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Customer-Driven Marketing Strategy: Creating Value for ... driven marketing strategy: market segmentation, targeting, and positioning.!List and distinguish among the requirements for

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    Field trip Next week Hotel tour at Marriott Marquis Punctuality: 12 pm – 2 pm Address: 1535 Broadway, New York, NY 10036 Faculty Contact: 616-580-4121 Professional dress

    Homework due on Nov 19 Take VALS Survey & Bring the survey results


    Customer-Driven Marketing Strategy: Creating Value for Target Customers

    HMGT 2405│Hospitality Marketing

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    ! Define the major steps in designing a customer- driven marketing strategy: market segmentation, targeting, and positioning.

    ! List and distinguish among the requirements for effective segmentation.

    ! Explain how companies identify attractive market segments and choose a market-targeting strategy.

    ! Illustrate the concept of positioning for competitive advantage.


    It is a place where….

    potential buyers and sellers meet

    to exchange goods and services.

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    What is Market Segmentation

    Coca Cola Brands

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    Market Segmentation

    Market Segmentation is pursuing a marketing strategy whereby the total potential market is divided into homogeneous subsets of customers, each of which responds differently to the marketing mix of the organization.

    Target Marketing

    Market Segmentation

    Market Targeting

    Market Positioning

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    Positioning, Segmentation & Differentiation

    Market Segmentation Group A

    Group B

    Group C

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    Market Segmentation Variables

    • country, region, state, zip codeGeographic

    • age, income, occupation, family sizeDemographic

    • AIO (attitudes-interests-opinions), lifestyle, hobbies, knowledge,Psychographic

    • occasion, benefits sought, user status, usage rate, loyalty statusBehavioral

    Criteria for Effective Market Segmentation

    Substantiality – large enough to warrant attention Measurability – potential demand and purchasing

    power Accessibility – can reach segments with a variety

    of communications Actionability – consumers in same segment should

    react similarly to marketing program

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    Market Segmentation Decision Process

    Identify segmentation bases Develop profiles for each segment Forecast potential demand Select specific target market segments

    Market Segmentation Strategies

    Mass-market strategy – one product-services mix for all potential customers

    Differentiated strategy – more than one market segment with a separate marketing program for each

    Concentrated strategy – one (or a few) market segments with limited changes in the marketing program

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    Evaluating Market Segments

    Size & Growth

    Structural Attractive-


    Company Objectives & Resources

    Micromarketing: Local & Niche MKT.


    Selecting Market Segments

    Undifferentiated Differentiated Marketing Strategies

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    Niche Market

    What is Positioning?

    The term ‘positioning’ refers to the consumer’s perception of a product or service in relation to its competitors. You need to ask yourself, what is the position of the product in the mind of the consumer?

    The process of determining how to differentiate a firm’s product offerings from those of its competitors in the minds of consumers

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    Perceived Price Four Seasons


    Sheraton Marriott

    Holiday Inn Low High

    Perceived Quality Hampton Inn Days Inn


    Motel 6


    Figure 4.4 Perceptual Map for Hotel Service

    The Positioning Process

    Four Steps in the Positioning Process wDetermine the ideal mix for consumers wMeasure consumer perceptions of available

    services wLook for gaps in coverage and select a desired

    position wDevelop a strategy for obtaining the desired


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    Step 1 - Determine the ideal mix for consumers

    Type of Firm List of Attributes Restaurant Price, value, quality of food, type of food, service quality, menu

    variety, employee friendliness, location, atmosphere, speed of service, cleanliness, parking

    Hotel Price, value, room quality, restaurant quality, location, number and types of restaurants, other facilities (e.g., pool and fitness center), cleanliness, atmosphere, employee friendliness, speed of check-in and check-out, amenities (e.g., valet parking and room service), service quality

    Airline Price, value, service quality, employee friendliness, on-time performance, baggage handling, direct routes, cities served, scheduled flights, frequent flyer programs

    Rental Car Company

    Price. value, service quality, convenience, location, types of cars, condition of cars, speed of service, pick-up and drop-off policies

    Step 2 - Measure consumer perceptions

    Potential benefits Our Operation Competitor A Competitor B Value for price

    Quality of food

    Quality of service



    Menu variety

    Perceptual mapping - A technique used to construct a graphic representation of how consumers in a market perceive a competing set of products relative to each other

    Table 4.3 Competitive Benefit Matrix

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    Step 3 - Look for gaps in coverage and select a desired position

    Positioning statement - Results from consumer research and perceptual mapping enable firms to develop a positioning statement. The positioning statement should differentiate the organization’s product–service mix from that of the competition

    Unique selling proposition (USP) - Promoting a unique element of the product–service mix

    Step 4 - Develop a strategy for obtaining the desired position

    Guidelines for Developing Positioning Strategies

    wWhat position do you own? wWhat position do you want? wWho must you outgun? wDo you have enough money? wCan you stick it out? wDo you match your position?

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    Positioning Strategy

    Identifying Competitive Advantages

    Selecting Competitive Advantages

    Effectively Communicate

    Chosen Position

    Differentiating Competitive Advantages

    Management Orientations

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    Positioning Errors


    Over- Positioning

    Confused Positioning

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