Segmentation, Targeting and Positioning

Companies cannot connect with all customers in large, broad and diverse markets. But they can divide markets into groups of customers or segments with distinct needs and wants. A company needs to identify which market segments it can serve effectively. 

Segmentation, with respect to marketing, refers to the slicing of markets into groups of customers who share similar set of needs and wants.

Segmentation can of different kinds:

• Geographic: Region, city, rural and semi-urban areas
• Demographic: Age, Family size, Gender, Income, Occupation, Education, Socio-economic class (SEC)
• Psychographic: Lifestyle, Personality
• Behavioral: Occasions, Benefits, Users status, Usage Rate, Loyalty Status, Readiness stage, Attitude towards product

Different cigarette brands target different customers. While cigarettes on a whole are consumed by those who can afford the Rs. 10-12 per stick cost of the cigarette, certain brands like Insignia or Black aim to target the suave customer. 

The smoker of Classic Milds is generally male, above 18 years of age, belonging to SEC A1, A2 or A3.
The smoker can be broadly categorized into:

1. The college going kid who wants to look cool

2. The office going professional or businessman who is addicted to the cigarette

3.  The seasoned senior citizen who has smoked cigarettes for the better part of his or her life

Targeting to the identifying the potential customers that will consume a particular product and mapping their needs to the value offered by the product.

Finally, positioning refers to the creation of an association between the product and needs and wants of the product.

While examining the Classic Milds segmentation we come across the positioning of the brand as:

Super Premium Products (Advertised in SEC A1 and A2 areas):

• Insignia - 
• ITC Insignia. Cost: Rs 280 for 20
• ‘‘Where quality touches infinity’’, ‘‘redefine perfection’’
• Stellar
• ITC Stellar Slims Cost: Rs 250 for 10
• “Low nicotine, High Satisfaction”

Premium Products (Advertised in SEC A1, A2 and A3 areas):

• Wills Classic/Mild/Regular
• ITC Wills Classic/Mild Filter: King
• 70–74 mm. Cost: Rs 220 for 20
• ‘‘Discover a passion’’
• Wills Navy Cut
• ITC Wills Navy Cut Filter: ,70 mm.
• Cost: Rs 200 for 20
• ‘‘Made for each other’’
• Wills Silk Cut
• ITC Wills Silk Cut Filter
• Cost: Rs 240 for 20
• ‘‘A blend so right a filter so fine’’
• Gold Flake/Lights Filter
• ITC Gold Flake/Lights Filter: Regular 68 mm. Cost: Rs 200 for 20
• ‘‘It’s Honeydew Smooth’’, Smooth, exquisite,timeless. But then, all art is’’
• Four Square Filter
• GPI Four Square Filter: Regular.68 mm Cost: Rs 140 for 20
• ‘‘Man with the smooth edge’’
• Advertised in Higher and Lower SES

Bingo Products (Advertised in A3, B1 and B2 areas):

• Bristol
• ITC Bristol
• ‘‘Rise to the taste’’
• GPI Red and White
• Cost: Rs14.50 for 10
• Text in Hindi ‘‘Hum red and white peene walon kibaat hi kuch aur hai’’