Flashcards in marketing ch.9 Deck (19)
involves aggregating prospective buyers into groups that
Have common needs
Will respond similarly to a marketing action
relatively homogenous groups of prospective buyers that result from the market segmentation process
- firm using different marketing mix activities such as product features and advertising to help consumers perceive the product as being different and better than competing products.
Market Product Grid
- framework to relate the market segments of potential buyers to products offered or potential marketing actions.
when generally do you segment
A business goes to the trouble and expense of segmenting its markets when it expects that this will increase its sales, profit, and return on investment.
One Product and Multiple Market Segments
When an org produces only one product and wants to sell it to two+ markets
Ex. Harry Potter, magazines
Multiple Products Multiple Market Segments
Different products attract different market segments
More expensive the producing one good BUT it is effective if it meets customers' needs better
Segments of One: Mass Customization
Each customer has unique set of needs/wants
Tailoring goods to individual customers on a high volume scale
the increased customer value achieved through preforming organizational functions like marketing/manufacturing more efficiently
new products/new chains simply stealing sales from the older ?
Steps in sementing/targeting markets
1-group potential buyers into segments
2-Group products to be sold into categories
3- Develop a market product grid and estimate size of markets
4-Select Target Markets
5-take marketing actions to reach target markets
○ Criteria to use in forming the segments
Potnetial for increased profits
similarity of needs of potential buyers
difference of needs of buyers among all segments
potential of marketing action to reach a segment
Ways to segment consumer markets
Geographic, Demographic, psychographic, behavioral
is the quantity consumed or patronage—store visits—during a specific period.
80% of a firms sales are obtained from 20% of its customers
Criteria to Use in Selecting the Target Segment
market size, expected growth, competitive position, cost of reaching segment, compatibility with the organizations objectives and resources
Head to head positioning
- competing directly with competitors on similar product attributes in the same target market
seeking less competitive, smaller market niche