Chapter 12 Flashcards
(147 cards)
1
Q
Why can companies no longer appeal to all buyers in the same way?
A
Buyers are too numerous, widely scattered, and varied in their needs and buying practices.
2
Q
What strategy do companies like Dunkin’ use to succeed in the marketplace?
A
Companies identify the parts of the market they can serve best and most profitably, designing customer-driven marketing strategies that build
the right relationships with the right customers
3
Q
What is the shift companies have made in their marketing approach?
A
Most companies have moved away from mass marketing toward target marketing, focusing on specific market segments.
4
Q
What is target marketing?
A
Identifying market segments, selecting one or more of them, and developing products and marketing pro-grams tailored to each
5
Q
What are the 4 major steps in designing a customer value-driven market-ing strategy?
A
- Market Segmentation
- Market Targeting
- Differentiation
- Positioning
6
Q
What is market segmentation?
A
Dividing a market into distinct
groups of buyers who have different needs, characteristics, or
behaviours and who might require
separate marketing strategies or
mixes.
7
Q
What is market targeting (targeting)?
A
Evaluating each market segment’s
attractiveness and selecting one or
more segments to serve.
8
Q
What is differentiation?
A
Actually differentiating the market offering to create superior customer value.
9
Q
What is positioning?
A
Arranging for a market offering to
occupy a clear, distinctive, and
desirable place relative to competing products in the minds of target
consumers.
10
Q
What are the first two steps in designing a customer value-driven marketing strategy?
A
The company selects the customers it will serve.
1. Market segmentation (divide the total market into smaller segments)
The company identifies different ways to segment the market and develops profiles of the resulting market segments.
2. Market targeting (select the segment or segments to enter)
11
Q
In concept, what 2 questions does marketing boil down to?
A
- Which customers will we serve?
2.How will we serve them? Of course, the tough part is coming up with
good answers to these simple-sounding yet difficult questions. The goal is to create more value for the customers we serve than competitors do.
12
Q
What are the last two steps in designing a customer value-driven marketing strategy?
A
The company decides on a value proposition—how it will create value for target customers.
3. Differentiation (differentiate the market offering to create superior customer value)
4. Positioning (position the market offering in the minds of target customers)
13
Q
What do all the steps in designing a customer value-driven marketing strategy aim to achieve?
A
Together, they aim to create value for targeted customers
14
Q
How do buyers in a market differ from one another?
A
Buyers differ in their wants, resources, locations, buying attitudes, and buying practices.
15
Q
What is the purpose of market segmentation?
A
Market segmentation divides large, diverse markets into smaller segments to reach them more efficiently and effectively with tailored products and services that match their unique needs
16
Q
What are the 4 key topics discussed in market segmentation?
A
- segmenting consumer markets
- segmenting business markets
- segmenting international markets
- the requirements for effective
segmentation
17
Q
Is there a single way to segment a (consumer) market?
A
There is no single way to segment a market. A marketer has to try different segmentation variables, alone and in combination, to find the best way to view market structure.
18
Q
What are the 4 variables used in segmenting consumer markets?
A
- geographic
- demographic
- psychographic
- behavioural
19
Q
What are examples of geographic segmentation variables?
A
Nations, regions, provinces, cities, neighbourhoods, population density
(urban, suburban, rural), climate
20
Q
What are examples of demographic segmentation variables?
A
Age, life-cycle stage, gender, income, occupation, education, religion, ethnicity, generation
21
Q
What are examples of psychographic segmentation variables?
A
Lifestyle, personality
22
Q
What are examples of behavioural segmentation variables?
A
Occasions, benefits, user status, usage rate, loyalty status
23
Q
What is geographic segmentation?
A
Dividing a market into different
geographical units, such as
nations, regions, provinces, cities,
or even neighbourhoods
24
Q
How may a company decide where to operate geographically?
A
A company may choose to operate in one or a few geographical areas or across all areas while paying attention to geographical differences in needs and wants.
25
What strategy do many companies use to cater to different geographic areas?
