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Essentials of Marketing
Ch. 8, Segmenting and Targeting Markets
41
Marketing
Undergraduate 3
02/26/2012

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Term
Market
Definition
people or organizations with needs or wants and the ability and willingness to buy
Term
market segment
Definition
a subgroup of people or organization sharing one or more characteristics that cause them to have similar product needs
Term
market segmentation
Definition
process of dividing a market into meaningful, relatively similar, and identifiable segments or groups
Term
substantiaility
Definition
segment must be large enough to warrant developing and maintaining a special marketing mix
Term
identifiability and measurablility:
Definition
segments must be identifiable and their size measurable
Term
accessibility
Definition
firm must be able to reach members of targeted segments with customized marketing mixes
Term
responsiveness
Definition
markets can be segmented using any criteria that seem logical
Term
segmentation bases/variables
Definition
characteristics of individuals, groups, or organizations
Term
geographic segmentation
Definition
segmenting markets by region of a country or the world, market size, market density, or climate
Term
demographic segmentation
Definition
segmenting markets by age, gender, income, ethnic background, and family life cycle.
Term
psychographic segmentation
Definition
market segmentation on the basis of personality, motives, lifestyles, and geodemographics
Term
geodemographic segmentation
Definition
segmenting potential customers into neighborhood lifestyle categories
Term
psychographic segmentation: personality
Definition
a person's traits, attitudes, and habits
Term
psychographic segmentation: motives
Definition
using appeals to economy. reliability, and dependability
Term
psychographic segmentation: lifestyles
Definition
divides people into groups according to the way they spend their time, the importance of things around them, their beliefs,and socioeconomic characteristic (income and education)
Term
benefit segmentation
Definition
process of grouping customers into market segments according to the benefits they seek from the product
Term
usage-rate segmentation
Definition
divides a market by the amount of product bought or consumed
Term
80/20 Principle
Definition
20% of all customers generate 80% of the consumer's demands
Term
buying processes: Satisficers
Definition
business customers who place an order with the first familiar supplier to satisfy product and delivery requirements
Term
buying processes: Optimizers
Definition
business customers who consider number suppliers, both familiar and unfamiliar, solicit bids, and study all proposals carefully before selecting one.
Term
Steps in Segmenting a market
Definition
1. select a market or product category for study
2. choose a basis or bases for segmenting the market
3. select segmentation descriptors
4. profile and analyze segments
5. select target markets
6. design, implement, and maintain appropriate marketing mixes
Term
target market
Definition
a group of people or organizations for which an organization designs, implements, and maintain a marketing mix intended to meet the needs of that group, resulting in mutually satisfying exchanges
Term
undifferentiated targeting strategy
Definition
a marketing approach that views the market as one big market with no individual segments and thus uses a single marketing mix
Term
concentrated targeting strategy
Definition
a strategy used to selet one segment of a market for targeting marketing efforts
Term
niche
Definition
one segment of a market
Term
multi-segmenting target market strategy
Definition
a strategy that chooses two or more well-defined market segments and develops a distinct marketing mix for each
Term
cannibalization
Definition
a situation that occurs when sales of a new product cut into sales of a firm's existing products
Term
one-to-one marketing
Definition
an individualized marketing method that utilizes customer information to build long-term, personalized, and profitable relationships with each customer.
Term
positioning
Definition
developing a specific marketing mix to influence potential customers' overall perception of a brand product line, or organization in general
Term
position
Definition
place a product, brand, or group of products occupies in consumers' minds relative to competing offering
Term
product differentiation
Definition
a positioning strategy that some firms use to distinguish their products from those competitors
Term
repositioning
Definition
changing consumer's perceptions of a brand in relation to competing brands
Term
perceptual mapping
Definition
means of displaying, or graphing, in two or more dimensions, the location of products, brands, or groups of products in customers' minds
Term
positioning basis: attributes
Definition
a product is associated with an attribute, product feature, or customer benefit
Term
positioning basis: price and quality
Definition
may stress high price as a signal of quality or emphasize low price as an indication of value
Term
positioning basis: use or application
Definition
stressing uses or applications can be an effective means of positioning a product with buyers
Term
positioning basis: product user
Definition
focuses on personality or type of user
Term
positioning basis: product class
Definition
position the product as being associated with particular category of products
Term
positioning basis: competitor
Definition
positioning against competitors is part of any positioning strategy
Term
positioning basis: emotion
Definition
positioning using emotion focuses on how the product makes customers feel
Term
repositioning
Definition
changing consumers' perceptions of a brand in relation to competing brands
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