Chapter 9

Question 1

define market segmentation

Answer 1

aggregating prospective buyers into groups that have common needs and will respond similarly to a marketing action

Question 2

what are the 4 key criteria for segmenting a market?

Answer 2

1. profit potential- no segments if no profits
2. similarity of needs
3. difference of needs
4. simplicity and costs of assigning potential buyers to segments

Question 3

what are 2 approaches to product positioning?

Answer 3

1. head to head: competing directly on similar product attributes to the same target market
2. differentiation: smaller scale, less competitive market niche, unique aspect of a good

Question 4

what are the 5 steps to segment a market?

Answer 4

1. group potential buyers into segments
2. group products to be sold into categories
3. develop a market product grid to estimate size of market
4. select target markets
5. take marketing actions to reach target markets