Many companies localize their products, services, advertising, promotion, and sales efforts to fit the specific needs of individual regions, cities, and other localities.
26
What is an example of companies deciding where to operate?
LCBO reported an 18 % increase in craft beer sales for 2017/18 and suggests that the popularity of local beers is tied to the idea of “shop local, eat local, drink local, and buy local.” Smaller micro-breweries are now opening Canada-wide with the mindset of serving the people in the local community and not necessarily achieving mass distribution across the country
Geographic Segmentation: Nine Locks Brewing Company targets the local market with products that speak directly to Nova Scotians. With seasonal beers like “Frig Off” and “Sea Shells Summer Session Sour,” the company has built a very brand-loyal local following.
27
What has caused the surge in hyperlocal social marketing?
The surge in digital and mobile technology has caused a corresponding surge in
hyperlocal social marketing
28
What is hyperlocal social marketing?
Location-based targeting to consumers in local communities or neighbourhoods using digital and social media
29
What is an example of hyperlocal social marketing?
Ex. to get coffee and promotions to customers faster, Dunkin’ has partnered Waze. No matter where they are, Dunkin’ drinkers can open the Waze app, locate the nearest Dunkin’ (map included), order ahead using the app, and have their order
waiting when they arrive.
30
How do social media platforms like Facebook and Instagram enable hyperlocal targeting?
They allow advertisers to select audiences based on geographic location, helping businesses reach consumers in specific areas.
31
How does Google Maps support hyperlocal targeting for businesses?
Google Maps allows businesses to show their locations and ads in response to “near me” or “nearby” Google searches, helping businesses appear in local search results.
32
Can you give an example of hyperlocal targeting in Google searches?
A search for "auto repairs near me" might display ads for local auto repair shops or service centers like Canadian Tire, while a search for "hotels in Edmonton, AB" could show ads from sites like Expedia and specific local hotel listings.
33
What advantage does hyperlocal targeting provide for advertisers?
Such hyperlocal targeting lets advertisers refine and tailor their marketing content to local consumer locations and search intent.
34
What is demographic segmentation?
Dividing the market into segments
based on variables such as age,
life-cycle stage, gender, income,
occupation, education, religion,
ethnicity, and generation.
35
What is the most popular bases for segmenting customer groups and why?
Demographic factors.
1. Consumer needs, wants, and usage rates often vary closely with demographic variables
2. Demographic variables are easier to measure than most other types of variables.
36
Why is it important to know a segment’s demographic characteristics, even when using other bases like benefits sought or behavior?
Knowing a segment’s demographic characteristics helps assess the size of the target market and allows for more efficient reach.
37
What is age and life-cycle segmentation?
Dividing a market into different age and life-cycle groups.
38
How do consumer needs and wants change with age?
Consumer needs and wants evolve as people age, prompting companies to adapt their products and marketing approaches to different age and life-cycle groups.
39
What is an example of age and life-cycle stage segmentation in marketing?
P&G uses age and life-cycle segmentation with Crest White Brilliance toothpaste targeting seniors and older adults, while Crest Pro-Health Jr. toothpaste targets young children with kid-friendly packaging and interactive features.
40
Why must marketers must be careful to guard against stereotypes when using age and life-cycle segmentation? Give an example?
Some 80 yr olds fit the stereotypes of
shut-ins with fixed incomes, others ski and play tennis. Some 40 yr old couples are sending their children off to college, others are just beginning new families.
Thus, age is often a poor predictor of a person’s life cycle, health, work or family status, needs, and buying power
41
What is gender segmentation?
Dividing a market into different
segments based on gender
42
How has gender segmentation been traditionally used in marketing?
Has long been used in marketing clothing, cosmetics, toiletries, toys, and magazines
43
Can you give an example of gender segmentation in marketing?
P&G was among the first to use gender segmentation with Secret, a deodorant brand specially formulated for a woman’s chemistry, packaged and advertised to reinforce the female image
44
How has the men’s personal care industry changed in recent years?
