Segmentation, Targeting and Positioning

 Segmentation: Kotler stated “Don’t buy a market share. Figure out how to earn it”. The above phrase enclosed the importance of developing marketing strategies/process in regard to the processes of segmentation and targeting. The marketers would have to adopt in such a way marketing strategies/process that are necessary answering to the following critical questions:

·         How can a company identify the segments that make a market?

·         What criteria can a company use to choose the most attractive target markets?

According to Keegan  that market segmentation is the process of subdividing a market into distinct subsets of customers that behave in the same way or have similar needs. Consequently, the potential benefits of an organization in regard to the well-develop segmentation strategy are the following:

·         Strengthening its position in the market.

·         Operating more effectively.

·         Fighting its competitors.

·         Allowing building a greater degree of market knowledge sector and customer loyalty.

It is of paramount importance to indicate that today, global companies are likely to segment world markets according to one or more key criteria: geography, demographics, psychographics, behavioral characteristics, and benefits sought. The above dictates that marketers use several variables in order to plan and execute the optimal and ideal marketing strategy.

It can be concluded that market segmentation is an adaptive strategy/process that consists of the partition of the market with the scope of selecting one or more market segments which the organization can target through the development of specific marketing strategies/mixes that adapt to particular market needs. Moreover, an organization will be in a position to strengthen its market share and furthermore to maximize its profits for the benefit of its shareholders.

Targeting: Keegan stated that targeting is the act of evaluating and comparing the identified groups and then selecting one or more of them as the prospects with a higher potential. In addition to a solid understanding of the customer, analyses of the competitive environment and the company are instrumental to the task of target market selection. The objective is to select segments in such a way that the firm maximizes its profits. The key to target market selection is understanding differentiation. It involves collecting and comparing data on the company and its competitors to evaluate which is most likely to succeed serving each on the identified segments. The process starts by collecting data for each firm in five areas:

·         Ability to conceive and design.

·         Ability to produce (quality and quantity).

·         Ability to market.

·         Ability to finance.

·         Ability to manage / execute.

According to Keegan there are three basic criteria in regard to the success of targeting:

·         Current size of the segment.

·         Potential growth.

·         Competition and compatibility.

Furthermore, Keegan stated after evaluating the identified segments in terms of the above three criteria, there are three basic categories of targeting marketing strategies in regard to the selecting a global target market strategy:

·         Standardized marketing.

·         Concentrated marketing.

·         Differentiated marketing.

Positioning: Kotler stated “Don’t watch the product life cycle: Watched the market life cycle”. The above phrase enclosed the critical role of the market/consumers in relation to the international marketing strategies/process. Keegan stated that positioning is the location of your product in the mind of your customer. Thus it is essential to plan a way to reach the targets. To achieve this task, marketers use positioning. In today’s global market environment, many companies find it increasingly important to have a unified global positioning strategy. Thus the business game is being played of this era in the global arena. Giant corporations such as Coca-Cola and PepsiCo adopted global strategies in such a way to gain global market share with result to be a global leaders in their field of industries.

In developing the positioning objective it is of paramount to understand that “positioning is not what you do to the product, but what you do to the mind”. Understanding how the mind receives, stores, or rejects information will improve the chances of making the positioning objective coincide with actual positioning in the target audience.  Consequently, a good positioning statement answers the following three questions:

·         Who are the customers?

·         What is the set of needs that the product fulfils?

·         Why is the product the best option to satisfy those needs?

Understanding a Segmentation, Targeting and Positioning process is probably one of the most important processes of marketing strategies/process used by organizations. The role of effective marketer is to identify the differences and similarities of potential buyers at a national or global level in order to group them. Furthermore, critical role in regard to the success plays the variables used to develop segmentation schemes like, demographic, psychographic, and consumers’ behavior.  Finally, the last step is “What strategy decided to be pursued by organization?”, differentiated, undifferentiated, or concentrated strategy. The role of marketers is very critical to the success of an organization. We live in a fast changing environment, which everything changes. Socrates, an ancient Greek philosopher said “I can do anything to them; I can only make them thinking”. Thus the most important is to thinking critically.