Selecting the target Market

Selecting the target Market:
To succeed in today’s competitive marketplace, companies must be customer centered. They must
win customers from competitors and keep them by delivering greater value.
• Sound marketing requires a careful, deliberate analysis of consumers.
• Since companies cannot satisfy all consumers in a given market, they must divide up the
total market (market segmentation), choose the best segments (market targeting), and
design strategies for profitably serving chosen segments better than the competition
(market positioning).
Market segmentation is the process of dividing a market into distinct groups of buyers with different
needs, characteristics, or behavior who might require separate products or marketing mixes.
Market targeting is the process of evaluating each market segment’s attractiveness and selecting one
or more segments to enter. A company should target segments in which it can generate the greatest
segments, or perhaps it might decide to offer a complete range of products to serve all market
segments. Special segments may be called “market niches.” Most companies enter a new market
by serving a single segment, and if this proves successful, they add segments.
Market positioning is arranging for a product to occupy a clear distinctive and desirable place relative
to competing products in the minds of target consumers. In positioning a product, a company
first needs to identify possible competitive advantages upon which to build the position. To gain
competitive advantage, the company must offer greater competitive advantage to the target
segment. The company’s entire marketing program should support the chosen positioning strategy.
Effective positioning begins with actually differentiating the company’s marketing offer so that it
gives consumers more value than they are offered by the competition.