[Solved] marketing 101 niche markets

1. Define the generic market for Mike Ball Dive Expedition. What are other possible markets?2.

Which segmenting dimensions are applicable to how MBDE segments to the dive market?3. Discuss the Psychographic & Geographic segmenting dimensions for the diving consumer who forms the target market for MBDE4. Identify market opportunities for Mike Ball. How could he reposition MBDE?IntroductionThis essay will discuss the segmentation dimensions of niche marketing, using the provided case study example of Mike Ball Dive Expeditions (MBDE).

MBDE is a Cairns based international live-aboard dive expedition company, who provide dive services for the great barrier reef and the coral sea. According to its website, MBDEMBDE caters for experienced diving enthusiasts by offering 6 different types of expeditions for novice to advanced divers with an empathasis on providing a quality customised service. The case study state that the region is known for some of the best diving in the world and that Mike Ball Dive Expeditions is positioned as a first-class live-aboard diving experience catering to the needs of the affluent, experienced diver.Philip Kotler (2001) characterises an attractive niche, ‘the customers in the niche have a distinct set of needs, they will pay a premium to the firm that nest satisfies their needs’.

Based on these comments, Mike Ball Dive Expeditions can be considered as a niche product as it seeks to offer a quality service customised to meet the diving needs of its individual customers. According to the case study, ‘each guest is treated to personalised diving assistance based on his or her diving experience. The company customises its service to suit each guest’s level of diving experience, from helping with dive equipment, getting to the dive site and education about safety issues.’It is clear that there is a growing domestic and international market in Australia for adventure tourists, that is tourists who engaged in the activities of bushwalking and/or rainforest walks; scuba diving; snorkelling; surfing; water activities or sports (eg.

sailing, windsurfing, kayaking etc); and/or other outdoor activities during their trip to Australia.The National Visitor Survey, Tourism Research Australia found that in 2005, there were 728,000 domestic visitors and over 4.4 million domestic visitor nights spent on dive/snorkel activities in Australia. 58% of these visitors participated in dive/snorkel activities in QLD (421,000 visitors).

Tourism Queensland (2005), provides the following snapshot in regards to international adventure tourists and diving. Based on the 2005 International Visitor Survey, there were 735,032 international dive/snorkel visitors to Australia in 2005, spending 30,401,781 visitor nights in the country.89% of these international dive/snorkel visitors made a stopover n QLD (654,231 visitors). From 2003 to 2005, there was a 8.

4% increase in international dive/snorkel visitors to Australia.Australia’s largest international dive/snorkel markets are the United Kingdom (24%), Japan (22%), Europe (excluding the UK and Germany, 17%) and the USA (13%).The Europe (excluding the UK and Germany) market showed the greatest increase in dive/snorkel visitation to Australia (average annual growth rate of 11.4% between 2003 and 2005).

81% of the international dive/snorkel visitors to Australia visited for holiday/leisure. Eight percent (8%) stated that their main reason for travelling to Australia was visiting friends and relatives. The VFR market increased by 9.9% annually since 2003, while the holiday/leisure market also increased by 8.

3%. 48% of all international dive/snorkel visitors to Australia were aged 25 to 44 years, while 28% were aged 15 to 24 years. The number of dive/snorkel visitors aged 25 to 44 years and over increased by 5.0% annually between 2003 and 2005.

Unaccompanied travellers and adult couples made up 35% each of the total international dive/snorkel market to Australia in 2005. A greater number were family groups in 2005 than in 2003.Kotler( 2003) states the mayor segmentation variables used to segment consumer markets are ‘ geographic, demographic psychographic and behavioural segmentation.’From the case study it is clear that MBDE segments to the dive market by focusing on psychographic and geographic segmenting.

Both of these segments are applicable. Firstly, according to Kotler (2001) geographic segmentation calls for dividing the market into different geographical units such as:o Nationso Regionso Stateso Municipalitieso Citieso Neighbourhoods.Geographical segmentation is most commonly used by multi-national and global businesses, who may alter their marketing mix based on the differing needs of consumers in each geographic segment they operate within.MBDE is based in Queensland, but the company specifically targets overseas divers from the United States, Japan and Europe.

The majority of overseas visitors come from the United States (31 per cent), Europe/United Kingdom (20 per cent), Japan and Asia (16 per cent). Australian visitors make up 25 per cent of their guests.MDBE uses geographical segmentation to respond to the needs of their different geographic markets, by developing appropriate marketing strategies or products for each area.The case study states that MBDE has develop its Paradisesport and Spoilssport to respond to the fact that visitors from the United States usually book their dive trips well in advance; often they are planning their dive trips a year ahead.

