Segmentation and Positioning

Using the steps below, develop a proposed Target Market Strategy for your company.

Step 1:Identify variables for segmenting the market. Define and describe market segments using the chart format below. You may alter the table below to use your own Segmenting Dimensions and draw your own segments.

• Develop three or fourpossible segments within your potential customer base. Develop descriptive names for each segment.
• Outline the differences between your segments in chart format.
• Use several different customer characteristics and buying situation variables to describe each group.

Exhibit 1: SEGMENTING THE MARKET

MARKET: Purple Mattress

Segmenting Dimension	Segment 1 ___________	Segment 2 ___________	Segment 3 ____________	Segment 4 ____________

Step 2:Analyze the competition. Answer the questions below and complete the competitive analysis chart.

• Who are your client's main competitors?
• What segments do they seem to be targeting?
• What are their strengths and weaknesses?
• What segments are most likely to be unsatisfied with the competition's product offering?

Exhibit 2: COMPETITIVE ANALYSIS

Competitors	Competitor 1 ___________	Competitor 2 ___________	Competitor 3 ___________
Apparent Target Markets
Strengths
Weaknesses
Likely Response to New Competitor

Summary of findings:

Step 3:Evaluate the four market segments and select a primary target.

• Evaluate on the basis of sales potential (size of the segment), level of competition within the segment, degree of consumer satisfaction with competitor products, and ability to reach the target with promotional efforts.
• Perhaps the most critical element in selecting a target segment is to answer the question, "Do they have an unmet need?"(i.e., are they dissatisfied with what the competition has to offer.)
• Complete the chart below to show your evaluation.
• Choose your primary target market and explain your rationale. (Located below the chart.)

Exhibit 3: TARGET MARKET SELECTION

Segment	Segment #1 ___________	Segment #2 ___________	Segment #3 ____________	Segment #4 ____________
Size of segment
Who competes for this segment?
Are target members satisfied with what the competition offers?
What are the target's unmet needs? (Be specific!)
How can target be reached?

Primary Target Market:

Rationale:

Secondary Target Market (if any):

Step 4: Write your positioning statement below: