The market segmentation is very important for an organization like Britvic. The elements of the market Segment process are outlined below:
1. Establish a sample of customers which will represent the different decision-makers found in the specified market;
2. Record personal details about the decision-makers. The standard categories for profiling customers are:
(a) demographic;
(b) Geographic;
(c) Geodemographic;
(d) Phychographic.
3. Understand the real needs of customers and list the benefits they are seeking;
4. Verify the concluding clusters can be regarded as segments;
5. Bring together those micro-segments that illustrate similar patterns of importance for the benefits in order to form clusters.
With the segments uncovered it is time to identify which of them we are targeting:
2. Establish the attractiveness of each segment to a company;
3. Determine the relative competitive strength of a company;
4. Establish a sample of customers which will represent the different decision-makers found in the specified market.
Benefits of market segmentation & Targeting:
1) Lower marketing expenses by targeting certain segment. Good for small budget companies;
2) allows a business to clearly identify their target audience;
3) Increased effectiveness in marketing campaign designed to attract that segment.
4) allows a business to develop specific marketing plans to reach particular segments;
5) Tailoring product offering to a certain market segment improves customer satisfaction.
The process of Market segmentation
Market segmentation is when the market is split into groups, so that product and service can be marketed to customers more effectively. It is a practice undertaken by marketers to identify the group of consumers. The division of a market into different homogeneous groups of consumers is known as also market segmentation. Right market segmentation can help a business to better understanding sub-section of their market, to learn what makes them unique and how differ from one another. They can learn that who is their buyer, who is more like their product, where is more profitable to market their product. They can also know the customers habit, interest, lifestyle, hobbies in different areas through market segmentation. The learning can help any kinds of business to target market and to bring new product.
Market segmentation has build up depend on the following elements.
Behavioural Segmentation: It is based on variable such as customers usage rate, benefits sought, company brand loyalty, user status, occasions and readiness to buy etc.
Psychographic Demographic Segmentation: It is based on the customer’s interests, activities, options, hobbies, lifestyle, perception of selling company and habits.
Geographic Segmentation: It is based on regional variables such as region, climate, population density, and population growth rate etc.
Geo-Demographic Segmentation: It is mix of Geographic and Demographic variables which included regional with the ethnicity, education, occupation, income and family status of customers.
Targeting:
Target market is defined as being a set of buyers who share common needs or characteristics that the company decides to serve. The selection of potential customers to whom a business wishes to sell products and services is targeting. Successful marketing find a target audiences. Every business set a target after their market research. The targeting involves segmentation the market choosing which segment of the market is appropriate and determining the product that will be offered in each segment.
Three method of targeting:
Undifferentiated marketing is a market-coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer. It assumes everyone is the same and aims a particular product at everyone.
Differentiated marketing is a market-coverage strategy in which a firm decides to target several market segments and designs a separate offer for each. It relies on mass distribution and mass advertising for its success. It aims the products at specific segments in the market. It applies for same products but different segmentation with different promotion method.
Concentrated marketing is a market-coverage strategy in which a firm goes after a large share of one or a few submarkets. Through concentrated marketing, a company achieves a strong market position in the segments it serves because of its greater knowledge of the segment’s needs and the special reputation it required.
Benefits of segmentation and targeting to Britvic:
Britvic following all kinds of market segmentation and they are applying market segmentation for targeting. As a result they are getting more and more benefits. They recognize that the poorest customers needed an affordable source of Vitamin C and they have made a small glass bottle of juice and the idea was successful from the Geo-Demographic Segmentation. Britvic has more soft drinks brands in its portfolio than any other UK manufacturer from the Psychographic Demographic Segmentation. They try to bring a new drink for old people with no sugar from the Geographic Segmentation. Britvic is now the number tow branded soft drinks business in the UK after Coca-Cola Enterprise Ltd. And the number one supplier of branded still drinks in the UK. They provide fully serviced vending machines for appropriate location, many of which are in the public sector. They also supply a wide range of product to approximately 2oo, ooo outlets across the country. From the Geographic Segmentation They have manufacturing plants in seven UK locations. Britvic has a constant flow of new product development. The packaging is expected to reflect the new target market.
So from the above success of Britvic we can say that Britvic is applying all the process of Market segmentation and targeting the customers and finally they are getting benefits.
Marketing theory in relation to each of the 4p’s.
Marketing theory is a body of through decided to selling a product in a specific market. Most generally it is a method of using mass media to convince consumers that a product is something they need. Through marketing theory the products firms can create a successful marketing mix of the right product sold at the right price in the right place using more suitable promotion. Four p’s are known as marketing mix. These 4p’s are Product, Price, Place and Promotion.
