02 Fundamental of Business Enterprise Simulation

FUNDAMENTAL OF
BUSINESS ENTERPRISE
SIMULATION
BUSINESS ENTERPRISE SIMULATION
The Target Marketing and the Market STP
(Segmentation, Targeting, And Positioning)
 Target Market the process

of breaking a market into
several segments and then
choosing and focusing the
marketing efforts to the
selected segment or
segments.
Basic steps
 Market segmentation the market is divided
into distinct groups or segments of consumers
or buyers.
 Market targeting the marketers select one or
a few key segments of the markets that will
receive the marketing efforts of the company.
 Market Positioning the companies decide
what position does the product or services will
occupy in the segments and create detailed
marketing mix.
MASS MARKETING vs. SEGMENT
MARKETING
Marketers merchandise a The market is

product or service to immense divided into
numbers of customers without
distinct groups or
consideration of their
differences in the perceived segments of
needs and how they will consumers or
respond to the marketing buyers.
efforts.
Advantages of segment
 The companiesmarketing:
will be able to promote the brand
more strategic by aiming for consumers who can
be served best.
 The companies will be able to merchandise the
brand effectively by enhancing its approach to
match the needs of the chosen segments of the
market.
 The companies will be able to find competitive
advantage in the market by serving the segments
that are not yet served by the competitors.
Appreciating Market
Segmentation
There are four (4) basic ways to do consumer market segmentation
 Geographic Psychographic segmentation

Segmentation Behavioral Segmentation
 Demographic - Occasion segmentation
Segmentation - Benefits segmentation
- User rates
- Age and life-cycle - User Status
segmentation - Loyalty Status
- Gender
segmentation
- Income
Geographic Segmentation
 the market is divided
into several
geographical units
such as continental,
national, regional,
cities, municipals, and
barangays.
NATIONALIT
NNTTYLAIA AREC
RACE
OI
Y AGE
GAE
DEMOGRAPHIC
EDUCATIO
AEIOUCDN
N SEGMENTATIO EEDGN
GENDE
T
N R
RELIGIO
GNLRII MLFYIA
FAMILY FAMILY
LAYIMF
N
OE LIFE
FELI SIZE
ZIES
CYCLE
LYECC
These factors are widely used bases for segmenting
consumer groups. It is also said that demographic
variables are easier to measure than most other
types of variables.
DEMOGRAPHIC
SEGMENTATION
 Age and life-cycle
segmentation marketers must
guard against stereotypes when
using this form of segmentation.
DEMOGRAPHIC
SEGMENTATION
 Gender segmentation
this segmentation form has
long been used for clothing,
cosmetics, toiletries, and
magazines.
DEMOGRAPHIC
SEGMENTATION
 Income segmentation this
form of segmentation has
long been used by marketers
for condominium units, cars,
clothing, cosmetics, hair
salon services, and travel.
PSYCHOGRAPHIC
SEGMENTATION
the market is divided into various segments
according to social class, lifestyle, and
personality characteristics.
 a. social class-class A, class B, upper C,
broad C, D, E
 b. lifestyle-achiever, career driven, family
focused
 c. personality-ambitious, impulsive,
passive, domineering
BEHAVIORAL
SEGMENTATION
It involves dividing a market into
groups based on consumer
knowledge, attitudes, uses, or
responses to a product. Many
marketers believe that behavior
variables are the best starting
point for building market
segments.
BEHAVIORAL
SEGMENTATION
Occasion segmentation consist of
dividing the market into groups according
to occasions when buyers get the idea to
buy.
 Benefits segmentation involves
dividing the market into groups according
to the different benefits the consumer
seeks from the product.
BEHAVIORAL
SEGMENTATION
 User rates light user, moderate
user, heavy user
 User Status – nonusers, possible
user, first time user, rare user,
seasonal user, regular user (brand)
 Loyalty Status – completely loyal,
somewhat loyal, not loyal at all.
Comprehending Market
Targeting
Three factors to consider in
evaluating market segments
 The segment size and growth
 The segment structural
attractiveness
 Examining the company’s
objectives and resources
The Segment size and
growth
 The company must gather and
examine the data on present
sales, projected sales rates, and
expected gains for various
segments.
The Segment Structural
Attractiveness
There are some major structural elements
that affect the segment attractiveness in
the long run.
 The competition (the present and
possible competitors)
 The substitute products that can be
potential threat to the brand
 The buyer’s and supplier’s relative power
Examining the Company’s
Objectives and Resources
 The company’s objectives

and resources should
harmonize with the
opportunity that the
identified segments bring.
Companies may utilize one of the 3
strategies in selecting a target market.
 Undifferentiated Marketing is
a strategy used in covering the
market by ignoring the market
segment distinctions and pursue
the entire market with a single
offer.
 Differentiated Marketing is a
strategy used to cover the
market by which companies
choose several segments in the
market and create a specific
offer for each.
 Concentrated Marketing
is a strategy in which
companies pursue a high
share of one or few sub
makers.
Considerations that a marketer must take
into consideration in choosing strategy:
 Resources of the company

concentrated marketing is very useful if
the company’s resources are limited.
 Variability of the product
undifferentiated marketing is suitable if
there is standardization and differentiated
marketing is appropriate if there is
variance.
 Product’s stage in the life cycle

undifferentiated marketing or
concentrated marketing maybe proper
to use in the beginning stage if limited
product offering are used and
differentiated marketing may be utilized
if the product offerings in the later stage
are expanded.
 Variability in the market

undifferentiated market can be used if
the tastes of the market are the same.
 Marketing strategies of the
competitors companies must be
cautious on how competitors segment
their market.
Identifying Position
Strategies
Product Position the way the
brand is defined by customers on
important attributes the place the
product occupies in consumers’
minds relative to competing
products.
Three Basic Steps in
Positioning Strategy
 Competitive advantage
 Choosing the right competitive
edge
 Choosing a comprehensive
positioning strategy
Competitive advantage the
advantage of the company or brand
over its competitors by providing
customers with a greater value such
as lower prices or unmatched benefits
that rationalize the competitive edge.
Choosing the right
competitive edge in this step,
the companies need to decide on
the number of differences that
they should promote.
Choosing a comprehensive
positioning strategy after
determining the desired
positioning of the brand, it needs
to be disseminated to the target
consumers.
Brand Positioning
Strategies:
 More for more positioning
involves providing the most
upscale product or service
and charging a higher price
to cover the higher costs.
Brand Positioning
Strategies:
 More for the same positioning
is useful in attacking competitors
using more-for-more positioning
by introducing brand offering
comparable quality at a lower
price.
Brand Positioning
Strategies:
 Same for less positioning can
be powerful value proposition.
Companies using this positioning
may offer deep discounts based
on superior power and lower-
cost operations.
Brand Positioning
Strategies:
 Less-for-much-less
positioning involves
meeting consumers’ lower
performance or quality
requirements at a lower
price.


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FUNDAMENTAL OF

 Target Market the process

Marketers merchandise a The market is

 Geographic Psychographic segmentation

 The company’s objectives

 Resources of the company

 Product’s stage in the life cycle

 Variability in the market

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