can be evaluated by the
following questions-
1.Is
IsIs i
iit si
t sit siz
zzeable
eableeable: -
: -: -
Size-wise, the popular segment is a bigger compared to the premium
segment. In term of tonnage, of the total market of around 6, 00,000
~ 21~
tonnes, the popular segment account for 80 percent and the premium
segment for the remaining 20 percent. If the firm wants a very large
volume, it has to think of the popular segment. At the same time, it has to
note that the premium segment too is sizeable, as it account for over
120,000 tonnes. In term of value, the premium segment is even more
sizeable, formerly nearly 30 percent of the total market. Clearly, the
segment cannot be ruled out as lacking in size.
2.Is
IsIs i
iit gr
t grt grow
owowing
inging:
::

Growth rate and likely future position of the segment will be the next
consideration in the evaluation process. Usually, business firms seek out the
high growth segments. Analysis will readily indicate to the firm that in bath
soaps, the premium segment happens to be the high growth segment. Whereas
the popular segment has been growing at 10 percent per annum, the premium
segment has been growing at over 20 percent annum. When this fact is taken
into consideration, the firm s choice may tilt toward the premium segment.
The tilt will be particularly pronounced if the firm s natural disposition is to
strive for a position in the high growth segment of the business.
3.Is
IsIs it pr
it prit prof
ofofitable
itableitable: -
: -: -
Next consideration will be the extend of profitability. In the present
example, the firms quickly sense that the premium segment is more
profitable one. Even a relatively lower volume in the segment may bring
in good returns. On the contrary, in the popular segment, a much larger
volume will be necessary for the business to be viable, since prices and
margins in the segment are low.
Another point is that costs of marketing, distribution and promotion in
the business are quite high and are constantly on the rise. Costs of
launching a new brand are particularly high. The market is very
~ 22~
competitive, aggressive promotional support through expensive media
like TV becomes essential. In this background, the firm may come to the
conclusion that it may be worthwhile to gamble in the premium segment
rather than the popular segment.
4.Is
IsIs it access
it accessit accessible
ibleible: -
: -: -
The firm has to now consider whether the segments are accessible to it.
This may need further analysis. The market realities will have to be
taken into consideration. The popular segment will be accessible only to
the firm with a cost advantage, since price is a major determinant in this
segment. Premium segment will be accessible only to firms, which enjoy
a differentiation advantage, and which are also marketing savvy. Liril of
Hindustan Lever has a commanding position in this segment. At the
upper end of the segment, HLL s Pears and Dove are well entrenched.
Several other brands of different companies are competing in the
segment. The firm has to take due note of this reality. At the same time,
analysis also reveals that new brands do keep entering the segment every
now and then, and some of them do manage to stay. So, the firm has no
reason to believe that the premium segment is not accessible to it, unless
it is convinced that it is very weak in marketing.
5.Is
IsIs it
itit co
cocompatible
mpatiblempatible with
withwith the
thethe fir
firfirm
m m s
ss r
rresour
esouresources
cesces and
andand capabi
capabicapabilit
litlities:
ies:ies: -
--Having
reached the conclusion that the premium segment is sizeable, growth
oriented, profitable and accessible, the firm has to now find out if the
segment matches its resources. For some firms, the popular segment may
be the natural choice and for others, the premium segment. And, for
some other choosing both. The premium segment is a highly competitive
segment. Only firms endowed with strong resources and an aggressive
marketing strategy/culture can fight and survive in the market. The firm
therefore has to assess whether the particular segments are compatible
with its resources and capabilities.
~ 23~
Thus by this following analysis a firm can easily evaluate it market
segmentations and also can tackle its problem.
~ 24~
MARKET
MARKETMARKET T
TTARGETING
ARGETINGARGETING
INT
INTINTRODUC
RODUCRODUCTI
TITION:
ON:ON: -There was a time when finding the best customers was like
throwing darts in the dark. Target marketing changed all that...Today's savvy
marketers know that finding their best prospects and customers hinges on well
thought out targeted marketing strategies.
Defining a target market requires market segmentation, the process of pulling
apart the entire market as a whole and separating it into manageable, disparate
units based on demographics. T
TTarget m
arget marget mar
ararket
ketket is a business term meaning the
market segment to which a particular good or service is marketed. It is mainly
defined by age, gender, geography, socio-economic grouping, or any other
combination of demographics. It is generally studied and mapped by an
organization through lists and reports containing demographic information that
may have an effect on the marketing of key products or services.
T
TTarget
argetarget Ma
MaMarketing
rketingrketing involves breaking a market into segments and then
concentrating your marketing efforts on one or a few key segments. Target
marketing can be the key to a small business s success.
The beauty of target marketing is that it makes the promotion, pricing and
distribution of your products and/or services easier and more cost-effective.
Target marketing provides a focus to all of your marketing activities.
Marke
MarkeMarket
tt tar
tartarget
getgeting
inging simply means choosing one s target market. It needs to be
clarified at the onset that marketing targeting is not synonymous with market
segmentation. Segmentation is actually the prelude to target market selection.
One has to carry out several tasks beside segmentation before choosing the targe
t
market.
Through segmentation, a firm divides the market into many segments. But all
these segments need not form its target market. Target market signifies only tho
se
segments that it wants to adopt as its market. A selection is thus involved in i
t.
In choosing target market, a firm basically carries out an evaluation of the
various segments and selects those segments that are most appropriate to it. As
we know that the segments must be relevant, accessible, sizable and profitable.
The evaluation of the different segments has to be actually based on these crite
ria
and only on the basis of such an evaluation should the target segments be
selected.
~ 25~
·· PROCESS
PROCESSPROCESS OF
OFOF CHOOSI
CHOOSICHOOSING
NGNG THE
THETHE T
TTARG
ARGARGET
ETET MARKET
MARKETMARKET
T
TThe process of choosing the target Market are:

