05 SEGMENTATION

Summary

In this marketing management course, Mila Armilia Windassari from the School of Business and Management Institute Technology Bundel, introduces the concept of market segmentation, targeting, and positioning within the STP model. She explains segmentation as identifying distinct groups based on needs and wants, like slicing a cookie. Targeting involves choosing one segment to focus on, while positioning is about communicating the product's unique benefits. The course also covers the importance of segmentation for resource allocation and differentiation, the various bases for segmentation, and the strategy of identifying primary, secondary, and tertiary segments to adapt to market changes.

Takeaways

• 📚 Segmentation is a foundational part of the STP (Segmentation, Targeting, Positioning) marketing process.
• 🍪 Segmentation can be visualized as dividing a large cookie into distinct slices, each representing a unique group of consumers with similar needs and wants.
• 🎯 Targeting involves selecting one or more segments to focus on, which is essential after segmenting the market.
• 📈 Positioning is about communicating the unique benefits of a product to the chosen segment, making it stand out among competitors.
• 🔍 The STP model categorizes the market into distinct groups based on shared characteristics, such as shape, size, or color in the provided example.
• 🔄 The segmentation process is not linear; it may need to be revisited due to shifts in customer behavior or market changes.
• 🌟 Segmentation allows a company to focus resources effectively, avoiding the inefficiency of targeting the entire market.
• 📊 Market segmentation can be based on demographic, psychographic, geographic, or behavioral factors, or a combination of these, known as hybrid segmentation.
• 🏆 Primary, secondary, and tertiary segments are used to prioritize and strategize marketing efforts, accounting for current and potential future demand.
• 📝 Need-based segmentation values the market based on how segments appreciate and value a product, which is crucial for resource allocation and marketing strategy.
• 📊 Segment attractiveness criteria such as market growth, competitive intensity, and market access are used to evaluate and prioritize different segments.
• 📋 The segmentation research process may involve surveys to gather demographic data, assess product value, and evaluate the attractiveness and profitability of each segment.

Q & A

What is the definition of market segmentation?

Market segmentation is the process of dividing a broad market into distinct groups of consumers who have similar needs and wants, based on which a company can tailor its marketing strategies.

What are the three components of the STP marketing strategy?

The three components of the STP marketing strategy are Segmentation, Targeting, and Positioning.

How is market segmentation like slicing a cookie?

Market segmentation is like slicing a cookie in that it involves dividing a large, undifferentiated market into smaller, distinct segments based on shared characteristics.

What is the purpose of targeting in the STP process?

The purpose of targeting is to select one or more segments from the market to enter, focusing marketing efforts on those most likely to be interested in the product or service.

What does positioning in the STP process entail?

Positioning involves communicating and delivering the right benefits of the offering to the chosen target segment, highlighting why it is the best choice compared to competitors.

Why is it important for a company to focus on segmentation?

Focusing on segmentation allows a company to allocate resources more effectively, avoid spreading efforts too thin across the entire market, and achieve better differentiation.

What are some common bases for market segmentation?

Common bases for market segmentation include demographic, psychographic, geographic, and behavioral factors.

What is the difference between primary, secondary, and tertiary segments?

Primary segments are the most attractive and have the highest potential for sales. Secondary segments have less urgency but high growth potential. Tertiary segments are less attractive and may only convert under specific conditions like price drops or increased popularity.

Why might a company need to revisit and revise its market segmentation strategy?

A company may need to revisit and revise its market segmentation strategy due to shifts in customer behavior, changes in the market environment, or to better align with emerging trends and opportunities.

How can a company assess the attractiveness of a market segment?

A company can assess the attractiveness of a market segment by considering factors such as market growth, competitive intensity, market access, segment profitability, and positioning.

What role does research play in the market segmentation process?

Research plays a crucial role in the market segmentation process by providing data on consumer demographics, psychographics, behavior, and preferences, which helps in identifying and understanding different market segments.