Consumer

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Advertising Research (Conclusion)

Published November 4, 2013 by Mayrbear's Lair

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Direct Response Marketing and Setting Objectives

To set marketing objectives, advertisers must identify the most efficient means to communicate their message and incorporate the best research methods to help them accomplish their goals. Eyun-Jung et al., (2012) purport that online data collection methods are more commonly employed than offline methods and must be taken into consideration during their research efforts (Eyun-Jung, Hyoungkoo, & Lan, 2012). In order to determine and set objectives marketers must identify precisely what they intend to communicate and what their message is supposed to achieve. In addition, they must determine the most appropriate means and tools used to communicate their message so that the answers to these key questions flow organically. Direct response marketing is another research strategy advertisers use to better understand their audience. For example, companies invest time and energy to implement programs that include direct mail and email campaigns. In doing so, they provide consumers with such items as catalogs, surveys, flyers, and other means to communicate to them. These strategies are implemented in conjunction with other direct response mass media efforts developed in their TV, radio, and magazine ads, to influence consumer behavior and encourage some kind of immediate response. In turn, marketing teams use the information they gather to build a solid data warehouse which includes some of the following components: (a) client name and contact information, (b) purchase transactions details, (c) the history of company interaction including inquiries, return merchandise, or complaints, (d) survey results, (e) consumer preferences, and (f) consumer participation in promotions and marketing campaigns. Marketers utilize data management disciplines as a research strategy and evaluate the information collected to help them identify and design their promotional campaign goals. This is also an effective way to develop more meaningful relationships with consumers\ that not only builds consumer trust it can also help predict future trends and behavior.

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Personal Selling Tactics and Budget Plans

Advertising research is also effective for identifying the most efficient executional frameworks to deliver brand messages with the financial resources available. Learning about consumer lifestyles and media preferences help marketers reach prospects and communicate their messages with precision. For example, to avoid costly mistakes and allocate funds efficiently, marketers may include personal selling tactic strategies in their research efforts to help determine the company’s resources and budgetary needs. Thomas (2013) postulates that one of the greatest obstacles marketers face is integrating media strategies effectively and deciding on the most efficient executional frameworks to deliver their message (Thomas, 2013). The choice of media channels, whether TV, print, or outdoor, is one of the most important aspects in the development of a marketing campaign because bad decisions due to a lack of poor research and planning can result in considerable financial losses as well as cost a company to lose their brand positioning in the marketplace. Companies that include personal selling techniques in their advertising research strategies, for instance, offer consumers the opportunity to build relationships face-to-face with company representatives. In the meantime, strategists are able to learn more about consumer interests so they can build better budget plans to achieve their goals. For example, one personal selling effort tactic may include an in-store demonstration of a product to give people an opportunity to experience a company’s goods with their own eyes. The response they receive can help marketers create more effective programs and build better budget procedures to support them. This strategy helps marketers in their research efforts because it also provides an opportunity to generate new leads by adding a personal touch. In addition, it gives consumers a chance to meet and interact with company insiders that can provide more details about a brand. This discipline helps build trust, gives consumers a chance to discover a brand’s goods and services first hand, and the data gathered from the event plays a significant role in the development of effective budgetary plans to support them.

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Conclusion

Companies want to build brand awareness not lose it. Their goal is to tell their story while meticulously crafting their image in a way that cleverly presents their unique selling points. Baack and Clow (2010) explain that the recruitment of new leads from implementing such strategies like frequency programs, permission marketing enticements, and direct response marketing techniques, are all effective practices to motivate customer action and build brand loyalty (Baack & Clow, 2012). In other words, companies that use the data they collect from consumers as a research strategy, will help them develop more effective methods to motivate and influence consumer behavior and more likely to achieve successful outcomes.