.
..Ch
ChChoosi
oosioosing
ngng the
thethe tar
tartarget
getget m
mmark
arkarket
etet is
isis relate
relaterelated
dd t
tto,
o,o, bu
bubut
tt n
nnot
otot syn
synsynony
onyonym
mmous
ousous with,
with,with, m
mma
aarket
rketrket
seg
segsegm
mmentatio
entatioentation.
n.n.
.
Seg
SegSegmentation
mentationmentation is
isis the
thethe m
mmean
eaneans
ss o
oor
rr the
thethe to
totool;
ol;ol; c
ccho
hohoosin
osinosing
gg the
thethe tar
tartarget
getget m
mmark
arkarket
etet is
isis t
tthe
hehe
pu
pupurp
rprpose.
ose.ose.
.
..Seg
SegSegmentation can also be viewed as
mentation can also be viewed asmentation can also be viewed as t
tthe
hehe p
pprelu
relurelude
dede t
tto tar
o taro target m
get mget ma
aarket sele
rket selerket selecti
ctiction.
on.on.
.
..Ch
ChChoosi
oosioosing
ngng t
tthe
hehe tar
tartarget
getget m
mma
aarket
rketrket us
ususually
uallyually f
ffoll
ollollows
owsows m
mmu
uulti-le
lti-lelti-level
velvel seg
segsegm
mmentati
entatientation
onon
usi
usiusing di
ng ding dif
ffferent bases
ferent basesferent bases.
..
.
..Ch
ChChoosi
oosioosing
ngng t
tthe
hehe tar
tartarget
getget m
mma
aarket
rketrket in
ininvo
vovolves
lveslves several
severalseveral ot
otother
herher tasks
taskstasks i
iin
nn ad
adadditi
ditidition
onon to
toto
seg
segsegm
mmentatio
entatioentation.
n.n.
.
..Lo
LoLook
okokin
ining
gg at each seg
at each segat each segm
mment
entent as a
as aas a d
ddistinct m
istinct mistinct ma
aarketi
rketirketing op
ng opng oppo
poport
rtrtunity
unityunity.
..
.
..Eval
EvalEvaluatin
uatinuating the wort
g the wortg the worth of each seg
h of each segh of each segm
mment
entent (sales/pr
(sales/pr(sales/profit p
ofit pofit poten
otenotential).
tial).tial).
.
..Eval
EvalEvaluatin
uatinuating whether t
g whether tg whether the
hehe seg
segsegment
mentment is:
is:is:
.
..Disting
DistingDistinguisha
uishauishable.
ble.ble.
.
..Measura
MeasuraMeasurable.
ble.ble.
.
..Sizable.
Sizable.Sizable.
.
..Acc
AccAccessible.
essible.essible.
.
..Gr
GrGrowing.
owing.owing.
.
..Pr
PrPro
oofi
fifitable.
table.table.
.
..Co
CoComp
mpmpat
atatible
ibleible wi
wiwith the
th theth the f
ffir
irirm
mm
s r
s rs re
eeso
sosour
ururc
cces.
es.es.
.
..Exa
ExaExaminin
mininmining
gg w
wwhether
hetherhether it
itit is
isis better
betterbetter to
toto ch
chchoose
ooseoose the
thethe wh
whwhole
oleole m
mmarket
arketarket,
,, or
oror t
tthe
hehe o
oonly
nlynly a
aa
few
fewfew seg
segsegment
mentment, and deci
, and deci, and decidi
diding whic
ng whicng which
hh o
oones sho
nes shones should be ch
uld be chuld be chosen.
osen.osen.
.
..Lo
LoLook
okokin
ining
gg f
ffor
oror seg
segsegm
mments,
ents,ents, wh
whwhich
ichich are
areare relati
relatirelativel
velvely
yy less
lessless satisfied
satisfiedsatisfied by
byby t
tthe
hehe current
currentcurrent
of
ofoffers in t
fers in tfers in the
hehe m
mmarket
arketarket fr
frfro
oom
mm co
cocompetin
mpetinmpeting
gg b
bbran
ranrands.
ds.ds.
.
..Checki
CheckiChecking
ngng ou
ouout
tt if
ifif t
tthe
hehe fir
firfirm
mm h
hhas
asas the
thethe d
ddif
ififferent
ferentferential
ialial adva
advaadvantage
ntagentage /
// disti
distidistinctive
nctivenctive
capabili
capabilicapability
tyty fo
fofor
rr serv
servservin
ining
gg t
tthe
hehe selected seg
selected segselected segm
mments.
ents.ents.
.
Eval
EvalEvaluatin
uatinuating
gg t
tthe
hehe fir
firfirm
m m s
ss reso
resoresource
urceurces
ss an
anand
dd check
checkcheckin
ining
gg whet
whetwhether
herher it
itit is
isis p
ppossi
ossiossible
bleble to
toto pu
puput
tt
in
inin t
tthe
hehe m
mmarketing
arketingarketing p
ppro
rorogra
gragram
mmm
mme
ees
ss req
reqrequired
uireduired f
ffor
oror captur
capturcapturin
ining
gg t
tthe
hehe s
sspot
potpotted
tedted seg
segsegm
mments
entsents
with t
with twith those resources.
hose resources.hose resources.
.
..Fi
FiFinally
nallynally selecting t
selecting tselecting those seg
hose seghose segm
mments
entsents t
tthat are
hat arehat are m
mmos
osost app
t appt appro
roropriate
priatepriate f
ffor the fir
or the firor the firm.
m.m.
~ 26~
F
FFA
AACT
CTCTORS
ORSORS T
TTO
OO B
BBE CONSI
E CONSIE CONSIDERE
DEREDERED
DD WHIL
WHILWHILE
EE T
TTARGET
ARGETARGET M
MMARKET
ARKETARKET
SELE
SELESELECTION
CTIONCTION
Target marketing tailors a marketing mix for one or more segments identified by
market segmentation. Target marketing contrasts with mass marketing, which
offers a single product to the entire market.
Two important factors to consider when selecting a target market segment are the
at
atattract
tracttractiveness
ivenessiveness of the
of theof the seg
segsegment
mentment and the f
the fthe fit between
it betweenit between the
thethe segment
segmentsegment and the fi
and the fiand the firm
rmrm's
's's
objec
objecobjectives,
tives,tives, r
rresour
esouresources,
ces,ces, and capabil
and capabiland capabilit
itities
iesies.
.
..At
AtAttractiven
tractiventractiveness
essess o
oof a
f af a Mark
MarkMarket
etet Seg
SegSegment
mentment
The following are some examples of aspects that should be considered when
evaluating the attractiveness of a market segment:

