MKTG 448 Exam 1 - FLASHCARDS - Segmentation, Targeting, and Positioning
What are the six requirements for segmentation to be useful?
- Identifiable. 2. Substantial. 3. Accessible. 4. Stable. 5. Differentiable. 6. Actionable
What is it when an organization should be able to identify customers in each segment and to measure their characteristics, such as demographics or usage behavior?
Identifiable
What is it called when a segment should be large enough for a firm to serve profitably?
Substantial
True or false: There is not much value in creating a segmentation scheme if an organization cannot reach the segments?
TRUE. It must be accessible
True or false: To be accessible, a segment needs to be reachable through communication and distribution channels independent of other segments?
TRUE
True or false: A segment should be stable over a long enough period of time that any marketing effort would be profitable?
TRUE
What does it mean for a segment to be differentiable?
Consumers in a segment should have similar needs, and these needs should differ from the needs of consumers in other segments
What is the rationale behind market segmentation strategy?
To achieve competitive advantage and superior performance, firms should (1) identify segments of industry demand, (2) target specific segments of demand, and (3) develop specific marketing mixes for each targeted market segment
What groups customers with similar needs into customer segments and then determines the characteristics of customers in those segments?
Segmentation
True or false: Without segmentation, companies can overlook opportunities as they continue to provide a single solution for everybody?
TRUE
True or false: Segments with unmet needs are opportunities that can drive marketing strategy and new product development?
TRUE
Do firms create segments?
No, they uncover them
True or false: Different companies may segment the same market differently, depending on how they view consumers and their needs/preference?
TRUE
How does segmentation benefit customers?
Customers benefit from products and services tailored to their needs because they provide convenience, save time, and enrich the customer experience
How do organizations benefit from segmentation?
It helps them identify underserved customers and unfulfilled customer needs/preferences
True or false: segmentation allows firms to better target their promotions and customize their products?
TRUE
What is selecting segments that the firm wants to focus on for its products or services called?
Targeting
The goal of ______ is to select segments that improve the organization’s chances of maximizing its long-term profitability in those segments?
Targeting
What is an undifferentiated market?
There are virtually no differences in the needs of customers
True or false: in undifferentiated markets, companies may decide to adopt a mass-marketing (undifferentiated-marketing) approach by designing the same product for everyone?
TRUE
What does an undifferentiated marketing approach allow for?
Allows firms to reach the largest potential market at low cost because of economies of scale in product design and marketing
What is it called where companies can customize their products and services for individual customers?
Micro marketing, disaggregated marketing, or local marketing
True or false: a firm’s ability to collect immense amounts of data and reach customers in real time through the internet can enable one-to-one marketing and mass customization?
TRUE
True or false: When choosing among segments, it is tempting for a company to target segments that are large, have high growth potential, and where the share of the company’s brands is low?
TRUE
What is the first factor that influences the selection of segments?
First, a firm should consider the characteristics of various segments, such as how large they are, how fast they are growing, and how profitable they are likely to be
What is the second factor that influences the selection of segments?
Second, the firm should consider its own competencies and resources that are available to address the needs of the different segments (does it have a competitive advantage, parity, or competitive disadvantage in market position)
True or false: Marketers should also consider their long-term objective in pursuing a segment; for example, they may want to target a small and emerging segment, since it may allow their organization to build unique skills that provide it with an advantage in the future?
TRUE
Should a firm consider current and potential competition in each segment?
Yes
What represents a firm’s, product’s, or brand’s location vs its competitors in the mental maps that consumers construct to represent the range of possible solutions to their problems?
Position
Why are strong positions powerful?
Strong positions are powerful because they help consumers categorize products by their similarities and, at the same time, distinguish and differentiate between products based on their differences
True or false: regardless of a company’s strategic intent in positioning its product, consumers actually determine the product’s position by their response to it?
TRUE
How do companies begin the positioning process?
By creating a positioning statement
What is a strategic document that communicates the unique value the product/brand would offer to a particular target segment?
Positioning statement
What distills the product’s value proposition into a compelling answer to the all-important question, “Why should I buy?”
Positioning statement
What is demand forecasting?
The process of predicting how much demand there will be for a product in the future
What type of positioning is when buyers do not have much information about the brand and its attributes, or the brand’s attributes are too close to another brand, and therefore consumers view the brand as just another me-too offering?
Under positioning
What type of positioning is when buyers view the brand as being very narrow, and as such do not understand the breadth of the brand offering?
Over positioning
What type of positioning is when buyers become confused because the brand has created too many associations with the product?
Confused positioning
What type of positioning is when buyers find it difficult to believe the claims made by the brand given the price, product features or the manufacturer?
Doubtful positioning
What component of positioning statements is this: explicit description of the target market segment that helps consumers easily discern which brands directly address their specific needs and which don’t?
For whom, for when, for where
What component of positioning statements is this: a simple description of the unique value claim the brand offers, written from the consumer’s viewpoint?
What value
What component of positioning statements is this: evidence that provides consumers with reasons to believe the brand’s claims?
Why and how
What component of positioning statements is this: description of the competitive set in which the brand classifies itself and the alternatives consumers may be considering?
Relative to whom
What is a two- or three-dimensional display of customer perceptions of competing alternatives in the marketplace?
Perceptual map
What is a two- or three-dimensional display of customer preferences of attributes?
Preference map
What are Incorporate preferences and perceptions in the same space?
Joint space map
