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BUS2010F: Marketing > CHAPTER SEVEN > Flashcards

CHAPTER SEVEN Flashcards

1
Q

What have firms moved away from mass marketing towards?

A

Firms have moved away from MASS marketing to TARGETED marketing as they realise that they cannot appeal to all consumers

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2
Q

It’s important to a firm they recognise which market is best for them to serve and which is most ___________

A

profitable

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3
Q

True or false, Identifying and meeting consumer needs is possible unless consumer marketers are able to define who their target market is, as well as who is not a target

A

FALSE, Identifying and meeting consumer needs is NOT possible unless consumer marketers are able to define who their target market is, as well as who is not a target

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4
Q

Why is consumer marketers being able to define their target market helpful?

A

This helps an organization to be competitive in relation to its business rivals

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5
Q

What are the four major steps in designing a customer-driven marketing strategy and thus create value for targeted customers?

A
  1. Segmentation
  2. Targeting
  3. Differentiation
  4. Positioning
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6
Q

What is Segmentation?

A

Dividing a market into smaller segments with distinct needs, characteristics or behaviour that might require separate marketing strategies or mixes

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7
Q

What is targeting?

A

The process of evaluating each market segment’s attractiveness and selecting one or more segments to enter

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8
Q

What is differentiation?

A

Differentiating the market offering to create
superior customer value

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9
Q

What is Positioning?

A

Arranging for a market offering to occupy a
clear, distinctive and desirable place
relative to competing products in the minds of target consumers

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10
Q

What needs to happen for segmentation to be successful?

A

For segmentation to be successful, the members within each group must have similar (homogenous) likes, tastes, needs, wants or preferences

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11
Q

What does market segmentation allow for? [2]

A
  • Market segmentation allows an organization to appeal accurately to consumers’ specific needs and wants
  • It allows organizations to target their resources more effectively and make better marketing decisions
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12
Q

What does consumer markets consist of?

A

Consumer markets consist of purchasers and household members who intend to consume or benefit from the purchased product and DO NOT buy products to make profit by re-selling them

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13
Q

What are the FOUR variables in segmentation? [4]

A
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14
Q

What does market segmentation look like?

A
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15
Q

What are some examples of demographic segmentation?

A

Gender, age, race, religion, family size, ethnicity, income, education level, occupation

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16
Q

What is geographic segmentation?

A

Segmenting the market into geographic units such as communities, cities, countries etc.

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17
Q

What is psychographic segmentation?

A

Psychographic segmentation further filters the market into segments based on how the consumer sees the world and takes into consideration different personality traits, values, interests, and lifestyles factors

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18
Q

What is behavioral segmentation?

A

Behavioural segmentation divides the market into group based on consumer knowledge, attitudes, product use or response

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19
Q

What is consider the most powerful segmentation approach?

A

Behavioural because it uses actual consumer behaviour or product usage to draw distinctions between different market segments

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20
Q

These segments could include grouping customers by:
* Their _________ towards a product, brand or service;
* Their _____ of a product or service,
* Their overall ___________ of a brand and the brand’s products,
* Their _____________ ___________ & ____________, such as buying on special occasions like birthdays or holidays only, etc.

A

attitude
use
knowledge
purchasing behavior
tendencies

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21
Q

What is a business market?

A

Uses similar variables as the consumer market to segment their market

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22
Q

What do business markets do + example? [2]

A

*Businessmarketsuseadditionalvariablessuchascustomeroperatingcharacteristics,
purchasing approaches, situational factors and personal characteristics
*For example ,FNB serves both consumers & businesses

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23
Q

What are international markets? [3]

A

*Only a few companies have resources to operate in all countries
*Large companies such as CocaCola & Sony operate in more than 200 countries
*Operating in a different country poses several challenges such as the political, economic & cultural makeup varies

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24
Q

What are the requirements for effective segmentation? [7] NB MASDAHHR

A

Measureable
Accessible
Substantial
Differentiable
Actionable
Homogenous
Heterogenous
Responsive

