Ibahrine 3 Marcom Targeting

3 The Fundamental Marcom Decisions#1 Targeting

11/10/09

Dr. Mohammed Ibahrine

AL AKHAWAYN UNIVERSITY in IFRANE SCHOOL OF HUMANITIES AND SOCIAL SCIENCES COMMUNICATIONS STUDIES PROGRAM

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Objectives 1.

Discuss the importance of targeting marketing communications to specific consumer groups and realize that the targeting decision is the initial and most fundamental of all marcom decisions

2.

Understand the role of behaviorgraphics in targeting consumer groups

3.

Describe the nature of psychographic targeting and the VALS system

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Objectives

1.

Explain the meaning of geodemographics and understand the role for this form of targeting

2.

Recognize that any single characteristic of consumers —whether their age, ethnicity, or income level—likely is not a sufficient basis alone for sophisticated marcom targeting

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Targeting Customers and Prospects • Targeting specific audiences can be considered the starting point for all marcom decisions Targeting allows marketing communicators to 1. Deliver their messages more precisely

1. Prevent wasted coverage to people falling outside the targeted audiences

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Targeting Customers and Prospects

Behaviorgraphics

Psychographics

Measureable Consumer Characteristics Demographics

Geodemographics

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Consumer Characteristics Behaviorgraphics Psychographics Demographics Geodemographics

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Consumer Characteristics

• Characteristics that singularly or in combination influence  What people consume  How they respond to marketing communications

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Consumer Characteristics • Note that "graphics," the suffix for each of these consumer characteristics, is a term that refers to measurable characteristics of target audiences

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Consumer Characteristics • The prefix to each type of targeting represents • how the audience is measured

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Consumer Characteristics • Specifically, behaviorgraphic represents information about the audience's behavior  In terms of Past purchase behavior Online search activity in a particular product category or set of related categories

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Consumer Characteristics  Psychographics captures aspects of consumers' psychological makeup and lifestyles including their Attitudes Values Motivations

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Consumer Characteristics • Captures aspects of consumers’ psychological make-ups and lifestyles including their attitudes, values, and motivations as they relate to buying behavior in a particular product category

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The Market Segmentation Process

1. Identify people with shared needs and characteristics

The Market Segmentation Process

1. Identify people with shared needs and characteristics 2. Aggregate these groups into market segments according to their mutual interest in the product’s utility

Consumer Characteristics • Demographics reflect measurable population characteristics such as Gender Age Education Income Ethnicity 11/10/09

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Consumer Characteristics • Marcom practitioners are mainly concerned with: the age structure of the population the changing household composition of the society. (ethnic population developments)

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Consumer Characteristics • Geodemographics is a conjunction of geography and demography • Geodemographics is based on the premise that consumers who reside within geographic clusters such as Zip Code Areas and neighborhoods also share demographic and lifestyle similarities 11/10/09

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Behaviorgraphic Targeting • Based on how people behave (with respect to a particular product category or class of related products) rather than in terms of their attitude and lifestyles, their age, income, or ethnicity, or where they live 11/10/09

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Behaviorgraphic Targeting

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The best predictor of one’s future behavior is his or her past behavior

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Classification of Four General Targeting Characteristics

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Online Behavioral Targeting • Audience Management Systems track Internet users’ surfing behavior in order to target them with specific advertisements • In the context of online behavior targeting, Web surfers are increasingly more likely to be served with ads for products that are most relevant to their interests

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Privacy Concerns • Technological advances in marketing bring with them increased ability to serve consumers but also at the risk of invading privacy

• This advantage comes at the expense that companies have access to our Internet search behavior without our approval or knowledge

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Privacy Concerns • What's the harm? • Big Brother is watching you!

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Definition • Segmenting Dividing the market into groups of people who have similar characteristics in certain key product-related areas

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Definition • Targeting Identifying the group that might be the most profitable audience (most likely prospects) and the most likely to respond to marketing communications messages 5-25

U.S: VALS segmentation •

The U.S: VALS segmentation scheme places American adult consumers into one of eight segments based on psychological characteristics that are related to purchase behavior and several key demographics

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The horizontal dimension in this figure represents individuals' primary motivations, whether in terms of their pursuit of ideals, their need for achievement, or drive to self-express

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The vertical dimension reflects individuals' resources as based on their educational accomplishment, income levels, health, energy, and consumerism

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U.S: VALS segmentation Psychographic segmentation

VALS

:

U.S: VALS segmentation •

VALS places U.S. adult consumers into one of eight segments based on their responses to the VALS questionares

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The main dimensions of the segmentation framework are  Primary motivation (the horizontal dimension)  Resource (the vertical dimension).

