MarketingStrategiesforTargetedMarketSegmentsBasedonShoppingMallImages.doc

MARKETING STRATEGIES FOR TARGETED MARKET SEGMENTS
BASED ON SHOPPING MALL IMAGES

Michael Adiwijaya
Lecturer Staff, Petra Christian University Surabaya
Email: [e-mail]

ABSTRACT
This research examined the market segmentation based on shopping mall image. The shopping mall image is derived from the customer perception toward the performances of shopping mall attributes such as merchandising, accessibility, service, atmosphere, entertainment, food, and services. There are four results from the market segmentation processes; they are market or customer segments, customer demographic profile, customer shopping behavior description, customer perception and customer opinion toward the shopping mall image. Three market segments are revealed in this research; namely “Demander”, “Rationale”, and “Satisfier” in which each of market segment had difference perception toward the shopping mall image but they had the same shopping behavior except for the amount of money spent per visit variable. Through the analysis of each market segments profile, then two segments, namely “Rationale” and “Satisfier”, are identified as potential target market. Finally the marketing strategies based on shopping mall image are developed for potential target market segments.
Keywords:
Shopping Mall Image Studies, Shopping Mall Attributes Performances, Market Segmentation, Target Market, Marketing Strategies
1.1 BACKGROUNDS
Nowadays one of the global market main challenges for shopping mall industry is the intense competition between the shopping mall both in the same region and also in the different region as well. (Soriano, 2003). This competition becomes more intense because the shopping malls not only compete with the other shopping malls but also with the other shopping centers format such as strip centers. Beside that, the shopping malls also have to compete with the indirect competitors both for the stores formats such as department stores, specialty stores, category specialist etc and for the non store formats such as online retailers, television home shopping, direct selling, etc as well. (Levy & Wietz, 2007, p.192)
Another global market main challenge of shopping mall industry is the changing of consumer market. Spurred by several demographic and life style trend, consumers have become a heterogeneous market. One composed of numerous micro segments. These trends include increasing ethnic diversity, an increasing proportion of elderly, smaller households due to the lower birth rate, higher divorce rate, greater double income, etc. (Dunne & Lusch, 1999, p.88).
In response to the intense competition and the changing consumer environment, several industry practitioners and academic experts have expressed the benefits of targeting specific consumer segments, positioning or repositioning the mall to attract those segments and differentiating the shopping mall’s attributes (Alexander & Muchlebach, 1992, p.75). Shopping malls management realized the efficiency and effectiveness of targeting a few segment of the market. Before target markets can be selected, the market must be segmented into meaningful group that can be realistically with the communication and marketing mix (Kotler, 2004, p.9).
The understanding for the need and characteristic of each customer segment gives the advantages for management of shopping mall in designing appropriate marketing strategies in order to attract potential customer segments which result the increasing visitor traffic and the increasing of tenants’ revenue within the shopping mall.

2.1 LITERATURE REVIEW
2.1.1 Shopping Mall Images
Nowadays the development of shopping mall is growing very fast especially in the developed and developing countries that leads to tight competition within shopping centers, but although there are so many shopping malls even in the same area, however each of shopping mall has its own image in the customer perception. Shopping mall attributes created distinctive shopping mall image as the result of the combination of several attributes performance within the mall (Levy and Weitz, 2007, p.192).
2.1.1.1 Merchandising
Merchandising is an important image attribute because it represents the core product of shopping center based on Berman and Evans study (as cited on Sit et al. 2003). The roles of merchandising are also supported by Wakerfield and Baker (1998) that highlighted the merchandising and tenant variety as stimuli that induce purchasing in a shopping mall setting and thus influence the consumer image of the mall.

