SUNDAY 18 MARCH 2012 | CEYLON TODAYSUNDAY CEYLON FT4 FT FOCUS

By Chiara ramaChandra

“Feel good, look good and get more out of life” – is the Unilever vision.

150 million times a day, someone somewhere chooses a Unilever product. From feeding your family to keeping your home clean and fresh, Unilever brands are part of everyday life.

With 400 brands spanning 14 categories of home, personal care and food products, no other company touches so many people’s lives in so many different ways. The brand portfolio has made Unilever a leader in every field in which they work. It ranges from much-loved world favourites including Lipton, Knorr, Dove and Omo, to trusted local brands such as Blue Band and Sauve.

The company constantly enhances their brands to deliver more intense, rewarding product experiences. They invest £ one billion every year in cutting edge research and development and have five laboratories around the world that explore new thinking and techniques to help develop its products.

Continuous Development

Consumer research plays a vital role in their brands’ development. They constantly develop new products and developing tried and tested brands to meet changing tastes, lifestyles and expectations and their strong roots in local markets also mean they can respond to consumers at a local level.

Segmentation of Brands

1. Health and Personal Care

(i) First launched in France in 1983, the leading male grooming brand, Axe, now gives guys the edge in the mating game in over 60 countries.

(ii) The oral care brands Mentadent, Pepsodent and Signal have teamed up with the World’s largest dental federation, the FDI which represents over 750,000 dentists around the world.

(iii) Lux became the first mass-marketed soap when it launched in 1924. Today it achieves annual global sales of £ one billion.

(iv) Recent breakthroughs at Rexona include Rexona Crystal, a deodorant that eliminates unsightly white deposits on dark garments.

2. Food

(i) Knorr is the biggest food brand with a strong presence in over 80 countries and a product range including soups, sauces, bouillons, noodles and complete meals.

(ii) Lipton’s tea – based drinks include the international Lipton iced tea – range, the Lipton range in North America and Lipton Yellow Label, the world’s favourite tea brand.

(iii) Becal/Flora pro active products have been recognized as the most significant advancement in the dietary management of cholesterol in 40 years.

Unilever culture also embodies vitality. Adding Vitality to life requires the highest standards of behaviour towards everyone they work with, the communities they touch and the environments on which they have an impact.

Market segmentationMarket segmentation represents an

important recent advance in marketing thinking and strategy. Market segmentation is the subdividing of a market into distinct subsets of customers, where any subset may conceivably be selected as a market target to be reached with a distinct marketing mix. The power of this concept is that in an age of intense competition for the mass market, individual sellers may prosper through developing offers for specific market segments whose needs are imperfectly satisfied by the mass-market offerings.

Requirements for effective Segmentation

1. Measurability – The degree to which the size and purchasing power of the resulting segments can be measured. Certain segmentation variables are hard to measure. E.g: The size of the segments of automobile buyers who are primarily motivated by automobile styling or by performance.

2. Accessibility – The degree to which the resulting segments can be effectively reached and served. It would be helpful if advertising could be directed mainly to the segment of opinion leaders, but their media habits are not always distinct from those of opinion followers.

3. Substantiality – The degree to

which the resulting segments are large and/or profitable enough to be worth considering for separate marketing attention. A segment should be the smallest unit for which it is practical to tailor a separate marketing programme. Segmental marketing is expensive. It

would not pay, for example, for an automobile manufacturer to develop special cars for midgets.

Basis for market segmentation

1. Geographic Segmentation – The market is divided in to different locations – nations, states, countries, cities or neighbourhoods. The organization recognizes that market potentials and costs vary with market location.

2. Demographic Segmentation – The market is subdivided into different parts on the basis of demographic variables – age, sex, family size, income, occupation, education, family life cycle,

religion, nationality. Demographic variables are easier to measure than most other types of variables.

3. Psychographic Segmentation – Marketers divide the buyers into several groups on the basis of social class, life style and/or personality characteristics. Lifestyles shape the interest of people in various goods.

4. Behavioural Segmentation – Marketers use behavioural variables to segment markets. Such variables include knowledge, attitude, and use of response to a product.

5. Occasion Segmentation – Customers may be divided according to occasions when they develop needs, purchase products

to satisfy the needs or use the products to satisfy needs.

6. Benefit Segmentation – This is also a useful and effective method of segmentation and customers are segmented on the basis of different benefits they seek from the product. It requires determination of major benefits people seek from a product class, the kind of people who look for each benefit and the principal brands offering each benefit. Benefit segmentation, thus, implies satisfying one benefit group. This can be done by developing a unique selling proposition (USP).

7. Volume Segmentation – Segmentation of markets may also be done on the basis of volume of usage (rate of usage) of a product. The markets may be segmented into light, medium and heavy user groups.

8. Segmentation according to attitude of people – A market may be segmented by classifying people in it according to their enthusiasm for a product. Thus, five classes may be seen enthusiastic, positive, indifferent, negative and hostile. While people with enthusiastic and positive attitudes seem to be the best prospects, the negative and hostile attitude people are just the opposite.

Advantages of segmentation

• Segmentationgivesaclearunderstanding of the customers and the difference that exist between them. This understanding helps to fine tune the marketing mix so as to satisfy each segment perfectly.• Italsoexposesgapsinthe

market, E.g.: it shows groups that are not being presently satisfied with the available products. The whole concept of niche marketing is based on segmentation.

E.g.: Sony Walkman, Mlesna Tea Centre (the concept of value added gift

packed tea in various pack forms such as ceramic and wooden ornaments.)

Buyers have unique needs and wants, each buyer is potentially a separate market. Ideally, then, a seller might design a separate marketing programme for each buyer. However, although some companies attempt to serve buyers individually, many others face larger numbers of smaller buyers and do to find complete segmentation worthwhile. Instead, they look for broader classes of buyers who differ in their product needs or buying responses.

A company that practices segment marketing recognizes that buyers differ in their needs, perceptions, and buying behaviours. The company tries to isolate broad segments that make up a market and adopts its offers to more closely match the needs of one or more segments. Thus, General Motors has designed specific models for different income and age groups. In fact, it sells models for segments with varied combinations of age and income. For instance, GM designed its Buick Park Avenue for older, higher income consumers.

Segment marketing offers several benefits over mass marketing. The company can market more efficiently, targeting its products or services, channels and communication programmes towards consumers that it can serve best. The company can also market more effectively by fine – tuning its products, prices and programmes to the needs of carefully defined segments. The company may face fewer competitors if fewer competitors are focusing on this market segment.

With dozens of brands in the marketplace, Procter and Gamble offers an array of consumer products with dazzling success. In the United States alone, P&G offers seven brands of laundry detergent, three Brands of deodorant and two brands each of fabric softener, cosmetics and disposable diapers. In each of these categories, P&G’s products compete against each other, as well as with products offered by other companies, for share of the customer’s wallet.

Marketing is not a routine task. Nor is it a cone-time task. The marketing man can never snuggle down in his chair saying 'It’s over'. It’s never over! An entirely new set of situations may hit from any time. He is operating in an ever changing and ever – challenging world. The capacity for managing all such change, must form an inbuilt part of the marketing strategy because marketing primarily implies marching ahead under changing conditions. Strategy should necessarily help this process. It should enable the firm to sense and anticipate change, to analyze and comprehend its implications and to confront and score over its effects.

(The writer has a MSc in Marketing (U.K.), DipM, MCIM, Chartered Marketer, FIAB, MSLIM)

Why segmentation?

Segmentation gives a clear understand-

ing of the customers and the difference that exist between them. This understanding helps to fine tune the marketing mix so as to satisfy each segment perfectly