Three Essential Market Targeting Strategies Defined

Selecting the Right Market Targeting Strategy

Once a company has selected the segment(s) it wishes to target, it must decide on the most appropriate targeting strategy: undifferentiated, differentiated, or focused. Understanding the details of each approach is crucial for determining when each one is most appropriate.

Differentiated Marketing Strategy

A differentiated marketing strategy is employed when a company creates campaigns designed to appeal to at least two distinct market segments or target groups. This approach allows the company to tailor its message and product offerings to maximize relevance across multiple audiences.

Key Characteristics and Examples:

• Differentiated strategies can target many segments (e.g., shoe companies marketing to both men and women across various age groups).
• The strategy often uses different messages within the same campaign for different segments.
• Example: A retailer might market low cost to a budget-conscious segment while simultaneously promoting product quality to an affluent market segment.

Focused (Niche) Marketing Strategy

A focused marketing strategy (often called niche marketing) involves designing a promotional message that communicates the benefits desired by a single, specific segment. This strategy is highly targeted to one specific market segment or audience.

When to Use Focused Marketing:

• Focused strategies are often geared toward smaller groups of people, as they are designed to appeal deeply to a specific segment's unique needs.
• Example 1: Promoting a city as historic by targeting elderly members of historical societies through specialized newsletters.
• Example 2: A company marketing a product specifically for teenage girls, or a retailer targeting residents within a specific town boundary.

Undifferentiated (Mass) Marketing Strategy

When discussing differentiated and focused marketing strategies, it is also important to understand undifferentiated marketing strategies. In an undifferentiated marketing strategy, marketers use the exact same message for all segments of the market. This approach is synonymous with mass marketing.

Marketers typically create a message that appeals broadly to everyone, meaning the communication is often general or simple to ensure maximum relatability across diverse audiences. This strategy ignores segment differences in favor of market commonalities.

Comparative Example: A Restaurant Launch

Assume a restaurant is trying to market its new business. The choice of strategy dictates the promotional approach:

• Differentiated Strategy: The restaurant appeals to multiple crowds simultaneously:
  • College Crowd: Marketing cheap specials on food and drinks.
  • Family Crowd: Marketing kid-friendly meal options and table entertainment.
  • Elderly Patrons: Marketing senior discounts and early-bird specials.
• Focused Strategy: The restaurant targets a single, specific group, such as marketing its convenient location to a group of residents within 10 miles of the business.
• Undifferentiated Strategy: The restaurant highlights a general message, such as promoting its grand opening celebration to everyone equally.