The men’s personal care industry has exploded, with many cosmetics brands, like L’Oréal, Nivea, Sephora, and Unilever's Dove, now successfully marketing men's lines.
45
Can you provide an example of a brand catering to men in personal care?
Dove's Men+Care line is an example, offering a full range of products like body washes, body bars, deodorants, face care, and hair care, with the slogan "Care makes a stronger man."
46
How are brands that have traditionally targeted men now shifting their focus?
Brands like Nike and Under Armour, which have traditionally targeted men, are now increasing their marketing efforts aimed at women, especially in line with the "athleisure" trend.
Women now make up half of all sporting good shoppers
47
What is income segmentation?
Dividing a market into different
income segments
48
How do marketers use income segmentation in targeting consumers?
The marketers of products and services such as automobiles, clothing, cosmetics, financial services, and travel have long used income segmentation.
Many companies target affluent consumers with luxury goods and convenience
services.
49
What is an example of targeting affluent customers?
The American Express Centurion Black Card is an exclusive credit card targeted at high-net-worth individuals earning at least US$1 million annually. It has an initiation fee of US$7500 and an annual fee of US$2500. The card offers luxury perks and personal services not available with the Platinum card.
Amex Black Card comes with status and bragging rights that you just
can’t get with other cards
50
How do some retailers use income segmentation to target low- and middle-income groups?
Retailers like Dollarama, Giant Tiger, and No Frills target low- and middle-income groups by offering affordable products. Their core market consists of families with incomes under $30,000.
51
What is psychographic segmentation?
Dividing a market into different
segments based on lifestyle or
personality characteristics.
52
What is psychographic segmentation, and how does it differ from demographic segmentation?
Psychographic segmentation divides buyers based on lifestyle or personality characteristics, while demographic segmentation groups buyers based on measurable factors like age or income. People in the same demographic group can have very different psychographic traits.
53
How do marketers use psychographic segmentation in their strategies?
Marketers often segment their markets by consumer lifestyles and base their marketing strategies on lifestyle appeals. Ex. Anthropologie sells a Bohemian-chic lifestyle to young women, and Athleta promotes an urban-active lifestyle with its athletic and post-workout apparel.
54
How do marketers use personality variables for market segmentation?
Marketers use personality variables to create personalized segments based on specific consumer traits. For example, Loews hotel chain targets segments like "luxury jetsetters" and "vacationing families," offering tailored experiences and communications that align with each segment's unique needs.
Ex. communications aimed at luxury jetsetters might start with an email
offering opportunities to enhance their experiences with special
room upgrades. Loews customer email engagement rates improved
40 percent and rebookings were up 20 percent.
55
What is an example of Panera using lifestyle segementation?
Lifestyle segmentation: Panera
caters to a healthy-eating lifestyle
segment of people who want more
than just good-tasting food—they
want food that’s good for them, too.
56
What is behavioural segmentation?
Dividing a market into segments
based on consumer knowledge,
attitudes, uses of a product, or
responses to a product
57
What do many marketers believe about behavioural variables?
That they are the best starting point for building market segments
58
What is occasion segmentation?
Dividing the market into segments
according to occasions when buyers get the idea to buy, actually make their purchase, or use the purchased item.
59
How do companies use occasion segmentation?
Buyers can be grouped according to occasions when they get the idea to
buy, actually make their purchases, or use the purchased items
Campbell’s advertises its soups more heavily in the cold winter months.
60
How do other companies try to boost consumption by promoting usage during non-traditional occasions?
Consumers tend to drink soft
drinks later in the day, Mountain Dew introduced Mtn Dew A.M. (a mixture of Moun-tain Dew and orange juice) to increase morning consumption. Taco Bell attempts to build morning business by promoting Mtn Dew A.M.
along with the chain’s A.M. Crunchwrap and other breakfast items
61
What is benefit segmentation?
Dividing the market into segments
according to the different benefits
that consumers seek from the
product.
62
What is a powerful form of segmentation?
Grouping buyers according to
the different benefits that they seek from a product.