Size
SizeSize of the
of theof the segm
segmsegment
entent (num
(num(number
berber of custo
of custoof custom
mmers
ersers and/or nu
and/or nuand/or number
mbermber of uni
of uniof units).
ts).ts).
Growth rate
Growth rateGrowth rate of the
of theof the segm
segmsegment.
ent.ent.
Co
CoCompet
mpetmpetit
itition in
ion inion in the seg
the segthe segmen
menment.
t.t.
Brand lo
Brand loBrand loyalt
yaltyalty of exis
y of exisy of existing cus
ting custing custo
totomer
mermers in the
s in thes in the seg
segsegment.
ment.ment.
Atta
AttaAttainable
inableinable ma
mamarket
rketrket share given
share givenshare given prom
prompromot
ototional budget
ional budgetional budget and com
and comand compet
petpetitor
itoritors'
s's'expendi
expendiexpenditures.
tures.tures.
Required
RequiredRequired ma
mamarket
rketrket share to
share toshare to break even.
break even.break even.
Sales
SalesSales potent
potentpotential
ialial for the
for thefor the fir
firfirm
mm in
inin the seg
the segthe segmen
menment.
t.t.
Expected pro
Expected proExpected profit
fitfit ma
mamar
rrg
ggins in
ins inins in the seg
the segthe segmen
menment.
t.t.
Market research and analysis is instrumental in obtaining this information. For
example, buyer intentions, sales force estimates, test marketing, and statistica
l
demand analysis are useful for determining sales potential. The impact of
applicable micro-environmental and macro-environmental variables on the
market segment should be considered.
Note that larger segments are not necessarily the most profitable to target sinc
e
they likely will have more competition. It may be more profitable to serve one o
r
more smaller segments that have little competition. On the other hand, if the fi
rm
~ 27~
can develop a competitive advantage, for example, via patent protection, it may
find it profitable to pursue a larger market segment.
.
..Suitab
SuitabSuitabil
ililit
itity of
y ofy of Market Seg
Market SegMarket Segm
mments
entsents to the Fir
to the Firto the Firm
mm
Market segments also should be evaluated according to how they fit the firm's
objectives, resources, and capabilities. Some aspects of fit include:

··Wh
WhWhethe
etheether the
r ther the fir
firfirm
mm can of
can ofcan offe
fefer super
r superr superior value
ior valueior value to the
to theto the custo
custocustomer
mermers in
s ins in the seg
the segthe segmen
menment
tt
··T
TThe i
he ihe impac
mpacmpact of
t oft of serving
servingserving the seg
the segthe segmen
menment on the
t on thet on the fir
firfirm'
m'm's i
s is im
mmage
ageage
··Access to
Access toAccess to dist
distdistribut
ributribution channel
ion channelion channels required
s requireds required to serve
to serveto serve the seg
the segthe segmen
menment
tt
··T
TThe fi
he fihe fir
rrm's
m'sm's resources
resourcesresources vs. capita
vs. capitavs. capital inves
l invesl invest
ttmen
menment requi
t requit required to serve
red to servered to serve the seg
the segthe segm
mment
entent
The better the firm's fit to a market segment and the more attractive the market
segment, the greater the profit potential to the firm.

··T
TTARGET
ARGETARGET MARKET
MARKETMARKET STRA
STRASTRATEGIES
TEGIESTEGIES
There are several different target-market strategies that may be followed.
Targeting strategies usually can be categorized as one of the following:

Sing
SingSingle-seg
le-segle-segment
mentment stra
strastrateg
tegtegy
yy -Also known as a concentrated strategy. One
market segment (not the entire market) is served with one marketing mix. A
single-segment approach often is the strategy of choice for smaller
companies with limited resources.
Select
SelectSelective spec
ive specive speciali
ialiializ
zzat
atation
ionion-This is a multiple-segment strategy, also known
as a differentiated strategy. Different marketing mixes are offered to
different segments. The product itself may or may not be different - in
many cases only the promotional message or distribution channels vary.
Pr
PrProduct spec
oduct specoduct speciali
ialiializ
zzat
atation
ionion-The firm specializes in a particular product and
tailors it to different market segments.
Market spec
Market specMarket speciali
ialiializ
zzat
atation
ionion-The firm specializes in serving a particular market
segment and offers that segment an array of different products.
Full
FullFull m
mma
aarket coverage
rket coveragerket coverage -The firm attempts to serve the entire market. This
coverage can be achieved by means of either a mass market strategy in
which a single undifferentiated marketing mix is offered to the entire
market, or by a differentiated strategy in which a separate marketing mix is
offered to each segment
~ 28~
The following diagrams show examples of the five market selection patterns
given three market segments S1, S2, and S3, and three products P1, P2, and P3.
Sing
SingSingle
lele Selective
SelectiveSelective Pr
PrProduct
oductoduct Market
MarketMarket Full
FullFull Market
MarketMarket
Seg
SegSegment
mentment Special
SpecialSpeciali
iiza
zazation
tiontion Specia
SpeciaSpeciali
liliz
zzat
atation
ionion Special
SpecialSpeciali
iiza
zazation
tiontion Coverage
CoverageCoverage
~ 29~
S
SS1
11 S
SS1
11 S
SS1
11
S
SS1
11 S
SS1
11
S
SS2
22 S
SS2
22 S
SS2
22
S
SS2
22 S
SS2
22
S
SS3
33 S
SS3
33 S
SS3
33
S
SS3
33 S
SS3
33

