As you may expect, the market environment will change during the course of the simulation. The size and growth rate of consumer segments will evolve over time. Some segments will grow and thus become more attractive while others will shrink. This will be especially true for the new Vodite market that may be quite small initially but could become fairly big if companies introduce the right products at the right price. More importantly, the needs of customers will probably change over time. For example, some segments may want more powerful brands while others may expect prices to decrease.
To respond to these changes, companies will have to introduce new Sonite or Vodite brands and reposition or withdraw existing ones. As marketing resources are limited, it is extremely important to adopt optimal segmentation and positioning strategies, especially because a Markstrat company cannot market more than five brands in a given period in each market. Your department will be faced with the following strategic issues on market segmentation and product positioning:
•Which segments to target
•How to design products satisfying the needs of these segments
•How to position new brands effectively
•How to reposition existing brands to better fit customers’ needs
Neither segmentation nor competitive strategies are addressed in this manual. Your professor may deliver conceptual sessions on these subjects during the course. You may also find useful information on these topics in your marketing textbook. In this chapter, we will assume that you have identified the consumer segment(s) that you want to target for a specific brand, and we will describe the various approaches that can be used in Markstrat to address product design and brand positioning.