9 - Selecting Market Targets
1. Explain how companies identify attractive market segments and choose a
market-targeting strategy.
In indentifying attractive market segments and choosing a marketing strategy,
companies analyze many external factors. These factors are important to answer
questions relating to market trends, demand, buying patterns and and overall
customer satisfaction. Having some sort of checklist, or basis as these factors
mentioned is quite strategic in designing an intelligent and comprehensive
marketing strategy to appeal to the company's target market/group. Furthermore,
since these factors provide detailed information, it also means that the
company/brand is going to be able to better serve the customers' needs.
Depending on the company, their objectives and the type of industry it is in, the
following factors are great starting point:
Market factors include size, growth rate, life cycle stage, etc. of the target
matket.
Competitive factors include intensity, quality, theat of substitution, and degree
of differentiation.
Economic and technological factors include: barriers to entry and exit, barganing
power of suppliers, technology utilizatiom, investment required and margins
Business environment factors include economic fluctuatins, political and legal,
regulation, social, physical environment.
2. Explain how to select target market using the ‘Directional Policy Matrix’
technique.
Using the DPM technique, factors deemed releavant in a particualr market are each
assigned weights depending on their perceived importance. This is customized to the
needs pf the specific company. This subjective but can be more objectively assessed
through the use of marketing research or other tools to analzye market data.
Factors are listend and weighted, where each potential market segment is scored: 1
being the lowest and 5 being the highest. The summary score provides insights on
'market segment attractiveness' and 'company business strenth in serving that
segment'. Further analyses are then conducted to gauge the impact of the result.
3. What is the difference between differentiated marketing and undifferentiated
marketing?
Undifferentitated Marketing
- producing a single product to appeal to all segments
-not dividing the markets into small segments
-market their products in a uniform way across different market segments,
Differentiated Marketing
-offering a different product to each of the different segments.
-divides the market into small segments
-market their products separately to small sgements.
4. Define the major steps in designing a customer-driven marketing strategy:
market segmentation, targeting, differentiation, and positioning.
Market segmentation: described as how we as marketers can divide the market into
1. Explain how companies identify attractive market segments and choose a
market-targeting strategy.
In indentifying attractive market segments and choosing a marketing strategy,
companies analyze many external factors. These factors are important to answer
questions relating to market trends, demand, buying patterns and and overall
customer satisfaction. Having some sort of checklist, or basis as these factors
mentioned is quite strategic in designing an intelligent and comprehensive
marketing strategy to appeal to the company's target market/group. Furthermore,
since these factors provide detailed information, it also means that the
company/brand is going to be able to better serve the customers' needs.
Depending on the company, their objectives and the type of industry it is in, the
following factors are great starting point:
Market factors include size, growth rate, life cycle stage, etc. of the target
matket.
Competitive factors include intensity, quality, theat of substitution, and degree
of differentiation.
Economic and technological factors include: barriers to entry and exit, barganing
power of suppliers, technology utilizatiom, investment required and margins
Business environment factors include economic fluctuatins, political and legal,
regulation, social, physical environment.
2. Explain how to select target market using the ‘Directional Policy Matrix’
technique.
Using the DPM technique, factors deemed releavant in a particualr market are each
assigned weights depending on their perceived importance. This is customized to the
needs pf the specific company. This subjective but can be more objectively assessed
through the use of marketing research or other tools to analzye market data.
Factors are listend and weighted, where each potential market segment is scored: 1
being the lowest and 5 being the highest. The summary score provides insights on
'market segment attractiveness' and 'company business strenth in serving that
segment'. Further analyses are then conducted to gauge the impact of the result.
3. What is the difference between differentiated marketing and undifferentiated
marketing?
Undifferentitated Marketing
- producing a single product to appeal to all segments
-not dividing the markets into small segments
-market their products in a uniform way across different market segments,
Differentiated Marketing
-offering a different product to each of the different segments.
-divides the market into small segments
-market their products separately to small sgements.
4. Define the major steps in designing a customer-driven marketing strategy:
market segmentation, targeting, differentiation, and positioning.
Market segmentation: described as how we as marketers can divide the market into
