‘Market segmentation, targeting and positioning’ (STP): Concepts, examples, projects

Market segmentation is the method of dividing a consumer or business market into sub-groups of consumers (known as segments) based on particular traits/characteristics.

Students are commonly asked to do essays, assignments, case studies on Market segmentation.

Examples:

Describe advantages of market segmentation

You are assigned a task to assist a Digital Marketing expert, who is setting up an online course for marketing professionals, fresh graduate and others pan India. Identify and explain the market segments (at least 3) you will recommend. Give example of at least one segment.

Questions & Answers

Management / MBA questions on ‘Market segmentation, targeting and positioning’ (STP):

Question: Discuss segmentation variables such as psychographic, behaviour, realistic geographic and demographic, and apply them to your organisation.
For targeting, please use the DAMP model and apply it to your chosen organisation. How are they targeting a particular consumer, engaging with their customers and working potentially with other businesses? Please discuss a new opportunity that you can look at in terms of your organisation.(new target audience with reasons and explanations).
Please also undertake a positioning or perceptual map and explain why they are in the position they are against their competitors. Also include a visual diagram with the competitors also labelled on this model alongside your own business that you have chosen.
Work on the following activities to support your STP examination:

• Examine the current customer perceptions either via social media, Trust Pilot etc.
• Review the role of the Customer Value Proposition (CVP) and Online Value Proposition (OVP) to be used to support the business.
• Consider application of the Loyalty Ladder to support your analysis, and enhance customer loyalty.
• Make sure to use supporting market research and academic references.

Question: Read the case & answer the questions based on the case: Kia Motors announced that it has opened its first digital showroom in India, moving towards providing digitized services to its customers. The showroom is located in Prabhadevi which is one of the busiest hubs of Mumbai and is equipped with 3D configurators with a digital catalogue, a Heritage Wall, Digital Spec Boards and a media wall.

The showroom is designed to display Kia’s current product portfolio with 3D configuration. The 3D configurator zone in the facility enables the customers to customize and design their favorite Kia cars and witness their intricate details. All the showcased vehicles will be equipped with digital spec boards to share all the relevant information about the product. The content displayed in the showroom is controlled directly by Kia India, providing greater transparency, a sense of security and reliability to the customers.

• a. ‘The 3D configurator zone in the facility enables the customers to customize and design their favorite Kia cars.’ Based on this statement explain which type of targeting strategies is initiated by Kia Motors. Justify your reason.
• b. In your opinion, which segmentation strategy is adopted by Kia Motors?

Q) M/s Kids Corporation is planning to launch its own brand of Dolls across India. The doll will be named Senorita and it will be available in the price range of 600/- to 1400/- Rupees. The doll will be available in major types of profession like Doctor, Lawyer, Teacher, etc. so that it can even inspire girls to go for these careers in future. Design the Segmentation, Targeting and Positioning strategy for Senorita.

Q) BMW, the luxury German car maker, stands for performance and luxury. The company has grown its product line by targeting specific market segments. BMW’s full range of cars includes 1 series, 3 series, 5 series, 6 series, 7 series, X3 SUV, X5 SUV, X6 SUV, Z4 and M. The 7 series was targeted to a group of consumers who were traditional and wealthy. They liked to be showy with flamboyant cars. They didn’t like sporty cars but preferred comfort and luxury, so BMW added electronic features like window controls, airflow, night vision, etc. The X5 was created to target a group of customers who weren’t born in wealthy families but had achieved success recently. They had taken up activities like biking and golf. These customers needed a bigger car for their active lifestyles and big families. Discuss on what dimensions (geographic, psychographic, demographic, behavioral) has BMW segmented and targeted customers for the 7 series and X5 models.

Q) You are the advertising manager for a health food brand. Develop two different ad themes to appeal the consumer on two different levels in the Maslow’s hierarchy for the ad campaign.