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Marketing Chapter 8
Chapter 8 Marketing
70
Marketing
Undergraduate 4
02/02/2013

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Term
Market
Definition
People or organizations
Needs or wants
Ability
Willingness to buy
Term
Market segment
Definition
Subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs
Term
Market Segmentation Purpose
Definition
Enable the marketer to tailor marketing mixes to meet the needs of one or more specific segments
Term
Market segmentation
Definition
process of dividing a market into meaningful relatively similar and identifiable segments or groups
Term
Market segmentation key role
Definition
Groups of people with different needs and preferences
Helps marketers define customer needs and wants more precisely
More accurately define marketing objectives
Term
3 reasons why marketers segment
Definition
Identify groups of customers
provides marketers with information to help them design marketing mixes
Consistent with marketing concept of satisfying customer wants and needs while meeting objectives
Term
Segmentation Scheme must provide
Definition
Substantiality
Identifiability and measurability
Accessibility
Responsiveness
Term
Segmentation Bases
Definition
Characteristics of individuals, groups, or organizations, to divide a total market into segments
Term
Improper segmentation leads to
Definition
Lost sales
Missed profit opportunities
Term
Segmentation key
Definition
Identify bases that will produce substantial, measurable, and accessible segments that exhibit different response patterns to marketing mixes
Term
Current trend for segmentation is
Definition
using more rather than fewer variables to segment most markets
Term
Multiple variable segmentation
Definition
Clearly more precise than single variable segmentation
Term
Consumer good markets use segments
Definition
Geographic
Demographic
Benefit
Usage Rate
Term
Geographic Segmentation
Definition
Region of a country or the world, market size, market density, or climate
Term
4 reasons for regional approach
Definition
Find new ways to generate sales because of sluggish and intensely competitive markets
Computerized checkout stations give accurate assessment of which brands sell best
New regional brands appeal to local preferences
Regional approach allows to consumer goods companies to react more quickly to competition
Term
Demographic Segmentation
Definition
Age
gender
Income
Ethnic
background
family life cycle
Term
Age Segmentation
Definition
Newborn infants
Young children
Tweens
Generation Y
Generation X
Baby Boomers
Seniors
Term
Generation Y
Definition
Millennial
Born between 1982-2003
1/3 of US population
Spend 200 billion
Civic minded
pay attention to company's overall message
Term
Unboxing
Definition
Popular with new technology, is a video or article describing and reviewing new products
Term
Hauls
Definition
Videos in which the shopper shows off and reviews her purchases from the day, reap millions of views and promote sales
Term
Generation X
Definition
Born after baby boomers (1964)
Disloyal to brands
Skeptical of big business
Desire experience not just product
Term
Baby Boomers
Definition
1946-1964
spend 2.1 trillion
Half of all spending
Make up 49% of households
Goods and services
Not brand loyal
Diverse group
Term
War Generation (61-66)
Great Depression generation (67-76)
GI Generation (77 and up)
Definition
Born before 1946
View retirement as active
explore new knowledge
Require shopping modifications
Term
Female
Gender Segmentation
Definition
70% of consumer goods
48% of video games
Term
Income Segmentation
Definition
Income level influences consumers wants and determines their buying power
Term
3 Largest Groups
Ethnic Segmentation
Definition
Hispanic American
African American
Asian American
Term
FLC
Family Life Cycle Segmentation
Definition
Series of stages determined by a combination of age, marital status, and the presence or absence of chilfren
Term
FLC Stages
Definition
Married adults down 80%
Unmarried Americans 42%
40% Home buyers
Single adults are the majority
Term
Psychographic Segmentation
Definition
Personality
Motives
Lifestyles
Geodemographics
Term
Geodemographic Segmentation
Definition
Combines Geographic, demographic, and lifestyle segmentation
Marketing to small regions
Specific lifestyles
Term
Psychographic collectors
Definition
Use cookies from web browsers to receive web habits
Term
Benefit Segmentation
Definition
Process of grouping customers into market segments according to the benefit they seek from the product
Term
Benefit Segmentation is different because
Definition
Groups potential customers on the basis of their needs or wants rather than some other characteristic
Term
Usage Rate Segmentation
Definition
Divides a market by the amount of product bought or consumed
Term
Usage rate segmentation focuses on
Definition
heavy users or multiple marketing mixes aimed at different segments
Term
80/20 principle
Definition
20% of all customers generate 80% of the demand
Term
Developing heavy users by
Definition
FREQUENCY/LOYALTY programs
Loyalty card programs
Term
Market segmentation
Definition
The process of dividing a market into distinct groups with distinct needs, characteristics, or behavior, who might require separate marketing mixes, is called _____.