P
PP2
22 P
PP2
22 P
PP2
22
P
PP2
22 P
PP2
22
~ 30~
P
PP
1
11
P
PP
1
11
P
PP
1
11
P
PP
1
11
P
PP
1
11
A firm that is seeking to enter a market and grow should first target the most
attractive segment that matches its capabilities. Once it gains a foothold, it c
an
expand by pursuing a product specialization strategy, tailoring the product for
different segments, or by pursuing a market
specialization strategy and offering new products to its existing market segment
.
Choosing the target market is a part of marketing strategy formulation, the othe
r
two parts being positioning and marketing mix formulation. Without right
targeting, the firm cannot formulate an effective strategy. It is through carefu
l
segmentation and targeting that firm pick up right group of consumers. Also, it
is
through this process that the firm gain vital knowledge about the need and buyin
g
behaviour of the consumer in each segment and the differences between one
segment and the other. And, it is by using this knowledge that the firm develops
marketing programmes that match the specific requirement of different segments.
In other words, segmentation and targeting help the firm not only the
characteristics of each of the segments but also the distinctive excellence that i
s
required for catering to the specific needs of the consumers in each of them.
Another strategy whose use is increasing is individual marketing, in which the
marketing mix is tailored on an individual consumer basis. While in the past
impractical, individual marketing is becoming more viable thanks to advances in
technology.
· DE
DEDECISI
CISICISIONS INV
ONS INVONS INVOL
OLOLVED IN
VED INVED IN T
TTA
AARGETING
RGETINGRGETING S
SSTRA
TRATRATEGY
TEGYTEGY INC
INCINCLUD
LUDLUDE
EE:.
which seg
which segwhich segmen
menments
tsts to tar
to tarto targe
gegeting.
ting.ting.
.
how ma
how mahow man
nny
yy product
productproducts to
s tos to of
ofoffer
ferfer.
..
.
which product
which productwhich products to
s tos to of
ofoffer
ferfer in which seg
in which segin which segmen
menments.
ts.ts.
· T
TTA
AARGETING
RGETINGRGETING S
SSTRA
TRATRATEGY
TEGYTEGY DE
DEDECISI
CISICISIONS
ONSONS A
AARE IN
RE INRE INFLU
FLUFLUENC
ENCENCED
EDED BY:
.
Marke
MarkeMarket m
t mt mat
ataturi
uriurit
tty
yy.
..
.
Divers
DiversDiversit
itity of bu
y of buy of buye
yeyers' needs
rs' needsrs' needs and preferences.
and preferences.and preferences.
.
Streng
StrengStrength of
th ofth of the co
the cothe compe
mpempetit
tittition.
ion.ion.
.
T
TThe volu
he voluhe volume
meme of sale
of saleof sales requi
s requis required for
red forred for profi
profiprofitabi
tabitabilit
litlity
yy.
~ 31~
·· DECI
DECIDECIDING
DINGDING THE
THETHE SI
SISIZE
ZEZE OF
OFOF T
TTARG
ARGARGET
ETET MARKET
MARKETMARKET
After selecting the target market it is important for marketers to decide the si
ze
of the target market. Is the target market large enough to sustain a business
which will provide products or services to them? A target market has to be of at
least a minimum size to be viable. Suppose a firm chooses food processing and
food packaging as its target market. In fact, they might be too large, and it mi
ght
be wise to find a niche within those target markets. Therefore, the firm must th
en
focus on a particular type of food market, such as a food production firm who
wants to package its products for selling. Thus by targeting its product for its
targeted market, the firm can decide its size on the basis of it.

·· RESUL
RESULRESULTS OF
TS OFTS OF W
WWRONG
RONGRONG T
TTARGETI
ARGETIARGETING
NGNG S
SSTRA
TRATRATE
TETEGY
GYGY
Ineffective augmentation and targeting led to wrong product offers,
inappropriate marketing appeals, wrong pricing, and overemphasis on the
brand name. No firm can offer single product to satisfy all the segment. For
example, in Indian market many MNCs offered single product to the entire
segment. The offer did not suit middle class as such. They suited only the
premium segment. Naturally, the firms were unable to gather worthwhile
volumes. As the firm did not target those segments and as they failed to make
product offers that were appropriate for them, the end result was poor. For this
reason firms like Reebok, Ray-ban, and Levi did not showed satisfactory result
for quite sometime in Indian market while they were very successful in the
western markets.
Thus the choice of target marketing for a given industry can decide the fate of
the industry in the market. This is because firms differ in their competencies,
resources, objectives, and strategies.
~ 32~
POSITIONI
POSITIONIPOSITIONING
NGNG
INTRODUCTION: -
INTRODUCTION: -INTRODUCTION: -Positioning is a concept in marketing which was fi
rst
popularized by Al Ries
Al RiesAl Ries and Jac
and Jacand Jack
kk T
TTr
rrout
outout in their bestseller book Posi
PosiPosition
tiontioning - a
ing - aing - a
bat
batbattle
tletle for y
for yfor you
ouour m
r mr mi
iind
ndnd". According to them Positioning is what you do to mind of
the prospect . They iterate that any brand is valued by the perception it carries
in
the prospect or customer's mind. Each brand has thus to be 'Positioned' in a
particular class or segment. Example: Mercedes is positioned for luxury segment,
Volvo is positioned for safety.
The position of a product is the sum of those attributes normally ascribed to it
by
the consumers its standing, its quality, the type of people who use it, its
strengths, its weaknesses, any other unusual or memorable characteristics it may
possess, its price and the value it represents.
Although there are different definitions of Positioning, probably the most
common is: "A product's position is how potential buyers see the product", and i
s
expressed relative to the position of competitors. Positioning is a platform for
the
brand. It facilitates the brand to get through to the mind of the target consume
r.
The position of the brand has thus to be carefully maintained and managed.
Example: when Malboro cut down its prices, its sales dropped immediately, as it
began being associated with the generic segment. Watches like Rolex are
positioned as luxury segment watches, thus they being one of the most expensive
have become a symbol for accomplishment in life. If Rolex reduces its prices, it
loses its perceived image and hence is in danger of losing its customers. This
differs slightly from the context in which the term was first published in 1969
by
Al Ries and Jack Trout in the paper "Positioning" is a game people play in
today s me-too market place" in the publication
Industrial Marketing, in which the case is made that the typical consumer is
overwhelmed with unwanted advertising, and has a natural tendency to discard
all information that does not immediately find a comfortable (and empty) slot in
the consumers mind. It was then expanded into their ground-breaking first book,
"Posit
PositPositioning:
ioning:ioning: The B
The BThe Bat
atattle
tletle for Y
for Yfor Your Mind
our Mindour Mind", in which they define Positioning as "an
organized system for finding a window in the mind. It is based on the concept
~ 33~
that communication can only take place at the right time and under the right
circumstances."

POSITI
POSITIPOSITIONING CON
ONING CONONING CONCEP
CEPCEPTS:-
TS:-TS:-Generally, there are three types of
positioning concepts:
··Functiona
FunctionaFunctional posi
l posil positions
tionstions
.
Solve problems.
.
Provide benefits to customers.
.
Get favorable perception by investors (stock profile) and lenders.

··Sy
SySym
mmbolic pos
bolic posbolic positions
itionsitions
.
Self-image enhancement.
.
Ego identification.
.
Belongingness and social meaningfulness.
.
Affective fulfillment.

··E
EExperientia
xperientiaxperiential pos
l posl positions
itionsitions
.
Provide sensory stimulation.
.
Provide cognitive stimulation.

