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Chapter 3

by: Megan Angelo

Chapter 3 MKTG - 45082 - 001

Megan Angelo

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Positioning Services in Competitive Markets
Services Marketing
Eileen Bridges
Class Notes
Servies, Marketing
25 ?




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This 5 page Class Notes was uploaded by Megan Angelo on Monday September 19, 2016. The Class Notes belongs to MKTG - 45082 - 001 at Kent State University taught by Eileen Bridges in Fall 2016. Since its upload, it has received 3 views. For similar materials see Services Marketing in Marketing at Kent State University.


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Date Created: 09/19/16
Chapter 3 Positioning Services in Competitive Markets 3.1 Customer Driven Service Marketing Strategy Customer, Competitor and Company Analysis (3 C’s) Customer Analysis: - Overall examination of market characteristics - Customer needs: related character and behaviors Competitor Analysis - Current positioning - Strengths and weaknesses Company Analysis - Current brand positioning and image - Resources - Limitations and constraints Segmentation, Targeting, and Positioning Segmentation - Dividing population of possible customers into groups with common service- related characteristics Targeting - Choose one or more segments to focus on Positioning - Unique place in the minds of customers - Differentiation – first step- create unique positioning Figure 3.1 3.2 Segmenting Service Markets - firms vary widely in their abilities to serve different type of customers - adopt a strategy of market segmentation, identifying those parts of the market you cannot serve best Market Segment- common buyers share common: - Characteristics - Needs - Purchase behavior - Consumption patterns Ways to Segment: - Demographics- usually will not result in meaningful segments - Psychographics- useful for strengthening brand identity and creating emotional connection - Behavior- based- focuses on observable behavior - Needs based- focuses on what customers want Right Service- Specific Market - Market research- identity and prioritize service attributes for specific market segments Individuals- may set different priorities: - Purpose of using the service - Who makes the buying decision - Timing of use - Used alone or in a group - Composition of relevant group Important vs. Determinant Attributes Important- targeted customers rank as having the highest priority. Unwilling to select a service that does not offer this top priority attributes Determinant- is those actually considered in making a choice between acceptable services. These attributes differentiate among competing alternatives Consumers usually choose between alternatives in service offerings based on perceived differences between them Determinate attributes- determine buyer’s choices with alternatives - Service alternatives Firms: performance they plan to offer - Quantified- retail hours - Qualitative- comfort, noise level Willingness to trade off some level of service to get a lower price Price insensitive customers- higher price= higher service level Price sensitive customers- inexpensive- low price 3.3 Targeting Service Markets Focus Strategies - Fully focused o Limited range of services to narrow and specific market - Opportunities o Develop expertise o Protect against competition o Charge premium price - Risks o Market may be too small o Demand may be displaced by generic competition from alternative products o Economic turn down - Market focused o Narrow market segments- wide range of services o Operational capability to deliver o Purchasing patterns and preferences - Service focused o Narrow services, broad market o New segment- develop knowledge and skills - Unfocused o Broad market/ wide services o Many try to belong to many – difficult o Danger- become a “jack of all trades” 3.4 Positioning Services Four Principles of Positioning Strategy - Establish position for brand in minds of target customers - One simple, consistent message - Position- set apart from competitors - Cannot do all things- focus efforts 6 questions for Effective Positioning Strategy 1.)What does our firm stand for in the minds of current and potential customers? 2.)What types of customers do we serve now, who would we like to target in the future? 3.)What is the value proposition for each of our current services, and what market segment does each target? 4.)How do our services differ from those of competitors? 5.)How do customers in target segment (s) perceive our services as meeting their needs? 6.)What changes must we make to our offerings to strengthen our competitive position? Segmentation, targeting and positioning integrate with customer, competitor and company analysis to form a positioning statement Target market - Specific group(s) of people that the brand wants to sell and serve Frame of reference - Category the brand is competing in identifies competitors Point of difference - Most compelling benefit offered by brand; stands out from competitor Reason to believe - Proof that brand can deliver promised benefits 3.5 Using Positioning Maps to Analyze Competitive Strategy - Positioning Maps are often called “Perceptual Maps” - Great tool to visualize competitive positioning and to track changes - Graphically represents consumer perceptions of firms own and competing brands - Typically confirmed to visualize two attributes in 2-D and 3-D when possible - Information about brands- to be mapped can be obtained from: - Market place data (scanner/ online order) - Ratings provided by representative consumers in surveys - Both Managers can Visualize Strategy - Positioning maps display relative performance of competing firms on key attributes - Marketing research provides inputs to development of positioning maps- challenges include: o Attributes employed in maps- target segment o Performance shown for individual firms on each attribute accurately reflects perceptions of customers in target segments o Predictions can be made as to how positions may change in light of future developments o Maps facilitate “visual awakening” to threats and opportunities, suggest alternatives strategic directions


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