Segmentation

Question 1

According to lecture, what is market segmentation?

Answer 1

aggregation of prospective buyers into groups that have common needs and respond similarly to marketing programs
(homogenous, similar consumption behaviour, leads to differentiation)

Question 2

3 reasons for market segmentation

Answer 2

• single product can’t satisfy everyone
• efficient to make targeted products
• clear consumer insights

Question 3

What are the two main market segments?

Answer 3

Consumer Market - goods, services, and ideas for personal use
Business Market - products to run a business or be used as a component in another good or service

Question 4

According to the lecture, what is the key to successful product differentiation and market segmentation?

Answer 4

satisfying needs and profits

Question 5

What are the 4 segmentation variables ?

Answer 5

geographic, demographic, psychographic, behavioural

Question 6

psychographic segmentation

Answer 6

customer attitudes, interests, opinions, and beliefs

Question 7

What does the segmentation variable ‘behavioral’ refer to?

Answer 7

occasion based purchases

benefits sought, usage rate, loyalty rate

Question 8

What are some traits that are looked at with geographic segmentation?

Answer 8

global regions, countries, region of country, provinces, cities, neighbourhoods

just where people live.

Question 9

What are some traits looked at with demographic segmentation?

Answer 9

age/life cycle
gender
income
etho cultural group

Question 10

Traits looked at in psychographics based segmentation

Answer 10

social class, lifestyle, personality, characteristics

Question 11

What’s a common example of a psychographic segmentation seen in marketing?

Answer 11

persona - character descriptions of a brand’s typical customer - brings data to life

Question 12

What are the 6 steps in market segmentation?

Answer 12

1. identify consumer needs and common characteristics
2. cluster common consumer / customer variables to create meaningful market segments
3. estimate the size and feasibility of each segment
4. identify segments to be targeted
5. take actions with marketing programs to reach the segments
6. monitor and evaluate the success of these programs compared with objectives

Question 13

What is a target market?

Answer 13

A specific group of existing and potential consumers to which marketers direct their marketing efforts

Question 14

What are the 4 forms of targeting?

Answer 14

mass marketing
segment marketing
niche marketing
individual marketing

Question 15

What is undifferentiated (mass) marketing?

Answer 15

one single offer for the whole market, cost advantages at the expense of focused targeting

Question 16

What is differentiated (segment) marketing?

Answer 16

Design separate marketing mixes for several different segments,
creates more sales than targeting everyone with a single product,
higher costs as a result of serving separate segments

Question 17

What is concentrated (niche) marketing?

Answer 17

Targeting one or more small segments (niches),

effective: fine tunes the marketing mix according to specific consumer needs,
efficient: targets only those that can be served profitably

Question 18

What is individual (micro) marketing?

Answer 18

Tailors offerings to suit consumer needs

eg) ethnic grocery stores, mass customization like sneakers

Question 19

The 4 structural factors that affect target marketing are…

Answer 19

company resources,
substitute products,
power of buyers and suppliers,
power of competitors

Question 20

What is product positioning?

Answer 20

the impression of the branded product you want to establish in the consumer’s minds relative to their needs and also in contrast to the competition

Question 21

Position statements are short paragraphs that indicate these 4 things…

Answer 21

target market and need

branded product name

category in which it competes

point of differentiation: brand’s unique attributes and benefits

Question 22

behaviouristics

Answer 22

how and why consumers buy and use product

how, where, desired benefits, whether loyal, etc.

Question 23

business market

Answer 23

products that are purchased either to run or to be used as a component in another product or service

Question 24

consumer market

Answer 24

goods, services, and ideas that a person can purchase, use or, support for personal use

Question 25

geographics

Answer 25

where a target market lives

Question 26

individualized marketing

Answer 26

one to one marketing that involves customizing offers and in some cases, products to fit individual needs

Question 27

mass marketing

Answer 27

marketing a product with broad appeal to the entire market without any product or market differentiation

Question 28

positioning maps

Answer 28

visual representations of how products in a category or positioned in consumer’s minds

Question 29

position statement formula

Answer 29

for (Target market) who desire (target market need), (brand) is the (product category) that offers (product benefits).