APP
APPAPPROAC
ROACROACHE
HEHES O
S OS OF
FF PO
POPOSI
SISITIONING :
TIONING :TIONING :-
--
T
TThe m
he mhe main
ainain positioning strategy is to either developing or reinforcing a particular
image for the brand in the mind of the customer. The main approaches to
positioning strategy are:

·· Custo
CustoCustom
mmer benef
er benefer benefits
itsits approach.
approach.approach.
·· T
TThe price-
he price-he price-quali
qualiqualit
tty
yy approach.
approach.approach.
~ 34~
·· T
TThe use or
he use orhe use or applicat
applicatapplication approach.
ion approach.ion approach.
·· T
TThe product
he producthe product user approach.
user approach.user approach.
·· T
TThe product
he producthe product class
classclass approach.
approach.approach.
·· T
TThe cultu
he cultuhe cultural
ralral s
ssymbol
ymbolymbol approach.
approach.approach.
·· T
TThe co
he cohe compet
mpetmpetitor
itoritor approach.
approach.approach.
1.
1.1. Custo
CustoCustomer
mermer benefit
benefitbenefit appr
apprapproach
oachoach: -
This is an important positioning strategy. It involves putting the brand above
competitors, based on specific brand attributes and customer benefit. In the
automobiles sector we can see many car manufacturer give emphasis on
different technical aspects such as fuel efficiency, safety, engine
performance, power windows etc. Generally marketers identify positioning
in respect of product characteristics that have been ignored by the
competitor. Often we can see that firms attempts to position their brands
along with two or more characteristic simultaneously, this is done to give an
extra edge to the product from its rival and also helps increase the
product s life cycle. Thus a single product can solve many problem is the
main theme behind the product. Example:
:: Pr
PrProcter
octerocter &
&& Ga
GaGamble
mble mble s
ss Head
HeadHead &
&&
shoulde
shouldeshoulder
rr sha
shashampoo functions
mpoo functionsmpoo functions as anti
as antias anti dandruff and anti
dandruff and antidandruff and anti hairfal
hairfalhairfall sha
l shal shampoo
mpoompoo.
~ 35~
Head & S
Head & SHead & Shoulder
houlderhoulder positio
positiopositioned as
ned asned as bo
boboth anti
th antith anti-dandru
-dandru-dandruff & a
ff & aff & anti
ntinti-hairfall sha
-hairfall sha-hairfall sham
mmpoo
poopoo
2.
2.2. Price qual
Price qualPrice quality appr
ity apprity approach
oachoach: -
: -: -
Sometimes brands attempts to offer more in term of service, feature, quality,
or performance. Manufacturer of such brands charge higher prices partly to
cover the cost and partly to communicate the fact that they are of high
quality. In fact in the same product category there are brands, through
comparable in qualities, which appeal on the basis of price. For example
brands like Rado and Timex use quality and price positioning technique
respectively. Rado competes for quality and Timex competes for price. It is
difficult to use both quality and price positioning together
because there is a risk that high quality-low price positioning technique may
infer the image of the product in the mind of the consumer.
~ 36~
Rado Orig
Rado OrigRado Original
inalinal C
CChr
hrhronograph
onographonograph
Priced at
Priced atPriced at U
UUSD 6516.00
SD 6516.00SD 6516.00

T
TTi
iime
memex lu
x lux luxur
xurxury w
y wy watch
atchatch priced ar
priced arpriced around Rs.1800
ound Rs.1800ound Rs.1800
Exa
ExaExample
mplemple of price
of priceof price quali
qualiqualit
tty
yy approach
approachapproach
3.
3.3.The use and appl
The use and applThe use and application
icationication appr
apprapproach: -
oach: -oach: -In this strategy the product is
positioned with a use or application approach. For example: - Largest Mobile
manufacturer in the world Nokia positioned its few variant of N-series
~ 37~
mobiles as music phones with enhanced memory and multimedia
capabilities.

Nokia N-70 Mus

Nokia N-70 MusNokia N-70 Music edit
ic editic edition
ionion Nokia N-73 Mus
Nokia N-73 MusNokia N-73 Music edit
ic editic edition
ionion
W
WWith 1G
ith 1Gith 1GB m
B mB me
eemo
momor
rry
yy with
withwith 1
11GB m
GB mGB me
eemo
momor
rry
yy
4.
4.4.The pr
The prThe product user
oduct useroduct user appr
apprapproach:-
oach:-oach:-In this approach, the brand identifies and
determines the target segement for which the product will be positioned.
Many brand uses a model or a celebrity to position their product. The
expectation are that a model or a celebrity is likely to influence the product s
image by reflecting their own image to it. For example:-Dabur
Chyvanprash is positioned for all age groups.
5.
5.5.The pr
The prThe product cla
oduct claoduct class appr
ss apprss approach:-
oach:-oach:-This approach is use so that the brand is
associated with a particular product category. This is generally used when a
category is too crowded. For example:-HLL has positioned Dove toilet soap
as a cleansing cream product for young womwn with dry skin and its is
positioned as a premium segment toilet soap.
~ 38~
6.
6.6.The cultura
The culturaThe cultural sy
l syl sym
mmbol appr
bol apprbol approach:-
oach:-oach:-The positioning strategy is based on
deeply entrenched cultural symbol. The use of cultural symbol can help to
differentiate the brand from competitors brands. For example:-The
positioning technique of Marlbor
MarlborMarlboro
oo cigarettes use the image of typical
American cowboy .
Marlbor
MarlborMarlboro
oo gives i
gives igives its cigar
ts cigarts cigare
eette brand a
tte brand atte brand a A
AAme
memerican
ricanrican co
cocowboy
wboywboy im
imimage
ageage
E
EExa
xaxam
mmple
pleple of cultural
of culturalof cultural s
ssy
yymb
mbmbol
olol appr
apprapproach
oachoach
7.
7.7.The co
The coThe comp
mpmpeti
etietitor
tortor appr
apprapproach:-
oach:-oach:-Many brands use competitor as a dominant
plank in their campaign. These brands are positioned following its
competitor. This is an offensive strategy.
DIFF
DIFFDIFFERE
EREERENT
NTNT POSITIONING
POSITIONINGPOSITIONING P
PPLA
LALANKS
NKSNKS / BAS
/ BAS/ BASES:-
ES:-ES:-Different types of
positioning planks /bases are used by the marketers are:~
39~
1.
Econo
EconoEconom
mmy:-
y:-y:-Product positioned toward a particular segment keeping in mind
it economy.Example-Maruti 800,
Maruti 800,Maruti 800, T
TTata N
ata Nata Nano, Nir
ano, Nirano, Nirma
mama detergent powder etc
are positioned for the economy segment
2.
Benefit
BenefitBenefit:-
:-:-Product positioned with some beneficial features. Example-
Colgate
ColgateColgate total, Clin
total, Clintotal, Clinic plus
ic plusic plus etc.
3.
Gender:
Gender:Gender:-Product positioned for a particular segment. Example-Scoot
ScootScooty
yy
Pep,
Pep,Pep, T
TTitan
itanitan R
RRaga
agaaga.
4.
Luxury and exclusiveness:-Product or services positioned toward luxury
segment. Example-T
TTaj
ajaj gr
grgroup of hotel,
oup of hotel,oup of hotel, Mer
MerMercedes Ben
cedes Bencedes Benz
zz E-class
E-classE-class etc.
etc.etc.
Mercedes Car -
--symbol of luxury and exclusiveness
5.
Fashion
FashionFashion for
forfor eli
elielite clas
te claste class:-
s:-s:-Product positioned for fashionable elite class or
member of the society, who always want to stay ahead in term of fashion
and demands exclusive products only. Example Peter
PeterPeter England,
England,England, V
VVan
anan
Heusen,
Heusen,Heusen, Ra
RaRay
yym
mmond etc
ond etcond etc.
~ 40~
6.
T
TTechnology and value added featur
echnology and value added featurechnology and value added feature
ees:-
s:-s:-Positioning of a product
according to its technological advancement and value added features.
Example:- Micr
MicrMicrosof
osofosoft
t t s
ss position
positionpositioning of
ing ofing of its
itsits r
rrecent operating
ecent operatingecent operating s
ssyste
ysteystem
mm
W
WWindo
indoindows
wsws V
VVi
iista as
sta assta as the advanced operating syste
the advanced operating systethe advanced operating system
mm, Sony
, Sony, Sony with
withwith various
variousvarious
elecr
elecrelecron
ononic goods, LG
ic goods, LGic goods, LG etc
etcetc
Pr
PrPreview of Micr
eview of Micreview of Micro
oosoft
soft soft s window
s windows window V
VVi
iista operat
sta operatsta operating syste
ing systeing system
mm