Academic discipline strategies play a key role in advertising research because they help companies build meaningful relationships with consumers. Thomas (2013) reminds us that the main objectives of marketers are: (a) to generate new leads, (b) identify current prospects, (c) stimulate activity, and (d) implement effective follow up programs to ensure customer satisfaction (Thomas, 2013). Advertisers that incorporate disciplined strategies into their research efforts are more likely to get clients excited about a brand and have a better chance of closing a sale than trying to reach them blindly in a vast sea of consumers. In conclusion, the best way to achieve marketing goals is to incorporate disciplined research and data collection systems that can help companies identify and determine consumer behavior. This helps touch clients in a way that is not intrusive and instead makes them feel special and valued. The findings of this research conclude that brands can communicate their message more effectively and develop more efficient advertising campaigns by implementing strategic academic disciplines into their advertising research efforts.

References

Baack, D., & Clow, K. (2012). Integrated advertising, promotion, and marketing communications (5th ed.). Upper Saddle River, NY: Pearson Education, Inc.

Eyun-Jung, K., Hyoungkoo, K., & Lan, Y. (2012). Social media research in advertising, communication, marketing, and public relations. Journalism and mass communication quarterly, 89. Columbia, USA: Association for Education in Journalism and Mass Communication. Retrieved October 16, 2013, from http://search.proquest.com/docview/1026654509?accountid=32521

King, P., & Young, C. (2008). The advertising research handbook (2nd ed.). Seattle, WA: Ad Essentials, LLC.

Shimp, T. (2010). Advertising, promotion, and other aspects of integrated marketing communications. Mason, OH: South-Western Cengage Learning.

Thomas, J. (2013). Advertising research. Retrieved October 17, 2013, from http://www.decisionanalyst.com: http://www.decisionanalyst.com/publ_art/adver.dai

Advertising and Research (Part 1)

Published November 1, 2013 by Mayrbear's Lair

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Introduction

An advertising campaign’s function is to provide information about a brand in a memorable and entertaining fashion. To achieve the most effective response, marketers focus their strategic plans to develop the brand’s positioning with the message and images they choose to communicate. Shimp (2010) suggests that marketers can entice consumers in interesting ways by learning more about their wants and needs, using the information they collect to reach them more effectively (Shimp, 2010). These strategies are commonly used to help advertisers grab the attention of viewers, build trusting relationships with them, and in exchange patrons offer brand loyalty.

To find out more about a target audience media teams implement precision research systems into their campaign efforts to experience maximum benefits for their efforts. Baack and Clow (2012) contend that research systems give marketers insights into: (a) consumer purchasing habits, (b) the merchandise they use, (c) how they make purchases, and (d) other behavior that may affect their interaction with the brand. Advertisers typically focus their research efforts in two areas: product-specific and consumer-oriented data collection to better comprehend their target audience (Baack & Clow, 2012). Research strategies help marketers devise the best methods to communicate their messages more effectively to motivate consumer action. The focus of this study is centered on three academic disciplines that play an integral role in advertising research to help in the development of an effective marketing campaign: (a) data driven management systems to help support brand positioning, (b) the implementation of direct response marketing programs to assist with goal setting strategies, and (c) applying personal selling tactics that can have a profound effect on budget allocation. In addition, the study will also examine how components like data mining, customer profiling, trawling, and frequency programs are important for building customer relationships to help with research efforts. The findings of this study will conclude that companies who implement a disciplined advertising research program which includes strategies to individualize communication with consumers, will experience more success from their efforts. These programs can help address important issues that will influence the development of their promotional campaigns which in turn has an impact on the brand’s positioning, goal achievements, and budget plans.

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Data Management and Brand Positioning

Media experts look to position their brand more effectively by including strategic disciplines in their advertising research efforts. King and Young (2010) explained that a brand’s position communicates the benefits, their image, and the key advantages they represent in the way they want to deliver that message to the collective mind of their target audience. In order to determine their brand positioning in the core of their message, they must provide a tangible reason their brand stands out above the competition (King & Young, 2008). To position themselves above others, marketers begin by conducting thorough research on their competitors and collect substantial data to profile consumers as a means to better comprehend the marketplace. This strategy is also effective to help to establish trustworthy relationships with their patrons.

