When people's diverse interests and backgrounds divide them into numerous groups with distinct needs and wants.
Process of dividing a larger market into smaller pieces. Usually based off of demographics, psychographics, brand loyalty, and usage.
-They evaluate for potential of success as a target market before they are chosen.
-From there, the firm may choose undifferentiated, differentiated, concentrated, or a custom strategy based on company characteristics & market.
Target Marketing Strategy
Dividing the total market into different segments on the basis of customer characteristics; choose one of more segments and make those products to those specific needs.
Management practice that actively seeks to include people of all kinds for their company
Segmenting consumers based on physiological, sociological and anthropological factors (Values, lifestyles)
Innovators: high resources, high innovation
Thinkers & Believers: Ideals
Achievers & Strivers: Achievement
Experiencers & Makers: Self Expression
Survivors; low resources, low innovation
Undifferentiated Vs. Differentiated Strategy
Appeals to a broad spectrum of people, VS. develops one of more products for each of the customer groups with different needs.
Concentrated Vs. Custom Strategy
Firm focuses on offering one or more products to a single segment Vs. Tailoring specific products and messages about them to individual customers.
Positioning Strategy & How is it used?
To influence how a particular market segment sees a good or service in comparison to the competition.
Used by developing a brand personality against its competitors to show the advantage offered by their product.
CRM (Customer Relationship Management)
Used to establish relationships and differentiate their behavior toward individual customers on a one to one basis through dialogue and feedback.
Success is often measured through the share of customer (individuals purchase of a single brand product) life time value ( the profit the company makes over their lifetime, and customer equity (financial value of a customer). Customers are prioritized based on the above.
A marketing rule of thumb that 20 percent of purchasers account for 80% of the product's sales. Makes more sense to focus on small group of customers not casual users.
A new approach to segmentation based on the idea that companies can make money by selling small amounts of items that only a few people want, provided they sell enough different items.
An indicator used in behavioral market segmentation based on when consumers use a product most.
A strategy in which marketers evaluate the attractiveness of each potential segment and decide in which of these groups they will invest resources to try to turn into customers.
The market segments on which an organization focuses its marketing plan and toward which it directs its marketing efforts.
Custom Marketing Strategy
A manufacturer works with one of a few large clients and develops products that only these clients will use.
An approach that modifies a basic good or service to meet the needs of an individual.
Develop a marketing strategy to influence how a particular market segment perceives a good or service in comparison to the competition.
A once-popular brand that has been revived to experience a popularity comeback, often by riding a wave of nostalgia.
A technique to visually describe where brands are "located" in consumers minds relative to competing brands.
Lifetime Value of a Customer
The potential profit a single customers purchase of a film's products generates over the customer's lifetime.
The financial value of a customer relationship throughout the lifetime of the relationship.
Customer Experience Management
The concept of holistically aligning a firm's people, processes, systems, and strategies to maximize the customer's experience with all aspects of your firm and its brands.
The actual product other supporting features such as warranty, credit, delivery, installation, and repair service after the sale.
Consumer products that provide benefits over a long period of time, such as cars, furniture and appliances.
Consumer products that provide benefits for a short time because they are consumed and no longer useful.
A consumer good or service that is usually low-priced, widely available, and purchased frequently with a minimum of comparison and effort.
Fast- Moving Consumer Goods
Products that exhibit consistently high velocity of sales in the consumer marketplace.
A good or service for which consumers spend considerable time and effort gathering information and comparing alternatives before making a purchase.
A good or service that has unique characteristics and is important to the buyer and for which she will devote significant effort to acquire.
Goods or services for which a consumer has little awareness or interest until the product or a need for the product is brought to their attention.
Expensive goods that an organization uses in its daily operations that last for a long time.
Products of the fishing, lumber, agricultural, and mining industries that organizational customers purchase to use in their finished products.
Manufactured goods or subassemblies of finished items that organizations need to complete their own products.
A modification of an existing product that sets one brand apart from its competitors.
Dynamically Continuous Innovation
A change in an existing product that requires a moderate amount of learning or behavior change.
The coming together of two or more technologies to create a new system with greater benefits than its separate parts.
The first step of product development in which marketers brainstorm for products that provide customer benefits and are compatible with the company mission.
Product Concept Development and Screening
The second step of product development in which marketers test product ideas for technical and commercial success.
The development of marketing strategies that support environmental stewardship by creating an environmentally-founded differential benefit in the minds of consumers.
The step in the product development process in which marketers access a product's commercial viability.
Testing the complete marketing plan in a small geographic area that is similar to the larger market the firm hopes to enter.
The final step in the product development process in which a new product is launched to the market.
In the context of product diffusion, the point when a product's sales spike from a slow climb to an unprecedented new level, often accompanied by a steep price decline.