chap 6 Market Segmentation & Marketing Mix

Market Segmentation

Identifying people with shared needs and characteristics and aggregating them into segments based on mutual interest in a product's utility.

Purpose of Market Segmentation

To help marketers cluster prospective customers to better understand needs and design targeted marketing strategies.

Geographic Segmentation

Segmenting a market by region, county size, climate, city size, or population density.

Behavioristic Segmentation

Segmenting consumers based on buying behavior, such as purchase occasion, benefits sought, user status, usage rate, loyalty status, and readiness stage.

Demographic Segmentation

Segmenting a population using statistical, social, and economic traits like age, sex, income, occupation, education, and family life cycle.

Psychographic Segmentation

Segmenting consumers based on inner feelings, values, lifestyles, attitudes, and personality.

Target Market

A specific group of segments designated as the focus for a firm's products and tailored marketing activities.

Target Marketing Process

1. Identify and aggregate groups into market segments. 2. Evaluate and select one or more segments as the target market. 3. Use the 4Ps to shape a product concept.

Product Element in IMC

Involves how a product is designed, positioned, branded, and packaged.

Product Positioning

The way a product is ranked in consumers' minds relative to competitors based on its benefits and needs fulfilled.

Product Packaging Functions

Provides identification, containment, economy, protection, convenience, and consumer appeal.

Price Factors in Marketing

Market demand, production and distribution costs, competition, corporate goals and strategies, and variable influences.

Place (Distribution) Elements

Direct distribution, indirect distribution (using channels and resellers), and vertical (centrally-managed) systems.

Direct Distribution

Company sells

directly to end

users

Indirect Distribution

Use a distribution

channel and

resellers

vertical systems

Centrally-managed

distribution system

serving a group of

stores (franchises)

Promotion (Communication) Element Mix

Includes personal selling, product advertising, sales promotion, direct marketing, public relations, and collateral materials.