Market targeting strategies are based on a concept that refers to the decision to concentrate on some particular segment of the market rather than trying to cover the whole market.
A company cannot focus on all the segments of the market equally. Rather, the company may only meet limited parts of the market. Hence, the concept of market targeting is useful, as the limited segmentation can be handled effectively and in a planned way. The concept of market targeting is also useful in many other ways.
In the first step of market targeting, the market segments that have the highest attractiveness are selected. This is done by analyzing the characteristics of these market segments and identifying their strengths and weaknesses. This analysis helps the company to focus its attention on the segment and develop strategies to serve that segment effectively and in a planned way.
Targeting involves developing strategies for serving the various segments.
These strategies depend upon the strength and weaknesses of each segment and upon the type of products the company sells. For instance, a company may choose to concentrate on the food segment, which has low marketing spend but high return on investment. Hence, the strategies developed for serving this segment include the development of quality products, increased brand name recognition, and optimized advertising and marketing strategies.
Mass market may include the use of standard forms of marketing.
Such forms of marketing usually have a lower response and have a limited reach. Hence, in order to maximize the marketing opportunities available through this channel, the company has to use the right form of marketing. The marketing strategies for mass marketing therefore revolve around the right use of media for the right location for the right type of product.
Market segmentation requires careful evaluation.
The evaluation of market segments enables the successful development of marketing campaigns. This involves identifying the profit margins of each segment and evaluating market segments according to key factors such as the age of the customers, the purchasing habits of the customers, the preferences of the customers, etc. For instance, young people are generally more expensive to advertise to than older people. Hence, the advertiser should analyze market segments by considering factors such as purchasing habits, age, etc.
The strategies used for market targeting must address problems that exist in the target audience’s life.
For instance, there may be some problems that arise from having to go to a bank or an internet site for help. In such a case, the marketing strategy must take care of providing answers to these problems. Some issues that might be considered in this context are whether there are sufficient numbers of stores within the target audience’s geographical area, whether the potential audience is adequately educated and whether there are sufficient services and goods available in the market to address potential needs.
The use of segmentation can be used to segment the market according to purchasing preferences.
Again, the market targeting strategies must consider how the products and services provided by a business can fit into the lives of potential customers. For example, if the business provides dog grooming services but not child care services then the marketing programme must be customized to cater to the needs of children, instead of concentrating on pet care. Again, a differentiation can be made according to whether or not the customers prefer to purchase online or offline.
Market targeting strategies must evaluate the effectiveness of the marketing strategy.
This is done through various aspects of evaluating market segments and target audiences. These include analyzing conversion rates and cost per action (CPA). Conversion rates refer to the percentage of customers completing a purchase offer and making a sale on the basis of that purchase. Similarly, CPA refers to the cost of commission paid to the marketer for a particular action, such as a lead or a sale.