MarketingRx for January 9, 2009
Dear Marketing RX,
Hope you could help me out. Iʼm a 4th year student taking up Marketing Management. I have stumbled across your column a few months back and I was really pleased that it was helpful and clarified some questions that I had. So I took a chance and decided to ask for your expert advice on my problem.
Graduation is fast approaching and I canʼt help but feel insecure of my knowledge and skills. Although I study in a reputable university, I am unfortunate to have outdated teachers whom despite having doctorate degrees stick strictly by the books.
They lack in 1st hand experience which I think is highly instructive and crucial for their students. Our typical classroom discussions range from reading out loud the latest copy of Kotler to embarrassing situations like when they are bombarded with questions they cannot answer convincingly. Another thing I find ironic is that they cannot relate what they teach to a Philippine setting. If not for your column, I would never have heard of marketing gurus such as Kumar or the concepts of customer insighting, communitization nor debunking the age-old belief that customer loyalty is the best business model.
Coming across marketing alumni, they have all expressed the same frustration: what we learn in school does not coincide with what is expected by the employers. This discrepancy highly alarms a lot of the marketing students. We have long expressed our observation that our curriculum needs to be streamlined with what is actually happening out there but it seems that these sentiments fall on deaf ears.
My grades are quite good and they have earned me a spot to be part of a team our department sends to compete in such competitions such as PANAʼs IMC and PMAʼs STRATMark. During these times, my team mates and I take it upon ourselves to learn the whole process and figure everything out on our own since our professors are not very helpful. We try to make the best of what is available but we still feel that it is inadequate. In fact as much as possible I try to attend seminars with key speakers and read up on marketing articles and books, but having no one to direct my questions to, I often get confused.
I am now scared that in the future when I am employed I will find myself in situations where I am clueless.
In closing here are some of my questions: ·
what am I to do about my situation without offending my professors?·
could you please give me an idea of how it is to be a professional marketer and what the industry is like?·
what reading materials could you suggest to a newbie like me which could be very helpful?· what else should I do that could supplement my education and make my resume more attractive?
Thank you and I hope that you could help me by answering through your column because I feel that there is a lot of potential among us and if given a chance we could become good marketers. Sincerely, Frustrated and Fearful of the Future (FFF)
+++Next week, we'll start addressing FFF's concerns and questions one by one. But what do you, our dear readers, think? Send us your suggestions for FFF and we'll include it in our column. If you're a marketing student please write to us and share your experience. We're sure that there are professors and schools out there that are exceptions to this future marketer's lament.Send them to us at MarketingRx@pldtDSL.net or post them at www.marketingrx.org .
We can also receive your reactions via text at 0918-3386412. (Pls include your name and co./organization/school.) Our prayers and thoughts are with our editor, Margie Quimpo-Espino who suffered a stroke while on a business trip to India last month. She's still recovering from a hospital in India and everyone who's read this column is encouraged to say a little prayer for her swift recovery. Thanks and God bless!===============
Showing posts with label marketing business solutions. Show all posts
Showing posts with label marketing business solutions. Show all posts
Tuesday, January 20, 2009
Wednesday, November 19, 2008
“What’s self-segmentation and is there such a thing?”
MarketingRx for October 31/November 7, 2008:
By Dr Ned Roberto with Ardy Roberto
Q: We heard that you recently gave a talk on market segmentation and self-segmentation. We read your book on market segmentation and we’ve been helped by the segmentation approaches you introduced. But that book didn’t at all talk about self-segmentation.
Our news said that you told your audience that self-segmentation is more useful than market segmentation. What’s the difference between market segmentation and self-segmentation? How exactly is self-segmentation of more practical use?
Is this a new book of yours? If it is, where can we buy it? If not, please give us a brief explanation so we can benefit from it just as we gained better understanding of market segmentation from your book.
A: That recent talk isn’t that recent. It’s been some two months ago. Anyway let’s take up your questions. We’ve been asked those questions before and for quite a number of times.
