Customer value-driven marketing strategy: creating value for target customers

Question 1

Define the concept of market segmentation

Answer 1

Dividing a market into smaller groups with distinct needs, characteristics or behavior that might require separate marketing strategies or mixes.

✓ There is no single way of
segmenting a market
✓ Different market segmentation variables to develop the most
effective segmentation method

Question 2

Name and briefly explain the four main types of segmentation variables, which can be used for segmenting consumer markets

Answer 2

1. Geographics: Country, City, Density, Language, Climate, Area, Population
2. Demographics: Age, Gender, Income, Education, Social status, Family, Life stage, Occupation
3. Psychographics: Lifestyle, Concerns, Personality, Values, Attitudes, AIO - Activity, Interest and Opinion,
4. Behavioral: Purchase, Usage, Intent, Occasion, Buyer stage, User status, Life cycle stage, Engagement.

Question 3

Define differentiation

Answer 3

Differentiating the market offering to create superior value

Question 4

Name 5 differentiation strategies

Answer 4

1. Product differentiation
2. Services differentiation
3. Channels differentiation
4. People differentiation
5. Image differentiation

Question 5

Define positioning

Answer 5

Arranging for market offering to occupy a clear, distinctive and desirable place relative to competing products in the minds of target consumers

Question 6

Need for target marketing

Answer 6

Marketers understand that they cannot offer all things
to all people, all of the time. Buyers and markets are
too complex and diverse for one simple marketing
formula to adequately address the needs of all.

Question 7

Requirements for effective segmentation

Answer 7

1. Measurable – size, purchasing power, profiles
2. Accessible – reach and serve effectively
3. Substantial – large and profitable
4. Differentiable – distinguishable between segments and homogeneous within a segment
5. Actionable – effective marketing program