The first step for a marketing team is to incorporate strategic data driven systems into their research programs. To achieve this task, teams begin by developing a strong data warehouse that includes coding analysis capabilities which can also be used for data mining procedures. Data driven marketing provides a direct link to consumers and helps advertisers develop more effective relationships with their audience. For instance, because of advances in internet technology and software development, companies can easily build and develop strong database programs that support and personalize customer interaction to build loyalty. Technologies that support database storage, mining and coding operations are more effective in building intimate relationships with consumers because they keep track of their interaction with the brand. For example, a brokerage firm that has established a customer profiling program may use database mining strategies to implement a practice called trawling. This procedure helps companies identify active patrons and pinpoints the inactive ones. It also helps strategists determine whether clients should be pursued and enticed into new action or released to make room for others. Companies that incorporate data driven marketing strategies into their research programs do so to understand consumer values so they can build better relationships with them and increase their chance of elevating their brand position in the marketplace.

Part 2 to be continued next Monday … thanks for staying tuned!

References:

Baack, D., & Clow, K. (2012). Integrated advertising, promotion, and marketing communications (5th ed.). Upper Saddle River, NY: Pearson Education, Inc.

Eyun-Jung, K., Hyoungkoo, K., & Lan, Y. (2012). Social media research in advertising, communication, marketing, and public relations. Journalism and mass communication quarterly, 89. Columbia, USA: Association for Education in Journalism and Mass Communication. Retrieved October 16, 2013, from http://search.proquest.com/docview/1026654509?accountid=32521

King, P., & Young, C. (2008). The advertising research handbook (2nd ed.). Seattle, WA: Ad Essentials, LLC.

Shimp, T. (2010). Advertising, promotion, and other aspects of integrated marketing communications. Mason, OH: South-Western Cengage Learning.

Thomas, J. (2013). Advertising research. Retrieved October 17, 2013, from http://www.decisionanalyst.com: http://www.decisionanalyst.com/publ_art/adver.dai

Consumer Promotions

Published October 25, 2013 by Mayrbear's Lair

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Marketers today try to comprehend the psychology of consumers and focus much of their research on consumer behavior. This helps them understand the following components: (a) how actions shape an individual’s identity, (b) the impact it has on their target audience and their families, and (c) how their consumption habits affect the environment. Jansson-Boyd (2012) explains that human consumption has become an integral part of society. From a business perspective, it is imperative that advertisers have a clear understanding of the effects these habits have on human behavior to better serve their customers. In other words, companies have more successful outcomes when they focus on figuring out how individuals are influenced based on their behavior with respect to the materials they acquire. The information they gather is used to determine how and why they are engaged in certain activities and what affects them in order to help influence that behavior (Jansson-Boyd, 2010). Knowing how people process information and in turn how they will respond, can also help marketers predict future behavior. This is useful data for developing consumer promotion strategies to generate more traffic and build long lasting brand loyalty. Consumer promotions are typically developed as exciting events to entice consumers to investigate further into a company’s merchandise so that they will purchase their goods. The focus of this research is centered on the various methods advertisers develop to influence consumer behavior by incorporating different types of promotional strategies to their campaigns to stimulate the buying process. The study will examine seven kinds of consumer promotion models including: (a) refunds and rebates, (b) contests, (c) sweepstakes, (d) premiums, (e) coupons, (f) in-store, and (g) trade shows. As an example to help illustrate these concepts, the research is influenced from my own personal experiences as a young corporate executive in the promotion department at EMI America Records in Hollywood. The study will take a closer look at the variety of strategies a record company will utilize to introduce a new artist and to help promote their music products. The findings of this research will conclude that consumer promotions drive patrons to buy products because they stimulate excitement, add fun to shopping, and create a memorable experience.

