Chapter 8 - Target Marketing Strategies and CRM Flashcards
Market Fragmentation
Creation of many consumer groups due to a diversity of distinct needs and wants in modern society.
Target Marketing Strategy
- Segmentation
- Targeting
- Positioning
Dividing the market into segments based on customer characteristics, selecting one or more segments, and then do the marketing mix.
Segmentation
The process of dividing a larger market into smaller pieces based on one or more meaningful, shared characteristics.
Segmentation Variables
Dimensions that divide the total market into fairly homogenous groups, each with different needs and preferences.
Generation Y
The group of consumers born between 1977 and 1994.
Segmenting by Demographics
- Measurable characteristics such as gender, age, family structure, income and social class, race and ethnicity, and geography.
Generation X
The group of consumers born between 1965 and 1976.
Baby Booomers
Segment of people born between 1946 and 1964.
Geodemography
Segmentation technique that combines geography with demographics.
- Birds of a feather flock together.
- People who live near one another share similar characteristics.
Segmenting by Psychographics
Help to understand differences among consumers who may be statistically similar to one another but whose needs and wants vary.
VALS (Values and Lifestyles)
Psychographic system that divides the entire U.S. population into eight segments.
Behavioral Segmentation
Technique that divides consumers into segments on the basis of how they act toward, eel about, or use a god or service.
80/20 Rule
A marketing rule of thumb that 20 percent of purchasers account for 80 percent of a product’s sales.
Usage occasions
Indicator used in one type of market segmentation based on when consumers use a product most.
Target Market
Group or groups that a firm selects to turn into customers as a result of segmentation and targeting.
- Are members of the segment similar to each other?
- Can marketers measure the segment?
- Is the segment large enough to be profitable?
- Can marketing communications reach the segment?
- Can the marketer adequately serve the needs of the segment?
Segment Profiles
A description of the “typical” customer in a segment.
Undifferentiated targeting strategy
Appealing to a broad spectrum of people.
Differentiated Targeting Strategy
Developing one or more products for each of several distinct customer groups and making sure these offerings are kept separate in the marketplace.
Concentrated Targeting Strategy
Focusing a firm’s efforts on offering one or more products to a single segment.
Custom Marketing Strategy
Approach that tailors specific products and the messages about them to individual customers.
Mass Customization
Approach that modifies a basic good or service to meet the needs of an individual.
Positioning
Developing a marketing strategy aimed at influencing how a particular market segment perceives a good or service in comparison to the competition.
Repositioning
Redoing a product’s position to respond to marketplace changes.
Brand Personality
A distinctive image that captures a good or service’s character and benefits.
Perceptual Map
A vivid way to construct a picture of where products or brands are “located” in the consumers’ minds.
CRM (Customer Relationship Management)
About communicating with customers and customers being able to communicate with a company one-to-one.
Share of Customer
The percentage of an individual customer’s purchase of a product that is a single brand.
Customer’s Lifetime Value
The potential profit generated by a single customer’s purchase of a firm’s products over the customer’s lifetime.
Customer Equity
The financial value of a customer relationship throughout the lifetime of the relationship.
Four Steps of One-to-One Marketing (CRM)
- Identify
- Differentiate
- Interact
- Customize
