Selecting a Target Market

The outcome of the segmentation analysis will reveal the market opportunities available. The next phase in the target marketing process involves two steps: (1) determining how many segments to enter and (2) determining which segments offer the most potential.

Determining How Many Segments to Enter Three market coverage alternatives are available. Undifferentiated marketing involves ignoring segment differences and offering just one product or service to the entire market. For example, when Henry Ford brought out the first assembly-line automobile, all potential consumers were offered the same basic product: a black Ford. For many years, Coca-Cola offered only one product version. While this standardized strategy saves the company money, it does not allow the opportunity to offer different versions of the product to different markets.

Differentiated marketing involves marketing in a number of segments, developing separate marketing strategies for each. The Viagra ads in Exhibit 2-10 reflect this strategy. Notice how the two ads differ given alternate target markets and media.

Exhibit 2-10 Viagra uses different appeals for the same product in different segments

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