Customer Driven Startegies

Question 1

What are the 4 bases for identifying and analysing consumer market segments

Answer 1

Geographical
Behavioural
Psychographic
Behavioural

Question 2

What is geographical segmentation

Answer 2

Dividing a market into different geographical units such as nations, regions, states, local government areas or neighbourhoods

Question 3

What are the 4 geographical segment variables

Answer 3

Region
City size (pop)
Density (urban etc)
Climate

Question 4

What is demographic segmentation

Answer 4

Dividing market into segments based on specific variables such as age gender family size etc.

Question 5

What are the 9 demographic segmentation variables

Answer 5

Age
Sex
Family size
Family life cycle
Income
Occupation 
Education 
Religion 
Nationality

Question 6

What is psychographic segmentation

Answer 6

Divides market into segments based on social class, lifestyle or personality characteristics.

Question 7

What are the 4 psychographic segmentation variables

Answer 7

Socioeconomic
Status
Values, attitudes and lifestyle
Personality

Question 8

What is behavioural segmentation

Answer 8

Dividing markets into segments based on consumer knowledge, attitudes, uses or responses to a product

Question 9

What are the 7 variables for behavioural segmentation

Answer 9

Purchase occasion (when buyers get the idea to buy actually make purchase or use item)

Benefit segmentation (based on benefits) 
User status
Usage rate 
Loyalty
Readiness stage
Attitude towards product

Question 10

What is intermarket segmentation

Answer 10

Forming segments of consumers who have similar needs and buying behaviour even though they live in different countries

Question 11

What are the requirements for effective segmentation and explain each

Answer 11

Measurable: size, purchasing power, profiles

Accessible: can be effectively reached and served

Substantial: have to be large and profitable

Differentiable: conceptually distinguishable and respond differently to marketing mix elements

Actionable: must be designed for attracting and serving segments

Question 12

Define target market

Answer 12

A set of buyers sharing common needs or characteristics that the company decides to serve

Question 13

What are the 4 market targeting strategies

Answer 13

1. Undifferentiated marketing (mass)
2. Differentiated marketing (segmented)
3. Concentrated marketing (niche)
4. Micro marketing (local or individual)

Question 14

Define undifferentiated marketing (mass)

Answer 14

A market coverage strategy where companies decide to ignore market segment differences and go after the whole market with one offer

-focuses on common needs

Question 15

What is differentiated marketing (segmented)

Answer 15

A market coverage strategy where a firm decides to target several segments and designs offers for each segment

• can be effective but very costly
• must weigh up

Question 16

What is concentrated marketing (niche)

Answer 16

A market coverage strategy where a company targets a large share of one or a few segments or niches

• can be more effective and efficient
• however it does increase the cost and can be risky if big players come into the market

Question 17

What is micro marketing

Answer 17

The practice of tailoring products and market programs to the needs and wants of specific individuals and local customer segments. It includes local marketing and individual marketing

Question 18

What is local marketing

Answer 18

• tailoring brands and promotions to the needs and wants of local customer segments (cities, neighbourhoods, specific stores)

Question 19

What is individual marketing

Answer 19

Tailoring marketing programns and products to the needs and preferences of individual consumers also labelled one to one marketing.

Question 20

What targeting strategy would suit these situations:

1. Company resources limited
2. Uniform products
3. Product life cycle née & mature
4. Lack or low market variability
5. Competitors

Answer 20

1. Concentrated (niche) marketing
2. Underfferentiated (mass)
3. New/mass or niche mature: segmented
4. Undifferentiated
5. Depends. If they are using segmented and niche it’s too hard to do mass

Question 21

What are the 4 codes of ethics in socially responsible marketing

Answer 21

Code of advertising and marketing to children
Food and beverages code
Environment claims code
Wagering advertising and marketing communications code

Question 22

What are positioning maps

Answer 22

Show customer perception of the product versus competing brands

Question 23

Define product position

Answer 23

The complex set of perceptions impressions and feelings that consumers have for the product compared with competing products

Question 24

What are the steps in choosing a differentiation and positioning strategy

Answer 24

1. Identifying competitive advantages
2. Choosing the right competitive advantages
3. Selecting overall positioning strategy

Question 25

Define competitive advantage

Answer 25

An advantage over competitors is gained by offering greater value either through lower prices, or by providing more benefits that justify higher prices

Question 26

What are the 5 dimensions of differentiation for competitive advantage

Answer 26

1. Product (features, design, style)
2. Services (speed, convenience etc.)
3. Channel (expertise, coverage)
4. People (hiring, training)
5. Image

Question 27

What criteria must the differences satisfy

Answer 27

Important: differences deliver high values benefit

Distinctive: competitors do not offer the same thing

Superior: difference is better than competitors

Communicable: difference is able to be communicated and visible to buyers

Pre-emotive: can’t be easily copied

Affordable: buyers can pay

Profitable: must gain revenue

Question 28

Define value proposition

Answer 28

The full positioning of a brand - the full mix of benefits upon which it is positioned

Question 29

What are the 5 overall position strategies

Answer 29

1. More for more: most prestigious and highest cost
2. More for same: comparable quality to more for more but lower price
3. Same for less: don’t claim to be different or better but they offer discounts and lower prices
4. Less for much less: less than optimal performance but for much lower price
5. More for less: hard to sustain

Question 30

Define positioning statement

Answer 30

A statement that summarises company or brand positioning. It takes this form

To (target segment and need) our (brand) is (concept) that (point of difference)