··POSITI
POSITIPOSITIONING P
ONING PONING PLAN
LANLANNING
NINGNING
Positions are described by variables and within parameters that are important to
the customers. Common examples are price, supporting services, quality,
reliability, and value for money. Often, customers position a product in relatio
n to
a brand or product that is especially visible to them. This could be the market
leader or any other offer with a high media exposure and an above average
marketing budget. Therefore, it is advisable to use in-depth market research to
determine relevant parameters in order to understand how customers rate
different products and marketing variables.
The number of relevant parameters is normally low. Most often, they can be
described with a two- or three-dimensional matrix. This tool to visually depict
customers perceptions of a product and its position is called perceptual mapping.

~ 41~
Normally, most suppliers in a market or in a market segment will be positioned
along the diagonal. This diagonal is called the Value-Equivalence-Line (VEL),
since value and price are balanced there.
In our example, product A is positioned unfavourably. It is too expensive for th
e
mass market and its quality is not good enough for the premium segment. In
general, there are the following strategies for repositioning; however, their
feasibility will depend on the particular situation.

··Change the re
Change the reChange the relation
lationlation of pr
of prof price and quali
ice and qualiice and qualit
tty
yy for
forfor the exi
the exithe existing
stingsting brand;
brand;brand; e.g. product
e.g. producte.g. product
relaunch
relaunchrelaunch with i
with iwith im
mmproved charac
proved characproved characteri
teriteristic
sticstics
ss
··Change the re
Change the reChange the relation
lationlation of pr
of prof price and quali
ice and qualiice and qualit
tty
yy b
bby
yy in
inintroducing
troducingtroducing a ne
a nea new brand
w brandw brand; e.g.
; e.g.; e.g.
in
inintroduct
troducttroduction of
ion ofion of clone under a cheap
clone under a cheapclone under a cheap
brand or
brand orbrand or a retai
a retaia retailers
lerslers o
oown brand
wn brandwn brand
··Alter
AlterAlter believe
believebelieves about the
s about thes about the brand;
brand;brand; e.g. im
e.g. ime.g. image ca
age caage campa
mpampaign, creat
ign, creatign, creation of
ion ofion of a h
a ha hy
yype
pe pe
··Alter
AlterAlter believe
believebelieves about co
s about cos about compe
mpempeti
tititive
tivetive brands; e.g. co
brands; e.g. cobrands; e.g. compa
mpamparing
ringring advertise
advertiseadvertisem
mments
entsents
~ 42~
··Alter
AlterAlter custo
custocustom
mmers
ersers
rankings
rankingsrankings of i
of iof im
mmportan
portanportant fac
t fact factors
torstors; e.g. focus
; e.g. focus; e.g. focus on additiona
on additionaon additional
ll
fea
feafeatures
turestures and characteri
and characteriand characterist
ststics (exa
ics (exaics (examp
mpmple:
le:le: car m
car mcar manufac
anufacanufacturer
turerturers focus
s focuss focus on ver
on veron very
yy
di
didif
ffferen
ferenferent product
t productt product character
charactercharacterist
ististics
icsics in thei
in theiin their co
r cor com
mmme
memercia
rciarcials, for
ls, forls, for ins
insinstance securi
tance securitance securit
tty
yy,
,,
fue
fuefuel consu
l consul consump
mpmption,
tion,tion, im
imimage, luxu
age, luxuage, luxur
rry
yy inte
inteinterior
riorrior, fun
, fun, fun)
))
··Int
IntIntroduct
roductroduction of new or neglec
ion of new or neglecion of new or neglected att
ted attted attribu
ribuributes;
tes;tes; e.g. product re
e.g. product ree.g. product relaunch with new
launch with newlaunch with new
fea
feafeatures
turestures that are
that arethat are ne
nenew for
w forw for the whole m
the whole mthe whole mar
ararket seg
ket segket segm
mment.
ent.ent.
When planning such activities it is critical to think about possible reactions o
f
competitors. A shift of a product into a more favourable position in the pricequ
ality-
map above the diagonal (e.g. into position B) will normally lead to in
shift of market shares in favour of this product. Competitors could react with a
reduction of general price level, thus moving the VEL to the left. Product B
would lose its superior position.
Moreover, it is advisable to keep in mind that customer and their individual
preferences of a price-quality-combination are not distributed equally along the
VEL. Neglecting the distribution of customers could lead to the following
problems:

