Chapter 7

Question 1

What 3 things does target marketing ask of marketers

Answer 1

• Market segmentation (identification of groups of buyers who differ in needs and wants)
• Market targeting (select markets segments to enter)
• Market positioning (establish the offering’s destinctive benefits to the target segment)

Question 2

Define market segments

Answer 2

Group of customers who share a similar set of needs and wants

Question 3

Name 4 kinds of market segmentation

Answer 3

• Geographic segmentation (nations, states, etc)
• Demographic segmentation (age, lifestage, gender, income, generation, race, culture)
• Psychographic segmentation (psychological traits)
• Behavioral segmentation (knowledge, attitude or response to products)

Question 4

What are the 3 major behavioral variables?

Answer 4

• Needs and benefits
• Decision rules
• Usage

Question 5

What are the 6 major variables in the usage of products?

Answer 5

• Occasions
• User status
• User rate
• Buyer-readiness stage
• Loyalty status
• Attitude

Question 6

Define the needs-based market segmentation approach

Answer 6

The combination of multiple variables in order to identify smaller, better-defined target groups

Question 7

What 5 criteria are there for useful market segments?

Answer 7

• Measurable (size, purchasing power, can be measured)
• Substantial (profitable enough)
• Accessible (effectively reached)
• Differentiable (distinguishable)
• Actionable (effective programs for attraction)

Question 8

What 5 threats determine the long-run attractiveness of a market segment?

Answer 8

• Threat of intense segment rivalry
• Threat of potential entrants
• Threat of substitutes
• Threat of buyers’ growing bargaining power
• Threat of supplier’s growing bargaining power

Question 9

What are 2 forms of full market coverage?

Answer 9

• Undifferentiated marketing (ignoring segment differences and supplies 1 offering for the whole market)
• Differentiated marketing (different products to all different segments)

Question 10

Define supersegments

Answer 10

A set of segments sharing some exploitable similarity

Question 11

What are 2 forms of market specialization?

Answer 11

• Product specialization (sell a certain product to all segments)
• Market specialization (sell a line of products to a particular segment, high reputation, loyalty)

Question 12

Define socially responsible marketing

Answer 12

Targeting that serves not only the company’s interest but also the interest of those targeted