Consumer Adoption Process and Market Segmentation Strategies

Stages in the Consumer Adoption Process

The adoption process consists of five distinct stages:

• Awareness
• Interest
• Evaluation
• Trial
• Adoption

This model suggests that the new product manager should focus on how to help consumers move through these stages.

Individual Differences in Innovativeness

People differ greatly in their readiness to try new products. There are five adopter groups:

• Innovators (2.5%): Venturesome; they try new ideas at some risk.
• Early Adopters (13.5%): Adopt new ideas early but carefully; they are often opinion leaders.
• Early Majority (34%): They are rarely leaders; they adopt new ideas before the average person.
• Late Majority (34%): Skeptical; they adopt new products after a majority of people have tried them.
• Laggards (16%): Traditional and suspicious of change; they adopt the innovation only when it has become a tradition.

Market Segmentation and Positioning

The strategic plan defines the company’s overall mission and objectives. Marketing’s role is to create value for customers and build profitable relationships.

The Marketing Strategy

The marketing strategy is the logic by which the company hopes to create customer value and achieve profitable relationships:

1. Segmentation & Targeting: Deciding which customers to serve.
2. Differentiation & Positioning: Deciding how to serve them.

The Marketing Mix (The Four Ps)

Guided by the marketing strategy, the company designs an integrated marketing mix:

• Product
• Price
• Place
• Promotion

Designing a Customer-Driven Strategy

Companies today cannot appeal to all buyers in the marketplace, or at least not in the same way. Buyers are too numerous, widely located, and varied in their needs. A company must identify the parts of the market that it can serve best and most profitably.

The four major steps in designing a customer-driven marketing strategy are Segmentation, Targeting, Differentiation, and Positioning.

Variables for Segmenting Consumer Markets

1. Geographic: Dividing the market into different geographical units (nations, regions, states, countries, cities, or neighborhoods).
2. Demographic: Dividing the market based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality.
3. Psychographic: Dividing buyers based on social class, lifestyle, or personality characteristics. People in the same demographic group can have very different psychographic characteristics.
4. Behavioral: Dividing buyers based on their knowledge, attitudes, uses, or responses to a product. Many marketers believe that behavioral variables are the best starting point for building market segments.