27 Questions
What is market segmentation?
The process of dividing large, heterogeneous markets into smaller, more homogeneous markets
Which is NOT a type of market segmentation?
Economic segmentation
What is the main goal of market segmentation?
To reach small markets more efficiently and effectively
Which type of segmentation divides markets based on factors such as lifestyle, personality, and social class?
Psychographic segmentation
What is the process that companies use to reach small markets more efficiently and effectively with products and services that match their unique needs?
Market targeting
Which type of market segmentation divides markets based on variables such as age, gender, income, and education?
Demographic segmentation
What is geographic segmentation in marketing?
Dividing the market into different geographical units such as nations, regions, states, counties, or cities
What is demographic segmentation based on?
Age and life-cycle groups
What does income segmentation divide the market into?
Affluent or low-income consumers
What is behavioral segmentation based on?
Knowledge, attitudes, uses, or responses to a product
What is multiple segmentation used for?
To identify smaller, better-defined target groups
What does geodemographic segmentation do?
Divides groups into consumer lifestyle patterns
What does PRIZM NE do?
Classifies every American household into 66 unique segments
What is the primary purpose of market segmentation?
To reach small markets more efficiently and effectively with products and services that match their unique needs
What are the main segments in market segmentation?
Geographic, demographic, and psychographic segmentation
What are the requirements for effective segmentation?
Homogeneous markets, identifiable and measurable segments, and substantiality
What is the process of segmenting consumer markets based on factors such as lifestyle, personality, and social class?
Psychographic segmentation
Which type of market segmentation divides markets based on variables such as age, gender, income, and education?
Demographic segmentation
In market segmentation, what does income segmentation aim to do?
Divide the market based on income levels
What is the process of offering different products or using different marketing approaches for different age and life-cycle groups?
Age and life-cycle stage segmentation
What type of segmentation divides the market into groups based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality?
Demographic segmentation
What is an example of multivariable segmentation that divides groups into consumer lifestyle patterns?
Geodemographic segmentation
What type of segmentation divides buyers into different groups based on social class, lifestyle, or personality traits?
Psychographic segmentation
What divides buyers into groups based on their knowledge, attitudes, uses, or responses to a product?
Usage rate
What type of market segmentation divides the market into different geographical units such as nations, regions, states, counties, or cities?
Geographic segmentation
Which type of segmentation classifies every American household into 66 unique segments organized into 14 different social groups?
PRIZM NE
What is the process of dividing the market based on factors such as lifestyle, personality traits, or social class?
Psychographic segmentation
Study Notes
What is Market Segmentation?
- Market segmentation is the process of dividing a larger market into smaller groups of consumers with similar needs or characteristics.
Types of Market Segmentation
- Demographic segmentation: divides markets based on variables such as age, gender, income, and education.
- Geographic segmentation: divides markets based on geographical units such as nations, regions, states, counties, or cities.
- Psychographic segmentation: divides markets based on factors such as lifestyle, personality, and social class.
- Behavioral segmentation: divides markets based on behavior, such as knowledge, attitudes, uses, or responses to a product.
- Geodemographic segmentation: combines geographic and demographic data to divide markets.
- Multivariable segmentation: uses multiple variables to divide markets, such as PRIZM NE, which classifies every American household into 66 unique segments organized into 14 different social groups.
Goals and Requirements
- The primary purpose of market segmentation is to identify and target specific groups of consumers with products and services that meet their unique needs.
- The main goal of market segmentation is to increase efficiency and effectiveness in reaching target markets.
- Requirements for effective segmentation include: identifying segments, understanding segment needs, developing marketing mixes, and allocating resources.
Multiple Segmentation
- Multiple segmentation is used to target multiple segments with different products, services, or marketing approaches.
Process of Market Segmentation
- The process of market segmentation involves dividing the market into smaller groups of consumers with similar needs or characteristics, understanding segment needs, developing marketing mixes, and allocating resources.
Examples
- An example of multivariable segmentation is PRIZM NE, which divides the market into 66 unique segments organized into 14 different social groups.
- An example of psychographic segmentation is dividing the market based on factors such as lifestyle, personality, and social class.
- An example of demographic segmentation is dividing the market based on variables such as age, gender, income, and education.
Test your knowledge of market segmentation, targeting, differentiation, and positioning as part of customer-driven marketing strategy. This quiz covers concepts from Chapter 7 of 'Customer-Driven Marketing Strategy: Creating Value for Target Customers'.
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