Positioning in a segment with very few potential customers (e.g. positioning in

a middle-segment in a market where customers prefer either the budget-
product or the premium product)
Positioning in a too low or too high price-value-combination (segments a and
b in our example). This product does not appeal to a large proportion of the
market, since customers either expect a higher quality (a) or are not willing to
pay that high price.
··STEPS FO
STEPS FOSTEPS FOR POSITI
R POSITIR POSITIONING
ONINGONING A
AA P
PPRODU
RODURODUCT
CTCT
Dibb et al recommend the following steps for determining and implementing the
positioning of a product. Although they focus on new product development, these
~ 43~
steps are applicable to a relaunch with new features or for a repositioning of a
n
existing product too.
1.
1.1.Define
DefineDefine the seg
the segthe segmen
menments in
ts ints in a particu
a particua particular
larlar ma
mamarket.
rket.rket.
2.
2.2.Decide which seg
Decide which segDecide which segmen
menments
tsts to tar
to tarto targe
geget.
t.t.
3.
3.3.Understand
UnderstandUnderstand w
wwhat
hathat the tar
the tarthe targe
geget consu
t consut consum
mmers
ersers expect and believe
expect and believeexpect and believe to be the
to be theto be the mo
momost
ststi
iim
mmportan
portanportant conside
t considet consideration
rationrations when deciding
s when decidings when deciding on the purchase.
on the purchase.on the purchase.
4.
4.4. Develop a product
Develop a productDevelop a product (or produc
(or produc(or products)
ts)ts) that cate
that catethat cater speci
r specir specifica
ficaficall
lllly
yy fo
fofor these
r theser these needs and
needs andneeds and
expecta
expectaexpectations.
tions.tions.
5.
5.5. Evaluate
EvaluateEvaluate the posi
the posithe position
tiontioning and i
ing and iing and im
mmages, as
ages, asages, as perceived b
perceived bperceived by
yy the
thethe tar
tartarget
getget custo
custocustome
memers, of
rs, ofrs, of
co
cocompe
mpempeting
tingting products in
products inproducts in the selec
the selecthe selected m
ted mted mar
ararket seg
ket segket segm
mments.
ents.ents.
6.
6.6. Evaluate
EvaluateEvaluate the m
the mthe marke
arkearket leader
t leadert leader
s
ss posit
positposition;
ion;ion; leading brand
leading brandleading brand that
thatthat occupies a specia
occupies a speciaoccupies a special
ll
posi
posiposition
tiontion in the
in thein the consum
consumconsumer
er er s m
s ms mind
indind (
((cadbury
cadbury cadbury s
ss in chocola
in chocolain chocolates);
tes);tes); other
otherother brands have
brands havebrands have
to
toto necessar
necessarnecessary
yy re
rerelate
latelate them
themthemse
seselves in
lves inlves in som
somsome wa
e wae way
yyto the
to theto the leaders
leadersleaders posit
positposition;
ion;ion; the
thethey
yy cannot
cannotcannot
ignore
ignoreignore the pos
the posthe position
itionition of the
of theof the leader
leaderleader, nor
, nor, nor wish i
wish iwish it awa
t awat away
yy.
..
7.
7.7. Selec
SelecSelect an i
t an it an image
magemage that
thatthat sets
setssets the product
the productthe product apart f
apart fapart fro
rorom
mm the com
the comthe compet
petpeting product
ing producting products, thus
s, thuss, thus
ensur
ensurensuring tha
ing thaing that the chosen
t the chosent the chosen i
iimage
magemage ma
mamatches
tchestches the aspira
the aspirathe aspiration
tiontions of the
s of thes of the tar
tartarge
geget custo
t custot custom
mmers.
ers.ers.
8.
Info
InfoInfor
rrm
mm tar
tartarget
getget custo
custocustome
memers about
rs aboutrs about the product
the productthe product (pro
(pro(promo
momotion).
tion).tion).
··PR
PRPRODUCT
ODUCTODUCT P
PPOSIT
OSITOSITIONIN
IONINIONING
GG A
AAND BRAND P
ND BRAND PND BRAND POSI
OSIOSITIONING
TIONINGTIONING
It is essential to understand the relationship between product positioning and b
rand
positioning. The two terms are synonymously and interchangeably used, technicall
y
they are different.
Product positioning denotes the specific product category / product class in whi
ch
the given product is opting to compete. And brand positioning denotes the
positioning of the brand viz-a-viz the competing brands in the chosen product
category.
~ 44~
·· ISSU
ISSUISSUES IN PR
ES IN PRES IN PRODUCT
ODUCTODUCT POSITIONING
POSITIONINGPOSITIONING
The main issues in product positioning are:
1.
1.1. Wh
WhWher
erere is the
e is thee is the new
newnew offer
offeroffer go
gogoing t
ing ting to c
o co compet
ompetompete?
e?e? As wh
As whAs what
atat?
??
2.
2.2. Whi
WhiWhich
chch pr
prproduct
oductoduct f
ffuncti
unctiunction/customer
on/customeron/customer need
needneed is
isis i
iit tr
t trt try
yying
inging to
toto meet
meetmeet?
??
3.
3.3. Wh
WhWhat
atat o
oother
therther pr
prproduct
oductoduct c
ccate
ateatego
gogories
riesries ser
serserve
veve this
thisthis need
needneed?
?? In
InIn oth
othother
erer w
wwo
oords,
rds,rds, wh
whwhat
atat a
aar
rre
ee the
thethe
sub
subsubstitu
stitustitute pr
te prte produc
oducoducts
tsts tha
thathat ser
t sert serve the
ve theve the same need
same needsame need?
??
4. Wh
WhWher
erere
ee the
thethe r
rreal
ealeal g
ggap
apap is,
is,is, w
wwher
herhere
ee is
isis such
suchsuch a
aa ne
nenew
ww offer
offeroffer w
wwel
elelcome
comecome and
andand w
wwan
ananted
tedted b
bby
yy the
thethe
mar
marmarke
keket?
t?t?
5.
5.5. Wh
WhWhat
atat ar
arare
ee the c
the cthe compan
ompanompany
y y s
ss compe
compecompetencies to
tencies totencies to fight her
fight herfight here?
e?e?
In fact, these are the issues the firm agitates in target market decision select
ion
too. The linkage is only natural because in product positioning, the firm is
actually bridging the product offer with the right target market.