Product:
Product is the most important in any kind of business. A company has to launch a product which is appealing to customers and makes them want to buy. For a product decision the customers should follow the following things;
Brand name, Styling, functionality, Quality, Safety etc.
Level of Product:
The are 3 levels of product, which are as:
i. Core product
ii. Tangible product
iii. Augmented product.
Core product: core product means for which reasons the customer are buying the product. For example peoples are buying the mobiles for the talking and using internet.
Tangible product: tangible means the colour, sizes, quality and design of the product. Its simply means that the output of the product.
Augmented product: its means that the benefit the service the product. For example the mobile company giving warranty and guaranty for 2 years.
Product Line:
A company creates a group of products, which has in common most of their main characteristics. For example Uniliver Company ltd. Creation different kinds of product Soup, Toot past, foam etc.
Product mix- an organization creates many products and, of course, sells them. So, the product mix is everything organization sells.
Product length- in a company the total number of product item creating that is product length.
Product line depth- A product line contains a number of items, this number being called product line depth.
Product width- An organization creates a number of product lines. The total number of theirs product line is called product width.
Product Consistency- its means that the various types of product how much related each others.
Product life cycle:
A product’s life cycle can be divided into several stages characterized by the revenue generated by the product. The stages are as follows:
Introduction stage: In the introduction stage, the firm seeks to build product awareness and develop a market for the product. In this stage cost are very high, no competition, slow sales volumes.
Product life cycle
Growth stage: in the growth stage, the firm to build brand preference and increase market share. In this stage
Maturity stage: At maturity stage, the strong growth in sales diminishes. Competition may appear with similar products. The primary objective at this point is to defined market share while maximizing profit
Decline stage : At this point there is a downturn in the market. For example more innovative products are introduced or consumer tastes have changed. There is intense price-cutting and many more products are withdrawn from the market. Profits can be improved by reducing marketing spend and cost cutting.
The factors which may affect Britvic on this target market they are selling to. If a mix of product could be sold to different types of customers and result in better than selling individual products then that should be done. Promoting their products to a larger market rather than one particular product to an individual market.
Price:
Price is the main of marketing mix. Because it is must be right price. It is must be high enough to cover costs and make a good profit however at the same time be low price to catch the eye of customers. Before taking pricing decision we have to think the following;
Pricing strategy which company’s use such as price skimming, price penetration, and competitive.
Price skimming involves setting a high price before other competitors come into the market. This is often used of a new product which is not facing little competition.
Price penetration is the pricing method of setting a relatively low initial entry price, usually lower than the intended established price to attract new customers.
Competitive: If there is strong competition in a market then the price of product will be same for different products. Products may be good or bad.
Price setting method
There are four price setting method;
Cost plus pricing: in this method price will be set the price of production cost, including both cost of goods and fixed costs at current volume, plus a certain profit margin.
Target return pricing: in this method price will be set to achieve a target return on investment.
Value based pricing: price will be set product based usually the most form of pricing, if firm can achieve it.
Fair pricing method: The concept of this method is price will be fair.
Britvic might like to use price skimming strategies when launching new products as they are already a very well known brand of soft drinks. Even price penetration to give customers the chance to try a well known brand at a low price but increase the price when the product is growing and nearing maturity.
Place:
The product must be in the right place, in location which is affordable to the business and also suitable for customers. It is known as channel, distribution and market coverage. It is the way that getting the product to the consumers, retailers, wholesaler’s agent are the distribution channel. Market coverage are divided exclusive, selective and inclusive.
Exclusive market coverage means that there only own brand product will marketed.
Selective market coverage means that there will be chosen brand out different brand product.
Inclusive market coverage means that there will be another brand product with own brand.
Britvic which is already distributing its products to a wide range of areas such as supermarkets, local shops, restaurant, pubs, hotels, and cinemas. They could expand there distribution even more if it wanted to. They could distribute to wholesalers and give them exclusive offers which are not available elsewhere. They may even think door to door promotion for their product.
Promotion;
Another one of 4p’s is promotion. This includes all of the tools available to the marketers for marketing communication. Company’s goal is the main of promotion. Different promotion methods could be such as advertising, personal sales, and sales force all are included in promotion.
Since Britvic is a very successful brand and company, they could afford to use any kinds of promotional method. They are already involved in many events such as Wimbledon and Pantomimes which gives the brand a lot of publicity. However they could have celebrity endorsement with famous athletes and film stars promoting their products.