63
What is an example of benefit segmentation?
Ppl who buy wearable health and activity trackers are looking for a variety of benefits, such as counting steps taken, calories burned, heart-rate monitoring and high-performance workout tracking and reporting. To meet these varying benefit preferences, Fitbit makes health and fitness tracking devices aimed at buyers in three major benefit segments: Everyday Fitness, Active Fitness, and Performance
Fitness
64
How can markets be segmented based on user status?
Markets can be segmented into nonusers, ex-users, potential users, first-time users, and regular users of a product.
65
Who are included in the potential users group, and how do companies target them?
Marketers want to reinforce and retain regular users, attract targeted nonusers, and reinvigorate relationships with ex-users.
Consumers facing life-stage changes—such as new parents and newlyweds—who can be turned into heavy users.
66
What's an example of companies targeting potential users?
Ex. to get new parents off to the right start, P&G makes certain that its Pampers Swaddlers are the diaper most U.S. hospitals provide for newborns and then promotes them as “the #1 choice of hospitals.”
67
How can markets be segmented based on usage rate?
Markets can be segmented into light, medium, and heavy product users. Heavy users typically make up a small percentage of the market but account for a large portion of total consumption.
68
What is an example of targeting heavy users?
Fast- growing Southeastern fast-food chain Bojangles’ Famous Chicken ‘n Biscuits targets everything it does toward the tastes and tendencies of hungry regulars.
The company calls them Bo Fanatics or Bo’lievers, people who crave lots and lots of Bojangles’ signature fried
chicken
69
How can a market be segmented by consumer loyalty?
Consumers can be loyal to brands (Tide), stores (Canadian Tire), and companies (Apple). Buyers can
be divided into groups according to their degree of loyalty. Some consumers are completely loyal—they buy one brand all the time and can’t wait to tell others about
70
Whats an example of segmented by consumer loyalty?
Apple devotees are granitelike in their devotion to the brand. At one end are the quietly satisfied
Apple users, folks who own one or several Apple devices and use them for browsing, texting, email, and social networking. At the other extreme, however, are the Apple
MacHeads or Macolytes—who can’t wait to tell anyone within earshot of their latest Apple gadget. Such loyal Apple devotees are at the forefront of
Apple’s huge iPhone, iPad, and iTunes empire."
71
How do somewhat loyal consumers behave in their purchasing decisions?
They are loyal to two or three brands of a given product or favour one brand while sometimes buying others.
72
What are the characteristics of consumers who show no loyalty to any brand?
Show no loyalty to any brand—they either want something different each time they buy, or they buy whatever’s on sale
73
How can a company can learn a lot by analyzing loyalty patterns in its market?
It should start by studying its own loyal customers. Highly loyal customers can be a real asset. They often promote the brand through personal word of mouth and social media.
74
How should companies interact with highly loyal customers?
Instead of just marketing to loyal customers, companies should engage them fully and make them partners in building the brand and telling the brand story.
75
What's an example of a company engaging with high-loyalty customers?
Ex. Mountain Dew has turned its loyal customers into a “Dew Nation” of passionate superfans who have made it the nation’s number three soft-drink brand behind only
Coca-Cola and Pepsi
76
What is an example of a company actually putting loyalists to work for the brand?
Patagonia relies on its most tried-and-true customers—what it calls Patagonia ambassadors—to field-test products in harsh environments, provide input for “ambassador-driven” lines of apparel and gear, and share their product
experiences with others
77
What info do companies get from studying less-loyal buyers?
A company can detect which
brands are most competitive with its own. By look-ing at customers who are shifting away from its brand, the company can learn about its marketing weaknesses and take actions to correct them.
78
Do marketers typically use only one segmentation base?
No, marketers rarely limit their segmentation analysis to just one or a few variables. They often use multiple segmentation bases to identify smaller, better-defined target groups.
79
Why do marketers use multiple segmentation bases?
Often use multiple segmentation bases in an effort to identify
smaller, better-defined target groups.
80
Which business information services provide multivariable segmentation systems?
