CHAPTER 3:MARKET OPPORTUNITY

ANALYSIS AND CONSUMER ANALYSIS

THE STRATEGIC MARKETING PROCESS
 It seeks to establish a clear and
concerted direction for all marketing
activities of an organization
THE STRATEGIC MARKETING PROCESS

MISSION
SITUATION OBJECTIVE
IDENTIFICATI
ANALYSIS SETTING
ON

MARKETING STRATEGY
STRATEGY EVALUATION
DEVELOPME AND
NT CONTROL
THE STRATEGIC MARKETING PROCESS
 Mission identification
 Situation analysis
 Objective setting
 Marketing strategy development
*cost leadership ,differentiation ,focused
-forward integration, backward integration, horizontal
integration ,market penetration ,market development ,
product development, related diversification, unrelated
diversification, retrenchment, divestiture, and
liquidation
 Strategy evaluation and control
STEP 1: MISSION IDENTIFICATION
 The company’s mission statement is
articulated
STEP 2 : SITUATION ANALYSIS
 This step assesses and evaluates the
markets , customers, competitors, and
the company’s internal and external
environment.
STEP 3: OBJECTIVE SETTING
 Objectives are marketing targets that
are SMART
 SMART means;
Specific
Measurable
Attainable
Realistic
Time-bound
STEP 4: MARKETING STRATEGY DEVELOPMENT

 The development of a marketing

strategy involves market segmentation,
identification, positioning ,selection of
broad marketing strategies, and the
translation of the strategies into action
plans.
MARKET STRATEGY DEVELOPMENT
 Cost leadership
>>this is the strategy primarily for achieving
low cost leadership among industry competitors
 Differentiation
>>it seeks to achieve superior products
attributes and features that are different from
industry competitors.
 Focused
>>efforts are concentrated on a relatively small
but profitable market.
SUB CATEGORIES
 Forward integration
 Backward integration
 Horizontal integration
 Market penetration
 Market development
 Product development
 Related diversification
 Unrelated diversification
 Retrenchment
 Divestiture
 Liquidation
1. FORWARD INTEGRATION
 This involves gaining ownership or
increased control over distributors or
retailers .
2.BACKWARD INTEGRATION
 This involves gaining ownership or
increased control over suppliers
3.HORIZONTAL INTEGRATION
 This involves purchase of or increased
control over competitors.
4. MARKET PENETRATION
 The objective of this strategy is to
increase market share of current
products or services in current markets
through greater and more intensive
marketing efforts .
5. MARKET DEVELOPMENT
 This strategy involves the introduction
of existing products or services into a
new geographical area or market .
6. PRODUCT DEVELOPMENT
 This strategy involves the improvement
of current products or services or the
development of new products with the
purpose of increasing sales .
7. RELATED DIVERSIFICATION
 This involves introducing new but
related products or services.
8. UNRELATED DIVERSIFICATION
 This involves introducing new products
but unrelated products or services.
9. RETRENCHMENT
 This involves halting or reversing
declining sales and profits through cost
or asset reduction.
10. DIVESTITURE
 This involves selling a division or part
of an organization.
11. LIQUIDATION
 This involves selling all of a company’s
assets, in parts or as a whole , for their
tangible worth.
STEP 5 : STRATEGY EVALUATION AND CONTROL

 After the strategy is developed ,

periodic monitoring and evaluation are
needed. This is necessary to identify
deviations and make necessary
adjustments and corrections.
THE TACTICAL MARKETING PROCESS

MARKETING MICROENVIRONMENT
IDENTIFYING STRENGTHS AND WEAKNESSES
MARKETING MACROENVIRONMENT
THE TACTICAL MARKETING PROCESS
 It determines the means or tactics to
implement the strategies
THE TACTICAL MARKETING PROCESS