·· ISSUES IN B
ISSUES IN BISSUES IN BRA
RARAND POSITIONING
ND POSITIONINGND POSITIONING
T
TThe issue
he issuehe issues in
s ins in brand posit
brand positbrand positioning
ioningioning are:-
are:-are:-
1.
1.1. Which ar
Which arWhich are the co
e the coe the comp
mpmpeting
etingeting brands in
brands inbrands in the chosen pr
the chosen prthe chosen product category?
oduct category?oduct category?
2.
2.2. Wh
WhWhat
atat ar
arare the unique cla
e the unique clae the unique clai
iims/str
ms/strms/strength
engthength of the variou
of the variouof the various brands?
s brands?s brands?
3.
3.3. Wh
WhWhat
atat position
positionposition do the
do thedo they enjoy
y enjoyy enjoy in
inin consu
consuconsum
mmer
erer
s
ss evaluation
evaluationevaluation and per
and perand perception?
ception?ception?
4.
4.4. According
AccordingAccording to
toto the
thethe consu
consuconsum
mmer
erer rat
ratrating
inging of
ofof the
thethe brands,
brands,brands, is
isis ther
therthere
ee a
aa wide
widewide gap
gapgap in
inin
ex
exexpectat
pectatpectation
ionion perfor
perforperformance?
mance?mance? W
WWhat
hathat kind
kindkind of
ofof a
aa pr
prproduct
oductoduct/new
/new/new attribute
attributeattribute/new
/new/new
funct
functfunctions wil
ions wilions will attrac
l attracl attract the consu
t the consut the consumer?
mer?mer?
5.
5.5. Wh
WhWhat
atat is the m
is the mis the most favour
ost favourost favoured
eded position
positionposition and y
and yand yet vacant?
et vacant?et vacant?
6. Can
CanCan the
thethe new
newnew brand
brandbrand clai
claiclaim
mm the
thethe needed
neededneeded distinc
distincdistinction
tiontion and
andand take
taketake the
thethe posit
positposition
ionion and
andand
sat
satsatisfy that need?
isfy that need?isfy that need?
~ 45~
·· CRI
CRICRITERIA
TERIATERIA S FOR S
S FOR S S FOR SUCC
UCCUCCESSFUL
ESSFULESSFUL POSITIONING
POSITIONINGPOSITIONING
Cer
CerCertain criteria are needed to be fulfilled for successful positioning are:

a.Clarity:
Clarity:Clarity: -
--While positioning its brand the firm must be able to position itself
in both distinct value, proposition, and to its target audience.
b.Consis
ConsisConsistenc
tenctency:
y:y: -Consistency in positioning means keeping the positioning
plank/bases intact for longtime. Planks should be carefully chosen while
positioning. But it does not mean that the firm must change its positioning
bases even though its survival is at stake. The firm must be flexible to the
changing environment.
c. Cr
CrCredibi
edibiedibility:
lity:lity: -
--The firm must deliver trustworthy and believable value
proposition. There should be perfect match between promise and action.
d.Co
CoCom
mmpeti
petipetitiveness
tivenesstiveness:
:: -
--For
ForFor surviving in this competitive and changing
environment innovative resources, talent pool, competitive advantage, strong
financial backup etc are very important.

·· RE
REREPOS
POSPOSITIONING
ITIONINGITIONING
Repositioning involves changing target market or distinct positioning
claim/differences advantages or both to bring the saturated attention of the
existing customers back into the limelight once again to survive safely and
happily in the market. In some cases,
,, the
thethe products that are faring well are
repositioned. This is done mainly to enlarge the reach of the product offer and
to
increase the sale of the product by appealing to a wider target market. The
product is provided with some new features or it is associated with some new
uses and is repositioned for existing as well as new target market.
Example of Maruti
MarutiMaruti O
OOmni
mnimni repositioning can be citied as important case in
repositioning strategy. When Maruti Omni was launched it was positioned as the
low priced, spacious van. But in the market as the time passed, Maruti Omni
cannot acquire a dominant position. The major competing brands are more
spacious, though higher priced. Thus Maruti decided to take the path of
repositioning. The features that were after repositioning are:

~ 46~
1. Most cars do not have any fifth door in the car. Maruti Omni had the boot-
latch at the back of the car which can be used both for entering and also for
keeping goods.
2. In the new car there is around 7.5 cubic meter of space. This gives the
advantage of more space for luggage and more people.
3. For having a pleasant driving experience Maruti Omni the instrument panel is
sleek, the steering columns just positioned just right, seat are adjustable with
control lever and gear shaft at hand-touch distance.
4. Engine was improved from the previous one. It is more fuel efficient and
delivers higher performance.
5. Safety features are standard.
6. A coolant system that eliminates daily chores of filling water in the radiato
r
was introduced.
As a result of repositioning the whole perception of customer has changed
toward Maruti Omni. Many people start taking it as a family car. The company
found a positioning theme the most spacious car at lowest price .

Maruti
MarutiMaruti O
OOmni (After
mni (Aftermni (After Reposit
RepositRepositioning
ioningioning)
))

·· Another
AnotherAnother ex
exexa
aample of r
mple of rmple of reposit
epositepositioning
ioningioning is Mi
is Miis Milk
lklkm
mmaid
aidaid
s stra
s stras strateg
tegtegy:-
y:-y:-
When the product was introduced it was positioned as convenient form of milk
that can be used in tea and coffee. But the product cannot reach its desired goa
l in
the market. As a result of which the company repositioned it as an ingredient fo
r
a variety of sweets and other preparation, in addition to daily use in tea/coffe
e.
Today Nestlé s milkmaid had many varieties such N
NNes
esestlé
tlé tlé s
ss Mi
MiMilk
lklkma
mamaid
idid fun
funfun shake
shakeshake,
~ 47~
Nestlé
NestléNestlé
s
ss Mi
MiMilk
lklkma
mamaid
idid frui
fruifruit
tt shake
shakeshake which is available in strawberry and mango
variant. Today milkmaid has acquired a market leader position in milk products.
Conclusion:
Conclusion:Conclusion: -
--Thus we can say that the total process of market segmentation,
targeting and positioning is a very important attribute of marketing mix. All th
ese
three process is very closely interrelated with each other.

Once the organization has decided which customer groups within which market
segments to target, it has to determine how to present the product to this targe
t
audience. This allows to exactly addressing the needs and expectations of the
target groups with a tangible marketing mix that consists of product
characteristics, price, promotional activities and places to present the product
.
Effective strategies of segmentation, targeting and positioning gives an extra
advantage in changing and highly competitive environment. To make this three
marketing process effective a thorough SWOT analysis of the firm is very
important. Keeping in mind the strength, weakness, opportunity and threat the
firm can formulate and implement its total marketing mix.
~ 48~
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~ 49~
~ 50~
~ 51~