Chapter 9

Question 1

What are the 5 steps of the STP process

Answer 1

Establish strategy and objects (segmentation)
Use segmentation methods (segmentation)
Evaluate segment attractiveness (targeting)
Select target market (targeting)
Identify and develop positioning strategy (positioning)

Question 2

What are the different ways firms can segment consumers

Answer 2

Geographic: country, region, where people live
Demographic: age, ethnicity, income, education
Psychographic: lifestyle, self-content, self-value
Benefits: convenience, affordability, prestige
Behavior: occasion, loyalty

Question 3

What are the 5 criteria for targeting

Answer 3

Identifiable
Is there a way of knowing if someone is in this segment

Substantial
A big enough group to make it worth it

Reachable
Some way to communicate with specific group

Responsive
wants them to react positively to product/service

Profitable
Will the product/service make you money

Question 4

What are the different types of targeting strategies

Answer 4

Mass (undifferentiated) marketing
Targets to entire market with one offer
Focuses on common needs rather than what’s different
Ex. coca-cola

Differentiated (segmented) marketing
Targets several different market segments and designs separate offers for each
Ex. diet coke vs coke zero

Concentrated marketing (niche)
Targets one or a few well defined segments of a large market
Ex. Ruffwear

Micromarketing
Tailoring products and marketing programs to the tastes of specific individuals

Question 5

What is a value propostion

Answer 5

-The set of benefits or values a company promises to deliver to customers to satisfy their needs and wants
-Differentiates the brand
-Should answer the question: why should I buy your brand instead of the competitor’s

Question 6

What are the 4 methods of positioning

Answer 6

Value -> quality or price
Salient attributes -> two or more evaluative criteria
Symbol -> image with strong and value meaning (nike swoosh)
Competition -> piggyback off of another brand well established pistons “gatorade but better”

Question 7

What is a perceptual map and how is it used

Answer 7

-Survey of ranking your company compared to other based on specific characteristics
-Position in consumers mind