Marketing Activity Monitoring

strategies budgets and control

Responsibilit
Action
y/
plans
accountabilit
/tactics
y

Marketing Activity
activities timetable
THE TACTICAL MARKETING PROCESS
 Marketing strategies
 Action plans /Tactics
 Marketing activities
 Timetable activity
 Responsibility/ accountability
 Activity Budgets
 Monitoring and Control
ACTION PLAN
 It is a sequential series of marketing
activities
THE MARKETING MICROENVIRONMENT
 It includes forces that are internal to
the company or those that are relevant
to its operation.
 It is composed of the company itself ,
its suppliers , market intermediaries
,customers , competition and its
various publics .
 THE MARKETING MICROENVIRONMENT
 The company
 Suppliers
 Market intermediaries
 Customers
 Competition
 Publics
1. THE COMPANY
 Marketing may be the “lifeblood” of an
organization , but it cannot exist
independently of other organizational
factors.
2.SUPPLIERS
 Suppliers provide raw materials ,
utilities , labor, capital, and equipment.
3.MARKET INTERMEDIARIES
 Intermediaries are channels that link
the organization to its customers.
4. CUSTOMERS
 Customers create the demand for
products and services .
5.COMPETITION
 The demands for the company’s
products and services is affected by the
nature and intensity of competition.
6.PUBLICS
 Publics may include any individual or
entity with an actual or potential
interest in the company and its
products or services .
IDENTIFYING STRENGTHS AND WEAKNESSES

 A thorough and impartial analysis of a

company’s microenvironment can
effectively identify the company’s
competitive strengths and weaknesses.
 A strength and weaknesses can either
be controllable or uncontrollable
THE MARKETING MACROENVIRONMENT
 It includes factors that are external to
the organization.
THE MARKETING MACROENVIRONMENT
REFERS TO:
 Economic

 Politicolegal
 Sociocultural
 Demographic

 Technological
 Natural environments
1.ECONOMIC MACROENVIRONMENT
 It represents economic factors that can
directly affect an organization.
2.POLITICOLEGAL MACROENVIRONMENT
 It includes both political and legal
factors
3.SOCIOCULTURAL MACROENVIRONMENT
 Each geographical area has a specific
culture that dictates how business is
conducted.
 Culture is defined as the beliefs ,
customs, arts, etc., of a particular
society , group, place ,or time.
4.DEMOGRAPHIC MACROENVIRONMENT
 It consist of changes in population
characteristics.
5.TECHNOLOGICAL MACROENVIRONMENT
 It is composed of current and
impending technological change.
6. NATURAL MACROENVIRONMENT
 It refers to natural resource inputs and
environmental concerns
OPPORTUNITIES AND THREATS
 External and uncontrollable factors that
should either be capitalized or
mitigated
MARKETING RESEARCH
 Function responsible for acquiring and
evaluating market and consumer-based
information for decision making and
the determination of marketing
strategic direction
 Marketing research is indispensable .
 Marketing research provides companies
information after a product is
purchased
THE PURPOSE AND IMPORTANCE OF
MARKETING RESEARCH
THE FOLLOWING ARE SOME OF THE ISSUES THAT CAN BE
ADDRESSED BY THE MARKETING RESEARCH;

• Identify variable new products and services

• Enable risk reduction
• Identify market opportunities and threats
• Determine the level of customer satisfaction
• Pinpoint and anticipate market trends or changes
• Decide on the best advertising medium
• Pre-test and post-test advertising and promotional
campaigns
• Evaluate the results of test marketing
• Evaluate the results of packaging , brand name , and
label testing
• Determine consumer price awareness and sensitivity
• Undertake location studies
STEPS IN THE MARKETING RESEARCH PROCESS

 1.Research need determination

 2.Problem/opportunity definition
 3.Establishment of research objectives
 4.Research design determination
 5.Information sources / types
identification
 6.Determination of data access
methods
STEPS IN MARKETING RESEARCH PROCESS

 7.Data collection forms design

 8.Sample size and sampling plan
determination
 9.Data collection
 10.Data analysis
 11.Report preparation and presentation
STEP 1:RESEARCH NEED DETERMINATION
 This initial step in the marketing
research process is necessary in order
to save effort , time , and cost.
STEP 2:PROBLEM/ OPPORTUNITY DEFINITION

