core components of market driven strategies are: deciding which buyers to target
superior customer value
direct positioning strategies
sustaining superior organizations performance
stp
segments
value opportunities
matching value opportunities & capabilities targeting (s)
positioning for each target (s)
market targeting strategy
is the process of identifying people or organization in market towards which organization directs its positioning strategy.
selecting good market targets is one of most demanding task of management of organization. management may select one or few segments or go after more complete coverage of the market by targeting most of the segments.
targeting alternatives
segments clearly defined
target selected niche(s)
selective targeting
target multiple segments
extensive targeting
product specialization product variety
differentiated but segments not clearly defined
patterns of target market selection
factors influencing targeting decisions
stage of product market maturity
extent of diversity in buyer preferences industry structure organizational capabilities and resources opportunities for gaining competitive advantage
targeting in different markets environments
emerging industries are newly formed or reformed by using factors like new technology, changing buyer preferences and identification of unmet needs. large number of relatively small firms make up of the fragmented industry, no company has strong share in terms of market share or influence in this industry structure. these industries are shifting from rapid growth to maturity. structure is not cyclic but technology fading out. firms in this category compete on a global basis.
fragmented
transitional
declining global
emerging market
buyer diversity segmentation limited due to similarity of buyers 'preferences
industry structure typically small new organizations
limited access to resources
capabilities & resources first-mover advantage unique benefit (differentiation) strategy rather than low-cost targeting strategy single target or a few broad segments
growth market
buyer diversity segments should exist industry structure numerous competitors capabilities & resources survival requires aggressive actions by firms that seek large market positions. otherwise select one or a few market segments. targeting strategy extensive market coverage selective targeting by firms with diversified product portfolios very focused targeting strategies by small organizations serving one or a few market segments.
mature markets
buyer diversity segmentation essential for competitive advantage industry structure intense competition for market share emphasis on cost and service, and pressures on profits capabilities and resources managements objectives: cost reduction, selective targeting, product differentiation. targeting strategy deciding which segment to serve. firms pursuing extensive targeting strategies may decide to exit from certain segments.
global markets
global reach and standardization identify market segments that span global markets and serve these needs with global positioning strategies. local adaptation consider requirements of domestic buyers. buyers needs and preferences affected by social, political, cultural, economic and language differences. industry structure restructuring, acquisitions, mergers, and strategic alliances altering industries and competition. targeting strategy targeting a single country, regional (multinational) targeting or global targeting.
positioning strategy
deciding the desired perception / association of an organization / brand by market target buyer and designing the marketing program to meet (and exceed) buyers value requirements.
strategic positioning initiatives
positioning concept the desired positioning of the product (brand) by targeted buyers
market target
positioning effectiveness how well managements positioning objectives are achieved for the market target.
positioning strategy the combination of marketing actions used to communicate the positioning concept to targeted buyers
how positioning works?
objective match the organizations distinctive capabilities with the customer value requirements for the market target.
how do we want to be perceived by targeted buyers?
desired result gain a relevant, distinct and enduring position by the targeted buyers that they consider important. actions by the organization design and implement the positioning strategy (marketing program) for the market target.
the perception or association that management wants buyers to have concerning the brand:
functional
symbolic
selecting positioning concept
experiential
the positioning strategy places the marketing program (mix) components into a coordinated set of actions designed to deliver superior customer value.
positioning Issues
the positioning concept applies to a specific brand rather
than all the competing brands that compose a product classification.
the concept is used to guide positioning decisions over the
life of the brand.
multiple concepts are likely to confuse buyers and may
weaken the effectiveness of positioning actions
the positioning strategy indicates how (and why) the product mix, line, or brand is to be positioned for each market target. this strategy includes: the product strategy, indicating how the product(s) will be positioned against the competition in the product-market.
the value chain strategy , how product reached to end user. the pricing strategy, including the role and positioning of price relative to competition. the advertising and sales promotion strategy the use of advertisement and promotion to communicate with customer.
the sales force strategy, direct marketing strategy and the internet strategy indicating how they are used in the positioning strategy.
Positioning effectiveness
customer & competitor research
methods for determining positioning effectiveness
customer & competitor research
research studies
test marketing
generates information about commercial feasibility and marketing program. provides market (sales forecasts) & effectiveness measures
positioning models
incorporates research data into formal models of decision analysis.
positioning errors
under-positioning customers have only vague ideas about the company and do not perceive anything distinctive about it.
over-positioning customers have too narrow an understanding of the company, product or brand. confused positioning frequent changes and contradictory messages confuse customers.
doubtful positioning claims made for the product or brand are not regarded as credible.
positioning in perspective
positioning is a central part of business strategy. positioning analysis starts with an understanding of the value proposition for the target segment. value-driven positioning is the objective. positioning seeks to differentiate the organizations offer from the competition. positioning seeks to create a unique perception in buyers minds of the target market segment.
positioning is the unifying dimension of market-driven strategy.
targeting & positioning
product strategy
positioning
promotion strategy
Market Target
distribution strategy
strategy
