MARKETING Targeting and Market Segmentation …………………. and Number ……………. . …………. Words-count: 524 Customer Targeting and Market Segmentation The contemporary business environments are highly dynamic and complex and marketers therefore look at most effective strategies that can help them achieve competitive advantage and long term profitability. Out of various marketing strategies, segmenting, targeting and positioning, generally termed as STP strategy, is perhaps one of the most effective marketing techniques. When it comes to the case of O2, the company has long been targeting consumer as well as family markets to help them meet their IT and communication needs. O2 UK has been established itself to be one of the best performing UK communication and mobile service operator and has held over the Apple iPhone for tow-years.
With highly advanced technology being used in developing the communication, the O2 company has also been able to beat many of its counterparts in the UK market. The company has offered an exclusive iPhone during 2008 and 2009 periods in which the company has also been able to reduce the overall churn rate (Wireless intelligence, 2011). As depicted above, Telefonica’s O2 was the leader in the first quarter of 2010 in the UK mobile market, with a market share of 27 % (telecomsmarketresearch. com, 2011).
One of the main success factors that helped the company achieve marketing success was its targeting strategy as it targeted lower value customers and it created a specific impression among the customers that O2 is an iPhone in most of their reach. STP strategy of O2 Segmentation is the basic marketing dimension of a company that helps it create strategic framework and it is the key to marketing process of identifying the right customers as well (Bygrave and Zacharakis, 2010, p.
170). The segmentation starts by breaking down the total market in to sub-groups relevant to its market like geographical, psychographic, behavioral etc (Lancaster and Reynolds, 2001, p. 68). O2, as is detailed above, segmented the mobile market to sub-groups like general consumer market, family market, tech-savvy customers and the potential market strength of each of the segmented group has been analyzed as well. A marketer, in order to make the company able to meet the very specific as well as general needs of the consumers, requires to target a group of people or organizations by designing and implementing a marketing mix (Lamb, Hair and McDaniel, 2008, p.
220). Different marketers go for different targeting techniques such as selective targeting, single segment strategy, product specialization, mass marketing etc (Ferrell and Hartline, 2008, p. 178). O2 has been able to target right customers for the right marketing purpose. Positioning is a basic marketing strategy that helps a marketer communicate its distinct value proposition and point of difference in relation to its products, place, promotion and price (Kerin, Hartley and Berkowitz, 2005, p.
64). In designing and developing the positioning, the marketer is required to identify set of possible competitive advantages, selecting right competitive advantage and select an overall positioning strategy. All these are meant for establishing brand image among the customers as the company will be able to be positioned differently and this can be converted to long term profitability being enabled by ‘brand loyalty’. References Bygrave, W. D and Zacharakis, A, (2010), Entrepreneurship, Second edition, John Wiley and Sons Ferrell, O.C and Hartline, M.D (2008), Marketing Strategy, Fourth edition, Cengage Learning Kerin, RA, Hartley, SW and Berkowitz, EN 2005, Marketing, Eighth edition, The McGraw Hill Companies Lamb, C.W, Hair, J.
F and McDaniel, J. C (2008), Essentials of Marketing, Sixth edition, Cengage Learning Lancaster, G and Reynolds, P ( 2001), Marketing: the one-semester introduction, Illustrated edition, Butterworth-Heinemann Telecoms-market research. com, 2011, UK Mobile Network Operator Subscriber Data 2007- 2011, Retrieved from http: //www. telecomsmarketresearch. com/resources/UK_Mobile_Operator_Subscriber_Statistics_2.shtml#Mobile_Operator_Market_Share_1Q10 Wireless intelligence, 2011, Wireless Intelligence: O2 records the lowest churn rates in UK, Retrieved from http: //www. wirelessintelligence. com/analysis/2011/04/o2-records-lowest-churn-rates-in-uk/