The Role of Product Positioning in Consumer Buying Decision Process Segmenting, Targeting, Positioning (STP) is the process which marketers employ to select target markets. Segmentation is the process of ordering consumers into groups with similar product interests or needs. Targeting involves a company determining which market segments it believes it can satisfy, and then choosing an appropriate targeting strategy for the segments. Positioning is how consumers perceive a brand or product, particularly in relation to other brands and products.
The relation between target segments and product positioning is dependent on the age of the company. For a new company, they have the opportunity to decide what perceptions that want the public to have about the company as they are yet to have a position. Therefore they can choose the target market, and then decide on brand positioning. For a company that has existed for some time, they already have a present brand position. Brand positioning often takes time to build, and much time to change. For this reason, established companies are likely to choose target markets that are ideal for its brand positioning.
“A market segment consists of a group of customers who share a similar set of needs and wants. The marketer’s task is to identify the appropriate number and nature of market segment and decide ...
Terrell, E. (n.d.). Market Segmentation. (Business Reference Services, Library of Congress). Retrieved April 6, 2014, from http://www.loc.gov/rr/business/marketing/
First, we will analyze the targeted customer and the proposition designed by each company to attract them. In this part, there is a description of each market target and how each company has taken advantage of each unique position in the industry.
Caroline and Jennifer said that ‘Market segmentation is a crucial marketing strategy. Its aim is to identify and delineate market segments or set of buyers which would then become targets for the company’s marketing plans.’ (Tynan and Drayton, 1987) There are many ways to segment the market, such as age, region, environment, psychology and wages (Hall, Jones and Raffo, 2010).
Segmentation, targeting and positioning are the fundament of modern marketing (Proctor, 2002, p. 188, as cited in Harris and Schaefer, 2015).
To begin with, it is crucial to appreciate the meaning of segmentation and targeting because these two terms lay the foundation for this report. Consequently, segmentation is dividing a market, into groups of consumers with homogenous traits in order to provide each group with the desired product. What is the meaning of targeting? It is where an enterprise evaluates every segment with an objective of identifying segments with promising business opportunities. Considering the nature of the product in question, it sufficed to mention that liquor- filled chocolates are to be sold to adults.
When analyzing an organization’s target market, the first step is to understand the business and what they hope to achieve through their marketing strategies. Targeting and positioning strategies consist of analyzing and identifying segments within a given product-market, choosing which segment or segments to target, and developing and implementing a positioning strategy for each targeted segment (Cravens & Piercy, 2009). The company’s target market determines what customer group or groups the company wants to serve (Cravens & Piercy, 2009). Analyzing IKEA’s target market allows the company to determine if their marketing strategies have successfully targeted their intended customer group or groups. Discussing the company’s positioning strategy helps determine if the strategy is effective or if the company must make improvements strengthen their positioning strategy. The company must determine if their targeting and positioning strategies may be lacking. If the company’s targeting and positioning strategies are lacking, the company must determine what they must do to strengthen their targeting and positioning strategies.
Green & Kriegar (1991) states that target market are that segment of the market to which a particular product of the firm is aimed at. It is often categorised by age, gender, and geography and socio economic analysis.
SECTION 3: TARGET MARKET: A full description of the current market segment(s) and identification of an existing or new target market to be the focus for the remainder of the strategic marketing plan, including a discussion of why this target market represents a growth opportunity for the company. Description of target market must be extensive and based on the criteria for segmenting consumer markets as outlined by Kotler. Also discuss the positioning strategy to be used for this chosen target market.
Product placement is one of the most important techniques in marketing especially in the past few years, where the media has played an essential role in forming people's opinion. As many people believe in all what they see because of the significant role of the media, product placement reaches its goals. However, the effectiveness of product placement varies according to numerous criteria, from how it is integrated to how it is used to show the product and whether it is intrusive or not. In the study article " The Effectiveness of Product Placement: The Influence of Product Placement towards Consumer Behavior of the Millennial Generation " by Liew Chee and Elizabeth Lim, the issue of product placement and its influence on a specific category of consumer is discussed. The study aims mainly to form a general idea about how effective the product placement could be to influence the millennial generation and sway their decisions. Liew and Lim made a valuable and professional study article that involves an interesting perspective regarding product placement through a good arrangement of ideas and a methodological study.
Product positioning is to use certain features of the product to position against the product of competitor. With the help of this marketing activity, marketers can attract more customers by focusing of special features of their product.
Segmentation, targeting and positioning are interrelated activities which are important to achieving a successful Marketing Mix. Discuss these concepts in theory and give practical examples of how they can be applied to one industry of your choice
Market segmentation means dividing the market into distinct groups that have common needs and will respond similarly to marketing action. Each segment must be unique, have common needs, and respond in a similar manner to marketing efforts. Target market is the group of potential customer that has been selected by business to focus its marketing efforts towards. This is the group the business wants to sell its products/services to. Positioning refers to the image created in the minds of customer of its product or brand. It is a perception created in the minds of the consumer relative to that of its competitors.
Once a business has successfully completed segmentation based on the market into various groups the targets will be chosen. As we all know no one unique strategy will be able to appeal to all consumer segments therefore being able to come up with different strategies for specific targets are a vital aspect of marketing.
According to Doyle, (1983) positioning strategy refers to the selection of a marked market segment that shows all the customers a type of business that could seek out to serve and the option of choosing the differential advantage that explains the way it is going to compare against all its competitors in the same segment. It could be said from this definition that a positioning strategy applies mainly at a certain product’s level or/and service, working in the limits of a particular market and the fact that it should not really be mistaken with a wider concept of “corporate” strategy, or with any other concepts that are more specifically related to strategy such due to the fact that it could be related to every individual matter in the marketing mix, such as a “pricing” or “promotional” strategy.