Understanding Market and Target Market Identification

Understanding Market and Target Market Identification

This article provides an explanation of the concept of market and market identification. A market is defined as a group of people who have a need or desire, the ability to pay, and the willingness to

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Slide1Marketing1.02-B Explain the concept of market and market identification

Slide2A market are those who have:  A need or desire,  and  The ability to pay,  and  The willingness to buy (soon) What is a Market?

Slide3A target market are those who:  Are grouped  within a  market  by what they have in common  Customers the business seeks to attract  Ipad Target Market

Slide4Customers belong to a number of markets  Customers targets = consumer market  Business target = industrial market  Markets usually change over time Importance of Target Markets Young Adult Middle Class Like Vacations Female

Slide5designing products and directing marketing activitiesto appeal to the whole market (Ex: lightbulbs)  Advantages:   communicates a broad message to as many customers as possible  More cost-effective  Businesses don’t have to pay for the production of similar products  Can price and distribute one type of product more easily than many  Can send one promotional message to everyone Mass Marketing

Slide6Disadvantages:  The diversity of the audience  Only a small percentage of the mass market is likely to purchase the product Mass Marketing

Slide7dividing the market into smaller groups in order totarget each group individually  Advantages:   meets the needs of customers, more precise than mass marketing, more effective communication  Provides an efficient way for smaller firms to compete with larger businesses Market Segments

Slide8Disadvantages:   takes more resources to be successful, more difficult to reproduce, requires more creativity and money Market Segments

Slide9Division of a totalmarket into smaller, more specific groups as a way to meet the needs of customers Market Segmentation Behavioral          . Demographic Psychographic      Geographic

Slide10basis of its physical and social characteristics  Gender:   indicates purchase preferences (female)  Origin or heritage:   race, ethnicity, nationality (Caucasian)  Religion  (Christian)  Social or economic status: education level, occupation, income (Middle-Class)  Life stage:   age, generation, marital status, family life cycle, family size. (Teens) Demographic Segmentation Demographic

Slide11basis of where consumers are located. Climate  (City)  Political Boundaries  (Democratic State)  Population Density  (High per capita)  Marketers discover  Where their markets are located ?  Who their competitors are?  Which media will reach their customers?      Geographic Geographic Segmentation

Slide12Psychographicbasis of consumers’ lifestyles personalities.  Values  Motives  Attitudes  Opinions  Interests  (Sports)  Activities  (Winter Sports)  Personalities  (Adventurous)  Lifestyles  (Outgoing)  It gives a clearer picture of customers’ needs and wants based on personality and lifestyle. Psychographic Segmentation

Slide13Behavioralbasis of consumers’ response to a product.  Cause and effect nature of customers’ purchase decisions  Examine what customers respond to when they buy a particular product Behavioral Segmentation

Slide14Customer questions in behavioral marketing: How will the product benefit me?  Am I ready to buy it?  When will I use the product….  On what occasions?  How often?  Am I in a comfortable buying pattern?  Do I feel loyal to a particular brand? Behavioral Segmentation (Cont)

Slide15segment marketing is more efficient in the long run… Customers today are more discerning about purchases  Not influenced by mass marketing alone  Meets customer’s needs  More opportunities for growth Why are market segments increasing?

Slide16Find a website highlighting the top 10 Super Bowl commercials for this year.  As you are watching the commercial Identify target markets used and why  Demographic  Geographic  Physiographic  Behavioral  As a group compare notes and fill in any target markets Student Response: Super Bowl Target Markets

Slide17Each group will use their assigned topic from 4P’s (luxury, economy, sports, truck, green and SUV automobiles).  Groups are to research the marketing segmentation and create an illustrative poster reflecting their findings.  Must show at least 3 segments  Must show research of the industry’s or company’s Marketing  Must be detailed by identifying subcategories of marketing segments from presentation 1.02 Student Response: 4’s & Target Market-  Part  2