Define The Marketing Term "target Market." Explain.

CLEANED: Define The marketing term "target market". Explain how bases for segmentation are defined and give a product example of each

1. Define the marketing term "target market".

2. Explain how bases for segmentation are defined and give a product example of each: a) Geographic b) Demographic c) Psychographic d) Benefit e) Usage-rate

3. Explain alternative strategies for selecting target markets: a) Undifferentiated b) Concentrated c) Multisegment

4. Case study "Coke Zero" at the end of chapter 8, questions 1, 2 & 4.

5. Describe what's included in the components of the marketing mix (4 P's). Then choose a product and provide an example for each category based on your product choice: a) Product b) Price c) Promotion d) Place/distribution

6. Why is it important for marketers to position their product? How does it relate to product differentiation? Can a product be repositioned? Case Study Coke Zero Do Real Men Drink Diet Coke? When a couple of marketing managers for Coca-Cola told attorney Elizabeth Finn Johnson that they wanted to sue their Coke Zero colleagues for “taste infringement,” she was baffled. She tried to talk them out of it, but they were determined. They argued that Coca-Cola Classic should be protected from the age discrimination it would suffer with the introduction of a newer, younger soft drink that tasted exactly the same as the original. Frustrated, Finn Johnson held up the Coke can and shouted, “It's not a person! Title VII doesn't cover these things!” What she didn't know was that the marketing managers were actors. Hidden cameras had been planted around the meeting room to capture the reactions of several unsuspecting attorneys who had been asked to consider the case, including an immigration lawyer who was asked if he could get the Coke Zero marketing head deported back to Canada. The short videos were strategically placed on Web sites such as to promote Coke Zero as the hip, new alternative to Diet Coke for men. © Vicki Beaver The Coca-Cola Company knows it has to be creative if it's going to sell more soda after sales dropped two years in a row in 2005 and 2006. Morgan Stanley analyst Bill Pecoriello explains, “Consumers are becoming ever more health-conscious, and the image of regular carbonated soft drinks is deteriorating rapidly.” In an attempt to appeal to consumers concerned with nutrition, Coke introduced Diet Coke Plus in 2007, a sweeter version of Diet Coke fortified with vitamins and minerals. But what they really needed was a way to reach young male consumers, and Diet Coke Plus, marketed with the tagline “Your Best Friend Just Got Friendlier!” wasn't going to do it. A few new products appealed to certain male demographics, such as Coca-Cola Blak, a cola with coffee essence created for older, more sophisticated consumers who are willing to pay more, and Full Throttle Blue Demon, an energy drink with an agave azul flavor (think margaritas) designed to appeal to Hispanic men. However, research showed that there was still a big demographic hole to fill as young men between the ages of 18 and 34 were abandoning the Coca-Cola brand altogether. They didn't want all the calories of regular Coke, but they weren't willing to make the move to Diet Coke, either, which has traditionally been marketed to women who want to lose weight. Katie Bayne, chief marketing officer for Coca-Cola North America, says that the men who weren't put off by the “feminine stigma” of Diet Coke often rejected it anyway because of its aspartame-sweetened aftertaste. “What we were seeing before Zero launched was that more and more younger people were interested in no-calorie beverages but weren't going to sacrifice taste,” Bayne said. “So when they got interested in no-calorie, they were like, ‘Forget it, I'm not going to Diet Coke.’” Testing showed that the name “Coke Zero” would be an effective way to sell a low-calorie cola to men without using the word “diet.” And advances in artificial sweeteners made it possible for Coke to finally create a product that tasted more like “the Real Thing.” So expectations were high when Coke Zero was introduced in 2005 with a big marketing push, including a commercial that remade the famous 1971 “Hilltop/I'd Like to Teach the World to Sing” ad—this time with rapper G. Love on a rooftop singing that he'd like to teach the world to “chill.” Unfortunately, the commercial didn't catch on, and neither did the product it was selling. Despite disappointing sales in the United States, however, Coke Zero was an immediate hit in Australia, selling more than three times the number of cases expected during its first year on the market. In the United States, the packaging was white and silver, making it difficult for consumers to see the difference between Coke Zero and Diet Coke. In Australia, the bottles and cans were black, making the product stand out on the shelves and look more like the “bloke's Coke” it was intended to be. The U.S. marketing team took notice and reintroduced Coke Zero with a black and silver label in 2007. Coca-Cola is now investing more money in Coke Zero than any other brand its size, hoping it will someday be a megabrand for the company alongside Coca-Cola Classic and Diet Coke. Chief marketing officer Bayne is enthusiastic about the impact it may have on the company. “We do see this as potentially a bit of a white knight. There's huge opportunity to grow here.” Questions 1. Describe the specific type of consumer that the Coca-Cola Company is targeting with each of the following products: Diet Coke, Coke Zero, Diet Coke Plus, Coca-Cola Blak, and Full Throttle Blue Demon. What types of demographic segmentation is each product's marketing most likely to include? 2. Some industry analysts think soft-drink companies should develop products that will bring new customers into the market rather than just creating variants on the old. They warn that products like Coke Zero will cannibalize lost market share from other soft drink categories instead of increasing the number of consumers overall. Which Coca-Cola products are most likely to lose customers to Coke Zero? 3. Why do you think that the hidden-camera videos used to promote Coke Zero were an effective way to reach its target market? Do you think a similar strategy with a viral marketing campaign on the Internet would appeal to the target market for Diet Coke Plus? 4. Do you think Diet Coke could have been repositioned to change consumers' perceptions of it enough to be considered a drink equally appealing to men? Why or why not?

