Market Segmentation & Target Marketing

Question 1

what is market segmentation

Answer 1

Dividing a market into smaller groups of buyers with distinct needs, characteristics, or behaviors requiring separate products or marketing mixes.

Question 2

what is the 4 importance of market segmentation

Answer 2

◆ Markets have a variety of product needs and preferences

◆ Marketers can better define customer needs

◆ Decision makers can define objectives and allocate
resources more accurately

◆ Reach customers more efficiently by tailoring market
offerings and messages to customers’ specific needs

Question 3

what are the 4 key segmentation bases

Answer 3

1. Geographic Segmentation
2. Demographic Segmentation
3. Psychographic Segmentation
4. Behavioral Segmentation

Question 4

true or false

there is no single way to segment a market

Answer 4

true,
you May combine more than one variable to better define segments.

Question 5

what is geographic segmentation

Answer 5

Geographic segmentation divides the market into different geographical variables such as nations, regions, states, counties, cities, or even neighborhoods.

Question 6

why geographic segmentation

Answer 6

Many companies today are localizing their products / advertising
/ promotions and sales efforts to fit the needs of individual
regions, cities and neighborhood

Question 7

what is demographic segmentation

Answer 7

Demographic segmentation divides the market into
segments based on variables such as age, gender, income,
occupation, education, religion & ethnicity

Question 8

what is psychographic segmentation

Answer 8

Dividing the market into groups based on the following variables
:-
➢Social class
➢Lifestyle
➢Personality
➢Beliefs & Attitudes
➢Values

Question 9

why do psychographic segmentation

Answer 9

This segmentation approach will allow marketers to better develop and market the
products because there will be a more precise match between the product and
each segment’s needs and wants.

Question 10

what is behavioural segmentation

Answer 10

Behavioral segmentation is done by organizations on the basis of buying patterns of customers; variables such as

usage frequency,
brand loyalty,
benefits,
occasion

are used

Question 11

behavioural segmentation can be done by

Answer 11

• occasion
• benefits sought
• user status (non user/potential user)
• loyalty
• usage rate (light/medium/heavy)

Question 12

people showing _____ can be grouped together in a single group and they can then be targeted

Answer 12

similar buying behaviour

Question 13

Clearly defined _______ not only ensure
that customers are more likely to purchase the product, it also
minimises wastage of resources, reducing the time spent
marketing the wrong products to the wrong customers.

Answer 13

market segmentation criteria

Question 14

what are the 5 criteria for effective segmentation

Answer 14

accessible

measurable

substantial

differentiable

actionable

Question 15

what is the measurable criteria

Answer 15

The number of customers within the segment;
purchasing power & sales volume. Customer insights
should be available to further target them.

Question 16

what is the substantial criteria

Answer 16

Is the market segment large or profitable
enough to serve? There would be no point in wasting
marketing budget on a market segment that is insufficiently
large, or has negligible spending power.

Question 17

what is accessible criteria

Answer 17

consider how the segment might be accessed and
served (Digital vs Traditional platforms, Ecommerce platforms vs Retail Stores )

Question 18

what is differentiable criteria

Answer 18

Differences between market segments should be clearly defined, so that the campaigns, products and marketing tools applied to them can be implemented.

Question 19

what is actionable criteria

Answer 19

The market segment must have practical value – its characteristics must provide supporting data for a marketing position or sales approach.

Question 20

Important aspects of Google Analytics are _____ and ________.

Answer 20

metrics
(quantitative measurements)

dimensions
(characteristics)

Question 21

on the google analytics dashboard how can you segment users

Answer 21

> from location and browser usage,

> to age,

> to what pages viewed

> to amount of time spent on your pages and website.

Question 22

It’s always best to combine ______ and ______ so
that they share the same scope or view

Answer 22

dimensions

metrics

Question 23

Your main goal is to get to know ________ and, from that, you will be able to define strategies to
_______

Answer 23

where your visitors come from

target new visitors and readers

Question 24

what is the second step of a marketing strategy

Answer 24

target marketing

(segmentation, targeting, positioning & differentiation are the 3 steps)

Question 25

Why have we
segmented the market by dividing it up into small segments ?

