Q.
(a) Explain the major bases in segmenting a consumer market. (15 marks)
(b) Elaborate how positioning of a property product can create a differentiated value for the targeted segment of the market. (10 marks)
(25 marks, 2016 Q4)
A.
(a) Major bases in segmenting a consumer market
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The major bases are:
Demography - Age group - income level
Geographical - Cultural - due to different tradition in different place
Psychological - Inner needs - status, education
Behavioural - Purchase behaviour - how frequent? Emotional
Psychographic - Use situation - functional?
(b) Positioning of a property product can create a differentiated value for the targeted segment of the market
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New competitions emerge everyday in the crowded market of today. Hence, a successful marketing plan should stand firm on its position. This is key to the long term reputation of a company.
Companies fail nowadays because of this mistake of not staying firm on this position. One day, it is everything to everyone, next day it is specialised thing to special people. The goal poles keep on moving. One is by greed, and the other is the drift by market forces. In all, it has lost its niche position.
Positioning is defined as:
"a position of product in the mind of consumer has its distinct value proposition and is most apparent in a market segment where no others are distinctive as it is."
Wikipedia gives a definition of positioning as "identifying and attempting to occupy a market niche for a brand, product or service utilizing traditional marketing placement strategies (i.e. price, promotion, distribution, packaging, and competition)."
"A marketing strategy that aims to make a brand occupy a distinct position, relative to competing brands, in the mind of the customer. Companies apply this strategy either by emphasizing the distinguishing features of their brand (what it is, what it does and how, etc.) or they may try to create a suitable image (inexpensive or premium, utilitarian or luxurious, entry-level or high-end, etc.) through advertising. Once a brand is positioned, it is very difficult to reposition it without destroying its credibility. Also called product positioning."
Read more: http://www.businessdictionary.com/definition/positioning.html
The key word is 'competing'. Positioning is important because of 'competing brand'.
In one sentence:
Positioning is to stand out among competing brands.
Hence, a property should acquire a position in the target segment of market, where consumers understands and demands the differentiated value this property has over other competing brands.
How does this position come to being? It goes back to the variable bases which this segment of market exhibits.
Take for example, a up-market condominium. The position of this up-market condominium is distinct feature of the project, the property developer should deliver the following elements:
- Geography - Property type - Condominium or near work place town houses
- Demographic - Characteristic of people - Graduate in job less than 10 years
- Psychology - Buyer's inner needs - Executive Rank, seeking recognition
- Psychographic - Use situation - small family, young family with baby
- Behavioural - Purchase behaviour - careful planning, waiting to upgrade
Therefore, the result of the analysis would probably come out with the following attributes of the property.
- Medium Size - psychography - easy to maintain, privacy, small family unit
- Super good quality assurance - psychography - modern living, slick
- Security - psychology - exclusive, privacy
- Style and taste - psychography - cultural, taste, ambiance
- Prestige - psychology - social status, executive rank
- Brand ambassador - psychology - successful attributes, social status
- Good location - psychography - personal preference, children schooling
- Good amenities - psychography - technology, entertainment
- Premium price - behavioural - price = quality
- Latest technology - psychography - technology, futuristic
- Quick processing and approval - behavioural - legal process made simple
Over the marketing process, the property will establish itself a position. This position is relative to the market place. There might be quite similar competing brand as well. However, enhancing one of the attributes in the above bases, the selected attribute become emphasized. This will emerge as the focus-position.
Take for example, "Latest Technology" as an attribute. The houses are equipped with voice and face recognizing softwares.
The position of this property will stand out among the similar type of properties, as itself being the only one with "Latest Technology". This position will be highlighted among the segment of market, and whenever people think of this "latest technology" - face and voice recognition, the property will straight away occupy this position.
The target segment would likely be middle or senior executives, business people, good income and longing for a futuristic living.
Ref:
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