T5 - STP

Question 1

What are the three market strategies?

Answer 1

• mass marketing (undifferentiated)
• capture bigger market, low cost per unit
• economies of scale
• sell single product that meets demand of most of this market
  # salt
  # pharmaceuticals
• one-to-one marketing (differentiated)
• higher unit costs
• niche/focused strategy
• close relationship with loyal customers
  *customised offering
  # architect
  # hairdresser
• target marketing
• identifying and responding to needs, wants and demands of individual or groups of buyers
• diff product for diff markets

Question 2

Target marketing process

- specialised approaches to target marketing

Answer 2

Consider:

1. org’s resources
2. market demand
3. competition

Specialised approaches to target marketing

• product specialisation
• market specialisation
• product-market specialisation (eg. narrow a menu based on a national cuisine like ramen)

STP

• segmenting
• targeting
• positioning

Question 3

Segmentation variables (4 main categories)

GDPB

Answer 3

GEOGRAPHIC

• climate
• region
• local population

DEMOGRAPHIC

• age
• ethnicity

PSYCHOGRAPHIC

• traits, personality
• lifestyles

BEHAVIOURAL

• behaviour at the time of buying
• benefit expectations
• usage of the product
• price sensitivity
• occasion when purchasing

Question 4

The two steps involved with market segmentation

Answer 4

1. identifying segmentation variables

2. profile the market segments

Question 5

How to evaluate potential segments? (targeting)

3

Answer 5

1. sales potential
2. competitive situation
3. costs structure

Question 6

defintion of positioning

Answer 6

• how target markets perceive the org’s offer compared to competing offers

Question 7

Two steps in positioning

Answer 7

1. determine the positioning that the company wants (understand current position - through market research, present through perceptual map, etc)
2. develop marketing mix that reflects this and customer expectations