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Contests

Consumer promotions are meant to drive people towards a company’s products. Smart advertisers know that in addition to delivering an awesome product, to attract and keep loyal clients, exceptional customer service also plays a key role to their success. Baack and Clow (2012) postulate, that in the past, many experts were under the impression that any type of sales promotion could contaminate a brand’s reputation. However, because of the vast amount of market place competition, advertisers are developing more clever methods to lure consumers into making a purchase. Promotions are an effective way to generate interest and excitement to attract shopper attention and activity (Baack & Clow, 2012). One method marketers use to spawn excitement about a new product is holding a contest. Contests require audience participation and can create a buzz about a new product. For example, record companies work in partnership with radio stations and music store outlets to set up various kinds of contests to attract attention. When an artist comes out with a new album, for instance, conducting a contest in conjunction with a radio station is a sure way to generate a buzz. First of all, radio stations work with record companies and provide free publicity from the airplay of the new album. To generate more of a thrilling experience, the radio station will hold competitions by offering callers incentives like free concert tickets or a chance to win the artist’s new album if they are logged in as the fifteenth caller, for instance or have the correct answer to a certain trivia question. These types of promotions not only generate excitement and interest in the artist and their new product, it also serves to help bring more listening traffic to the radio station. This choice of promotion is ideal and if planned well, can serve the music company, the artist, the radio stations, and the concert promoter.

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Sweepstakes

Without consumer promotions, a company’s product can get lost in the crowd. Cummins and Mullin (2010) state flatly, that the main goal of marketers is to drive consumers to buy products and sales promotions are effective for achieving those outcomes. People go shopping because they want a rewarding experience (Cummins & Mullin, 2010). In other words, people purchase merchandise because it makes them feel good and sales promotions, like sweepstakes, are one way of adding fun to the buying equation. In a sweepstakes promotion, purchases are not necessary for participation and generally shoppers are encouraged to enter as often as they want. In these kinds of promotions, probability determines the outcome so merchandisers are required to reveal the odds of winning in advance. This displays a company’s fair business practices and helps build trust. A record company, for instance, will incorporate a sweepstakes event into their promotion campaign because they add both extrinsic and intrinsic value. For example, to add extrinsic value and make the promotion more attractive, the record label may include an all-expense paid trip to Hollywood, California for entry winners to attend an artist’s concert. In addition, they may offer free promotional material, like t-shirts, special concert related program books, and other paraphernalia merchandise to support the release of the new album.  Sweepstakes promotions are similar to contests, in that they require participation and necessitate the use of some kind of skill, such as sharing stories centered on the theme of the album or the submission of an original song. People that enjoy competition events will participate because: (a) it is fun, (b) they want to demonstrate their abilities, and (c) it presents an opportunity to meet the artist. Marketers have discovered that offering discounts only are not as effective in generating excitement over their products, and by designing promotions into their advertising campaigns, such as contests and sweepstakes, they become extremely efficient for generating a positive experience and attracting more business.

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Refunds and Rebates

Consumer promotions stimulate excitement in a company’s brand. Refunds and rebate strategies are cash incentives offered to buyers once they purchase merchandise. Baack and Clow (2012) submit that this strategy is more effective when they it is perceived as an original idea and usually motivate buyers to change their behavior (Baack & Clow, 2012). To receive the reward, the consumer must provide a proof of purchase and mail it to the designated organization to redeem their prize. This is not a very popular method because many people do not want to take the time to mail in the required documentation, follow-up, or even wait for that matter. However, if the prize is enticing enough, consumers will participate. Music companies can use this strategy to help promote the release of an artist’s new album as well as their concert events. For example, a rebate offer can be an effective method to entice consumers to purchase a special limited edition of the music product offered exclusively at certain outlets only that includes concert tickets as part of the rebate strategy. This promotes the record label, the music store retailer and the concert promoters. Plus, it also helps fans save money on costly concert events while encouraging sales for higher ticket items such as special collector products. These effective strategies assist advertisers in generating more sales, build brand loyalty, that can also lead to additional purchases. This model draws attention to the brand and is a great way to engage and win new supporters.