With the Supersport live-aboard product being more suitable for Japanese divers who tend to take short trips that are less action oriented, and are often booked within three months of the date of their departure-due to the nature of the Japanese employment culture.A second variable that is applicable to MDBE is psychographic segmentation. Kotler(2003) describes psychographic segmentation as diving buyers into different groups based on: lifestyle, personality characteristics and values. This type of segmentation is based on the assumption that the types of products and brands an individual purchases will reflect that persons characteristics and patterns of livingPlummer (1974) credits Lazer (1963) as the first to introduce the concept of lifestyle patterns and the potential for its relationship with marketing.

Lazer defines lifestyles as: ‘. . . a systems concept.

It refers to the distinctive mode of living, in its aggregative or broadest sense . . . It embodies the patterns that develop and emerge from the dynamics of living in a society’ (Lazer, 1963; cited in Plummer, 1974: 33).

The linking of values and lifestyles proposed by Lazer is further strengthened by the development of life style classifications using the SRI International VALS framework. The VALS approach, uses Maslow’s heirachy of needs (1954) as a theoretical base in classifying all U.S adults into 8 groups based on psychological attributes. The 8 groups VALS types are as follows:; Innovators; Thinkers; Achievers; Experiencers; Believers; Strivers; Makers; SurvivorsThe basic premise of VALS is that people express their personalities through their behaviours.

VALS specifically defines consumer segments on the basis of those personality traits that affect behaviour in the marketplace. VALS uses psychology to segment people according to their distinct personality traits. The personality traits are the motivation-the cause. Buying behaviour becomes the effect-the observable, external behaviour prompted by an internal driver.

In the case study MBDE describes its target audience as being ‘The type of people that afford our expeditions live in beautiful homes’ and are ‘physically active people, seeking adventure and a challenge as their leisure experience. They love the marine environment-the reef and the marine life. They appreciate nature and the marine habitat and are passionate about reef conservation motivated by the challenge of their sport and they revel in the escapism of the marine world.’ Using the VALS types as a guide, it can be said that MBDE target group can be described as Innovators (formerly Actualizers).

SRI’s website denotes that Innovators are successful, sophisticated, take-charge people with high self-esteem. Because they have such abundant resources, they exhibit all three primary motivations in varying degrees. They are change leaders and are the most receptive to new ideas and technologies. Innovators are very active consumers, and their purchases reflect cultivated tastes for upscale, niche products and services.

Image is important to Innovators, not as evidence of status or power but as an expression of their taste, independence, and personality. Innovators are among the established and emerging leaders in business and government, yet they continue to seek challenges. Their lives are characterized by variety. Their possessions and recreation reflect a cultivated taste for the finer things in life.

According to the case study, it appears that MBDE expertly manages its relationship with its customers. The case study states that MBDE are known for ‘being an extremely professional dive operation in terms of the advice, assistance and qualifications of its staff.’MBDE focus on luxury and high quality service provides a point of differentiation from other Dive Expedition operators. Kotler(2003) states that when a ‘physical product can not be easily differentiated’ as can be said of the hundreads of Asutralian dive expedition operators, ‘the key to competitive success may lie in adding valued services and improving their quality’It can be said that MBDE has positioned their product most advantageously.

Product position is the way the product is defined by consumers on important attributes the place the product occupies in consumers’ minds relative to competing products. This is clearly the case with MBDE as positive testimonials from past customers appear frequently on their website denoting the quality of service and value for money derived from the expeditions. MBDE has also won numerous awards within the industry which further adds to their reputation.However, according to Kotler (2001) there are four major positioning errors that firms such as MBDE should avoid.

These include under positioning, confused positioning, doubtful positioning and finally over positioning. It is clear from the case study that MBDE prides itself on servicing the high end of the market and in particular the international markets and this may result in over positioning.MBDE might also consider that given the global focus on environment issues, that there may be some competitive advantages in investigating and identifying products which have more of focus on ecotourism and nature and are therefore attractive to a target group who value environmental sustainability over luxury 4/5 star accommodation.References:Kotler P (2001) Marketing Management, Millennium Edition (160-292)Lawson R and Todd S Consumer Lifestyles: A Social Stratification Perspective, Marketing Theory 2002Lazer, W.

(1963) ‘Lifestyle Concepts and Marketing’, in S. Greyser (ed.) Towards Scientific Marketing. Chicago: American Marketing Association.

Plummer, J. (1974) ‘The Concept and Application of Lifestyle Segmentation’, Journal ofMarketing 38: 33-7.The National Visitor Survey(NVS) is conducted by Newton Wayman ChongResearch. on behalf of Tourism Research Australia.

Approximately 80,000 Australian residents aged 14 and over comprise the annual national sample.The International Visitor Survey(IVS) is also conducted by Newton Wayman ChongResearch on behalf of Tourism Research Australia. IVS information is collected by personal interviews with short-term international visitors to Australia in the departure lounges at eight Australian airports prior to departure. The IVS is weighted to total figures supplied by the Australian Bureau of Statistics’Overseas Arrivals and Departures data and does not included persons aged under 15 years.

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