Some business information services that provide multivariable segmentation systems include Nielsen, Acxiom, Esri, and Experian.
81
What is an example of a business information services providing multivariable segmentation systems?
- Acxiom’s Personicx Lifestage
system classifies U.S. households into one of 70 distinct clusters within 21 life-stage groups
- Each segment has its own pattern of demographics, lifestyles, likes and dislikes, and purchase behaviours.
Ex. “Cartoons and Carpools” cluster" consists of solidly middle-income, married, mid-30s couples with children of all ages.
- Lie dead centre in terms of income, education, and home values and provide comfortably for their families.
- Cluster has a high concentration of blue-collar occupations.
- Consumers drive minivans and pickups, buy lots of clothes and shoes for their kids, and enjoy family activities such as visiting zoos, going to theme parks, and camping.
82
How can Personicx and other such systems help marketers to segment people and locations into marketable groups of like-minded consumers?
Such rich segmentation pro-vides a powerful tool for marketers of all kinds. It can help companies identify and better understand key customer segments, reach them more efficiently, and tailor market offerings and messages to their specific needs
83
What does market segmentation reveal for a firm?
Market segmentation reveals the firm's market segment opportunities.
84
After identifying market segments, what must a firm do next?
Firm must evaluate the various segments and decide which ones it can serve best.
85
In evaluating different market segments, a firm must look at what 3 factors?
1. Segment size and growth
2. Segment structural attractiveness
3. Company objectives and resources
86
Why does a company wants to select segments that have the right size and growth characteristics?
“Right size and growth” is a relative matter. The largest, fastest-growing segments are not always the most attractive for every company. Smaller companies may lack the skills and resources needed to serve larger segments.
87
Why might smaller companies target smaller segments?
Smaller companies may target smaller segments because they might lack the resources to serve larger segments, or find them too competitive. These smaller segments may still be more profitable for them.
88
What structural factors should a company examine when evaluating segment attractiveness?
- Number of competitors
- Ease of entry for new competitors, - - Existence of substitute products
- Bargaining power of buyers
- The power of suppliers.
89
How does number of competitors and ease of entry affect attractiveness?
Less attractive if it already contains
many strong and aggressive competitors or if it is easy for new entrants to come into the
segment.
90
How existence of substitute products affect attractiveness?
The existence of many actual or potential substitute products may limit prices and the profits that can be earned in a segment.
91
How does the power of buyers affect attractiveness?
The relative power of buyers also affects segment attractiveness. Buyers with strong bargaining power relative to sellers will try to force prices down, demand more services, and set competitors against one
another—all at the expense of seller profitability.
92
How does the power of suppliers affect attractiveness?
Finally, a segment may be less attrac-tive if it contains powerful suppliers that can control prices or reduce the quality or quantity of ordered goods and services
93
What should a company consider when evaluating whether to enter a market segment? (in context of attractiveness)
Even if it has the right size and growth and is structurally attractive, the company must consider its own objectives and resources.
94
Why might a company dismiss an attractive segment?
Some attractive segments
can be dismissed quickly because they do not mesh with the company’s long-run objectives. Or the company may lack the skills and resources needed to succeed in an attractive segment.
95
Why would Mercedes-Benz avoid entering the economy segment of the automobile market?
Mercedes-Benz would avoid entering the economy segment because it is a luxury-performance brand, and such a move would not align with its objectives or resources.
96
Under what conditions should a company enter segments?
Only enter segments in which it can create superior customer value and gain advantages over its competitors.
97
What is a target market?
A set of buyers who share common
needs or characteristics that a
company decides to serve.
98
What is undifferentiated (mass)
marketing?
A market-coverage strategy in
which a firm decides to ignore
market segment differences and
go after the whole market with
one offer
99
What must the company decide after evaluating different segments?
The company must decide which and how many segments it will target
100
What 3 (technically 4) different levels can market targeting be carried out at?
