Chapter 5 Flashcards
(25 cards)
What is the purpose of the first step in segmentation?
To align segmentation with the company’s overall strategy and objectives.
Why is geographic segmentation useful?
Demand for goods and services varies by region, and most brands get 40-80% of sales from core regions.
What characteristics define demographic segmentation?
Age, gender, race, income, education, occupation, family size, family life cycle, generation
What is the focus of psychographic segmentation?
Personality, lifestyle, social class, attitudes, and value-system.
What is self-values in psychographics?
Goals for life that drive how a person lives.
What is self-concept in psychographics?
The image a person has of themselves.
How are psychographic profiles developed?
Through large-scale surveys.
Why are psychographics important?
They are highly predictive of consumer decisions.
What factors are considered in behavioral segmentation?
Purchase occasion, benefits sought, user status, usage rates, and loyalty.
What is the 80/20 rule in usage rates?
80% of sales often come from 20% of customers.
What does geodemographic segmentation involve?
Combining multiple bases like geographic and demographic data.
What is PRIZM in segmentation?
A system with 68 lifestyle types for segmentation.
What are the criteria for evaluating segment attractiveness?
Identifiable, Reachable, Responsive, Substantial, and Profitable.
What does “Substantial and Profitable” mean in segment evaluation?
The segment must be large enough and provide sufficient profitability.
What are the four strategies for selecting a target market?
Undifferentiated (Mass), Differentiated (Segmented), Niche (Concentrated), Micro-Marketing (One-to-One).
What is the goal of undifferentiated marketing?
When is undifferentiated marketing effective?
To reach as much of the market as possible with one marketing mix.
When consumer needs are common and products are undifferentiated.
What is the goal of differentiated marketing?
What is an example of differentiated marketing?
To secure stronger positions in each market segment.
Nike selling shoes for running, cross-training, basketball, etc.
What is the goal of niche marketing?
When is niche marketing ideal?
To acquire a large share of a single segment.
When resources are limited and competitors are few.
What is micro-marketing?
What is an example of micro-marketing?
Offering highly customized products at the individual or local level.
Rolls-Royce or NikeID.
What is the goal of positioning?
To develop a clear, unique, and desirable position in the target market’s mind.
What criteria make positioning effective?
Important, distinctive, superior, communicable, unique, and profitable.
What are the main positioning methods?
Product attributes, value, benefits/symbolism, competition, and market leadership.
How is competition used in positioning?
Through head-to-head comparison or differentiation.
What is market leadership positioning?
Emphasizing a brand’s status in the industry.
