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Promotion Strategies: Target Market Selection and Brand Positioning

Autor:   •  February 7, 2016  •  Coursework  •  1,012 Words (5 Pages)  •  525 Views

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PROMOTION STRATEGIES: TARGET MARKET SELECTION AND BRAND POSITIONING

Strategies are sweeping guidelines that provide long term direction to the company. These are never changed casually unless there are dramatic changes and upheavals in the market.

Eg. Mountain Dew chose to target young adults as their potential customers as its strategic target group, hence their advertising features high risk activities as it is presumed that the young and the young at heart group is more likely to take risks and are more adventurous, hence the marketing appeal.

Tactics should fall within the guidelines and objectives set forth by the strategies so that promotion activities will be still based on the main theme but have a special occasion focus.

Eg. Dasain, Tihar, Xmas specials. Where extra incentives are provided to sales people, there are special packaging ( Coke for the world cup), price incentives, coupons, gifts etc.

Market Segmentation:

Is the identification of potential customers and isolating specific groups of customers on the basis of similar needs, similar interests and similar purchasing power. Obviously, the better the process, the more is the likelihood of success of the IMC program. Because of the difficulty to make individually desired products, FMCG companies make a wide variety of similar products so as to be able to cater to a broad spectrum of customers.

As it is not possible to make a specific product for each and every individual, in order to optimize the application of resources, companies form groups, which are then targeted for the IMC program and whose sales can be supported by the company. Once the market is identified and potential customers isolated, the targeted group is formed into distinct clusters based on a) needs and purchasing power parity and b) likely common response to the IMC program.

5 clear steps in target market selection:

        1. Finding ways to group customers according to specific needs and

              also according to company policies.

        2. Find ways to group promotion and advertising activities

        3. Develop a product-market matrix which relates to the segment

        4. Selection and prioritizing of the market segments

        5. Definition of promotion activities to reach these segments.

Some of the ways to form customer clusters can be as follows:

  1. Geographic: market clusters based on cities, regions and countries, because of resource constraints and specific product attributes, companies prefer to focus marketing efforts on a specific geographical area. Example: promoting woolen wear in equatorial countries or swim wear in mountainous regions of Nepal.
  2. Demographic: market clusters based on age, sex, education, income or a combination of all or any of the above.
  1. Income: difference in needs and luxuries (BMW, Rolex)
  2. Age: children, seniors, who are active, ailing, healthy and active
  3. Sex: products targeted exclusively at women or men        ( Virginia Slims cigarettes for women).
  4. Ethnic groups: products targeted at specific ethnic group within a community or city ( Asian super markets in Europe, USA or Australia)

  1. Psychographic: market clusters formed on the basis of life styles, attitudes, interests. Opinions and values ( out door products, gardening products)

Example: a new multi media gadget enters the market, and research done by a company for the manufacturer Odyssey (USA) found six different segments

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