W3: Customer –driven marketing strategy
Check list:
Define the four steps in designing customer driven marketing
strategy
List, discuss and apply the major bases for segmenting consumer
markets: How would you describe the typical iPhone customer?
o Explain how companies choose market segments and target
marketing strategy: How do brands like Coke Zero decide who to sell
to and how to reach them?
Discuss how companies differentiate and position their products and
services: How is VietJet Air different to other airlines in Vietnam?
1. 4 steps in designing customer-driven strategy:
o A target market/customer segmentation changes over time!
STEP 1 STEP 3
STEP 4
STEP 2
o Marketers need to identify which is the most profitable and
suitable rpoduct at a specific period of time.
STEP 1: MARKET SEGMENTATION
o The process in which the company divides the market in smaller
segments in order to deliver products that match the customers’
needs more effective and efficient.
Based on geography
Several ways: city, rural, climate or total
Geographic
population
Easiest
Age, gender, family size, income, etc
Age and life-cycle stage segmentation: process of
Demographic offering different products/ marketing approaches
for different age and life-cycle groups.
Most popular
Psychographic Personality, lifestyle and social class.
Knowledge, attitudes, uses or responses to the
product
5 criterias: occasions (when they buy), benefits
Behavioural
sought (different benefits in same item), user status
(non-users, ex-users, potential, etc), usesage rate
(light, medium, heavy), loyalty status.
Able to do all 4 things simulataneously in order to have a
more identified, better-defined groups.
o A segment is useful when:
Measurable
Size, purchasing power and profiles of
segments can be measured
Substantial
Segments are large and profitable enough to
serve
Accessible
Segments can be effectively reached and
served
Actionable
Effective programs can be designed for
attracting and serving segments
Differentiable
Conceptually distinguisable and respond
differently
STEP 2: MARKET TARGETING
o Target market: set of buyers who share common needs or
charateristics that the firm decideds to serve.
o Among various segments, firm has to decide how many and which
segments to serve best!
o 4 market targeting strategies:
Undifferentiated
Focus on what is in common in the need of customers
Target whole market with one onffer
Differentiated
Target several market segments and designs seperate offer for each
Concentrated (Niche)
Target a large market share of a small market
Suitable where only few competitors and firm has strong capability
Micro- marketing
Tailoring products and marketing programs to the needs and wants of specific individuals
and local customers
STEP 3 AND 4: DIFFERENTATION AND POSITIONING
o Product position: set of feelings, perceptions and impressions the
customers have on the products compared to competitors’ products.
a) How to position the brand?
o In order to prepare for positioning the brand, marketers often use
perceptual positioning map to identify the gaps and show
consumers perceptions about their product compared to
competitors’ on important criterias.
b) Choosing a differentiation and positioning strategy:
Identifying a set of
differentiating
Choosing the right Selecting an overall
competitive advantages
competitive advantages positioning strategy
upon which to build a
position
c) Identifying possible value differences and competitive advantages:
o Competitive advantage: adavtages gained by offering greater
customer values, either by low prices or more benefits that
justify a higher price.
o A company can differentiate along the lines of of product,
services, channels, people or image.
Product/Service differentiation
features, performance, style, design, superior services, etc.
Channel differentiation
speedy, convenient or careful deliver
Amazon.com, Netflix
People differentiation
hiring and training better people than competitors.
Singapore airlines vs Vietnam airlines
Image differentiation
convey the product’s distinctive benefits and positioning.
McDonald’s golden arches, Google’s colourful logo, etc.
d) Choosing the right competitve advantge:
Which differences to promote? A difference is worth establishing to the
extent that it satisfies the following criteria:
Distinctive Important Superior
Communicable Pre-emptive Affordable
Profitable
e) Selecting an overall positioning strategy:
o Value Proposition: The full positioning of a brand – the full mix
of benefits upon which it is positioned.
o Positioning statement: A statement that summarises company or
brand positioning – it takes this form: To (target segment and
need) our (brand) is (concept) that (point of difference).
o Once it has chosen a position, the company must take strong steps
to deliver and communicate the desired position to target
customers.
o All the company’s marketing mix efforts must support the
positioning strategy.