 Both problems and opportunities can

be subjects of marketing research .
STEP 3: ESTABLISHMENT OF RESEARCH OBJECTIVES

 The purpose of research objectives is to

gather precise information to address
information gaps.
STEP 4:RESEARCH DESIGN DETERMINATION

 At this step , methods and procedures

for the collection and analysis of
information must be determined.
4 MAJOR TYPES OF MARKET RESEARCH DESIGNS

 Observational
 Experimental
 Qualitative
 Quantitative
OBSERVATIONAL
 Social phenomenon is observed in its
natural setting , and observations can
be made any one time or regularly
within a period of time
EXPERIMENTAL
 Includes laboratory experiments and
test marketing .
 Results from two sets of samples are
compared.
 QUALITATIVE
 Includes focus groups , in-depth
interviews , and projective techniques .
 This type of research uses only a small
number of respondents .
 Thus ,results are not reflective of the
general population
QUANTITATIVE
 One example of this type of research is
the use of surveys .
 It is used to test observations .
 The number of respondents is relatively
large and randomly selected, and the
results are generally reflective of the
population.
STEP 5: INFORMATION SOURCE / TYPE IDENTIFICATION

 The two basic types of information

utilized in market research are primary
and secondary information
 TYPES OF INFORMATION

 Primary or secondary information

 Internal data
 Focus groups
PRIMARY INFORMATION

 Refers to the data gathered by the

researcher himself/ herself for the
specific research problem
SECONDARY INFORMATION
 It is information acquired from
previously conducted researches,
journals, periodicals, and other similar
sources.
INTERNAL DATA
 The information collected from
company records
FOCUS GROUPS
 Focused group discussion or fgd
 It is a marketing research tool that
involves a small group of people
STEP 6: DETERMINATION OF DATA ACCESS METHODS
TYPES OF SURVEYS
 Person-administered surveys
 Computer-administered surveys
 Self-administered surveys
 Hybrid surveys
 PERSON ADMINISTERED SURVEY

 It is the most popular ways of data

access in consumer surveys is through
person-administered surveys.
 This could either be administered
through face to face or telephone
interviews
 COMPUTER-ADMINISTERED SURVEYS
 It is faster method of data access
 This method likewise benefits from the
elimination of the need for time
consuming data tabulation , as
computers can generate this
information in real time.
 SELF-ADMINISTERED SURVEYS
 Where the respondents complete the
surveys on their own .
 This is a relatively inexpensive method
but may suffer from lack of respondent
control, among others.
 HYBRID
 It utilizes multiple data method
 This method is rather complex to
develop and administer.
STEP 7: DATA COLLECTION FORMS DESIGN
 The survey questionnaire ,which is the
most common form used in data
collection , must be carefully and
meticulously prepared.
 SURVEY MAJOR PARTS

 Introduction
 Screening
 Core
 Classification
 INTRODUCTION

 Contains a greeting , introduction ,

research introduction and affiliation,
purpose, and a statement assuring the
respondent of confidentially /
anonymity
 SCREENING

 Are the series of questions designed to

eliminate respondents who are not
qualified to take part in the survey.
 CORE
 The body of survey questionnaire
CLASSIFICATION
 Questions used to classify respondents
into different groups for stratification
and analysis purposes .
 TYPES OF QUESTIONS
 Categorical response questions
Dual choice
Multiple choice
 Open-end questions
 Metric questions
 CATEGORICAL RESPONSE QUESTIONS
 Questions where answer options are
provided.
 2 types of categorical response
questions
 Dual choice>> where there are only two
choices of answers, usually “yes” or “no”
 Multiple choice>> where there are three or
more choices of answer
 OPEN-END QUESTIONS
 A respondent can answer these
questions in his/her own words
 METRIC QUESTIONS
 Questions which require respondents to
answer using a number on a scale
developed by the researcher
STEP 8: SAMPLE SIZE AND SAMPLING PLAN DETERMINATION