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Premiums

To put it simply, promotions are developed for consumers to help create a rewarding shopping experience for them. Calder and Tybout (2010) assert that human behavior is motivated by goals. Goals are a reflection of a fulfilling future that is driven by an individual’s desires, aspirations, hopes, and dreams. The value individuals attach to their solutions varies by the degree of the problem solved or goal they want to achieve. Taking this concept into consideration, advertisers engage in competitive marketing as a valuable tool that provides consumers a means to achieve their goals (Calder & Tybout, 2010). Sales promotions that offer premiums in the form of prizes, gifts, or other special offers, are also useful for getting people excited about a company’s brand. Typically there are four kinds of premiums that a company offers: (a) free-in-the-mail, (b) in-or on-package, (c) store or manufacturer, and (d) self-liquidating. A music company, for instance, may offer two albums for the price of one as a premium bonus. This strategy promotes a new release and is also effective for moving older inventory. Another popular strategy is to provide personalized autographed merchandise as a premium because that has value that no other company can offer. This is highly effective because any item that is specifically autographed to an individual from the artist will inherently add more value to that product and is a successfully proven promotional strategy.

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Coupons

Consumer promotions are typically developed to make shopping a memorable experience. Advertisers that include coupon promotions in their campaigns do so to offer a price reduction to stimulate consumer interest. Baack and Clow (2012) purport that out of 188 billion coupons issued in a year, about 1.6 billion were redeemed (Baack & Clow, 2012). Studies suggest that manufacturers issue about 80 percent of all coupons produced and are delivered through print media systems, although with advances in technology, coupons are now also offered digitally through social media and smartphone outlets. In addition, some companies use cross-ruffing techniques to promote other products. For example, a record company that wants to promote a new soundtrack album that features a song by one of their artist’s, may include a redeemable movie ticket coupon with their music album purchase. This strategy promotes the artist, the record company, as well as the movie company that made the investment in the artist to compose a new track to support the film. Companies that work together can share advertising costs as well as create an unforgettable experience for consumers.

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Trade Shows

Trade show promotions offer incentives that are also effective for enticing consumers to purchase products.  Trade shows can build a company’s business rapidly in just a few short days.  Abrams and Bozdech (2006) explain that trade shows consist of a large number of industry contacts, potential suppliers, and important buyers.  These key players are brought together at one venue.  In fact, trade shows are very successful because: (a) they attract significant clients, (b) they introduce new products, (c) produce real prospects, and (d) they enhance relationships (Abrams & Bozdech, 2006).  The main objective of a trade show is to bring industry professionals together to feature new or existing merchandise to impress existing vendors and attract new ones.  Music industry trade shows are designed to showcase the company’s artists and will include live performances.  This tactic provides entertainment as well as gives attendees the opportunity to sample the music and meet the artists in person.  In addition, it is a great public relations strategy which allows other industry heavy weights the opportunity to view the competition, meet these talented performers, as well as enjoy some quality entertainment.

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In-Store Promotions

The goal of an advertiser is to drive consumers to buy their products. Cummins and Mullin (2010) advise that in-store promotions conducted by specially trained staff members that offer incentives to motivate a crowd, is still one of the most effective ways to generate substantial business (Cummins & Mullin, 2010). In-store promotions are the most common methods companies employ as part of their sales promotion strategies. For example, a music company that is looking to promote a new album or artist will develop an in-store promotion because it is the most effective means to generate excitement around a new product. This strategy offers the general public an opportunity to listen to the product as well as meet and mingle with the artists face-to-face. Depending on the magnitude and celebrity of the artist, these kinds of promotions tend to generate the largest crowds because they provide fans an opportunity to experience direct contact with their music heroes. This plan makes the brand stand out above the competition because of the unique abilities and talent of the artist who can strike a deep emotional chord from their supporters. In addition, once consumers are enticed to visit the retail outlet, when the promotion concludes, people remain free to roam the facility to explore other purchasing options. In-store promotions of this nature are appealing to merchants because of the inherent ability to draw a large crowd by those interested in meeting a celebrity in person. In addition, it helps create a long lasting buzz for the company in the community, especially from those who were fortunate to have been a part of the experience. When a celebrity is associated with a particular music retail chain like the Virgin Megastore or other outlets where their music is sold like Barnes and Noble, the chains become favorites because of the memories consumers experience during those events.  In-store promotion strategies work the best for a record label due to the artist’s power of attraction.  Plus, consumers do not have to pay an admission price to attend them like they would a trade show or concert event.