Paper For Above instruction

The concept of a target market is fundamental to effective marketing strategies. It refers to a specific group of consumers at which a company’s products or services are aimed. Identifying the target market helps marketers tailor their messaging, product features, pricing, promotional strategies, and distribution channels to meet the specific needs, preferences, and behaviors of that group. An accurately defined target market allows companies to allocate resources efficiently, increase the likelihood of product acceptance, and foster brand loyalty.

Market segmentation is a process that divides a broad consumer or business market into sub-groups based on shared characteristics. These bases for segmentation are crucial because they help firms understand and classify their potential customers. Each segmentation basis provides a different perspective on consumer needs and preferences, guiding the development of targeted marketing strategies. Common bases for segmentation include geographic, demographic, psychographic, benefit, and usage-rate segmentation.

Geographic Segmentation

Geographic segmentation divides the market based on location—such as nations, regions, cities, or neighborhoods. This basis of segmentation is particularly relevant for products that vary in popularity due to climate, cultural preferences, or regional tastes. For example, a company selling winter apparel would focus on colder regions, while a surfboard brand might target coastal areas. A specific product example is a sunscreen brand marketed primarily in sunny, tropical regions. Geographic segmentation allows firms to tailor marketing messages based on local climate, language, and cultural nuances.

Demographic Segmentation

Demographic segmentation categorizes consumers based on variables such as age, gender, income, education, occupation, and family size. This approach assumes that consumer needs and preferences are closely related to demographic factors. For instance, luxury watches typically target high-income consumers, while educational toys may appeal more to parents with young children. For example, a healthcare insurance plan may target middle-aged adults with stable incomes. Demographic segmentation provides a straightforward way to reach specific population groups with tailored messages, as these variables are easy to measure and collect.

Psychographic Segmentation

Psychographic segmentation focuses on consumers' lifestyles, personalities, values, interests, and social class. This segmentation basis helps marketers craft messages that resonate on a deeper psychological level. For instance, a brand selling outdoor adventure gear might target thrill-seekers and nature enthusiasts. An example product could be a high-end athletic apparel line aimed at active, health-conscious individuals. This type of segmentation recognizes that consumers with similar demographic profiles may have vastly different lifestyles and preferences, necessitating targeted messaging that aligns with their identity and values.

Benefit Segmentation

Benefit segmentation divides the market based on the specific benefits consumers seek from a product. For example, some consumers buy toothpaste for whitening, others for cavity protection, and still others for fresh breath. A good example is skincare products marketed as anti-aging versus moisturizing. Benefit segmentation helps companies identify distinct customer needs and develop specialized products that deliver desired outcomes, increasing overall satisfaction and loyalty.

Usage-rate Segmentation

Usage-rate segmentation categorizes consumers based on their level of product usage—light, medium, or heavy users. For example, a coffee brand might target heavy coffee drinkers with loyalty programs, while light users are approached with trial offers. A coffee shop chain might differentiate its marketing strategies for occasional customers versus daily users, tailoring messages to increase frequency among light users or reward heavy users for their loyalty. This segmentation helps optimize marketing efforts by focusing on consumers with the highest potential lifetime value.