From broadly to narrowly:
1. Undifferentiated (mass) marketing
2. Differentiated (segmented) marketing
3. Concentrated
(niche) marketing
4. Micromarketing (local or individual
marketing)
101
What is an example of individual marketing?
At mymms.com, customers can order M&M’s with their face and a personal message printed on each candy.
102
What does undifferentiated marketing focus on?
Focuses on what is common
in the needs of consumers rather than on what is different
103
How does a company approach product design in undifferentiated marketing?
The company designs a product and marketing program that appeals to the largest number of buyers.
104
Why do most modern marketers doubt the effectiveness of undifferentiated marketing?
Because it is difficult to develop a product or brand that satisfies all consumers.
105
What challenges do mass marketers face when using undifferentiated marketing?
Trouble competing with more focused firms that do a better job of satisfying the needs of specific segments and niches.
106
What is differentiated (segmented)
marketing?
A market-coverage strategy in
which a firm targets several mar-ket segments and designs separate
offers for each
107
How does P&G demonstrate differentiated marketing with its laundry detergent brands?
P&G markets at least six different detergent brands, such as Tide, Gain, and Cheer, each further segmented into versions like Tide Original, Tide Pods, or Tide Plus Coldwater Clean.
Thanks to its differentiated approach, P&G is really cleaning up in the $15 billion U.S. laundry detergent market, capturing a 61 percent market share
108
Why do companies offer product and marketing variations to segments?
They aim to achieve higher sales and a stronger position within each market segment.
109
How does targeting multiple segments compare to undifferentiated marketing in terms of sales?
Targeting multiple segments with tailored strategies often results in more total sales than undifferentiated marketing.
110
What are the drawbacks of using differentiated marketing?
Increases the costs of doing business. A firm usually finds it more expensive to develop and produce, say, 10 units of 10 different products than 100 units of a single product.
111
Why is differentiated marketing so costly?
Developing separate marketing plans for separate segments requires extra marketing research, forecasting, sales analysis, promotion planning, and channel management. And trying to reach different market segments with different advertising campaigns increases promotion costs. Company must weigh increased sales against increased costs when deciding on a differentiated marketing strategy.
112
What is concentrated (niche) marketing?
A market-coverage strategy in
which a firm goes after a large
share of one or a few segments or
niches
113
What is an example of concentrated (niche) marketing?
Stance socks. Colourful, fun, socks. Ranging from $10 to $40 a pair,
114
What market position does a firm achieve through concentrated marketing?
It achieves a strong market position due to greater knowledge of consumer needs in the niches it serves and the special reputation it acquires.
115
How does concentrated marketing allow firms to market more effectively?
By fine-tuning products, prices, and programs to meet the needs of carefully defined segments.
116
How does concentrated marketing improve marketing efficiency?
It targets products, services, channels, and communications toward consumers the firm can serve best and most profitably.
117
How does niching benefit smaller companies?
It allows them to focus limited resources on serving niches that may be unimportant to or overlooked by larger competitors.
118
Why do some companies start as nichers?
To get a foothold against larger, more
resourceful competitors and then grow into broader competitors.
119
How did Enterprise Rent-A-Car use niching to grow?
It focused on building a network of neighborhood offices rather than competing with larger companies like Hertz and Avis in airport locations.
120
How did Amazon exemplify the growth of a nicher into a broader competitor?
It began by selling books online and expanded to sell a wide range of products, becoming the nation's largest online retailer.
121
Concentrated marketing can be highly profitable. At the same time, it involves:
Higher-than-normal risks
122
What is a key risk of concentrated marketing?
Companies that rely on one or a few segments for all of their business will suffer greatly if the segment turns sour. Or larger competitors may
decide to enter the same segment with greater resources.
123
How do large companies mitigate the risks of concentrated marketing?
They often develop or acquire niche brands to compete effectively in smaller, specialized markets.
124
How does Coca-Cola use niche brands to mitigate risks?
Coca-Cola’s Venturing & Emerging Brands unit markets niche beverages like Honest Tea, NOS, and Topo-Chico, helping it compete in specialized markets.
125
What is micro marketing?
