Chapter_9-marketing

Chapter_9-marketing - Chapter 9- marketing 3104 A business...

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Chapter 9- marketing 3104 A business segments its markets so that it can respond more effectively to the wants of groups of potential buyers and increase profits Market Segmentation- sorting potential buyers into groups that have common needs and will respond similarly to a marketing action. Market Segments- groups of prospective buyers that result from the market segmentation process. These consist of people who have similar consumption behaviors. Product Differentiation - the strategy of using different marketing mix activities, such as product features and advertising, to help consumers perceive a product as being different and better than competing products Market segmentation is only a means to an end: to lead to tangible marketing actions that can increase sales and profits. Market-Product Grid - framework relating the segments of a market to products or marketing actions of the firm A business firm goes to the trouble/expense of segmenting its markets when it expects that this will increase its sales/profits/ROI. Examples of Successful Market Segmentation- movies, books, magazines often times have marketing schemes directed toward many different distinct segments in order to attract the attention of people within them. Reebok targets different types of users with all its types of shoes. There are the walker, runner, basketball, golf, tennis, aerobic types. This is the essence of Customer Relationship Management (CRM) where every customer is unique and has their own wants/needs/desires about products. Mass customization is also possible now due to the ability for consumers to adapt to standardized products because they will be cheaper. Manufacturing a product only when there is an order from a customer is called build-to-order (BTO). Key to successful differentiation and segmentation strategies is finding the balance between satisfying a customer’s individual wants and achieving organizational synergy- increased customer value achieved through performing organizational functions more efficiently. More products, improved quality, lower prices, increased revenues/profits are
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Chapter_9-marketing - Chapter 9- marketing 3104 A business...

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