2.1.1.2 Accessibility
The definition of accessibility is the ease of getting in and out of a shopping center (Levy and Weitz, 2007, p.594). Accessibility can be further divided into macro accessibility and micro accessibility. Macro accessibility concerns access road condition to the center and the proximity of the center from the customer’s work place or residence. Meanwhile according to Sit et al. (2003), the micro accessibility refers to parking facilities within the center and the ease of navigation within the shopping center. The definition of accessibility is close related with the site selection process and layout planning within the mall as one part of retail mix.
2.1.1.3 Service
Shopping center services are confined to behavior of retail employees such as courtesy, knowledge, and friendliness. Thus these services can be classified as personal service. By Lovelock et al (as cited in Sit et al, 2003). However, according to Berman & Evans (as cited in Sit et al, 2003) besides personal service, shopping mall also provides communal services in terms of ambulance such as escalators, lifts, and sign boards and amenities such as restrooms. Sit et al. (2003) stated that both personal and communal services are central to the shopping mall image because they represent the augmented product that support the core product (merchandising) and also add value to the total shopping experiences of the customers.
2.1.1.4 Atmospherics
Atmospherics refer to the design of an environment via visual communicators, lighting, colors, music, and scent to stimulate customer’s perceptual and emotional response and ultimately to affect their purchase behavior (Levy & Weitz, 2007, p.510). According to Smith and Burns (as cited on Sit et al, 2003), the atmospherics are critical because they act as environmental cues that consumers use to imply the quality of a shopping center. Further, atmospherics have been reported to stimulate consumer purchase at a shopping mall (Wakefield & Baker, 1998).
2.1.1.5 Entertainment
Entertainment is pivotal for shopping center because it induce an exciting or fun shopping experience, which in turn can entice consumer patronage. Entertainment in the shopping center can be categorized into special event entertainment and specialty entertainment. The key distinction between these two types of entertainment is the length of duration or span of operation. Special entertainment is offered on an occasional or seasonal basis for a short period of time. Conversely, specialty entertainment is generally incorporated into a shopping center’s property for longer duration (Haynes & Talpade, 1996).
2.1.1.6 Food
Food is pivotal to shoppers because they: first, create an entertaining ambience within a shopping centre conducive to a pleasant or exciting shopping experience. And second, provide a needed break from hours of shopping and or as a conclusion to an extended shopping excursion (Haynes & Talpade, 1996).
2.1.1.7 Security
Besides attracting consumers, shopping centers also appeal to the criminals. The consumer behavior literature by Schiffman & Kanuk has revealed that many consumers are risk averse and thus they may be reluctant to visit a shopping center that is perceived to be dangerous (as cited in Sit et al. 2003). Despite its significance, Sit et al. (2003) elucidate that limited studies have examined the contribution of security to shopping center image. There are three security variables; they are quality of the center, safe place to be, and the personal security.
2.1.2 Customer Perception
Perception is defined as the process by which an individual selects, organizes, and interprets stimuli into a meaningful and coherent picture of the world (Schiffman and Kanuk, 2004, p.158). Meanwhile customer perception according to Cutlipp (1999, p.120) is the interpreted of scene of actions, included people, places, actions, and entire range of phenomena, which is give perceptions of that scene to the customer and respond based on the perception.
Two individuals may be exposed to the same stimuli under the same apparent conditions, but how each person recognizes, selects, organizes, and interprets this stimuli is highly individual process based on each person’s own need, values, and expectation. (Schiffman and Kanuk, 2004, p.158)
2.1.3 Market Segmentation and Targeting
Market segmentation can be defined as the process of dividing a market into distinct subsets of consumers with common needs or characteristics and selecting one or more segments to target with a distinct marketing mix (Schiffman and Kanuk, 2004, p.50). Based on Kotler, there are two kind bases for market segmentation. They are descriptive base and causal base (as cited in Lee Hew & Fairhurst, 2000). The descriptive segmentation base uses demographic, socio-economic, geographic, personality, lifestyle, product usage and brand loyalty as the characteristic of customer in the market. Demographic and socioeconomic bases, which include age, gender, education, marital status, and life cycle stage, have been utilized most frequently. There has been empirical support for the validity of using the descriptive segmentation bases (Plummer, 1974).
The causal segmentation bases include self concept, attitude or preference or perceptions, benefits and usage situation. These bases typically are preferred over descriptive ones, by academicians and practitioners, because of their link to the actual behavior of the consumer. There has been empirical support for the validity of using the causal segmentation bases (Finn and Louviere, 1996).