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25
What is targeting?
“The process of evaluating each market segment’s attractiveness and selecting one or more segments to enter.”
26
Why do firms need to evaluate identified market segments? [2]
Firms need to evaluate identified segments to determine the attractiveness of the segment (1) and whether the firm can realistically serve the segment (2).
27
Attractive segments can be determined by analysing ___________ (marketing environment and consumer _______________)
CONSUMERS behavior
28
How can businesses serve a market segment?
Whether a business can serve a segment can be determined through competitor and firm analysis (Porters 5 forces and SWOT).
29
What are Porters 5 forces? [5]
1. Threat of new entrants 2. Bargaining power of buyers 3. Threat of substitute products 4. bargaining power of suppliers 5. Rivalry among existing competitors
30
Why is it so important for the marketer to conduct market research ?
It is important for the marketer to conduct market research in order to understand and advise the business on the relevant target market
31
Once the business understands who the __________ audience is, the _____________ mix (4Ps) are tailored accordingly
target marketing
32
What is a 'target market'?
A target market is a group of consumers (individuals, households or common groups) that the business selects to market to and is the most attractive in terms of profitability.
33
What is the size and shape of a target market determined by?
The size and shape of a target market is determined by the type of target marketing strategy the firm uses
34
What are the FOUR market targeting strategies? [4]
1. Mass marketing 2. Differentiated marketing 3. Niche Marketing 4. Micro-marketing
35
What is mass marketing?
This approach involves no segmentation whatsoever. Mass marketers target marketing campaigns at the entire market. Such a campaign assumes that all customers have similar needs and wants
36
What is Differentiated Marketing?
Most organisations use some form of segmentation by dividing the total market into groups of customers having relatively similar needs and then attempting to develop a marketing program that appeals to one or more of these segments
37
What is Niche marketing?
Some organisations narrow the market concentration approach even further and focus their marketing efforts on one small, well-defined market segment or niche that has a unique, specific set of needs
38
What is Niche marketing?
Some organisations narrow the market concentration approach even further and focus their marketing efforts on one small, well-defined market segment or niche that has a unique, specific set of needs
39
Niche marketing can be ____________ -focused or __________ -focused.
product market
40
Niche marketing can be ____________ -focused or __________ -focused.
product market
41
What are the benefits of focusing on fewer customers? [2]
*By focusing on fewer customers, niche marketing firms are able to offer high quality products tailored to the specific needs of their target market. *They are also able to market more effectively and efficiently because they only deal with a minimal number of segments.
42
What is micro-marketing?
This is when an organisation creates an entirely unique product or marketing program for each customer in the target segments and is commonly used in business markets
43
What is local marketing?
tailoring brands and promotions to the needs and wants of local customer groups – cities, neighbourhoods and even specific stores.
44
What is individual marketing?
tailoring products and marketing programs to the need and wants of individual customers.
45
What is one pro versus one con of one con of micro marketing?
PRO: Firms can create high quality, highly specific solutions to customers needs and wants, leading to much greater customer satisfaction. CON: However, micromarketing can lead to high costs of doing business and segments with too few customers may not yield enough sales volume to operate profitably.
46
When choosing a strategy to implement consider: [5]
* The firm’s available resources * Product variability * Product’s life cycle stage * Market variability * Competitors marketing strategy
47
Why can target marketing be controversial?
Target marketing can sometimes be controversial especially when vulnerable or disadvantaged consumers are targeted with products that are potentially harmful
48
What have marketers been criticized for? [3]
* Marketing to children and teens. * Marketing of alcohol, cigarettes and fast-food. * Exploitative marketing practices
49
What is an advantage versus a disadvantage of mass marketing? [2]
Advantage: Potential savings on production and marketing cost Disadvantage: Unimaginative product offerings.
50
What is two advantages versus two disadvantages of Differentiated marketing? [4]
Advantages: * Greater financial success * Economies of scale in production and marketing Disadvantage: * Highcost * Cannibalization
51
What are FOUR advantages of Niche marketing? [4]
* Dedicated resources * Better able to meet the needs of a narrowly defined segment * Better competitive position * Stronger positioning
52
What are TWO disadvantages of Niche marketing? [2]
* Segment too small * Large competitors may market to niche segment more effectively
