This presentation is related to the International Segmentation

1. COURSE: Competing in Global Markets
Course Code:403
Unit 2
International Segmentation
Session 1

2. • INTERNATIONAL MARKET SEGMENTATION

3. MARKET
• Refers to a set of all ACTUAL AND POTENTIAL BUYERS of a
product.
• It means that BUYERS IN THE SAME MARKET SEEK
PRODUCTS BROADLY FOR THE SAME FUNCTION.
• But different buyers have DIFFERENT EVALUATIVE CRITERIA
about what constitutes the right product for performing the same
function

4. MARKET
• Within the same market there are SUBMARKETS that differ
significantly from one another.
• This LACK OF HOMOGENEITY within the same market may be due
to the differences in buying habits, the ways in which the product is
used, motives for buying, etc.
• It is necessary to divide the market into HOMOGENEOUS
SUBMARKETS for successfully marketing the product.

5. International Market Segmentation
• is the process of identifying groups or set of potential customers at
national or international level who exhibit similar buying behaviour.
According to Philip Kotler
Marketing segmentation is dividing a market into distinct groups of
buyers with different needs, characteristics, or behaviour who might
require separate products or marketing mixes

6. International market segmentation
• Is the process of dividing total market into one or more parts
(submarkets or segments) each of which tends to be homogeneous in
all significant aspects.
• A market segment refers to a submarket (a part) of the market which is
homogeneous in all significant aspects.

7. International Market Segmentation
• Segmenting helps in DESIGNING THE MARKETING MIX as per
requirements of the customers which is beneficial not only to the
marketers but also to the customers..
• Markets in industrialized countries/regions such as the USA or
Western Europe are often highly segmented while those in developing
or emerging countries are more likely to be unsegmented

8. International Market Segmentation
• There are certain target segments with similar interest and response
patterns that can be identified across countries and region

9. INTERNATIONAL MARKET
SEGMENTATION
• Businessmen and women from different‘ countries often exhibit
similar preferences with regard to expensive pens, watches and other
personal items and are prime targets for the international business
media such as fortune and business week.
• The same cartoon characters from disney films such 'as batman,
superman and aladdin and toys such as barbie dolls attract children
worldwide.

10. International market segmentation
• Indian 'immigrants into the UK have retained traditional food
consumptions patterns and are prime targets for Indian spices and
pulses. This promotes a range of firms to develop products suited to
their tastes.

11. Relationship of a Segment to the Market
• A market segment consists of buyers who seek (occasionally or often)
the same aspects of a product.
• The concept of a market as a set and a segment as a subset is the basis
on which the process of segmentation is carried out.
• But the relationship of a segment to a market is also one of the means
to achieving certain goals

12. COURSE: Competing in Global Markets
Course Code:403
Unit 2
International Segmentation
Session 2

13. International market segmentation
• Is the process of dividing total market into one or more parts
(submarkets or segments) each of which tends to be homogeneous in
all significant aspects.
• A market segment refers to a submarket (a part) of the market which is
homogeneous in all significant aspects.

14. Geographic Segmentation
Demographic Segmentation
Behaviour Segmentation
Psychographic Segmentation

15. Geographic Segmentation
• Global segmentation IDENTIFIES GROUPS OF CONSUMERS
with similar needs and wants in multiple country markets.
• They may come from different countries, have different
backgrounds, and speak different languages, but they do have
commonalties -THEY HAVE SIMILAR SETS OF NEEDS FOR
A PRODUCT.
• Consumers in a global market segment share common
characteristics that make them a RELATIVELY
HOMOGENEOUS OF BUYERS.

16. Geographic Segmentation
• JAPAN'S NISSIN INSTANT NOODLES is sold in most
parts of Asia
• But Customized regionally.
• In India, unlike the Japanese, where people do not use
CHOPSTICKS, the noodles come in a shorter version.
• They are also given SPICIER FLAVOUR and is vegetarian-
based because of a large population of vegetarians.

18. Geographic Segmentation
• When a company does business in more than one country
• Target markets can be identified as:
(1) All consumers within the borders of a country; or
(2) global market segments - all consumers with the same
needs and wants in groups of country markets

20. Demographic Segmentation
• Demographic segmentation is based on measurable characteristics
of population such as AGE, GENDER, INCOME, EDUCATION
AND OCCUPATION
• Most popular bases & variables are easier to measure
• For most consumer and industrial products, national income and
per capita income constitute the single most important segmentation
variable and indicator of market potential

21. Demographic Segmentation
• Global teenager (young people between the ages of 12-19) has been a
major variable to segment the international market
• SOCIAL CLASS- Elites represent older, more affluent consumers
who are widely travelled and have money to spend on prestigious
products with an image of exclusivity

22. Psychographic Segmentation
• Divided into different groups on the basis of attitudes, values,
lifestyles
• NESTLE introduced a special brand of decaffeinated coffee for
"late nighter
• In the late 1950s, ford and CHEVROLET (car Brands were
promoted as having different personalities.
• FORD buyers were identified as independent, impulsive,
masculine, alert to change and self-confident.
• Chevrolet owners were conservative, thrifty, prestige
conscious, less masculine and seeking to avoid extreme

23. Behaviour Segmentation
• Behaviour segmentation focuses on whether or not people buy and
use a product as well as how often, and how much they use it.
• Behavioural variables such as occasions, user status, usage rate,
loyalty status, and buyer readiness stage enables the companies to
segment the market accordingly.

