Market Targeting
LEARNING OUTCOMES
On completion of this study unit you should be able to:
explain what is meant by the term "target marketing"
suggest factors that should be considered when selecting a target
market
explain the concept of product positioning
discuss the positioning process
describe the positioning methods that marketers can pursue in
practice
Getting an Overview
The savvy retailer recognizes that the company cannot serve all
consumers in the market equally well – some consumers expect the
highest quality products, others prioritize convenience, while others are
concerned about lower prices. There is little likelihood that one retailer
can serve all of these diverse consumer expectations. The organization
should therefore decide which type of consumer it is really good at
serving given its own strengths and weaknesses and then focus entirely
on that market segment or segments.
Choosing between the market segments that make up the overall
market is called market targeting. For example, BMW's products target
, different market segments such as the Z3 Roadster for import buyers
and the BMW X5 for the mass muscle car crowd. With these two
products, BMW thus segmented the market into older, performance-
oriented traditional buyers and younger buyers who are looking for a
trendy, upmarket and more expensive vehicle.
Selecting Potential Target Markets
Whether an organisation is a newly established venture or has been in
existence for sometime, it has to evaluate the market segments in the
marketplace to determine where the lucrative opportunities lie. For the
new concern the choice is easy, but for the existing business it might
entail pursuing a whole new direction.
For the retailer, this might mean relocation and/or changing the product
selection it carries. Before such a drastic decision is taken a through
evaluation of the identified market segments is undertaken. This
involves evaluating them in terms of the following criteria:
segment size and growth possibilities
attractiveness and potential profitability
resources and skills of the enterprise
compatibility with the enterprises objectives
cost of reaching the target market
Such assessments have an external and internal focus. The external
analysis entails looking at each market segment in terms of its present
LEARNING OUTCOMES
On completion of this study unit you should be able to:
explain what is meant by the term "target marketing"
suggest factors that should be considered when selecting a target
market
explain the concept of product positioning
discuss the positioning process
describe the positioning methods that marketers can pursue in
practice
Getting an Overview
The savvy retailer recognizes that the company cannot serve all
consumers in the market equally well – some consumers expect the
highest quality products, others prioritize convenience, while others are
concerned about lower prices. There is little likelihood that one retailer
can serve all of these diverse consumer expectations. The organization
should therefore decide which type of consumer it is really good at
serving given its own strengths and weaknesses and then focus entirely
on that market segment or segments.
Choosing between the market segments that make up the overall
market is called market targeting. For example, BMW's products target
, different market segments such as the Z3 Roadster for import buyers
and the BMW X5 for the mass muscle car crowd. With these two
products, BMW thus segmented the market into older, performance-
oriented traditional buyers and younger buyers who are looking for a
trendy, upmarket and more expensive vehicle.
Selecting Potential Target Markets
Whether an organisation is a newly established venture or has been in
existence for sometime, it has to evaluate the market segments in the
marketplace to determine where the lucrative opportunities lie. For the
new concern the choice is easy, but for the existing business it might
entail pursuing a whole new direction.
For the retailer, this might mean relocation and/or changing the product
selection it carries. Before such a drastic decision is taken a through
evaluation of the identified market segments is undertaken. This
involves evaluating them in terms of the following criteria:
segment size and growth possibilities
attractiveness and potential profitability
resources and skills of the enterprise
compatibility with the enterprises objectives
cost of reaching the target market
Such assessments have an external and internal focus. The external
analysis entails looking at each market segment in terms of its present
