MARK 3000 Chapter 9 Flashcards
(35 cards)
what is segmentation?
identifying and serving homogenous groups of people
what are segments?
naturally existing groups of consumers with similar needs/wants and responses
what is the target market?
the segment the firm chooses to serve
what are the 5 Steps of STP?
- establish the strategy or objectives
- use segmentation method to understand the customer profiles
- evaluate the attractiveness of each segment
- select the target market
- develop a positioning strategy
what is geographic segmentation?
based on where people live (can be super broad like continents or more focused)
what is demographic segmentation?
based on easily measured characteristics like age, gender, income
what is psychographic segmentation?
based on how customers spend their time and money and how they feel about the world
what is derived from the mission statement and current state?
step 1: strategy and objectives
what are the segmentation methods?
geographic, demographic, psychographic, benefits and behavioral
what is the most common segmentation strategy?
demographic
what is benefit segmentation?
grouping based on the benefits they get from buying a product
what is behavioral segmentation?
grouping based on how customers use the product (occasion or loyalty)
what is occasional segmentation?
when/how often is a product purchased
what is loyalty segmentation?
strategy of investing in loyalty to retain the firm’s repeating customers
do firms just one method of segmentation?
NO! each method has pros and cons so using a mixture allows you to get the best segments
what is geo graphic segmentation?
method of segmentation based on geographic, demographic and lifestyle characteristics
what is tapestry segmentation?
common type of geo graphic segmentation that classify all US neighborhoods in 65 distinctive segments based on zip code
how do you evaluate segment attractiveness?
-identify
-substantial
-reachable
-responsive
-profitable
what questions do you ask to determine if the segment is identifiable?
who is the market?
are the segments unique?
does each segment require a unique marketing mix?
when is the segment reachable?
can you reach consumers so they:
know the product exists
understand what it can do
recognize how you buy it
when is the segment substantial?
too small and its buying power is insignificant, and therefore unlikely to be profitable
when are segments responsive?
when customers must:
moves towards the firms products/services
be willing to value the firms value proposition
what makes the segment profitable?
segment size, segment adoption, fixed costs
what are the methods to select a target market?
-undifferentiated/mass marketing
-differentiated
-concentrated
-one-on-one/micromarketing