The most instructive way to be clear about the difference between market segmentation and self-segmentation is to think of segmentation as a behavior. Our traditional practice of market segmentation is the marketer’s segmenting behavior. That’s basically your partitioning as a marketer of your total market into segments.
The partitioning may be by socio-economic classification. This is probably the most used segmenting variable. It’s a conventional practice in the shopping mall, restaurant and hospitality services business. The practice typically yields the Class AB (upper class) segment, Class C (middle class) segment, Class D (borderline poor) segment, and Class E (extreme poor) segment. In another occasion as in the apparel and food supplement categories, you may partition by age to come out with the young adult segment, the mature adult segment, and the post-mature adult segment. Others like to partition by gender (the male segment versus the female segment), or even by geographical residency.
The classic pHCare example
Self-segmentation is the consumer’s segmentation behavior. This was what the pHCare market launching team at Unilab found in the feminine wash market in year 2000. The total population of menstruating women at that time self-segmented themselves into the femwash user segment and the femwash non-user segment. According to AC Nielsen, the user segment made up 12% of the total menstruating population while the non-users were a large 82%.
The 82% non-users self-segmented into 3 sub-segments. There were about 50% out of this 82% who for their feminine hygiene needs used 2 substitutes, namely, soap or water. This 50% divided about equally between soap and water. The remaining 32% out of the 82% were the “true” femwash non-users whose reason for non-use was something like this: “Wala naman akong UTI. So di ko kailangan yan.” (I don’t have UTI. So I don’t need that.) This is the most difficult market segment to go after for converting into femwash usage.
The other 2, the soap-using segment and the water-using segment, are not as difficult a segment for conversion. This is because the first of these 2 is already unhappy with soap as a femwash substitute. Soap users say something like this: “It makes me dry and itchy down there.” So demonstrating that a femwash like pHCare won’t dry and won’t make its user feel itchy will lead to conversion in favor of pHCare. On the other hand, the water-using femwash prospects reason out this way: “Okay na ang tubig. Gastos pa yang feminine wash” (Water is okay. It’s extra expense to use feminine wash.) That’s a resolvable issue of affordable value-for-money pricing.
In population size, each of these 2 non-user segments is somewhat larger than the current18% femwash users. The consumers in the soap-using segment count to 20.5% prospective femwash users (= 25% x 82% non-users). That’s the same population size of consumers in the water-using segment.
Converting the soap users into becoming femwash users doubles (about a little bit more) the current femwash user market. Then bringing in the consumers in the water-using segment will more than triple that current femwash user market! As you can see, this is the argument in favor of taking advantage of consumer self-segmentation for its more practical business-growing benefits. As we often tell our seminar participants, the ultimate source for growing your business is a new user market segment. Find one and your double or even triple your business. Because the period of owning a new market segment has been getting shorter and shorter, you can appreciate why searching and locating a new user market segment has become ever more critical.
The AyalaLand example
Here’s another instructive case that reinforces this practical business-growing advantage of self-segmentation but with a different twist. This is the self-segmenting behaviour of home owners of AyalaLand.
Originally, the market segmentation that AyalaLand adopted was by the socio-eco classification of the upper-upper class, i.e., the Class A market. This real property company partitioned the Class A market into the Class AAA (triple A) segment, the Class AA (double A) segment and the Class A (single A) segment.
Over the years, as these market segments got “saturated,” research on home owners in these segments revealed that home owners here were self-segmenting themselves into a first repeat customers for another house and lot, and even as second repeat customers. At the life cycle stage of “Full Nesters 1” where the couple’s youngest kid is less than 6 years old, this Class A customer has been observed to be at its first peak repeat home buying. This is a potentially double-the-business opportunity.
Then at another life cycle stage of “Empty Nesters 1” where you now have older couples, with or without kids at home, but the household head is still working, a Class A customer in this stage has been recorded to be at its second peak repeat home owning. This time and in most cases, this customer buys for gift giving. One of the children is now getting married and what can be a more welcome wedding gift than a house for the newly wed. That’s potentially another double-the-business opportunity.
