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Identify the major componentsof a marketing system.

Understand how marketers canimprove marketing decisionsthrough intelligence systems,

marketing research, andmarketing decision supportsystems.

Understanding Markets

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Essential Aspects

The marketMarket demandCompany demand

and sales forecastsCurrent demandFuture demand

Market

Potential marketAvailable marketTarget market (servedmarket)

Qualified availablemarketPenetrated market

Forecasting and Demand Measurement

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Essential Aspects

The marketMeasuring demandCompany demand andsales forecastsCurrent demandFuture demand

Market demandMarket minimumMarket forecastMarket potentialNonexpansible vs.expansible marketsPrimary vs.secondary demand

Market forecastMarket potential

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Essential Aspects

The marketMeasuring demand

Company demand and salesforecastsCurrent demandFuture demand

Company demandCompany sales forecast

Sales quotaSales budgetCompany sales potential

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Essential Aspects

The marketMeasuring demand

Company demand and salesforecastsCurrent demandFuture demand

Total market potentialArea market potential

Market-buildupmethod

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Essential Aspects

The market

Measuring demandCompany demand and salesforecastsCurrent demandFuture demand

Many Forecasting Methods:

Buyer intentions surveyComposite of sales forceopinionsExpert opinion

Past-sales analysisMarket-test method

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Identifying Market Segments and

Selecting Target Markets

Dr. Rakesh Premi

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Objectives

Learn how companies identify thesegments that make up a market.

Understand the criteria companiesuse to choose the most attractivemarket segments.

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Target Marketing

Target marketing requires marketers to take three

major steps:

Market segmentation:Identifying and profilingdistinct groups of buyers who differ in their

needs and preferences.

Market targeting: Selecting one or more marketsegments to enter.

Market positioning: Establishing andcommunicating the key distinctive benefit(s) ofthe companys market offering to each target.

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Market Segmentation

Mass marketing is losing popularityMicromarketing can be undertaken at four levels:

Segment marketing

Niche marketing

Local marketing

Individual marketing

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MARKET SEGMENTATION

Dr. Rakesh Premi

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Three patterns of preference segmentsare typically identified:

Homogeneous preferences

Diffused preferences

Clustered preferences

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Needs-based Segmentation Process

Needs-basedsegmentation

Segment identification

Segment attractiveness

Segment profitability

Segment positioning

Segment acid test

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Useful market segments share certain characteristics:

Measurable

Substantial

Accessible

Differentiable

Actionable

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Bases for Segmentation

Geographic

DemographicPsychographicBehavioral

Nation or country

State or regionCity or metro sizeDensityClimate

Demographic Age, race, genderIncome, educationFamily sizeFamily life cycleOccupationReligion,nationalityGeneration

Social class

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Bases for Segmentation

Psychographic LifestyleActivitiesInterestsOpinions

PersonalityCore values

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Bases for Segmentation

Behavioral OccasionsBenefits

User statusUsage rateLoyalty statusBuyer-readiness

Attitude

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Segmenting Consumer Markets

Multi-attribute segmentation via geoclusteringcombines multiplevariables to identify smaller, better-defined target groups

PRIZM Geoclustering system uses demographic, geographic,lifestyle, and behavioral characteristics

Segmenting Business Markets

Operating variables

Purchasing approaches

Situational factorsPersonal characteristics

Demographic variables

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Segmenting Business Markets

Rackman and Vincentis proposed a segmentation

scheme that classifies business buyers into threegroups:

Price-oriented customers:best served via

transactional selling

Solution-oriented customers:best served bymeans of consultative selling

Strategic-value customers:best served bymeans of enterprise selling

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TARGETING

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Market Targeting Strategies

Evaluating and selecting market segments requires

assessing the segments overall attractiveness in lightof companys objectives and resources.

Five patterns of target market selection can then be

considered

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Market Targeting Strategies

Patterns of Target Market Selection

Single-segment concentration

Selective specialization

Product specialization

Market specialization

Full market coverage