Alternative Strategies for Selecting Target Markets

Marketers can employ different approaches when selecting target markets to maximize their impact and efficiency. The undifferentiated strategy ignores segmentation altogether, targeting the entire market with a single product offering—used traditionally when mass marketing was common. For instance, basic commodities like salt or sugar often follow this approach due to minimal differentiation. Conversely, the concentrated (niche) approach targets one specific segment, such as a luxury jewelry brand focusing solely on high-net-worth individuals. This strategy allows for specialized marketing and product development tailored to a particular group.

The multisegment strategy targets multiple segments simultaneously, offering different products or marketing messages for each group. For example, an automobile company may produce economy cars for budget-conscious consumers and luxury models for affluent buyers, tailoring features, pricing, and advertising accordingly. This approach broadens market reach but requires more resources and a refined understanding of diverse customer needs.

Case Study: Coke Zero and Consumer Targeting

Coca-Cola’s marketing efforts for its various products demonstrate the importance of targeted segmentation. Diet Coke primarily targets health-conscious women who want to lose weight or watch their calorie intake. Coke Zero, on the other hand, was developed to appeal to young men seeking a low-calorie soda that tastes like the original Coca-Cola without the 'diet' stigma. The demographic segmentation for Coke Zero predominantly includes young adult men aged 18 to 34 who desire calorie reduction but dislike artificial aftertastes and perceive diet beverages as feminine.

Additionally, Coca-Cola has tailored its messaging for Diet Coke Plus towards health-conscious consumers interested in added nutritional benefits, while Coca-Cola Blak targeted more sophisticated, older drinkers interested in coffee-flavored soft drinks. Full Throttle Blue Demon aimed at Hispanic men who are attracted to energy drinks with unique flavors, demonstrating how diverse product offerings are designed to meet different demographic groups.

Market Cannibalization and Product Strategies

Market cannibalization occurs when a new product takes sales away from a company's existing offerings rather than expanding the overall market. Some analysts argue that Coke Zero risks cannibalizing sales from Diet Coke and regular Coca-Cola, especially among the health-conscious demographic seeking low-calorie options. The primary concern is that Coke Zero might simply shift existing consumers rather than attracting new ones to the whole soft drink category.

However, Coca-Cola’s strategy aims to attract a specific segment—young men—who may not have previously purchased any Coca-Cola beverages. Consequently, Coke Zero’s development might represent an effort to expand the overall market by capturing new demographic groups rather than just replacing existing consumption. Existing products most likely to lose customers to Coke Zero include Diet Coke and regular Coca-Cola among younger males who perceive Diet Coke as feminine or unappealing due to its taste.

The Effectiveness of Viral Marketing and Repositioning Strategies

The use of hidden-camera videos to promote Coke Zero leveraged humor, surprise, and emotional engagement—techniques known to positively influence brand perception among young consumers. This guerrilla-style marketing approach created a viral effect, generating buzz and discussion about Coke Zero’s masculinity appeal while subtly challenging stereotypes associated with diet drinks. The authentic and edgy nature of these videos resonated with the target demographic, making them effective.

Applying a similar strategy through online viral campaigns for products like Diet Coke Plus, however, might be less effective. This product targets health-conscious consumers interested in nutritional benefits, a demographic often seeking informative, credible content rather than entertainment or humor. Instead, social media campaigns emphasizing health benefits, testimonials, and influencer partnerships would likely be more suitable for appealing to this group, aligning with their information-seeking behavior and lifestyle values.

Repositioning Diet Coke

Repositioning Diet Coke to appeal to men could have involved addressing stereotypes associated with diet beverages. For instance, marketers could have promoted Diet Coke as a fashionable, bold, and modern choice, emphasizing taste and image rather than weight loss. However, changing deep-seated perceptions is challenging because branding and consumer associations are built over time. While it’s theoretically possible to reposition Diet Coke—such as branding it as a lifestyle beverage for active, health-conscious men—such efforts would need to overcome existing bonds with its feminine perception and taste profile.

In conclusion, targeting specific market segments and strategically repositioning products are essential techniques in effective marketing. Coca-Cola’s case illustrates how understanding demographic and psychographic profiles enables companies to craft tailored messages, develop innovative products, and engage with consumers in meaningful ways. While repositioning is feasible, it requires consistent branding efforts and aligning product attributes with the desired consumer identity, especially for products like Diet Coke that carry strong pre-existing perceptions.

References

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