Chapter 7 Flashcards
What are the 4 major steps in designing a customer value driven marketing strategy?
Market segmentation
Market targeting
Differentiation
Positioning
Market segmentation
Involves dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviours and who might require separate marketing strategies or mixes
What are the variables that can segment consumer markets?
Geographic segmentation
Demographic segmentation
Psychographic segmentation
Behavioural segmentation
Geographic segmentation
A market is divided into different geographical units, such as nations, states, regions, counties, cities, or even neighbourhoods
Demographic segmentation
A market is divided into segments based on variables, such as age, life cycle stage, gender, income, occupation, education, religion, ethnicity, and generation
Psychographic segmentation
A market is divided into different segments based on lifestyle or personality characteristics
Behavioural segmentation
A market is divided into segments based on consumer knowledge, attitudes, uses of a product, or responses to a product
In order to segment a market effectively, market segments must be:
Measurable
Accessible
Substantial
Differentiable
Actionable
Market targeting
Involves evaluating each market segment’s attractive and selecting one or more segments to serve
When evaluating different market segments, a firm must look at three factors:
Segment size and growth
Segment structural attractiveness
Company objectives and resources
Target market
A set of buyers who share common needs or characteristics that a company decides to serve
What are the different levels of the target market?
Undifferentiated marketing
Differentiated marketing
Concentrated marketing
Micromarketing
Undifferentiated marketing
A market coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer
Differentiated marketing
A market coverage strategy in which a firm targets several market segments and designs separate offers for each
Concentrated marketing
A market coverage strategy in which a firm goes after a large share of one or a few segments or niches
Micromarketing
Involves tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments
What does micro marketing include?
Local marketing
Individual marketing
Local marketing
Involves tailoring brands and marketing to the needs and wants of local customer segments, such as cities, neighbourhoods, and specific stores
Individual marketing
Involves tailoring products and marketing programs to the needs and preferences of individual cusotmers
When choosing a market targeting strategy, a company needs to consider several factors:
The company’s resources
The degree of product variability
The product’s life cycle stage
Market variability
Competitor’s marketing strategies
Differentiation
Involves actually differentiating the market offering to create superior customer value
Positioning
Involves arranging for a market offering to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers
What do companies need to decide after deciding on the target segment
Value proposition
Value proposition
It will create differentiated value for targeted segments and what positions it wants to occupy in those segments
