Targeting

Target Market Selection

After profiling segments, firms have to make a decision on how many segments to target. Evaluation of segments is done before selection.

Five Patterns of Target Market Selection

• Concentrated Marketing
  • Advantage: The firm gains a strong knowledge of the segment's needs and achieves a strong market presence
  • Risks: A market segment may turn sour and competitor may invade the segment
  • Companies may try super-segments: A set of segments sharing some exploitable similarity
• Selective Specialization
  • The firm selects a number of segments, each objectively attractive and appropriate
  • Advantage: risk diversification
• Product Specialization
  • The firm makes a certain product and it sells to several different market segments
• Market Specialization
  • The firm concentrates on serving many needs of a particular customer group
• Full-market Coverage
  • The firm attempts to serve all customer groups with all the products that they may need
  • Undifferentiated Marketing
  • The firm ignores segment differences and goes after the whole market segment
  • Differentiated Marketing
  • The firm operates in several market segments and designs different products for each segment