Unit 4 Marketing Chapter 1

Question 1

What are the 5 benefits of market segmentation & targeting

Answer 1

1. increased understanding of target audience
2. easy to identify trends/changes in target audience
3. resources more efficiently used as they focus on needs of specific target audience
4. more efficient tailoring/development of market programs
5. increased potential for setting achievable & realistic objectives

Question 2

What is segmentation & targeting

Answer 2

Process to divide target market (audience) into different groups

Based on certain characteristics

Grouping of people who share similar characteristics (1 or more aspects in common)

Question 3

Why should an org segment its market

Answer 3

1. help create custom marketing mix (4p‘s) for each segment
2. help deal with variety of preferences of market to spend/buy a product
3. identify group of individuals with homogeneous needs & preferences

Question 4

What are the segmentation quality criteria (hamave)

Answer 4

Homogenous
Accessible
Measurable 
Actionable
Viable/substantial 
Ethical

Question 5

What does Kotler mean with benefits & sacrifice

Answer 5

Benefits: tangible benefits of a product that influence consumer choice among competing alternatives

Can involve augmented features or product offering e.g maintenance and delivery

It is perceived by customers

Sacrifice: need to give up something to get benefits

Money, time, energy, effort

Question 6

What are the characteristics to segment b2c markets

Answer 6

Demographic
Geographic
Behavioral
Psychological

Question 7

What are the 5 criteria for segmentation of b2b markets

Answer 7

1. Geographic: location of org/ head office; local vs global firm
2. Business demographics: size, age (start up), org form(sole trader,partnership,company),sector (public/private), nature of business (agricultural, manufacturing,service)
3. Behavioral: current or potential clients, competitors customers, value & volume of purchase, frequency of purchase,nature of purchase
4. Decision making process: who makes/ influences decisions, how many ppl make decision, how fast is process
5. Personal characteristics of decision maker: age,experience, risk taker? & loyalty to supplier, negotiation style

Question 8

What do Dibb & Simkin suggest to ask when deciding which segment to target?

Answer 8

1. How many segments should be targeted?

2. Which segments should be targeted?

Question 9

What is undifferentiated targeting strategy

Answer 9

It involves mass marketing that is not tailored to different segment

Question 10

What are the differentiated targeting strategies

Answer 10

Single segment: develop single product or service offering for a specific target group

Multi segment