After evaluating identified segments, decisions have to be made whether to pursue a particular opportunity or not. Assuming the decision is made to proceed, an appropriate targeting strategy must be developed

Question

Explain the basic categories of target marketing strategies and how they can be implemented.

Answer 1

The three basic categories of target marketing strategies are: standardized marketing, concentrated marketing, and differentiated marketing. Standardized global marketing is analogous to mass marketing in a single country. It involves creating the same marketing mix for a broad mass market of potential buyers. It is also known as undifferentiated target marketing since it is based on the premise that a mass market exists around the world. Product adaptation is minimized, and a strategy of intensive distribution ensures that the product is available in the maximum number of retail outlets. The appeal of standardized global marketing is due to the lower production costs. The concentrated target marketing involves devising a marketing mix to reach a niche. A niche is a single segment of the global market. For example, in cosmetics, Chanel has targeted the upscale, prestige segment of the market. Concentrated targeting is also the strategy employed by the hidden champions of global marketing–companies unknown to most people that have succeeded by serving a niche market that exists in many countries. These companies define their markets narrowly and strive for global depth rather than national breadth. The narrowing of market definition is the key principle in this strategy. The third category differentiated global marketing, represents a more ambitious approach than concentrated target marketing. It is also known as multi-segment targeting. It entails targeting two or more distinct market segments with multiple marketing mix offerings. This strategy allows a company to achieve wider market coverage. For example, in the sport utility vehicle segment, Rover has a Range Rover at the high end of the market. A scaled down version, the Land Rover Discovery, is offered which competes directly with the Jeep Grand Cherokee. The Freelander, its newest vehicle, has been on sale in Europe for several years. Thus, there is a multi-pronged approach to marketing.