Process:
Process is a procedure. It is a mechanism of activities which is involved in the delivery of a service. It means that how a business provides a good service to the customers and to get success. For example in a restaurant customer come to get proper food within short time for that there will be a procedure, the management will give them food in time and proper food. Also there will be a rule every staff will come before opening times to prepare everything that if any customer is come early then they can serve food. To make a regular customer procedure is very important.
People:
People who serve the customers is the main in a service. People are considering the most important element in any kinds of service so the rule of staff is very important to influences a customer’s perception of the quality of service. There are different department for service in a restaurant. Front side who are dealings with customers they must be highly trained and with good knowledge about their product. In kitchen there must be experiences people. And also it is very important that they all will be a good behaviour staff.
Physical Environment
Physical environment is very important for any kinds of business. It is an extended marketing strategy which is used to satisfy the customers by the best advertisement, with either tangible products or service. The marketing strategy should include effectively communicating their satisfaction to potential customers because of the intangibility of service. From physical environment the customers want comfort. Suppose a restaurant’s physical environment should be very clean and well decorated and also comfortable for the customers, because physical environment influences customers to choice a food. On the other hand it will be not only comfortable for the customers but also for staffs. Otherwise it not possible to serve the customers in proper way.
Economic Growth:
For economic growth they can adapt the following marketing mix.
Product: they can bring new drinks in their product range.
Price: In this case they can increase the price of their products.
Place: Britvic already has strong distribution channel after that they can improve their distribution channel all over the world.
Promotion: they have to set a strong promotion group for their new drinks.
More old people (Environment):
If they thought that more old people of their customers then they can adapt the following marketing mix.
Product: they can bring a new drink for old people with no sugar.
Price: they have to set a good price for the new drinks with the compare of their competitors.
Place: in this case they can set agent or distribution channel in where older people is living.
Promotion: they have to follow a good promotion method. Like they can use old people as model for advertise.
Ban on fizzy drink for children (Government rules & regulations):
If government currently ban the fizzy drink for children they can adapt the following marketing mix.
Product: Britvic can bring new healthy drinks in their product range for children with no sugar.
Price: they can set a reasonable price for their customers.
Place: they have to distribute their new product with distribute channel or they can set more new distribution channel and agent. They can use children model for their advertise.
Promotion: they have to give advertise for their new product with media
Marketing theory in relation to each of the 4p’s.
Marketing theory is a body of through decided to selling a product in a specific market. Most generally it is a method of using mass media to convince consumers that a product is something they need. Through marketing theory the products firms can create a successful marketing mix of the right product sold at the right price in the right place using more suitable promotion. Four p’s are known as marketing mix. These 4p’s are Product, Price, Place and Promotion.
Product:
Product is the most important in any kind of business. A company has to launch a product which is appealing to customers and makes them want to buy. For a product decision the customers should follow the following things;
Brand name, Styling, functionality, Quality, Safety etc.
Level of Product:
The are 3 levels of product, which are as:
i. Core product
ii. Tangible product
iii. Augmented product.
Core product: core product means for which reasons the customer are buying the product. For example peoples are buying the mobiles for the talking and using internet.
Tangible product: tangible means the colour, sizes, quality and design of the product. Its simply means that the output of the product.
Augmented product: its means that the benefit the service the product. For example the mobile company giving warranty and guaranty for 2 years.
Product Line:
A company creates a group of products, which has in common most of their main characteristics. For example Uniliver Company ltd. Creation different kinds of product Soup, Toot past, foam etc.
Product mix- an organization creates many products and, of course, sells them. So, the product mix is everything organization sells.
Product length- in a company the total number of product item creating that is product length.
Product line depth- A product line contains a number of items, this number being called product line depth.
Product width- An organization creates a number of product lines. The total number of theirs product line is called product width.
Product Consistency- its means that the various types of product how much related each others.
Product life cycle:
A product’s life cycle can be divided into several stages characterized by the revenue generated by the product. The stages are as follows:
Introduction stage: In the introduction stage, the firm seeks to build product awareness and develop a market for the product. In this stage cost are very high, no competition, slow sales volumes.
Product life cycle
Growth stage: in the growth stage, the firm to build brand preference and increase market share. In this stage
Maturity stage: At maturity stage, the strong growth in sales diminishes. Competition may appear with similar products. The primary objective at this point is to defined market share while maximizing profit
Decline stage : At this point there is a downturn in the market. For example more innovative products are introduced or consumer tastes have changed. There is intense price-cutting and many more products are withdrawn from the market. Profits can be improved by reducing marketing spend and cost cutting.
The factors which may affect Britvic on this target market they are selling to. If a mix of product could be sold to different types of customers and result in better than selling individual products then that should be done. Promoting their products to a larger market rather than one particular product to an individual market.
