Q.
a) As marketing companies move away from mass marketing towards target marketing, firms are focusing on the buyers who have greater interest in the best values they have created. Discuss the steps in designing a customer-driven marketing strategy. (15 marks)
b) Discuss two (2) variables that might be used in segmenting the consumer market. (10 marks)
(25 marks, 2013 Q4)
A.
a)
4 major steps in designing a customer-driven marketing strategy:
- Market segmentation.
- Market targeting.
- Differentiation.
- Positioning.
1. Market segmentation.
It involves dividing a market into smaller groups of buyers with distinct needs, characteristics or behaviors that might require separate marketing strategies or mixes.
2. Market targeting.
It consists of evaluating each market segment's attractiveness and selecting one or more market segments to enter.
3. Differentiation.
It involves actually differentiating the firm's market offering to create superior customer value.
4. Positioning.
It consists of arranging for a market offering to occupy a clear, Distinctive and desirable place relative to competing products in the minds of target consumers.
[For example: property marketing.
Market segmentation according to age group would yield senior age group of retiring executives. They will need housing for golden age or grey hair enjoyment.
Targeting this age group would require analysis of family units, their affordability and the cultural backgrounds of the population. Example, rich Chinese businessman with strong family ties who need big bungalow to house two families.
Differentiation of the product group as for ownership and loan application to pass from father to son. This would differentiate from other similar product in the market. Another way to differentiate would be physical built. Example, lift or escalator in the bungalow. Such feature may be able to differentiate from similar property products in the same target market, hence giving exclusivity to the buyer. Of course, if lifts and escalators are already common in the target segment, it would be unwelcoming or 'me too' product feature to compete with. This part requires innovation and cost effectiveness.
Positioning of bungalow for two families with age groups of say father and son to aggregate at 100 years. This means with 35 years old son and 65 years old father, certain discount can be given as incentive. This offering put a position of the product (bungalow for 2 families) as distinctive for the market segment.]
Ref:
Chapter 6 Customer Driven Marketing Strategy: Creating Value for Target Customers, available at
http://quizlet.com/28725955/chapter-6-customer-driven-marketing-strategy-creating-value-for-target-customers-flash-cards/
[Own account]
b) Refer earlier post Past Year 2011 Q3 - segmentation of market.
Ref:
As in earlier post.