Where’s the difference in this case? Notice that the new market at each of the 2 peak repeat home buying opportunities comes from the same original customers. The same customer has segmented himself or herself to participate in 2 new market segments. That’s growing business from your already acquired customers. It’s not new customer acquisition as in the femwash case. That’s the most cost-effective sourcing of business growing.
So there you are. There’s hopefully the clear difference between market segmentation and self-segmentation, and the true practical business-growing advantage to navigating through this fast changing waters and times via customers’ self-segmentation.
Keep your questions coming. Send them to ardy.roberto@gmail.com or visit www.marketingrx.org . God bless!
By Dr Ned Roberto with Ardy Roberto
Q: We heard that you recently gave a talk on market segmentation and self-segmentation. We read your book on market segmentation and we’ve been helped by the segmentation approaches you introduced. But that book didn’t at all talk about self-segmentation.
Our news said that you told your audience that self-segmentation is more useful than market segmentation. What’s the difference between market segmentation and self-segmentation? How exactly is self-segmentation of more practical use?
Is this a new book of yours? If it is, where can we buy it? If not, please give us a brief explanation so we can benefit from it just as we gained better understanding of market segmentation from your book.
A: That recent talk isn’t that recent. It’s been some two months ago. Anyway let’s take up your questions. We’ve been asked those questions before and for quite a number of times.
The most instructive way to be clear about the difference between market segmentation and self-segmentation is to think of segmentation as a behavior. Our traditional practice of market segmentation is the marketer’s segmenting behavior. That’s basically your partitioning as a marketer of your total market into segments.
The partitioning may be by socio-economic classification. This is probably the most used segmenting variable. It’s a conventional practice in the shopping mall, restaurant and hospitality services business. The practice typically yields the Class AB (upper class) segment, Class C (middle class) segment, Class D (borderline poor) segment, and Class E (extreme poor) segment. In another occasion as in the apparel and food supplement categories, you may partition by age to come out with the young adult segment, the mature adult segment, and the post-mature adult segment. Others like to partition by gender (the male segment versus the female segment), or even by geographical residency.
The classic pHCare example
Self-segmentation is the consumer’s segmentation behavior. This was what the pHCare market launching team at Unilab found in the feminine wash market in year 2000. The total population of menstruating women at that time self-segmented themselves into the femwash user segment and the femwash non-user segment. According to AC Nielsen, the user segment made up 12% of the total menstruating population while the non-users were a large 82%.
The 82% non-users self-segmented into 3 sub-segments. There were about 50% out of this 82% who for their feminine hygiene needs used 2 substitutes, namely, soap or water. This 50% divided about equally between soap and water. The remaining 32% out of the 82% were the “true” femwash non-users whose reason for non-use was something like this: “Wala naman akong UTI. So di ko kailangan yan.” (I don’t have UTI. So I don’t need that.) This is the most difficult market segment to go after for converting into femwash usage.
The other 2, the soap-using segment and the water-using segment, are not as difficult a segment for conversion. This is because the first of these 2 is already unhappy with soap as a femwash substitute. Soap users say something like this: “It makes me dry and itchy down there.” So demonstrating that a femwash like pHCare won’t dry and won’t make its user feel itchy will lead to conversion in favor of pHCare. On the other hand, the water-using femwash prospects reason out this way: “Okay na ang tubig. Gastos pa yang feminine wash” (Water is okay. It’s extra expense to use feminine wash.) That’s a resolvable issue of affordable value-for-money pricing.
In population size, each of these 2 non-user segments is somewhat larger than the current18% femwash users. The consumers in the soap-using segment count to 20.5% prospective femwash users (= 25% x 82% non-users). That’s the same population size of consumers in the water-using segment.
Converting the soap users into becoming femwash users doubles (about a little bit more) the current femwash user market. Then bringing in the consumers in the water-using segment will more than triple that current femwash user market! As you can see, this is the argument in favor of taking advantage of consumer self-segmentation for its more practical business-growing benefits. As we often tell our seminar participants, the ultimate source for growing your business is a new user market segment. Find one and your double or even triple your business. Because the period of owning a new market segment has been getting shorter and shorter, you can appreciate why searching and locating a new user market segment has become ever more critical.