Price:
Price is the main of marketing mix. Because it is must be right price. It is must be high enough to cover costs and make a good profit however at the same time be low price to catch the eye of customers. Before taking pricing decision we have to think the following;
Pricing strategy which company’s use such as price skimming, price penetration, and competitive.
Price skimming involves setting a high price before other competitors come into the market. This is often used of a new product which is not facing little competition.
Price penetration is the pricing method of setting a relatively low initial entry price, usually lower than the intended established price to attract new customers.
Competitive: If there is strong competition in a market then the price of product will be same for different products. Products may be good or bad.
Price setting method
There are four price setting method;
Cost plus pricing: in this method price will be set the price of production cost, including both cost of goods and fixed costs at current volume, plus a certain profit margin.
Target return pricing: in this method price will be set to achieve a target return on investment.
Value based pricing: price will be set product based usually the most form of pricing, if firm can achieve it.
Fair pricing method: The concept of this method is price will be fair.
Britvic might like to use price skimming strategies when launching new products as they are already a very well known brand of soft drinks. Even price penetration to give customers the chance to try a well known brand at a low price but increase the price when the product is growing and nearing maturity.
Place:
The product must be in the right place, in location which is affordable to the business and also suitable for customers. It is known as channel, distribution and market coverage. It is the way that getting the product to the consumers, retailers, wholesaler’s agent are the distribution channel. Market coverage are divided exclusive, selective and inclusive.
Exclusive market coverage means that there only own brand product will marketed.
Selective market coverage means that there will be chosen brand out different brand product.
Inclusive market coverage means that there will be another brand product with own brand.
Britvic which is already distributing its products to a wide range of areas such as supermarkets, local shops, restaurant, pubs, hotels, and cinemas. They could expand there distribution even more if it wanted to. They could distribute to wholesalers and give them exclusive offers which are not available elsewhere. They may even think door to door promotion for their product.
Promotion;
Another one of 4p’s is promotion. This includes all of the tools available to the marketers for marketing communication. Company’s goal is the main of promotion. Different promotion methods could be such as advertising, personal sales, and sales force all are included in promotion.
Since Britvic is a very successful brand and company, they could afford to use any kinds of promotional method. They are already involved in many events such as Wimbledon and Pantomimes which gives the brand a lot of publicity. However they could have celebrity endorsement with famous athletes and film stars promoting their products.
Process:
Process is a procedure. It is a mechanism of activities which is involved in the delivery of a service. It means that how a business provides a good service to the customers and to get success. For example in a restaurant customer come to get proper food within short time for that there will be a procedure, the management will give them food in time and proper food. Also there will be a rule every staff will come before opening times to prepare everything that if any customer is come early then they can serve food. To make a regular customer procedure is very important.
People:
People who serve the customers is the main in a service. People are considering the most important element in any kinds of service so the rule of staff is very important to influences a customer’s perception of the quality of service. There are different department for service in a restaurant. Front side who are dealings with customers they must be highly trained and with good knowledge about their product. In kitchen there must be experiences people. And also it is very important that they all will be a good behaviour staff.
Physical Environment
Physical environment is very important for any kinds of business. It is an extended marketing strategy which is used to satisfy the customers by the best advertisement, with either tangible products or service. The marketing strategy should include effectively communicating their satisfaction to potential customers because of the intangibility of service. From physical environment the customers want comfort. Suppose a restaurant’s physical environment should be very clean and well decorated and also comfortable for the customers, because physical environment influences customers to choice a food. On the other hand it will be not only comfortable for the customers but also for staffs. Otherwise it not possible to serve the customers in proper way.
Economic Growth:
For economic growth they can adapt the following marketing mix.
Product: they can bring new drinks in their product range.
Price: In this case they can increase the price of their products.
Place: Britvic already has strong distribution channel after that they can improve their distribution channel all over the world.
Promotion: they have to set a strong promotion group for their new drinks.
More old people (Environment):
If they thought that more old people of their customers then they can adapt the following marketing mix.
Product: they can bring a new drink for old people with no sugar.
Price: they have to set a good price for the new drinks with the compare of their competitors.
Place: in this case they can set agent or distribution channel in where older people is living.
Promotion: they have to follow a good promotion method. Like they can use old people as model for advertise.
Ban on fizzy drink for children (Government rules & regulations):
If government currently ban the fizzy drink for children they can adapt the following marketing mix.
Product: Britvic can bring new healthy drinks in their product range for children with no sugar.
Price: they can set a reasonable price for their customers.
Place: they have to distribute their new product with distribute channel or they can set more new distribution channel and agent. They can use children model for their advertise.
Promotion: they have to give advertise for their new product with media
