Target Marketing

1
Target Marketing Positioning

• MKT 846
• Professor West

2
Agenda

• Finish Team Updates
• Discuss Targeting Positioning
• Next time Tim Londergan from WBNS will join us

3
Segmentation Targeting

• Trying to reach everyone with a marketing
  message costs money and sends unwanted messages
  to people who arent customers or prospects.
• It makes more sense to narrow the audience to
  people who are most likely to buy the brand.
• Segmenting is used to identify these groups of
  people.
• Targeting is the planning strategy for reaching
  and communicating with them.

4
Steps in Segmentation Targeting

• Identify your most profitable current customers
• Create profiles of these segments
• Target these segments to increase retention and
  customer growth
• Use profitable-customer profiles to locate
  prospective segments
• Evaluate prospective segments
• Target prospective segments that are likely to
  respond favorably
• Continue testing responsiveness of prospective
  segments

5
Step 1 How to determine LVC

• Lifetime Value of the Customer
• Volume (spending)
• Voice
• Cost of servicing
• Potential for growth
• RFM Model
• Three critical variables
• Recency, Frequency, Monetary Value

6
The Customer Pyramid
Most Profitable Least Profitable

• Platinum
• Gold
• Iron
• Lead

7
Step 2 Profiling Segments

• There are many bases for segmentation
• Behavior/Benefit
• Demographic/Geodemographics
• Psychographics Lifestyle
• Relationship level
• Adopters
• The objective is to create a useful description
  of segment that describes
• Who are they? How can they most effectively be
  reached? Why do they buy their brands of choice?
  How will they respond to our message?

8
Claritas Prizm Segmentation

• Segment Descriptions

9
VALS Psychographic segmentation

• http//www.sric-bi.com/VALS/

10
Goal of Profiling
11
Selecting a Target Market

• Measurable Can we identify and quantify the
  segment?
• Accessible Can we reach this segment
  efficiently and effectively?
• Substantial Is there enough critical mass to be
  profitable?
• Differential Is this segment distinct from
  others?
• Actionable Can we serve this segment? Do we
  have the capacity and budget?

12
Moving on to Positioning

• This is the art and science of fitting the
  product or service to one or more segments in
  such a way to set is apart from competition
• Positioning is how your product is perceived on
  the hearts and minds of consumers
• Many advertising practitioners consider this to
  be the most important factor in establishing the
  brand in the marketplace.

13
Positioning, the battle for your mind

• Trout Ries suggest asking yourself the
  following questions
• What position, if any, do you already have in the
  prospects mind? (this most come from consumers
  not managers)
• What position do we want to own?
• What companies must be outgunned if we are to
  establish that position?
• Do we have enough resources to occupy and hold
  the position?
• Do we have enough guts to stick with one
  consistent positioning strategy?
• Does our creative approach match our positioning
  strategy?

14
Positioning Strategies

• Product attributes benefits
• Price/Quality
• Use or Application
• Product Class
• Product User
• Competitor
• Cultural Symbol

15
Next Time

• Read Chapters 9 -11
• Prepare questions for Tim Londergan regarding
  targeting and media selection
• Begin the process of developing a positioning
  strategy for your brand and communication
  objectives