Industrial Market Segmentation,

Target marketing and Positioning

By
Raveendra Rao.K.
KRR IM 2014
 Topics covered
 What is industrial market segmentation

 Basis for segmentation (both macro and micro variables)

 Target marketing

 Niche marketing

 Product Positioning

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 Industrial marketing segmentation

 Industrial market segmentation is to identify group of firms

whose purchasing requirements and response to marketing
program are similar.

 Industrial market segmentation is not an easy task

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 Basis for segmenting industrial market

Macro variable

1. Industry targeted to different industry e.g. computer

manufactures

2. Organizational characteristic
 Size characteristic
 Location
 Purchasing factor
 Competitive forces
 End use market
 Product application
large organisation = volume requirement
distance from the plant (on time delivery)
centralized Vs decentralized
degree of competition, ease of entry, ease of
switching
multitude of end user (mining,constrution etc)
one product can be used in several ways( electrical
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 Micro variable
1. Organizational variable
 Purchasing situation
 Customer experience stage
 Customer interaction need
 Product innovativeness
2. Purchase situation variable
 Inventory requirement
 Purchase importance
 Purchasing policy
 Purchasing criteria
 Structure of buying centre
3. Individual variable
 Personal characteristics
 Power structure
new task, modified or straight rebuy
PLC stage
dependence on supplier in decision making
innovative firm Vs follower (high tech component)
MRP and JIT
degree of perceived risk
market based price, bid or leasing
suppliers reputation, reliability, flexibility
involvement
experience, risk taker/avoider
powerful
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 Market profitability analysis
1. Market potential
2. Sales potential
3. Sales forecast
4. profitability

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 Target marketing - where the opportunities exist
3 strategies are involved

1. Undifferentiated market selection (lubricant

manufacturers)
2. Differentiated market selection (costincreases)
3. Concentrated market selection (limited resources)

 Niche marketing –
 Finer ,homogeneous cluster
 Product that are tailored to individual desire and preferences.

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 Product positioning
 Positioning strategy should be clearly defined
 Positioning strategy in industrial market is more difficult than in
the consumer market

 Specific question that the firm should address:

1. What position do we own?

2. What position do we want to own?
3. Whom must the firm outgun?
4. Once chosen, can the firm stick it out? (basic position)
5. Does the firm match its positioning strategy?

KRR IM 2014
KRR IM 2014