 It is ideal to give questionnaires to

every member of the target population.
This type of survey is called a census
 SAMPLE SIZE

 Is determined using three variables :

 Confidence level
 Variability
 Margin of error
SAMPLING PLAN
 After sample size has been calculated ,
the sampling plan
 Sampling methodology can either be
nonprobability or probability-based
 NONPROBABILITY SAMPLING
 Does not involve probabilities. All the
members of the survey population don
not have equal chances of being
selected to be part of the sample
SAMPLING METHODOLOGY
 Sampling size  Sampling plan

 Non probability:  Probability:

 Conventional  Simple random

sampling sampling
 Judgment sampling  Cluster sampling
 Referral sampling  Stratified sampling
 Quota sampling
TYPES OF NONPROBABILITY SAMPLING
 Convenience sampling
 Judgment sampling
 Referral sampling
 Quota sampling
 CONVENIENCE SAMPLING
 When the researcher arbitrarily selects
relatives, friends, and/or classmates ,
etc., to be given survey questionnaires.
 JUDGMENT SAMPLING
 The researcher gives survey
questionnaires to individuals who in
his/her judgment , are qualified to
participate in the survey.
REFERRAL SAMPLING
 The researcher ask initial respondents
to provide other qualified respondents
for the surveys
 QUOTA SAMPLING
 When the researcher specifies the
proportions of various classifications to
be included in the survey .
PROBABILITY SAMPLING
 Methods utilize the principles of
randomness .
 Randomness is when every member of
the survey population has an equal
non-zero chance of being selected as
part of the sample.
PROBABILITY SAMPLING
 Simple random sampling
 Systematic sampling
 Cluster sampling
 Stratefied sampling
SIMPLE RANDOM SAMPLING
 When the researcher selects survey
respondents so that each member of
the population has an identical chance
of being chosen to be included in the
sample
SYSTEMATIC SAMPLING
 A probability sampling method where
the researcher selects respondents
using a sampling frame ,a random
starting point , and a skip interval .
 CLUSTER SAMPLING
 Sampling method where the survey
population is divided into subgroups ,
each of which represents the entire
survey population
 STRATEFIED SAMPLING
 Where the survey population is divided
into subgroups , and proportional
samples from all the subgroups are
included in the sample using the
principle of randomness.
STEP 9: DATA COLLECTION
 This is the stage in the process where
the questionnaire are administered to
the selected respondents.
STEP 10. DATA ANALYSIS
 At this stage, collected data is
summarized and generalized.
STEP 11. REPORT PREPARATION AND PRESENTATION

 The last step in the marketing research

process is the preparation and
presentation of the report findings ,
interpretations, conclusion ,and
recommendations to the marketing
decision maker.
MAKING MARKETING RESEARCH-BASED DECISIONS

 Marketing research reports include a lot

of information that can aid
organizations in making effective
marketing decisions , rather than
resorting to unsupported “gut feel”
decisions.
MAKING MARKETING RESEARCH-BASED DECISION
 External factor research
 Observation research
 Test marketing
 Target market studies
 Concept ,product development , and product
studies
 Pricing test
 Location studies
 Advertising pre- and post- testing
 Usage, attitude , and image studies
EXTERNAL FACTOR RESEARCH
 The information from these researches
helps marketers identify
macroenvironmental shifts.
OBSERVATION RESEARCH
 This is an invaluable aid in determining
consumer behavior
TEST MARKETING
 Based on test marketing results, the
company shall gauge the acceptability
of a proposed product/service .
TARGET MARKET STUDIES
 These help to identify , quantify, and
understand the target market better.
CONCEPT, PRODUCT DEVELOPMENT AND PRODUCT STUDIES

