Identifying the Target Market

Question 1

Define Segmentation

Answer 1

Segmentation is the division of the market place into distinct subgroups or segments, each characterized by particular tastes and requiring a specific market strategy.

• The target market for any given product may be one or more of these segments

Question 2

What are the four set of variables that segmentation is based on

Answer 2

• Geographic
• Demographic
• Psychographic
• Behavioral

Question 3

What are the different Demographic variables?

Answer 3

• Age
• Gender
• Ethnicity
• Family Status
• Income
• Level of Education
• Occupation
• S.E.S. (socioeconomic status)

Question 4

What are the different Psychographic variables?

Answer 4

• Lifestyle
• Personality
• Values and beliefs
• Interest

Question 5

List the different Behavioral variables

Answer 5

• What benefit does the consumer want from the wine
• Where do the consumers buy the wine
• What is the consumers level of brand loyalty
• What is the consumers interest level in wine?
• Is the consumer staying up with whats trendy or are they “late to the party”?

Question 6

What are the three different groups of wine consumers? Is there any drawbacks to this approach?

Answer 6

1. Wine Lovers: those with a great interest in, and knowledge of wine; High income and high level of education
2. Wine-interested: Those with a great interest in wine; medium income and moderate wine knowledge
3. Wine Curious: Those with a moderate interest in wine but limited knowledge; moderate income and they see wine as an opportunity to maintain social relations

While these 3 categories is a useful way to separate consumers, it is to simplistic to link this to income and education.

Question 7

What is market research?

Answer 7

Market research is the gathering and analysis of data about a particular market segment in order to understand what the segment wants or needs.

Question 8

What are the different ways that market research is carried out?

Answer 8

1. Survey: a series of questions designed to investigate the opinions, feelings, actions, or behaviors of a large group of people
2. Focus Groups: A small group of people drawn from the relevant consumer segment, brought together to discuss and comment on the topic being researched
3. Interviews: One-on-one discussion of the topic to be researched
4. Observing Consumer Behavior
5. Secondary Research: Market research is carried out by using data already available in the public domain or available in a report from a market research company

Question 9

What are the two ways that consumers are separated on a global scale?

Answer 9

There are High and low -involvement consumers.

• High-involvement consumers are very interested in wine
• Low-involvement customers have little interest in what they drink or buy, and tend to buy the same products over again