Answer 25

Too many products & too many needs.

Question 26

what is target marketing

Answer 26

Evaluating each segment’s attractiveness and selecting one or more to enter. (e.g. Primary & Secondary target market)

Question 27

3 ways to evaluate target market segments

Answer 27

1. Segment Size and Growth
   ▪ Analyze current segment sales, growth rates, and expected profitability.
2. Segment Structural Attractiveness
   ▪ Consider competition, existence of substitute products, and the power of buyers and suppliers.
3. Company Objectives and Resources
   ▪ Examine company skills & resources needed to succeed in that segment.
   ▪ Offer superior value and gain advantages over competitors.

Question 28

from targeting narrowly to broadly, name the 4 target market approaches

Answer 28

micro marketing (local/individual marketing)

concentrated marketing

differentiated marketing

undifferentiated marketing

Question 29

what is Undifferentiated Target Marketing also called

Answer 29

MASS MARKETING

Question 30

what does Undifferentiated Target Marketing focus on

Answer 30

Focus is on common needs of consumers

Question 31

what happens in undifferentiated target marketing

Answer 31

Ignore market segment differences and go after whole market with one offer

Product and marketing program are geared to the largest number of buyers.

Uses mass advertising and distribution

Question 32

what happens in differentiated target marketing

Answer 32

Firm targets several market segments

Firms design Different marketing Strategies for each segment.

The goal is to have higher sales and a stronger position with each market segment.

This approach increases the costs of doing business.

Question 33

give example of differentiated target marketing

Answer 33

EG. CANON CAMERAS
>Target Professionals
>Target Amateurs
>Target Divers
Etc

Question 34

what is concentrated marketing

Answer 34

The focus is acquiring a large share in just ONE Segment, like a Niche Market. EG. Lamborghini / Collectible Toys Market Etc.

Question 35

Generally, there are fewer competitors in which targeted marketing strategy

Answer 35

concentrated marketing

Question 36

how can marketer build strong market position using concentrated marketing strategy

Answer 36

because of its greater
knowledge of consumer needs in the niches it serves and the special reputation its acquires.

Appealing approach when marketer’s resources are limit

There is some risk in focusing on only one market.

Question 37

what is micro marketing

Answer 37

Tailoring products and marketing programs to suit the tastes of specific individuals and locations within a population or segment (Very Niche).

Question 38

what are 2 ways of customisation in micromarketing

Answer 38

➢Local Marketing: Tailoring brands and promotions to the needs and wants of local customer groups — cities, neighborhoods, specific stores.

➢Individual Marketing: Tailoring products and marketing programs to
the needs and preferences of individual customers.

Question 39

Each firm must differentiate its market offer by identifying a ______ that appeals to a
substantial group within the segment.

Answer 39

competitive advantage

Question 40

what is competitive advantage

Answer 40

An advantage over competitors gained by offering greater customer value either by:
– Having lower prices, or
– Providing more benefits that justify higher prices (benefits can be in terms of product, services, channels, people, or image.)

Question 41

what is the key to winning target customers

Answer 41

▪ Understand their needs better than competitors do and to deliver more value. This will create a competitive advantage for companies.

Question 42

what are the competitive advantage types

Answer 42

product differentiation (features, performance, style, etc)

service differentiation (delivery speed, repair services, customer training service)

image/brand differentiation (nike swoosh & mcdonalds logo have strong brand recognition)

people differentiation (hiring and training staff better)

channel differentiation (ecommerce, 24/7 banks, vending machine)

Question 43

what are the 7 criteria the competitive advantages must follow

Answer 43

▪Important. The difference delivers a highly valued benefit to target buyers.

▪Distinctive. Competitors do not offer the difference, or
the company can offer it in a more distinctive way.

▪Superior. The difference is superior to other ways that
customers might obtain the same benefit.

▪Communicable. The difference is communicable and visible to buyers. People can ‘See’ it

▪Preemptive. Competitors cannot easily copy the difference.

▪Affordable. Buyers can afford to pay for the difference.

▪Profitable. The company can introduce the difference profitably.