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Descriptions of the VALS types: • Descriptions of the VALS types:  Innovators  Thinkers  Achievers  Experiencers  Believers  Strivers  Makers  Survivors

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Descriptions of the VALS types: • Innovators Innovators are successful, sophisticated, takecharge people with high self-esteem Because they have such abundant resources, they exhibit all three primary motivations in varying degrees They are change leaders and are the most receptive to new ideas and technologies Innovators are very active consumers, and their purchases reflect cultivated tastes for upscale, niche products and services 11/10/09

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Descriptions of the VALS types: • Thinkers Thinkers are motivated by ideals They are mature, satisfied, comfortable , and reflective people who value order, knowledge, and responsibility They tend to be well educated and actively seek out information in the decision-making process They are well-informed about world and national events and are alert to opportunities to broaden their knowledge 11/10/09

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Descriptions of the VALS types: • Believers Like Thinkers, Believers are motivated by ideals They are conservative, conventional people with concrete beliefs based on traditional, established codes: family, religion, community, and the nation Many Believers express moral codes that are deeply rooted and literally interpreted They follow established routines, organized in large part around home, family, community, and social or religious organizations to which they belong 11/10/09

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Descriptions of the VALS types: • Achievers Motivated by the desire for achievement Achievers have goal-oriented lifestyles and a deep commitment to career and family Their social lives reflect this focus and are structured around family, their place of worship, and work Achievers live conventional lives, are politically conservative, and respect authority and the status quo  They value consensus, predictability, and stability over risk, intimacy, and self-discovery 11/10/09

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Descriptions of the VALS types: • Strivers Strivers are trendy and fun loving. Because they are motivated by achievement, Strivers are concerned about the opinions and approval of others Money defines success for Strivers, who don't have enough of it to meet their desires They favor stylish products that emulate the purchases of people with greater material wealth Many see themselves as having a job rather than a career, and a lack of skills and focus often prevents them from moving ahead 11/10/09

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Descriptions of the VALS types: • Experiencers Experiencers are motivated by self-expression As young, enthusiastic, and impulsive consumers, Experiencers quickly become enthusiastic about new possibilities but are equally quick to cool They seek variety and excitement, savoring the new, the offbeat, and the risky Their energy finds an outlet in exercise, sports, outdoor recreation, and social activities 11/10/09

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Descriptions of the VALS types: • Makers  Like Experiencers, Makers are motivated by self-expression  They express themselves and experience the world by working on it-building a house, raising children, fixing a car, or canning vegetables-and have enough skill and energy to carry out their projects successfully  Makers are practical people who have constructive skills and value self-sufficiency  They live within a traditional context of family, practical work, and physical recreation and have little interest in what lies outside that context 11/10/09

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Descriptions of the VALS types: • Survivors Survivors live narrowly focused lives With few resources with which to cope, they often believe that the world is changing too quickly They are comfortable with the familiar and are primarily concerned with safety and security Because they must focus on meeting needs rather than fulfilling desires, Survivors do not show a strong primary motivation 11/10/09

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Descriptions of the VALS types: Innovators

Successful, sophisticated, take-charge, with high selfesteem

Thinkers

Mature, satisfied, comfortable, and reflective; valuing order, knowledge, and responsibility and motivated by ideals

Believers

Conservative, conventional with concrete beliefs based on traditional, established codes: family, religion, community, and the nation; motivated by ideals

Achievers

Motivated by the desire for achievement; have goaloriented lifestyles and a deep commitment to career and family

Descriptions of the VALS types: Strivers

Trendy and fun loving. Motivated by achievement out of concern about the opinions and approval of others

Experiencers

Motivated by self-expression; are young, enthusiastic, and impulsive consumers; quickly become enthusiastic about new possibilities but are equally quick to cool.

Makers

Motivated by self-expression; express themselves and experience the world by working on it and have enough skill and energy to carry out their projects successfully

Survivors

Live narrowly focused lives; with few resources with which to cope, often believe that the world is changing too quickly; are comfortable with the familiar and are primarily concerned with safety and security

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Geodemographic • Hence, knowing where people live also provides some information regarding their general marketplace behaviors • Several companies have developed services that delineate geographical areas into common groups, or clusters, wherein reside people with similar demographie and lifestyle characteristics • Geodemographic clustering systems have been developed in many countries other than the United States, including Canada, most countries in Western Europe, some African countries, Australia, and Japan 11/10/09

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Geodemographic: PRIZMNE 1/1 • PRIZMNE is an acronym in which PRIZM stands for Potential Rating Index by Zip Markets and NE represents the "new evolution" of Claritas' original segmentation system • The PRIZMNE classification system delineates every neighborhood in the United States into one of 66 clusters based on an analysis of neighborhoods‚ demographic characteristics

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Geodemographic: PRIZMNE 1/2 • These characteristics include variables such as educational attainment, race/ ethnicity, predominant age range, occupational achievement, and type of housing (e.g., owned versus rented)

• Sophisticated statistical analysis of these demographic characteristics has enabled Claritas to identify 66 groups, or clusters, of neighborhoods that share similar demographie profiles

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Benefit segmentation • Focuses on the advantages consumes receive from the product rather than the characteristics of consumers themselves

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USAGE Segmentation • The final type of consumer segmentation is based on costumer usage or purchases • The goal of usage segmentation is to provide the highest level of service to a firm best customers while promoting the company to casual or light users • Usage segmentation is also designed to maximize sales to all user groups

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The Changing Age Structure • The U.S. population is aging relentlessly.

Median Age: 28

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1970

1980 11/10/09

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36 2000 46

Population of the United States by Age Group, as of 2006

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Demographic Targeting • • • • • • • • •

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Children and Teenagers Preschoolers. PreschoolElementary-school-age children Tweens Teenagers Young Adults Middle-Aged and Mature Consumers Middle-aged Mature Consumers

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Demographic segmentation: Heavy usage patterns of various age groups

Market Segmentation