53
What is ONE advantage and ONE disadvantage of micro marketing?
Advantage: Unique product/service Disadvantage: Costly
54
What is brand positioning?
A brand’s position in a market is the perceived fit between the product and the needs of the target market, relative to competitive product offerings
55
What is the main aim of brand positioning and what is it used for?
* The main aim of positioning is to set your product and brand apart from your competitors * The positioning of a product or brand is used to describe how its positioned within the consumer’s mind
56
What does positioning attempt to allow?
Positioning attempts to allow the consumer the ability to rank the product or brand against competitors
57
What is differentiation?
Differentiation means offering consumers something they value more than what your competitors are able to offer
58
What are Perceptual Maps?
A positioning grid is a perceptual map on which important aspects of a category of products can be drawn and individual brands within the category are compared
59
Perceptual maps are pictures or maps of consumer ____________ of competing products relative to at least ___ buying considerations (or dimensions) that are important to a market in a specific product category
perceptions two
60
What are the two ways of constructing a perceptual map? [2]
1. Overall similarity method 2. Attribute rating method
61
What is the perceptual map 1: Overall similarity method ?
An Overall Similarities (OS) perceptual map illustrates the positioning of brands when consumers are asked to compare how similar the brands/products are in their view.
62
What is the perceptual map 2: Attribute rating?
The attribute rating method is used when consumers are asked to rate specified attributes related to a brand/product on a scale
63
What is the method to research salient attributes that consumers use to evaluate brands in a product category?
1. Research the market to identify the salient attributes that consumers use to evaluate the various competing brands in a product category 2. Present respondents with the list of attributes and request them to rate each brand on each attribute 3. Average the ratings across all respondents to determine which attributes are the two most important dimensions to consumers when evaluating or considering to buy a product
64
Choosing the relevant positioning brand strategy depends on many factors, including the brands __________ type, the __________ situation in their market segment, the competitors’ ____________ and the organisation’s ____________
product current positioning capabilities
65
What three steps do businesses follow when identifying their relevant positioning and differentiation strategy?
1.Identify a few customer value differences that provide potential competitive advantages 2. Choose the right competitive advantage 3. Select an overall positioning strategy
66
What is a competitive advantage?
An advantage over competitors gained by offering consumers greater value, either through lower prices or providing additional benefits that justify higher prices.
67
What are the Differentiation strategies? [4]
68
What is PRODUCT Differentiation?
Choosing a unique product feature example: Volvo is a car provider & differentiates their brand product by highlighting their safety features
69
What is Define SERVICES Differentiation?
Companies differentiate their brand by implementing speedy, convenient or efficient delivery services such as Mc Donalds drive-through
70
What is CHANNEL differentiation?
Companies that practice channel differentiation gain competitive advantage by the way they design their channel’s coverage, expertise and performance. For example, Woolies has food trucks that are specifically designed to carry fresh produce
71
What is PEOPLE differentiation?
When companies hire and train employees to offer excellent customer service for example: Disney employees are very helpful & friendly
72
What is IMAGE differentiation?
Companies use differentiating symbols in order to differentiate their brand such as the Nike swoosh
73
What is the full positioning of a brand called and what question does it answer? [2]
The full positioning of a brand is called a brand’s value proposition and it answers the question Why should I buy your brand?’
74
What are the principles of Positioning?
75
Define value proposition
the full positioning of a brand – the full mix of benefits upon which it is positioned.
76
_________ squares are winning propositions (with more for less being the best) while ____ squares are losing propositions. The _______ square is indicative of no differentiation at all.
Green Red Middle
77
What does a positioning strategy require the marketer to do?
Developing a positioning strategy requires the marketer to associate the product or service with a set of particular needs that ranks high on the consumer's priority list
78
Define Positioning Statement
A statement that summarises the firm or brand positioning
79
What does brand positioning include? [4]
80
What does EFFECTIVE postioning statements usually have? [4]
1. Target audience 2. Frame of reference 3. Point of difference 4. Reason to believe

BUS2010F: Marketing (12 decks)

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