Customer-Driven Marketing Strategy: Chapter 6 Quiz

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Questions and Answers

What are the major steps in designing a customer-driven marketing strategy?

Competitive analysis, market research, customer service, and sales forecasting

Market segmentation, targeting, differentiation, and positioning (correct)

Market analysis, product development, promotion, and pricing

Advertising, sales, distribution, and branding

What did Best Buy do to serve its 'Angel' customers?

Instituted a 20% restocking fee for all customers

Reduced promotions for all customers

Developed better service and stocked more items of interest to them (correct)

Increased promotions for 'Angel' customers

Why did Best Buy delete 'Demon' customers from marketing lists?

To adopt a customer-centric strategy

To focus solely on online retailing

To increase promotions for the 'Angel' customers

To reduce costs associated with serving 'Demon' customers (correct)

What prompted Best Buy to reexamine its segmentation strategy and positioning strategies?

Changes in consumer behavior Signup and view all the answers

Which of the following is NOT a major base for segmenting consumer and business markets?

Product color options Signup and view all the answers

How do firms identify attractive market segments and choose a market-targeting strategy?

By evaluating the size, growth, and profit potential of each segment Signup and view all the answers

What is the process of dividing a market into smaller segments with distinct needs, characteristics, or behaviors that might require separate marketing strategies or mixes?

Segmentation Signup and view all the answers

Which of the following is NOT a key variable for market segmentation?

Economic Signup and view all the answers

What does demographic segmentation primarily focus on?

Age, gender, family size Signup and view all the answers

What type of segmentation involves dividing a market into different groups based on social class, lifestyle, or personality characteristics?

Psychographic segmentation Signup and view all the answers

Which variable is used to identify and target the affluent for luxury goods?

Income Signup and view all the answers

What does behavioral segmentation primarily focus on?

Occasions and benefits sought Signup and view all the answers

Which type of segmentation addresses the fact that consumer needs and wants change with age?

Demographic segmentation Signup and view all the answers

What process involves avoiding stereotypes in promotions based on age and promoting positive messages when marketing to mature consumers?

Positioning Signup and view all the answers

What variable can offer new opportunities when neglected gender segments are targeted?

Gender Signup and view all the answers

What is the first step in designing a customer-driven marketing strategy?

Segmentation Signup and view all the answers

Study Notes

Customer-driven marketing strategy involves major steps: market segmentation, targeting, differentiation, and positioning.
Market segmentation: dividing a market into smaller groups with distinct needs or characteristics, often using variables such as geographic, demographic, psychographic, and behavioral.
Geographic segmentation: dividing a market by nations, regions, states, counties, cities, and neighborhoods.
Demographic segmentation: dividing a market based on demographics like age, gender, family size, income, occupation, education, race, religion, generation, and nationality. Age and life-cycle stage address the changing needs of consumers with age.
Psychographic segmentation: dividing a market based on social class, lifestyle, or personality characteristics. Behavioral segmentation: dividing buyers into groups based on consumer knowledge, attitudes, uses, or responses to a product.
Firms use segmentation to identify attractive market segments and choose a market-targeting strategy. Companies differentiate and position their products for maximum competitive advantage.
Best Buy adopted a customer-centric strategy, segmenting customers into "Angels" and "Demon" shoppers, and focusing on Angels' shopping preferences and needs.
Angels accounted for 20% of customers and generated bulk of profits, while Demons were extreme bargain hunters. Best Buy deleted Demons from marketing lists, reduced promotions that attracted them, and established a loyalty program for Angels.
Targeting strategies include undifferentiated, differentiated, concentrated, and selective targeting. Firms should consider market size, market growth, competition, and firm strategy when choosing a targeting strategy.

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Description

Test your understanding of designing a customer-driven marketing strategy, market segmentation, targeting, differentiation, and positioning. This quiz covers the major bases for segmenting consumer and business markets and how firms identify attractive market segments and choose a market-targeting strategy.