INTERNET SEGMENTS MKTG 476 Segmentation Internet segments The

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INTERNET SEGMENTS ¡ ¡ ¡ MKTG 476 Segmentation Internet segments The “Digital Divide” Online

INTERNET SEGMENTS ¡ ¡ ¡ MKTG 476 Segmentation Internet segments The “Digital Divide” Online activities Consequences of Internet use SEGMENTS Lars Perner, Instructor 1

Definition Although not all these consumers are completely alike, they share relatively similar needs

Definition Although not all these consumers are completely alike, they share relatively similar needs and wants Marketing action: involves efforts, resources, and decisions--product, distribution, promotion, and price MKTG 476 SEGMENTS Segmentation: “Aggregating prospective buyers into groups that (1) have common needs and (2) will respond similarly to a marketing action. ” Lars Perner, Instructor 2

Approaches to Marketing ¡ Undifferentiated Strategy (no intended difference from competitors; no specific consumer

Approaches to Marketing ¡ Undifferentiated Strategy (no intended difference from competitors; no specific consumer group sought out) l l Southwest Airlines ¡ Concentrated Strategy (differentiation; one consumer segment sought) l ¡ MKTG 476 E. g. , AOL: Easy to use; protection Differentiated Strategy (same firm makes different versions for different segments) l Auto makers Generic, local Internet access Generic information web page E. g. , Yahoo! offers different types of email access and information access to different customers SEGMENTS Lars Perner, Instructor 3

Example ¡ Internet access l l l MKTG 476 Casual, price sensitive user: Cost

Example ¡ Internet access l l l MKTG 476 Casual, price sensitive user: Cost is most important; speed less so will probably choose generic dial-up Casual user, ease of use: Ease of use is more important; will pay for ease may choose AOL dial-up Heavy user: May choose broadband Moderate user: Will choose broadband only if the price is low enough Traveler: Must have access both at home and while on the road (dial-up or wireless) SEGMENTS Lars Perner, Instructor 4

Bases for Segmentation ¡ Buyer/consumer characteristics l l l Demographics User type Lifestyle Behavior

Bases for Segmentation ¡ Buyer/consumer characteristics l l l Demographics User type Lifestyle Behavior ¡ Situation ¡ Benefit desired ¡ MKTG 476 SEGMENTS Lars Perner, Instructor 5

Positioning Strategies ¡ “Head-on” competition l ¡ Differentiation l l MKTG 476 Net Zero:

Positioning Strategies ¡ “Head-on” competition l ¡ Differentiation l l MKTG 476 Net Zero: Offers access comparable to AOL but at a lower cost AOL: Ease of use, differentiation Google: Large free e-mail account but must accept advertising SEGMENTS Lars Perner, Instructor 6

Segments must Be relatively similar within and differ between ¡ Respond similarly to different

Segments must Be relatively similar within and differ between ¡ Respond similarly to different “treatments” (e. g. , product offerings, prices, options) ¡ Be practically serviceable ¡ l l MKTG 476 Service must be feasible Segment must be large enough to be profitable SEGMENTS Lars Perner, Instructor 7

Targeting: Selecting Segment(s) and Specializing ¡ ¡ ¡ “You can’t be all things to

Targeting: Selecting Segment(s) and Specializing ¡ ¡ ¡ “You can’t be all things to all people” ---> choose one or more groups Focus narrows scope of competition, but demands are greater Repositioning: Changing established position may be Good sales; difficult -- e. g. , poor everyday l l MKTG 476 Sears Mc. Donald values Lunch; not dinner Good for children SEGMENTS Lars Perner, Instructor 8

Enterprise Segments ¡ Businesses l l ¡ Large Small Non-business l Public sector Government

Enterprise Segments ¡ Businesses l l ¡ Large Small Non-business l Public sector Government ¡ Educational ¡ l MKTG 476 Non-profit organizations SEGMENTS Lars Perner, Instructor 9

The “Digital Divide” ¡ Is the Internet an “equalizer” or another obstacle for the

The “Digital Divide” ¡ Is the Internet an “equalizer” or another obstacle for the disadvantaged? l l l ¡ MKTG 476 U. S. Europe Developing countries Cultural issues in Internet use SEGMENTS Lars Perner, Instructor 10

High growth rate activities Consumer Internet Behavior ¡ ¡ ¡ E-mail Instant messaging Information

High growth rate activities Consumer Internet Behavior ¡ ¡ ¡ E-mail Instant messaging Information search l l ¡ Work-related Educational Entertainment News File sharing l l l Photos Entertainment Software/data ¡ ¡ ¡ ¡ ¡ Online shopping/purchasing Online banking Travel reservations Online auctions Downloading Hobby information Medical information research e. Government Internet telephony See Siegel, pp. 64 -65 MKTG 476 SEGMENTS Lars Perner, Instructor 11

Possible consequences Social isolation ¡ Internet addiction ¡ Making new contacts ¡ Different types

Possible consequences Social isolation ¡ Internet addiction ¡ Making new contacts ¡ Different types of communication ¡ Activism ¡ MKTG 476 SEGMENTS Lars Perner, Instructor 12