 Using the results that generated by

concept, product development, and
product studies , marketing
organizations shall select the proposed
product /service concepts that have the
highest level of market acceptance.
PRICING TEST
 It can be utilized by marketers to
calculate a product’s or service’s
optimal price, to determine price
elasticity , or to determine how price
adjustments can affect total demand
for the product or service
LOCATION STUDIES
 It determines ideal retail store locations
and is a valuable tool in the site
selection.
ADVERTISING PRE- AND POST-TESTING
 These test can determine advertising
copy effectiveness , advertising recalls,
sales promotion response rates,
outdoor advertising traffic results, and
the effectiveness of public relations
media placement.
USAGE, ATTITUDE, AND IMAGE STUDIES
 These studies can provide cost-
effective ways on how to increase a
products/services awareness level and
brand trial
CONSUMER AND ORGANIZATIONAL MARKETS

 Businesses offer products/services to

both consumer and organizational
markets .
CONSUMER MARKETS
 Individual and/or households who
purchase products and services for
personal consumption
THE CONSUMER BUYING PROCESS
 Outlines the steps a consumer goes
through when buying a product/service.
THE CONSUMER BUYING PROCESS

problem Alternative
Information
/need s
search
recognition evaluations

Post-
Purchase
purchase
decision
behavior
STEP 1 :PROBLEM/NEED RECOGNITION
 This initial steps in the consumer
buying process is the most important of
all because the failure of a consumer to
recognize a need or problem will not
result in any sale.
STEP 2: INFORMATION SEARCH
 The consumer will search for ways to
address the need or solve the problem
STEP 3:ALTERNATIVES EVALUATION
 The consumer compares the
attributes , features, and selling prices
of the various brands of
products/services capable of
addressing his/her recognized need or
solving his/her problem.
STEP 4:PURCHASE DECISIONS
 It can still be disrupted by external
circumstances or factors such as
quality of the actual shopping
experience .
STEP 5:POST-PURCHASE BEHAVIOR
 The consumer shall make a judgment
of the product /service ability to satisfy
his/her recognized need or problem .
CONSUMER BUYING ROLES
 Initiator
 Influencer
 Decider
 Buyer
 User
INITIATOR
 Person who initially suggests buying a
particular product/service.
INFLUENCER
 Person who tries to convince others of
the need for the product /service and
influences the purchase decision.
DECIDER
 The person who makes the final
decision or makes the final decision on
any product/service components such
as what to buy , how to buy, where to
buy, etc,.
BUYER
 The person who makes the actual
purchase.
USER
 The person who actually uses the
product/services whether or not he/she
was involved in the buying decision .
CONSUMER MARKET AND BUYING BEHAVIOR

 Marketing stimuli refer to the elements

of the marketing mix , oftentimes
referred to as the four P’s:
 Product
 Price
 Place
 Promotion
CONSUMER BEHAVIOR MODEL

PURCHASE
MARKETING CONSUMER DECISION
INPUTS
PRODUCT CHOICE
PRODUCT BRAND CHOICE
PRICE PSYCHOLOGI LOCATION CHOICE
PLACE CAL INPUTS PURCHASE TIMING
PROMOTION PURCHASE AMOUNT
CULTURE PURCHASE
ATTITUDE FREQUENCY
LEARNING
PERCEPTION
CONSUMER CULTURAL FACTORS
 Culture
 Subculture
 Social Class
CULTURAL
 Characteristics particularly play a large
role in consumer interest and eventual
purchase.
SUBCULTURAL
 Factors are minutes part of ones culture
that provide specific identification of its
members .
SOCIAL CLASS
 Is a status hierarchy in which
individuals and groups are classified
through economic success and
accumulation of wealth.
CONSUMER SOCIAL FACTORS
 Reference Groups
 Aspirational Groups
 Role and Status
 REFERENCE GROUPS
 Includes individuals or groups that
influence consumer opinions ,beliefs
,attitudes, and behaviors .
 ASPIRATIONAL GROUPS
 Groups that a person currently does not
belong to but wishes to belong to or to
be associated with it.
 FAMILY
 An even stronger influence on buyer
behavior
BUYER CHARACTERISTICS INFLUENCING PURCHASE BEHAVIOR

