Customer-Driven Marketing

Strategy

Creating Value for

Target Customers

Chapter 7
kotler
 Rest Stop: Previewing the Concepts

1. Define the major steps in designing a customer-

driven marketing strategy: market segmentation,
targeting, differentiation, and positioning.
2. List and discuss the major bases for segmenting
consumer and business markets.
3. Explain how firms identify attractive market
segments and choose a market-targeting strategy.
4. Discuss how companies differentiate and position
their products for maximum competitive
advantage.

Copyright 2011, Pearson Education Inc.

6-2
Publishing as Prentice-Hall
Q.1.Define the major steps in designing a customer-driven strategy: market
segmentation, targeting, differentiation, and positioning.

Answer: Customer driven marketing strategy is a marketing strategy that focuses on

targeting a specific set of customers, retaining them by meeting their needs, and using
metrics to measure their satisfaction.
Q.2. List and discuss the major bases for segmenting consumer and business markets.

Answer:
There is no single way to segment a market. Therefore, consumer and
business marketers use many of the same variables to segment their
markets.

Bases for Segmenting Consumer and Business Markets

Q.3. Explain how firms identify attractive market segments and choose a market-targeting
strategy.

Answer: To target the best market segments, the company first evaluates each segment’s
size and growth characteristics, segment structural attractiveness, and company
objectives & resources. 

It then choose one of four marketing strategies.

Selecting Target Market Segments

 Selecting Target Market Segments

• Targeting strategies include:

– Undifferentiated (mass) marketing:
• Ignores segmentation opportunities.
– Differentiated (segmented) marketing:
• Targets several segments and designs separate offers
for each.
– Concentrated (niche) marketing:
• Targets one or a couple small segments.
– Micromarketing (local or individual marketing)

Copyright 2011, Pearson Education Inc.

6-6
Publishing as Prentice-Hall
Q.4. Discuss how companies differentiate and position their products for maximum competitive
advantage.

Answer: Once a company has decided which segments to enter, it must decide on its
differentiation and positioning strategy. The differentiation and positioning task consists of
three steps:
Q.1. Define product and the major classifications of product and services.
Product include physical object but also places, persons ,experiences, organizations
and information.
 Major classifications of products and services

Product and services fall into two broad classes based on the types of consumers that
use them.
Q.2. Describe the decisions companies make regarding their individual products and
services, productline, product services.
Individual product decisions involve product attributes, branding, packaging, labeling,
and product support services.

Product attribute decisions involve product quality, features, and style and design.
Branding decisions include selecting a brand name and developing a brand strategy.
Packaging provides many key benefits, such as protection,economy,promotion.
Companies also develop product support services that enhance customer service and
satisfaction.
 Product Line Decisions

 Product line refers to a group of same products. Product line decisions refer

to decisions relating to addition or deletion of product from the existing product line
Q.3. Discuss branding strategy the decisions companies make in building and managing their
brands.

Branding consists of a set of complex branding decisions. Major brand strategy decisions
involve brand positioning, brand name selection, brand sponsorship and brand
development. Before going into the four branding decisions, also called brand strategy
decisions, we should clarify what a brand actually is. A brand is a company’s promise to
deliver a specific set of features, benefits, services and experiences consistently to buyers.
However, a brand should rather be understood as a set of perceptions a consumer has
about the products of a particular firm. Therefore, all branding decisions focus on the
consumer.
We will take a close look at each of these four branding decisions
Q.4. Identify the four characteristics that affect the marketing of a service and the additional
marketing considerations that services require.

Answer: The four key characteristics of service businesses are: Intangibility, Inseparability,

Perishability, and Variability.