Market Targeting Class 11
Meaning of Market Targeting
As done in Market Targeting – Class 10
Types of Market TargetingÂ
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Strategies of Market Targeting
As done in Class 10
Additional types of Market Targeting:
Adjacent Segment Strategy: When a single segment is successful and has reached the point of full market penetration the firm opts for adjacent marketing strategy, a closely related segment to be captured next.
Small Segment Strategy: The smallest segment is used by a business with limited resources and capabilities to compete. Large companies using mass market or large segment strategies usually ignore such a small segment.
Market Targeting Class 11
Selection Criteria for Targeting /Need for Targeting:
There has to be match between costing and revenues. Following factors must be considered while targeting a market:
- Existing Market Share and Market Homogeneity
Targeting and finding becomes easy if there’s understanding of market share. Homogeneous markets are easier to target as they exhibit similarity of behaviors and needs of the customers.
- Existing Product Expertise
Having expertise in the current product can lead to better-targeted marketing strategies. It’s easier to market products where a firm has significant knowledge and experience.
- Likelihood of Production and Marketing Scale Economies
Targeting segments where economies of scale are possible can reduce costs and increase profitability. It’s important to identify markets where mass production and marketing activities result in cost advantages.
- Nature of Competitive Environment
It’s really important to analyse the competition environment. The firm can achieve favourable conditions in the areas having less competition.
- Forces of Marketing Environment and Trends
The firm should be aware of macro-environmental forces like economic, technological, and social factors and trends that impact consumer behavior. Targeting should consider these forces for better market reception.
- Capability and Ease of Matching Customer Needs
The firm should assess how well its products/services can meet the specific needs of the target segment. The easier it is to match these needs, the more effective will be the targeting efforts will be.
- Segment Attractiveness in Terms of Size, Structure, and Growth
Larger and growing segments are generally more attractive. The firm should evaluate the structural attractiveness, including customer base, market growth rate, and potential profitability.
- Available Corporate Resources
The marketer should consider the firm’s available resources—financial, human, and technological. Effective targeting requires sufficient resources to implement strategies and campaigns.
- Anticipated Profitability and Market Share
The firm should analyze the expected profitability and potential market share in the target segments. It should focus on segments where its ROI will be maximum.
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Failure of Target Market
If the chosen market segment isn't meeting its needs, consider the following questions:
- Have our targets changed over the years? Are we still aiming for the same groups?
- How do we clearly describe our target market for each business or brand?
- Have we analyzed each market to find the most profitable segments?
- Why did we choose these targets?
- Can we prove these targets are profitable?
- Would other targets be more profitable?
- Does every part of our marketing team have the right information about these targets?