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Conclusion

Consumer promotions offer the public a fun way to go shopping. Cummins and Mullin (2010) suggest that the use of sales promotions in their campaigns is one of the most effective ways a company stimulates excitement, encourages retail response, and offers valuable rewards. These marketing strategies serve to create an exhilarating and unforgettable experience for consumers. A good sales promotion will make consumers stop and think about a brand and if it has the right impact, will cause them to follow through on their feelings to purchase their products (Cummins & Mullin, 2010). Today’s consumer is looking for more than just making a purchase; they want to have an experience that will transform them. Sales promotions can do that by offering novelty, excitement, and even humor at the point-of-purchase. These are significant components that consumers respond to and motivates them to help build brand loyalty. Consumer promotions are meant to create a  rewarding shopping experience; one that motivates consumers to purchase products and tell their friends about it. The findings of this research conclude that without effective promotional sales strategies a brand’s products can get lost in the crowd.

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References

Abrams, R., & Bozdech, B. (2006). Trade show in a day: Get it done right, get it done fast! Palo Alto, CA: The Planning Shop.

Baack, D., & Clow, K. (2012). Integrated advertising, promotion, and marketing communications (Fifth ed.). Upper Saddle River, NY: Pearson Education, Inc.

Calder, B., & Tybout, A. (2010). Kellogg on marketing (Second ed.). Hoboken, NJ: John Wiley and Sons, Inc.

Cummins, J., & Mullin, R. (2010). Sales promotion: How to create, implement and integrate campaigns that really work (Fifth ed.). London, UK: Kogan Page.

Jansson-Boyd, C. (2010). Consumer psychology. New York, NY: McGraw-Hill Education.

Market Segmentation

Published October 11, 2013 by Mayrbear's Lair

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Most experts agree that effective marketing campaigns communicate their messages directly to their intended audience. McDonald (2012) suggests that in addition, the objective of a successful advertising campaign is to gain the competitive advantage by building a loyal customer following providing them with products and services that meet the demands of clearly defined markets. Many advertisers fail to reach their target audience, however, because they rarely focus beyond the basic demographics. In addition, the complex arena of today’s marketplace presents many challenges for companies trying to identify their target audience. To address this, marketers implement various strategies of segmentation to divide potential consumers into different market groups recognizing that not all customers are created equally (McDonald, 2012). The focus of this research is centered on the importance of market segmentation and the components that are utilized to help companies develop a detailed understanding of their arena. For the sake of this analysis, the Apple Corporation’s iPad is included as an example product to help illustrate how marketers incorporate a variety of target market segmentation practices to help them develop their marketing campaigns. In addition, the study will also look at how core messages can be implemented to support these campaigns. The findings of this research will conclude that market segmentation is a strategy that can help corporations stop wasting money on ads that do not reach their intended buyers and is effective in helping companies identify their target audience.

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Definition

Market segmentation is an important component because it helps advertisers reach their core audience and turn them into advocates for their products and services. Many leaders know that advertising is a significant business strategy that fulfills a fundamental purpose. Gallagher and Zoratti (2012) explain that the marketing process: (a) defines markets, (b) quantifies the needs of customer groups within these markets to determine the value propositions, (c) communicates these value propositions effectively to those in the organization responsible for delivering them, (d) deliver these value propositions, and (e) monitor the value that is delivered. Many of today’s top performers in business are committed to consumer focus strategies. This is achieved through extensive data mining, analysis, and enriched profiling utilizing outside data sources in addition to behavioral, transactional, and conversational tracking methods. These strategies are designed to help companies define their markets and understand their value. These methods typically include incorporating: (a) the corporate mission and objectives which in turn helps determine markets of interest, (b) external data such as market research, and (c) internal data which flows from ongoing operations. The organization then processes this information and divides it into segments of consumers with similar needs so they can also predict future behavior (Gallagher & Zoratti, 2012). In other words, marketers gather sufficient data from consumers to help them quantify the needs of consumer groups to determine value propositions. Marketers then communicate their message implementing the company’s core values in their propositions to the appropriate parties in an effort to inspire action.

