Chapter 6

Question 1

Consumer Market

Answer 1

Purchasers and household members who intend to consume or benefit from the purchased products and do not buy products to make profits.

Question 2

Business Market

Answer 2

Individuals or groups that purchase a specific kind of product for resale, direct use in producing other products, or use in general daily operations.

Question 3

Undifferentiated Targeting Strategy

Answer 3

A strategy in which an organization designs a single marketing mix and directs it at the entire market for a particular product.

Question 4

Homogeneous Market

Answer 4

A market in which a large proportion of customers have similar needs for a product.

Question 5

Heterogeneous Market

Answer 5

A market made up of individuals or organizations with diverse needs for products in a specific product class.

Question 6

Market Segmentation

Answer 6

The process of dividing a total market into groups with relatively similar product needs to design a marketing mix that matches those needs.

Question 7

Market Segment

Answer 7

Individuals, groups, or organizations sharing one or more similar characteristics that cause them to have similar product needs.

Question 8

Concentrated Targeting Strategy

Answer 8

A market segmentation strategy in which an organization targets a single market segment using one marketing mix.

Question 9

Differentiated Targeting Strategy

Answer 9

A strategy in which an organization targets two or more segments by developing a marketing mix for each segment.

Question 10

Segmentation Variables

Answer 10

Characteristics of individuals, groups, or organizations used to divide a market into segments.

Question 11

Market Density

Answer 11

The number of potential customers within a unit of land area.

Question 12

Geodemographic Segmentation

Answer 12

A method of market segmentation that clusters people in zip code areas and smaller neighborhood units based on lifestyle and demographic information.

Question 13

Micromarketing

Answer 13

An approach to market segmentation in which organizations focus precise marketing efforts on very small geographic markets.

Question 14

Benefit Segmentation

Answer 14

The division of a market according to benefits that consumers want from the product.

Question 15

Market Potential

Answer 15

The total amount of a product that customers will purchase within a specified period at a specific level of industry wide marketing activity.

Question 16

Company Sales Potential

Answer 16

The maximum percentage of market potential that an individual firm within an industry can expect to obtain for a specific product.

Question 17

Breakdown Approach

Answer 17

Measuring company sales potential based on a general economic forecast for a specific period and the market potential derived from it.

Question 18

Buildup Approach

Answer 18

Measuring company sales potential by estimated how much of a product a potential buyer in a specific geographic area will purchase in a given period, multiplying the estimate by the number of potential buyers, and adding the totals of all the geographic areas considered.

Question 19

Product Positioning

Answer 19

Creating and maintaining a certain concept of a product in customer’s minds.

Question 20

Sales Forecast

Answer 20

The amount of a product a company expects to sell during a specific period at a specified level of marketing activities.

Question 21

Executive Judgment

Answer 21

A sales forecasting method based on the tuition of one or more executives.

Question 22

Customer Forecasting Survey

Answer 22

A survey of customers regarding the types and quantities of products they intend to buy during a specific period.

Question 23

Sales Force Forecasting Survey

Answer 23

A survey of a firm’s sales force regarding anticipated sales in their territories for a specified period.

Question 24

Expert Forecasting Survey

Answer 24

Sales forecast prepared by experts outside the firm, such as economists, management consultants, advertising executives, or college professors.

Question 25

Delphi Technique

Answer 25

A procedure in which experts create initial forecasts, submit them to the company for averaging, and then refine the forecasts.

Question 26

Time Series Analysis

Answer 26

A forecasting method that uses historical sales data to discover patterns in the firm’s sales over time and generally involves trend, cycle, seasonal, and random factor analyses.

Question 27

Trend Analysis

Answer 27

An analysis that focuses on aggregate sales data over a period of many years to determine general trends in annual sales.

Question 28

Cycle Analysis

Answer 28

An analysis of sales figures for a three to five year period to ascertain whether sales fluctuate in a consistent, periodic manner.

Question 29

Seasonal Analysis

Answer 29

An analysis of daily, weekly, or monthly sales figures to evaluate the degree to which seasonal factors influence sales.

Question 30

Random Factor Analysis

Answer 30

An analysis attempting to attribute erratic sales variations to random, nonrecurrent events.

Question 31

Regression Analysis

Answer 31

A method of predicting sales based on finding a relationship between past sales and one or more independent variables, such as population or income.

Question 32

Market Test

Answer 32

Making a product available to buyers in one or more test areas and measuring purchases and consumer responses to marketing efforts.