Chapter 8 - Segmenting and Targeting Markets

Question 1

What is a market? There are four characteristics that need to be met to be considered a market.

Answer 1

(1) people or organizations with
(2) needs or wants and with
(3) the ability and
(4) the willingness to buy. A group of people or an organization that lacks any one of these characteristics is not a market.

Question 2

What is a market segment?

Answer 2

is a subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs.

Question 3

What is market segmentation?

Answer 3

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

Question 4

What is the importance of market segmention?

Answer 4

Market segmentation helps marketers define customer needs and wants more precisely and helps decision makers to more accurately define marketing objectives and better allocate resources.

Question 5

Why are segment markets important?

Answer 5

1. ) Allows marketers to create a group and pinpoint needs of that group
2. ) Provides marketers with important information to better design their marketing mix that is tailored with the characteristics and desires of one or more segments.
3. ) Segmentation is consistent with concept of satisfying needs and wants of customer while meeting objectives.

Question 6

How do you segment consumer markets?

Answer 6

Using segmentation bases. Looking at individual characteristics of individuals or groups you are looking to seek out and dividing the market into segments.

Question 7

What are the commonly used characteristics to segment markets?

Answer 7

• Geographic
• Demographics
• Psychographics
• Benefits sought
• Usage rate

Question 8

What is geographic segmentation?

Answer 8

refers to segmenting markets by

• region of a country or the world,
• market size,
• market density,
• climate.

Question 9

What is demographic segmentation?

Answer 9

Common bases are

• age
• gender
• income
• ethnic background
• family life cycle

Question 10

What is psychographic segmentation?

Answer 10

A market segmentation based on

• personality
• motives
• lifestyles
• geodemographics

Question 11

What is benefit segmentation?

Answer 11

Process of grouping customers into market segments according to the benefits they seek from the product.

Question 12

Segmenting Business Markets

Answer 12

• all 5 of ones from consumer segments
• Company characteristics
• Buying processes

Question 13

What is a target market?

Answer 13

A group of people or organizations for which an organization designs, implements, and maintains a marketing mix intended to meet the needs of that group, resulting in mutually satisfying exchanges.