Market Segmentation, Targeting and Positioning

Flashcards on Market Segmentation, Targeting, and Positioning

Market segmentation

The technique where the market is broken down into smaller sections with similar characteristics.

Demographic Segmentation

Breaking down a market based on age, family size, occupation, ethnicity, education, and income.

Geographic Segmentation

Dividing a market based on geographic factors such as town, county, country, climate, and population growth.

Income Segmentation

Segmenting a market based on socio-economic groupings.

Behavioral Segmentation

Segmenting a market based on when they buy, how much they buy, and how brand loyal they are.

Market segment

A smaller segment of a market with specific needs and wants.

Benefit of Segmentation

Understanding a market segment helps better meet their needs, leading to increased sales.

Limitation to Segmentation

Depends upon an entrepreneur’s knowledge of the market; may be limited in small businesses.

Targeting

Choosing which market segments a business wants to focus on.

Niche Market

A very specific market segment.

Mass Market

Targeting the entire market.

Niche Marketing

Meeting the needs of a specialized market.

Advantage of mass marketing

High sales, at low prices, mean that costs are spread over a greater number of units.

Disadvantage of Niche marketing

Sales levels may be relatively low as not many consumers are being targeted

Positioning

Identifies the benefit and price combination of a product relative to competitors.

Market Map

Diagram that identifies all the products in the market using two key features.