Summary

Sellers can take three approaches to a market. Mass marketing is the decision to mass-produce and mass-distribute one product and attempt to attract all kinds of buyers. Target marketing is the decision to identify the different groups that make up a market and to develop products and marketing mixes for selected target markets. Sellers today are moving away from mass marketing and product differentiation towards target marketing because this approach is more helpful in spotting market opportunities and developing more effective products and marketing mixes.

The key steps in target marketing are market segmentation, market targeting and market positioning. Market segmentation is the act of dividing a market into distinct groups of buyers who might merit separate products or marketing mixes. The marketer tries different variables to see which give the best segmentation opportunities. For consumer marketing, the chief segmentation variables are geographic, demographic, psycbographic and behavioural. Business markets segment by business consumer demographics, operating characteristics, buying approaches and personal characteristics. The effectiveness of segmentation analysis depends on finding segments that are measurable, accessible, substantial and actionable.

Next, the seller has to target the best market segments. The company first evaluates each segment's size and growth characteristics, structural attractiveness and compatibility with company resources and objectives, it then chooses one of three market-coverage strategies. The seller can ignore segment differences (undif-ferentiafed marketing), develop different market offers for several segments (differentiated marketing), or go after one or a few market segments (concentrated marketing). Much depends on company resources, product variability, product life-cycle stage and competitive marketing strategies.

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