bu
ye
r
Psychologica
l

personal

social

cultural
CONSUMER PERSONAL FACTORS
 Age & Life Cycle
 Occupation
 Economic Capability
 Lifestyle
 Personality
PERSONAL FACTORS
 Also plays a sizeable influence in his
buying behavior.
A STAGES OF A FAMILY’S LIFE CYCLE
1. Bachelor/ Bachelorette stage
2. Young, newly married couple with no children
3. Married couple , with eldest child below
elementary school age
4. Married couple , with youngest child six years
old and young
5. Older married couple, family head still working,
all children living on their own
6. Widow /widower, in labor force
7. Widow /widower ,retired
 OCCUPATION
 Also plays an important indicator in the
products and services he/she
purchases.
 ECONOMIC CAPABILITY
 It is evident that individuals need
money to purchase goods and services.
 LIFESTYLE
 Is defined as a manner of living that
reflects a person’s values and
attitudes.
 PERSONALITY
 Refers to individual differences in
characteristics patterns of thinking ,
feeling, and behaving.
CONSUMER PSYCHOLOGICAL FACTORS
 Motivation
 Perception
 Learning
 Beliefs & Attitude
 MOTIVATION

 Addresses the issue of why a consumer

buys a product or what needs he is
trying to satisfy
ABRAHAM MASLOW’S HIERARCHY OF NEEDS
Sel
f-
act
ual
iza
tio
Esteem
n

social

safety

physiological
 PERCEPTION
 Is the process by which people
translate sensory impressions into a
coherent and unified view of the world
around them
 3 PERPETUAL PROCESSES GUIDE AN INDIVIDUAL PERCEPTION

 Selective attention
 Selective distortion
 Selective retention
 LEARNING
 Is a relatively lasting change in
behavior that is the result of
experience.
 BELIEF AND ATTITUDES

 Belief >>it is defined as confidence in

the truth or existence of something not
immediately susceptible to rigorous
proof.
 Attitudes >> is a settled way of feeling
about someone or something typically
one that is reflected in a person’s
behavior.
ORGANIZATIONAL MARKETS
 All the individuals and companies who
purchase goods and services for some
use other than personal consumption
3 TYPES OF ORGANIZATIONAL MARKETS
 Industries
 Resellers
 Government
INDUSTRIES
 Are business organizations that
purchase goods and services for the
purpose of producing other products
and services or for use in their
production and operating processes
RESELLERS
 Are entities that buy goods and
services in order to resell them at a
profit
GOVERNMENT
 Comprise of agencies or government
units at all levels that purchase good
and services for the purpose of
producing public services or to transfer
them to third parties that need them.
3 TYPES OF ORGANIZATIONAL BUYING DECISIONS

 New task
 Straight rebuy
 Modified rebuy
NEW TASK
 Involves the purchase of products or
services that the organization has
never bought before ,or has not
purchased for a long period of time .
STRAIGHT REBUY
 Pertain to organizational purchases
which have exactly the same
specifications as previously purchased
MODIFIED REBUY
 This can be a rebuy with some change
in specifications
ORGANIZATIONAL BUYING ROLES
 Users
 Influencers
 Deciders
 Buyers
 Gatekeepers
USERS
 Usually initiate the organizational
buying process after having identified a
specific need in their department
INFLUENCERS
 Are the individuals within the
organization that influence the
purchase decision.
DECIDER
 Are parties who are empowered to
make the purchase decision with
regards to product specifications
selection of supplier.
APPROVERS
 Are individuals in higher level
management who oversee the
purchase decisions of the deciders and
buyers and who grant final approval on
the purchase
BUYERS
 Are responsible for the actual
purchase .
GATEKEEPERS
 Are individuals whose positions allow
them to screen and/or prevent supplier
representatives and vital
products/services information from
reaching participants who perform roles
in the organizational buying decisions ;
in some instances , they may actually
implicity favor one supplier over
another.
ORGANIZATIONAL SEGMENTATION VARIABLES