Term
Market positioning
Definition
Ensuring a product occupies a clear, distinctive, and desirable place relative to competing products in the minds of target consumers is called ____________.
Term
Feelings
Definition
Which of the following is not a major segmentation variable for consumer markets?
Term
Gender
Definition
The W Network, which offers Canadian women television programming tailored to their interest and issues, is focusing on a _____ segmentation base.
Term
Psychographic segmentation
Definition
Variables such as social class, lifestyle, and personality are components of ________.
Term
Desirability
Definition
Which of the following is not a requirement for effective segmentation?
Term
What factors do we use to evaluate market segments?
Definition
Segment size and growth, structural attractiveness, and company objectives and resources.
Term
Which targeting strategy is used by Coke?
Definition
Undifferentiated
Term
An advantage over competitors gained by offering consumers greater value is called a ___________.
Definition
Competitive advantage
Term
Which value proposition is Mercedes Benz going after?
Definition
More for more
Term
It is important to target your market, before you define the market segments.
Definition
False
Term
Positioning is the process of ensuring your product has the same USP's as your competitors.
Definition
False
Term
Dividing segments based on the sports they play is an example of behavioral segmentation.
Definition
False
Term
Hershey's offers "Hershey's Kisses" in special holiday colors. This is a type of behavioral segmentation.
Definition
True
Term
Heavy users are often a small percentage of the market but account for a high percentage of total consumption.
Definition
True
Term
By pursuing customers who need a replacement car while their car is being repaired, which represents only 5% of the total rental car market, rather than the tourism component of the rental car market, Enterprise Rent-A-Car has chosen a niche market.
Definition
True
Term
Perceptual positioning maps show consumer perceptions of their brands versus competing products on important buying dimensions.
Definition
True
Term
The most successful value proposition is less for more.
Definition
False:This does not make sense. You would not make a product that is less desirable than competitors and charge more for it.
Term
Wal-Mart employs the same for less value proposition.
Definition
True
Term
Positioning statements should follow the form: To (target segment and need) our (brand) is (concept) that (point-of-difference).
Definition
True
Term
Consider Procter and Gamble’s (P&G) skincare brands, Noxzema and Oil of Olay. Why can P&G successfully market these apparently similar products and never directly compete for the same customer?
Definition
Because Noxzema is carefully targeted at teens and young women while Olay is targeted to women over 50
Term
Why does P&G market so many different versions of each brand?
Definition
Because different groups of consumers want different set of benefits
Term
What is the competitive advantage to P&G in marketing competing brands in a product category?
Definition
P&G can capture more share of the total market with multiple brands than with just one brand
Term
Why does P&G focus on product brands rather than the P&G brand?
Definition
Because each brand must be positioned for its target segment and a single Procter and Gamble brand cannot have one positioning for all of P&G’s segments
Term
The increased prevalence of segmentation and targeting is leading to the end of traditional mass marketing.
Definition
True
Term
True
Definition
Generally, segments are comprised of consumers who exhibit similar buying behaviours.
Term
As a criterion for determining a segment’s value as a target segment, “substantial” dictates that the largest possible segment is the correct target.
Definition
False
Term
True
Definition
If a desired market position is already owned by another brand, it is possible to compete by deliberately shifting that brand’s position in the minds of consumers.
Term
False
Definition
Marketers are beginning to lose control of consumers as they search for brand and product information online and make the purchase decision without ever viewing advertising or interacting with a sales person.
Term
The different segments of Red Bull Energy Drink and Gatorade are largely based on what segmentation criteria?
Definition
Lifestyle and personality
Term
Undifferentiated, differentiated and niche
Definition
Consider the following product category brands: Dasani bottled water, diet caffeine-free Coke and Clearly Canadian. Each of these brands illustrates a segmentation level. Select the set that most closely matches these brands respectively:
Term
Because heavy users do not need the reinforcement of brand advertising and stay loyal due to ongoing customer satisfaction
Definition
Although loyal and heavy users of a brand generate the most revenue, marketers generally target advertising at non-users or light users. Why is this so?
Term
In each case, the company services different target segments with different marketing mixes. IBM services the consumer market, the small/medium business market and the Fortune 1000 market. Home Depot services both the home do-it-yourselfer and the professional contractor. Staples services students, home-based business owners and larger companies. And 3M makes products for the consumer market as well more complex products for the business-to-business market.
Definition
An undifferentiated segmentation strategy in the business-to-business market is illustrated by makers of standard printer paper. A differentiated segmentation strategy in the business-to-business market is best illustrated by
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