The AyalaLand example
Here’s another instructive case that reinforces this practical business-growing advantage of self-segmentation but with a different twist. This is the self-segmenting behaviour of home owners of AyalaLand.
Originally, the market segmentation that AyalaLand adopted was by the socio-eco classification of the upper-upper class, i.e., the Class A market. This real property company partitioned the Class A market into the Class AAA (triple A) segment, the Class AA (double A) segment and the Class A (single A) segment.
Over the years, as these market segments got “saturated,” research on home owners in these segments revealed that home owners here were self-segmenting themselves into a first repeat customers for another house and lot, and even as second repeat customers. At the life cycle stage of “Full Nesters 1” where the couple’s youngest kid is less than 6 years old, this Class A customer has been observed to be at its first peak repeat home buying. This is a potentially double-the-business opportunity.
Then at another life cycle stage of “Empty Nesters 1” where you now have older couples, with or without kids at home, but the household head is still working, a Class A customer in this stage has been recorded to be at its second peak repeat home owning. This time and in most cases, this customer buys for gift giving. One of the children is now getting married and what can be a more welcome wedding gift than a house for the newly wed. That’s potentially another double-the-business opportunity.
Where’s the difference in this case? Notice that the new market at each of the 2 peak repeat home buying opportunities comes from the same original customers. The same customer has segmented himself or herself to participate in 2 new market segments. That’s growing business from your already acquired customers. It’s not new customer acquisition as in the femwash case. That’s the most cost-effective sourcing of business growing.
So there you are. There’s hopefully the clear difference between market segmentation and self-segmentation, and the true practical business-growing advantage to navigating through this fast changing waters and times via customers’ self-segmentation.
Keep your questions coming. Send them to ardy.roberto@gmail.com or visit www.marketingrx.org . God bless!
Thursday, August 21, 2008
'What’s different in Kartajaya’s horizontal marketing?’
Just click on the title above to read this column published last August 1. We just sent our friend, Hermawan Kartajaya--Indonesia's marketing guru and also co-author of Philip Kotler (like the Senior MRxer), an email to ask him to respond to this.
In the meantime, we'll try to catch up and post the last few weeks columns within the next few days.
God bless you all!
In the meantime, we'll try to catch up and post the last few weeks columns within the next few days.
God bless you all!
Thursday, July 24, 2008
Buy a copy of Best of MarketingRx now via Credit Card and Paypal
The Best of MarketingRx for Entrepreneurs, by authors Dr. Ned Roberto and Ardy Roberto, is a selection, by marketing consultants who are also successful entrepreneurs, of their best, most useful columns since 2003. Buy your copy today!
What's in it for you? Here's a sampling:
What's in it for you? Here's a sampling:
- A patis entrepreneur asks: "What is a better method than product testing to help raise my new product success rate?"
- A group of marketing students wants to know how to go up against a giants in service marketing.
- An employee about to retire wonders: "What products sell well during times of crisis?"
- A businessman asks: "As a small start-up company, should I be concerned about branding?"
- The entrepreneur and the marketing mindset
- How to estimate market size or market share
- "How can we pinpoint our target market?"
- "How do I increase my new product success rate?"
- What irritates the consumer reveals new product opportunities
- Going up against the giants in service marketing
- How to create a customer-satisfying service
- Use mobile marketing
- Get rich by marketing to the poor!
- Get lucky by copying Lucky Me!
- Get rich by marketing to the rich!
- "Should a small start-up company bother about branding?"
- Hire a celebrity endorser
- Buzz marketing
- How do you market when you cannot advertise or solicit directly?
- Understand your market first through STP 4Ps marketing strategy
- The magic of FREE!
- Segment, sell, and persist!
- Create distribution success for your products
- How to do painless price increases
- Is your pricing "right"?
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