Chapter 7 Segmenting, Targeting and Positioning

Question 1

market

Answer 1

people or organizations with:
needs or wants and willingness to buy

people with need or wants and willingness to buy

Question 2

market segment

Answer 2

A subgroup of people or organizations:
sharing one or more characteristics causing them to have similar needs

a subgroup of people with similar characteristics causing them to have similar needs

Question 3

market segmentation

Answer 3

the process of dividing a market into:
meaningful, relatively similar and identifiable segments or groups

the process of dividing a market into meaningful segments or groups

Question 4

segmentation bases(variables)

Answer 4

characteristics of individuals, groups, or organizations

Question 5

demographic segmentation

Answer 5

segmenting markets by:
-age
-gender
-income
-ethnic background
-occupation
-family life cycle (stages determined by age, marital status and presence or absence of children)

Question 6

geographic segmentation

Answer 6

segmenting markets by:
-region/country
-market size
-market density
-climate

Question 7

family life cycle (FLC)

Answer 7

stages determined by:
-age
-marital status
-presence or absence of children

Question 8

psychographic segmentation

Answer 8

segmenting markets by:
-personality
-motives
-lifestyle
-geodemographic ( geographic and demographic)

Question 9

geodemographic segmentation

Answer 9

segmenting markets by:
segmenting potential customers by neighbourhood lifestyles
-clusters potential customers by neighbourhood lifestyle categories
ex) lululemon places its first store in kits where all the hippies and weird yoga people are living.

Question 10

benefit segmentation

Answer 10

segmenting markets by:
grouping customers according to the benefits they seek from the product

ex) if someone buys athletic clothing for comfort vs if someone buys the clothes for their technology and moisture-wicking properties.

Question 11

usage-rate segmentation

Answer 11

segmenting markets by:
- the amount of product bought or consumed

Question 12

Pareto Principal (80/20) Rule

Answer 12

a principal that:
20 percent of all customers generate around 80 percent of the demand

Question 13

satisficers

Answer 13

business customers who places their order with the first familiar supplier

business customers who go with the first known supplier

Question 14

optimizers

Answer 14

business customers who consider numerous supplies, both familiar and unfamiliar, solicit bids, and study all proposals carefully before selecting one

business customers who consider numerous suppliers

Question 15

undifferentiated targeting strategy

Answer 15

views market as one big market
(no individual segments) uses (single marketing mix) the 4 p’s

Question 16

concentrated targeting strategy

Answer 16

targets one segment of the market

Question 17

niche

Answer 17

one segment of a market

Question 18

multisegment targeting strategy

Answer 18

chooses 2+ marketing segments and develops a distinct marketing mix

choosing two or more segments and developing a marketing mix

Question 19

cannibalization

Answer 19

sales of a new product cut into sales of a company’s existing product

*potential cost of multisegment targeting

Question 20

one-to-one marketing

Answer 20

individualized marketing method (company and customer relationship)
-to build long-term personalized and profitable relationships

individualized marketing method with a company-customer relationship

Question 21

positioning

Answer 21

influences potential customer’s overall perception of a brand a product line or an organization in general

the process that influences potential customer’s overall perception of a brand

Question 22

position

Answer 22

the place a product, brand or group of products occupies in consumers minds relative to competing offerings

consumer ranking on where the company/product/brand sits in comparison to others

ex) customers might place apple phones higher than google phones for their OLED display

Question 23

product differentiation

Answer 23

a positioning strategy that some companies use to distinguish their products from those of competitors

a positioning strategy that some company uses to distinguish their products from their competitors

Question 24

perceptual mapping

Answer 24

displaying or graphing, in two or more dimensions:
*the location of products, brands or groups of products in customer’s minds

displaying or graphing in two or more dimensions based on what the consumers think about the brands/group/product

Question 25

repositioning

Answer 25

changing consumer’s perceptions of a brand in relation to competing brands

Question 26

5 bases market segmentation in the consumer market are…

Answer 26

-geographic segmentation
-demographic segmentation
-psychographic segmentation
- benefit segmentation
- usage-rate segmentation

Question 27

importance of market segmentation

Answer 27

• develops marketing strategy
• defines customers needs
• defines marketing objectives
• helps evaluate performance

Question 28

critera for successful segmentation

Answer 28

-sustainability
-identifiable and measurable
-accessibility
-responsiveness

Question 29

steps in segmenting a market

Answer 29

1) select market product
2) choose base for segmentation
3) select segmentation descriptor
4) profile and analyze segments