 Industry affiliation
 Organizational size
 Geographic location
 End-use application
INDUSTRY AFFILIATION
 Organizations can be segmented by
industry affiliation, or based on a
company’s primary business activity
ORGANIZATIONAL SIZE
 Can be determined through different
ways ;
 Amount of capitalization
 Number of employees
 Annual sales revenues
GEOGRAPHIC LOCATION
 In order to not dissipate setting
capabilities and also to reduce travel
and logistics cost, some supply
companies segment organizational
markets by geographic location
END-USE APPLICATION
 Refers to the way a product is used by
a purchasing company on firm.
MARKET SEGMENTATION
 Is a process of dividing the market into
homogeneous parts or groups.
CONSUMER SEGMENTATION VARIABLES
 Geographic
 Demographic
 Psychographic
 behaviorgraphic
GEOGRAPHIC
 Pertains to where the population is
located
 Subvariables;
 Region
 Density
 Climate
DEMOGRAPHIC
 Refers to the general characteristics of the
population
 Subvariables;
 Gender
 Age
 Income
 Population
 Education
 Civil status
 Religion
 Nationality
 Race
 Family size
PSYCHOLOGICAL
 These are variables that represent the
psychological profile of consumers
 Subvariables;
 Lifestyle
 Personality
 Social class
 User status
 Usage rate
 Loyalty status
 Benefits sought
BEHAVIORGRAPHIC
 Is the segmentation variable most
indicative of purchase behavior.
TARGET MARKET
 Target market of a product or services
is defined as its most probable and
most logical consumers, and may
likewise be its heaviest consumer.
ELLEMENTS OF AN IDEAL TARGET MARKET
 Substantial
 Financially capable
 Reachable
 Homogeneous
SUBSTANTIAL
 The selected target market must be
large enough in terms of quantity
and/or total consumption capability.
THE ORGANIZATION CAN EITHER:
 A. Expand its target market to include
other segment brackets previously not
targeted .
 B. Expand its target market by reducing
the number of subvariables
 C. Combination of the two options
THE TARGET MARKET SHOULD IDEALLY BE;
 Financially capable
 Reachable
 Homogeneous
FINANCIALLY CAPABLE
 Must have financial means to afford the
purchase price of the product /services
REACHABLE
 Must be within physical reach to permit
product distribution it should also be
reachable by various marketing
activities
HOMOGENEOUS
 Similarly to specific marketing stimuli
is an ideal target market
TARGET MARKET VS CONSUMING MARKET
COMPANY’S TARGET MARKET
 Is the group of individuals with specific
characteristics to whom the company
has decided to focus its marketing
efforts
CONSUMING MARKET
 Comprise the actual consumers of the
product /sevice.
POSITIONING
 Is the process of communicating the
image of a brand into the minds of
consumer.
ELEMENTS OF A GOOD BRAND POSITION
 Unique
 Beneficial
 Credible
UNIQUE
 A brand must select a position that is
not currently occupied by another
brand.
BENEFICIAL
 The selected position must be
perceived by its customers as
beneficial.
CREDIBLE
 Once a brand position is selected, it
must ensure that it is performs and
fulfills the promise of its position .
SELECTING A GOOD BRAND POSITION
PERCEPTUAL MAPPING
 Involves the identification of a
competitive brand’s position using two
variables or axis.
COMMUNICATING BRAND POSITION
 The brand position of a product or
service must be consistent and
communicative effectively to its target
market.
COMMUNICATING BRAND POSITION
 Packaging
 Labeling
 Selling price
 Advertising
 Brand endorser
 Tagline
IDENTIFYING AND SELECTING COMPETITIVE ADVANTAGE

 Competitive advantage- superiority an

organization over its competitors
 3 major types of competitive
advantage
 Cost advantage
 Differential advantage
 Focus advantage
COST ADVANTAGE
 Results when a firm has the ability to
produce a product or service at a lower
cost compared to its competitors .
DIFFERENTIAL ADVANTAGE
 When a company knows its target
market very well, and can service its
needs better than any of its
competitors.