2.2 CONCEPTUAL FRAMEWORK
This research is started with the main challenges that the shopping malls management faced nowadays. Those main challenges replace the mass marketing strategy into the segmented marketing strategy for shopping mall management. Moreover this research did causal market segmentation based on shopping mall image. The next phase is the market targeting process that was conducted by measuring each market segment based on their perception toward the performances of shopping mall attributes and based on their shopping behavior in order to identify and to select the potential market segment to be served and treated specially.
After finding the potential market segments together with their perception information and their shopping behavior; then the development of marketing strategy can be established. The summary of the theoretical framework can be seen as flow chart on figure 1.1

Figure 1.1 Conceptual Framework Chart

The Global Shopping Mall Challenges

The movement from mass marketing strategy to the segmented marketing strategy
The Causal Market Segmentation based on Shopping Mall Image

Customer Shopping Behavior

Market Segments
Shopping Mall Attributes

Target Market
Marketing Strategies

3.1 ISSUES FOR INVESTIGATION
3.1.1 Purpose of Research
1. To make the customer segmentation based on the customers’ perception toward the performances of shopping mall attributes or based on shopping mall image.
2. To collect information regarding the demographic profile of customer, the customer shopping behavior, customer perception towards shopping mall image and the customer’s opinion toward Tunjungan Plaza Surabaya as the places (object) of the research.
3. To identify the potential market segments as target markets.
4. To develop marketing strategy based on shopping mall image for target markets.
3.1.2 Problem Statement
“How to formulate the marketing strategies for shopping mall based on shopping mall image in order to attract the targeted potential market segments to visit and to shop at the mall?”
3.1.3 Hypotheses
Hypothesis 1:
H0: There are no differences of customer perception toward shopping mall image for each market segment
H1: There are differences of customer perception toward shopping mall image for each market segments.
Hypothesis 2:
H0: Each customer segment does not perform different shopping behavior
H1: Each customer segment performs different shopping behavior.

4.1 RESEARCH METHODOLOGY
4.1.1 Place of Research
The place for this research will be done at Tunjungan Plaza (TP) which is located in Surabaya, East Java Province – Indonesia. The considerations in choosing TP as the place of research are as follow; firstly TP is the largest shopping center in Indonesia, secondly TP is strategically located in the heart of Surabaya's central business district

4.1.2 Instrument Research Design
There were four sections of questions on the questionnaire design; they are the demographic questions, the customer shopping behavior questions, the customer perception questions and the customer opinion question. The first section of the questionnaire is containing some questions related with the demographic information of the customers such as gender, age, marital status, education background, occupation, and monthly income. At the mean time, the second section of the questionnaire is containing some questions related with the customer shopping behavior information. There are six shopping behavior that will be investigated; they are shopping preference, frequency of visit per month, amount of money spent per visit, desire to stay, amount of variable purchased per visit, and re-patronage intention.
The third section of the questionnaire is containing some questions related with the customer perceptions toward the importance of shopping mall attributes performances. Finally, the last part is the open questions which are consisting of two questions connected to the customer opinion regarding the shopping preferences and the uniqueness of the shopping mall
4.1.3 Research Population
The population for this research is the entire customers of TP who were doing shopping activities within the mall, at the time that the field study was conducted. Therefore the customers who were not doing the shopping activities at that moment were not covered as the population for this research

4.1.4 Sampling Type and Method
This research used the non-probability sampling as the type of sampling design and convenience samples as the sampling method.
4.1.5 Sample Size
Since standard value of ordinal data is similar to nominal data then the maximum value of the variance (quadratic standard deviation) is 0.25. It is gathered by multiply the p (probab