25. Behaviour Segmentation-Survey
• An annual survey of consumer life styles, attitudes, and purchasing patterns
of over 15,000 customers in 14 countries suggested classification of
consumers into six distinct categories:
• Strivers (28 per cent global average),
• Achievers (22 per cent),
• Adapters (18 per cent),
• Traditional (16 per cent),
• Pressured (13 per cent), and
• Unassigned (3 per cent).

26. Benefit Segmentation

27. Essentials of Effective Segmentation
• The process of segmentation must clearly
• measurability, accessibility, profitability and actionality

28. Advantages of Segmentation
• Understand potential customers better
• Pay better attention to specific areas of marketing strategy
• Formulate marketing programmes more effectively
• Understand competition better
• Deploy marketing resources efficiently
• Promote the products more effectively
• Appropriate designing of the marketing mix
• In general, serve the customer better

29. Export Market Selection: Strategies
and Assessment

30. INVEST/GROW COUNTRIES:
 Such countries call for a
high level marketing
commitment.
 They represent a large
market size which can be
tapped through investment
in people and capital.
 It becomes necessary to
match the products with the
marketing requirements.

31. DOMINANT/DIVEST
COUNTRIES:
 Such countries rank high on country
attractiveness but low on competitive
strengths.
 The choice rest in either of the
alternatives, to sell out or to develop
competitive strength to reap the
opportunities offered by such a market.
 If one wants to reap such benefits then
one must analyze the market more closely
in terms of cash required to build the
strength and the potential profits.
 In such a decision, time frame and
corporate profitability become
important issues.

32.  SELECTIVITY COUNTRIES:
 Such countries fall in the center of
the matrix representing the fact .that
thev are neither highly attractive
countries nor highly unattractive.
 They also represent in company
terms, a position that can be built or
broken.
 In such situation the company can
either unite the market or build the
market by introducing new product.
features, through technological
upgradations

33. HARVEST/DIVEST/COMBINE/
COMBINE COUNTRIES:
 A country must be harvested.
 A growth of market share in such a
market would demand an equal
increase in marketing effort wiping
out the gains if any.
 Therefore, in such countries it makes
more sense to sell out, to maintain a
close watch of cash flow and to follow
a pricing which will minimize the
investment in such countries till the
operations are abandoned.

34. COURSE: Competing in Global Markets
Course Code:403
Unit 2
INTERNATIONAL PRODUCT LIFE CYCLE
Session 5

35. • Discusses the consumption pattern of the product in many countries.
• Pass through several stages of the product life cycle.
• The product is innovated in country usually a developed country to satisfy
the needs of the consumers.
• The innovator country wants to exploit the technological break through
• Gradually foreign country also starts production
• As a'result, the innovator country starts losing its export market
• In this way, the innovator country becomes the importer of the products.

36. International Product Life Cycle
1. Export strength is
evident by innovator
country
2. Foreign production
starts
3. Foreign production
becomes competitive in
export market
4. Import Competition
begins

37. EXPORT STRENGTH IS EVIDENT BY INNOVATOR COUNTRY
Innovated in the developed countries
They possess the resources , have the technological know how and sufficient capital
to invest on the research and development activities
Forces the production activities to be located near the market
(ADAPTATION AND MODIFICATION)
The customers are affluent in the developed countries
The manufactures are attracted to Produce the goods in the developed
country
The goods are marketed in the home country and exploring foreign markets
Phase exhibits the introduction and growth stage of the product life cycle.

38. FOREIGN PRODUCTION STARTS
The importing firms in the middle income country realise the demand
potential of the product in the home market
manufacturers also become familiar in producing the goods
The growing demand of the products attracts the attention of many
firms
start production in their country and gradually start exporting to the
low income countries
reduces the export from the innovating country

39. FOREIGN PRODUCTION BECOMES COMPETITIVE IN EXPORT MARKET
The firms in low income country also realise the demand potential
They gain expertise in manufacturing the commodity.
start exporting the goods to other countries
This exhibits the ,declining stage of product life cycle for the
innovator country.
This is the third phase of product life cycle where the products start
becoming standardized.

40. IMPORT COMPETITION BEGINS
The producers in the low income importing country gain sufficient
experience in producing and marketing the products
The innovator country finds the import from this country
advantageous.
In this fourth stage of product life cycle the product becomes
completely standardized.

41. IMPLICATIONS FOR INTERNATIONAL PRODUCT
PLANNER
Innovative products improve the staying power of the international
firm.
The marketers whose products face declining sale in one foreign
market may find another foreign market with encouraging demand for
his product;
 Innovative products carry significant export potential;