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Applications

Market Segmentation

Market Segmentation is one of the most efficient strategies available to advertisers because it helps them develop a unique selling proposition. Kennedy (2011) postulates that because of advances in technology, many companies have issues identifying the most appropriate media for the delivery of their message to prospects. In fact, most use media because that is the traditional course. This approach is both ineffective and inefficient. To construct a marketing campaign that conveys a powerful message, leaders must conduct a thorough survey of all the components they are up against (Kennedy, 2011). In short, their goal is to design a message that translates into a transformational experience that trumps all others and places them in their own category. One way to achieve this is to divide consumers into separate groups. For example, Baack and Clow (2012) explain that the foremost method of segmentation implemented employs demographics, or the characteristics of the inhabitants of that region. Typical examples include gender, age, education, income, and cultural ethnicity. Organizations use this information to construct products and services that meet specific demographic segments (Baack & Clow, 2012). For example, when the Apple Corporation introduced the iPad tablet as a new product, the goal was to convince their target audience that the new electronic devise was the future of computer technology and designed their campaigns to transmit that message effectively. Apple’s core message communicates their commitment to bring consumers the best products. In exchange for keeping their promise to deliver high quality merchandise, consumers agree to pay higher prices to support these innovations. Apple marketers that design their campaigns using market segmentation as a model will focus their campaigns based on the demographics of consumers that have the most influential buying power, which for this product could include such factors as income, education, geography, and age.

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Product Segmentation

Product Segmentation can help companies stop wasting money on campaigns that do not reach intended buyers. Godfrey (2007) purports that retailers need to present their products in ways that consumers can efficiently search and select them. The WalMart Corporation, like many large retail outlets, sells thousands of merchandise in a variety of categories including electronics, grocery, household, and personal care items. Their core value is transmitted in their company tagline: save money, live better. To help them keep their promise they must have knowledge and insight on consumer spending habits. One way the retail giant does this is by implementing a variety of segmentation techniques to better serve their clientele in a way they can discover more about them. First, their strategy identified and separated consumers into the following six categories as their target audience: Hispanics, African-Americans, Suburbanites, Rural Residents, Affluent, and Empty-nesters. Next, the store designed their layout by segmenting their products and organizing them into various categories. To enhance the shopping experience, for instance, merchandise is organized into collections of products to attract each target audience member. In other words, they present their merchandise in a way that is more appealing to target consumers by incorporating a methodology that identifies consumer behavior. This strategy helps them match consumers to specific groups of services and products (Godfrey, 2007). Retailers refer to this practice as product segmentation because they group and display products strategically in a manner that attracts a certain type of clientele. For example, consumers seeking the iPad tablet will find them situated in a specific location of the retail outlet with other popular electronic devices. These items are strategically placed where the eyes can find them quickly and easily. However, in keeping their promise to deliver high end merchandise, the Apple products are placed only where employees can access them under lock and key for security purposes. This is one example of how product placement and segmentation provides a significant model to help identify and serve target consumers more effectively.

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Generational Segmentation

Generational segmentation helps marketers identify groups of consumers that share similar experiences from common events. These occurrences help create bonds in individuals of a similar age group. Baack and Clow (2012) contend that similar experiences in certain age groups impact consumer perceptions, penchants, and social morals (Baack & Clow, 2012). Generational segmentation is one way Apple Corporation marketers, for example, can transmit their campaign messages to motivate a target audience to take action.  Apple’s website clearly states that their core message is a commitment to produce quality products. To demonstrate this concept, the promotion department may create a strategy to transmit that message to the Older Boomers age group for instance.  A campaign targeted at them would be developed in a different manner than a campaign that targets Generation Y, for instance, because each age group evolved with a different set of experiences. For example, Older Boomers grew up with TV shows like Star Trek. Knowing this, marketers can use this factor to influence their interest in iPad products because they remind them of the devices their heroes used in the show.  On the other hand, a marketer would appeal to Generation Y consumers based on the exciting new apps and features as the next evolution of the electronic devices they grew up with. Generational segmentation is an effective strategy that is utilized to help marketing experts transmit relevant information to the intended consumer.

