Marketing Management, Millenium Edition - epiheirimatikotita.gr

Market Targeting Strategies 157tersegmentation to broaden their customer base. Smith Kline Beecham introducedAquafresh toothpaste to attract three benefit segments simultaneously: those seekingfresh breath, whiter teeth, and cavity protection. Next, the company moved deeperinto countersegmentation by launching flavored toothpastes for children, toothpastefor people with sensitive teeth, and other toothpaste products.Targeting Multiple Segments and SupersegmentsVery often, companies start out by marketing to one segment, then expand to others.For example, Paging Network Inc.—known as PageNet—is a small developer of pagingsystems, and was the first to offer voice mail on pagers. To compete withSouthwestern Bell and other Bell companies, it sets its prices about 20 percent belowrivals’ prices. Initially, PageNet used geographic segmentation to identify attractivemarkets in Ohio and Texas where local competitors were vulnerable to its aggressivepricing. Next, the firm developed a profile of users for paging services so it could targetsalespeople, messengers, and service people. PageNet also used lifestyle segmentationto target additional consumer groups, such as parents who leave their childrenwith a sitter. Finally, PageNet began distributing its pagers through Kmart, Wal-Mart,and Home Depot, offering attractive discounts in return for the right to keep themonthly service charge revenues on any pagers sold. 33In targeting more than one segment, a company should examine segment interrelationshipson the cost, performance, and technology side. A company that is carryingfixed costs, such as a sales force or store outlets, can generally add products toabsorb and share some of these costs. Smart companies know that economies of scopecan be just as important as economies of scale. Moreover, companies should lookbeyond isolated segments to target a supersegment, a set of segments that share someexploitable similarity. For example, many symphony orchestras target people withbroad cultural interests, rather than only those who regularly attend concerts.Still, a company’s invasion plans can be thwarted when it confronts blocked markets.This problem calls for megamarketing, the strategic coordination of economic, psychological,political, and public-relations skills to gain the cooperation of a number ofparties in order to enter or operate in a given market. Pepsi used megamarketing toenter India after Coca-Cola left the market. First, it worked with a local business group togain government approval for its entry over the objections of domestic soft-drink companiesand antimultinational legislators. Pepsi also offered to help India export enoughagricultural products to more than cover the cost of importing soft-drink concentrateand promised economic development for some rural areas. By winning the support ofthese and other interest groups, Pepsi was finally able to crack the Indian market.Ethical Choice of Market TargetsMarket targeting sometimes generates public controversy. 34 The public is concernedwhen marketers take unfair advantage of vulnerable groups (such as children) or disadvantagedgroups (such as inner-city poor people), or promote potentially harmfulproducts. For example, the cereal industry has been criticized for marketing to children.Critics worry that high-powered appeals presented through the mouths of lovableanimated characters will overwhelm children’s defenses and lead them to eat toomuch sugared cereal or poorly balanced breakfasts.As another example, R. J. Reynolds was criticized for plans to market Uptown, amenthol cigarette targeted toward low-income African Americans. Recently, internaldocuments from R. J. Reynolds and Brown & Williamson Tobacco Corporation (marketerof the Kool brand) have revealed the extent to which these companies targetblack youths aged 16 to 25, particularly with menthol brands. 35