Chapter 7

Question 1

What are the 4 major steps in designing a customer value driven marketing strategy?

Answer 1

Market segmentation

Market targeting

Differentiation

Positioning

Question 2

Market segmentation

Answer 2

Involves dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviours and who might require separate marketing strategies or mixes

Question 3

What are the variables that can segment consumer markets?

Answer 3

Geographic segmentation

Demographic segmentation

Psychographic segmentation

Behavioural segmentation

Question 4

Geographic segmentation

Answer 4

A market is divided into different geographical units, such as nations, states, regions, counties, cities, or even neighbourhoods

Question 5

Demographic segmentation

Answer 5

A market is divided into segments based on variables, such as age, life cycle stage, gender, income, occupation, education, religion, ethnicity, and generation

Question 6

Psychographic segmentation

Answer 6

A market is divided into different segments based on lifestyle or personality characteristics

Question 7

Behavioural segmentation

Answer 7

A market is divided into segments based on consumer knowledge, attitudes, uses of a product, or responses to a product

Question 8

In order to segment a market effectively, market segments must be:

Answer 8

Measurable

Accessible

Substantial

Differentiable

Actionable

Question 9

Market targeting

Answer 9

Involves evaluating each market segment’s attractive and selecting one or more segments to serve

Question 10

When evaluating different market segments, a firm must look at three factors:

Answer 10

Segment size and growth

Segment structural attractiveness

Company objectives and resources

Question 11

Target market

Answer 11

A set of buyers who share common needs or characteristics that a company decides to serve

Question 12

What are the different levels of the target market?

Answer 12

Undifferentiated marketing

Differentiated marketing

Concentrated marketing

Micromarketing

Question 13

Undifferentiated marketing

Answer 13

A market coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer

Question 14

Differentiated marketing

Answer 14

A market coverage strategy in which a firm targets several market segments and designs separate offers for each

Question 15

Concentrated marketing

Answer 15

A market coverage strategy in which a firm goes after a large share of one or a few segments or niches

Question 16

Micromarketing

Answer 16

Involves tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments

Question 17

What does micro marketing include?

Answer 17

Local marketing

Individual marketing

Question 18

Local marketing

Answer 18

Involves tailoring brands and marketing to the needs and wants of local customer segments, such as cities, neighbourhoods, and specific stores

Question 19

Individual marketing

Answer 19

Involves tailoring products and marketing programs to the needs and preferences of individual cusotmers

Question 20

When choosing a market targeting strategy, a company needs to consider several factors:

Answer 20

The company’s resources

The degree of product variability

The product’s life cycle stage

Market variability

Competitor’s marketing strategies

Question 21

Differentiation

Answer 21

Involves actually differentiating the market offering to create superior customer value

Question 22

Positioning

Answer 22

Involves arranging for a market offering to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers

Question 23

What do companies need to decide after deciding on the target segment

Answer 23

Value proposition

Question 24

Value proposition

Answer 24

It will create differentiated value for targeted segments and what positions it wants to occupy in those segments

Question 25

Product position

Answer 25

The way a product is defined by consumers on important attributes, the place it occupies in consumers’ minds relative to competition products

Question 26

What are the 3 steps in differentiation and positioning task?

Answer 26

Identifying possible value differences and competitive advantages

Choosing the right competitive advantages

Selecting an overall posting strategy

Question 27

Competitive advantages

Answer 27

Advantages over competitors gained by offering greater customer value either by having lower prices or providing more benefits that justify higher prices

Question 28

When is a difference worth promoting?

Answer 28

Important

Distinctive

Superior

Communicable

Preemptive

Affordable

Profitable

Question 29

Value proposition

Answer 29

The mix of benefits on which it is positioned.