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Benefit Segmentation

Benefit segmentation focuses on customer benefits or improvements that are provided by a product or service. Baack and Clow (2012) propose that demographic and psychographic information are united with benefit data to help identify these groups so that marketers can analyze further variables that affect their audience (Baack & Clow, 2012). For example, another strategy Apple Corporation marketers can develop to promote their product is one that highlights the benefits of the new iPad by comparing it to other tablets and portable laptop computers available on the market. Some of these benefits may focus attention on components like the larger viewing display, the lightweight design, and that it is more compact than laptop computers. Marketers that feature product benefits in their campaigns can attract consumers effectively. A company in the health care industry, however, like the Chopra Center, that wants to transmit the benefits of their facility and services to consumers, would implement completely different segmentation strategies based on the consumer’s desire to improve their fitness and maintain a healthy lifestyle. The Chopra Center in San Diego is designed and operated by licensed physicians and medical practitioners for a specific target audience. Chopra Center marketers for example, would identify individuals that are experiencing health issues who are looking for alternative methods in health care. The Center’s core message is to serve as a global source for balance, healing, transformation, and the expansion of awareness (Chopra & Simon, 2013). This is stated clearly on their website and in their promotional material. This declaration helps to provide consumers with confidence and security in the organizational management of their institution. As a medical facility that offers both products and services, it is important that their marketing campaigns keep their promises and are designed to protect them from fraud and liability issues that may arise. Companies that incorporate benefit segmentation are focused on fulfilling consumer needs based on a desire to improve their life in some manner.

Conclusion

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Leaders that acknowledge the concept that markets are not homogenous and use market segmentation strategies are in a better position to standout in their industry and maintain a competitive edge. Baack and Clow (2012) purport that developing effective targeted advertising is the key to a successful marketing campaign. Marketers that identify their target audience by implementing precision plans to influence consumer: (a) awareness, (b) knowledge, (c) liking, (d) preference, (e) conviction, and (f) the actual purchase, are significant elements that impact consumer buying power. These strategies are designed to impact consumer cognitive, affective, and conative components in an effort to produce a powerful feeling or experience that motives them to take action (Baack & Clow, 2012). The findings of this research conclude that market segmentation is an effective strategy that helps corporations stop wasting their advertising investments on campaigns that do not reach intended buyers, and plays a significant role to help them identify a target audience.

Next week my research work is centered on advertising strategies and media buying. Stay tuned … until then, have a great weekend everyone!

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References

Baack, D., & Clow, K. (2012). Integrated advertising, promotion, and marketing communications (Fifth ed.). Upper Saddle River, NY: Pearson Education, Inc.

Chopra, D., & Simon, D. (2013). The Chopra Center for Well-Being. Retrieved July 14, 2013, from The Chopra Center for Well-Being: http://www.chopra.com/welcome-chopra-center

Gallagher, L., & Zoratti, S. (2012). Precision marketing: Maximizing revenue through relevance. London, UK: Kogan Page Ltd.

Godfrey, A. L. (2007). A product segmentation approach and its relationship to customer segmentation approaches and recommendation system approaches. ProQuest Dissertations and Theses. Ann Arbor, MI, USA. Retrieved September 25, 2012, from http://search.proquest.com/docview/304811614?accountid=32521

Kennedy, D. (2011). The ultimate marketing plan: Target your audience (Fourth ed.). Avon, MA, USA: Amazon Digital Services, Inc.

McDonald, M. (2012). Market segmentation: How to do it and how to profit from it. Chichester, West Sussex, UK: John Wiley & Sons.