Tailoring products and marketing
programs to the needs and wants
of specific individuals and local
customer segments; it includes
local marketing and individual
marketing
126
How does micromarketing differ from differentiated and concentrated marketing?
While differentiated and concentrated marketing tailor offers to segments or niches, micromarketing customizes offers to each individual customer.
127
What are the two types of micromarketing?
The two types of micromarketing are local marketing and individual marketing.
128
What is local marketing?
Tailoring brands and marketing to
the needs and wants of local
customer segments—cities,
neighbourhoods, and even specific
stores
129
What is an example of local marketing?
Mariott's Renaissance Hotels’ Navigator program puts a personal and local face on each location by “microlocalizing” recommendations for guests’ food, shopping, entertainment, and cultural experiences at each destination.
130
How has advances in communications technology have given rise to new high-tech versions of location-based marketing?
Thanks to the explosion in smartphones and tab-ets that integrate geolocation technology, companies can now track consumers’
whereabouts closely and engage them on the go with localized deals and information fast, wherever they may be
131
How does Walgreens use location-based marketing?
Uses its mobile app to beam in-store notifications and personalized offers to shoppers as they navigate the store’s aisles, based on shopper demographics and previous buying patterns.
132
What are the drawbacks to local based marketing?
- Can drive up manufacturing
and marketing costs by reducing the economies of scale.
- Can also create logistics problems as companies try to meet the varied requirements of different local markets
133
How do the advantages of local marketing often outweigh the
drawbacks?
Companies face increasingly fragmented markets and as new supporting digital technologies develop
134
What is individual marketing?
Tailoring products and marketing
programs to the needs and prefer-ences of individual customers.
135
What has the widespread use of mass marketing obscured?
The fact that for centuries consumers were served as individuals: The tailor custom-made a suit, the cobbler
designed shoes for an individual, and the cabinetmaker made furniture to order
Today, new technologies are permitting many companies to return to customized marketing.
136
What is mass customization?
Mass customization is the process by which companies interact one-on-one with large groups of customers to design products, services, and marketing programs that are tailored to individual needs.
137
How have new technologies enabled mass customization?
Technologies such as detailed databases, robotic production, flexible manufacturing, and interactive tools like smartphones, online platforms, and social media have combined to make mass customization possible.
138
What are some examples of hypercustomization in consumer products?
Examples of hypercustomization include personalized M&Ms with custom messages, custom sneakers designed through Nike ID or Puma Factory, and earphones made from molds of customers' ears for optimized fit and sound by companies like JH Audio.
139
How are companies personalizing advertising messages and marketing offers, and service encounters on a one-to-one basis?
Given today’s data and analytics technologies, almost any customer engagement can be fine-tuned to
individual customer characteristics, preferences, and behaviours.
140
What is product position?
The way a product is defined by consumers on important attributes—the place it occupies in
consumers’ minds relative to competing products
141
What is a value proposition in marketing?
How a company will create differentiated value for targeted segments and what positions it wants to occupy in those segments
Products are made in factories, but brands happen in the minds of consumers.
142
How are automobiles positioned?
Honda Fit and Nissan Versa are positioned on economy, Mercedes and Cadillac on luxury, and Porsche and BMW on performance.
143
Why do consumers organize products, brands, and companies into categories?
Consumers organize products, brands, and companies into categories to simplify the buying process, as they cannot constantly reevaluate products for every purchasing decision.
144
What is a product's position in the minds of consumers?
A product's position is the complex set of perceptions, impressions, and feelings that consumers have about the product compared to competing products, helping them make decisions based on their mental categories.
145
How do consumers position products?
With or without the help of marketers
146
Why do marketers need to actively plan product positions?
Marketers do not want
to leave their products’ positions to chance. They must plan positions that will give their products
the greatest advantage in selected target markets, and they must design marketing mixes to create these planned positions.
147
What is a perceptual positioning map?
Show consumer perceptions of their brands versus those of competing products on important buying dimensions
2 dimensions
Example: look at the SUV map
