10 Questions
What is the primary goal of market segmentation?
To divide a market into smaller, identifiable groups
Which of the following is a criterion for successful segmentation?
Substantiality of the segment
What is the main reason for identifying and measuring segment size?
To ensure the segment is substantial enough
Which of the following is a base for segmenting consumer markets?
All of the above
What is market targeting?
The process of selecting a target market
What is the primary goal of market positioning?
To create an image or identity for a product
Which of the following is a strategy for selecting a target market?
All of the above
What is demographic segmentation?
Segmenting a market based on demographic characteristics
Which of the following is an example of geographic segmentation?
Segmenting a market based on region
What is the main benefit of market segmentation?
Improved customer satisfaction
Study Notes
Market Segmentation
- Market segmentation is the process of dividing a market into meaningful, relatively similar, and identifiable segments or groups.
- A market segment is a subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs.
Criteria for Successful Segmentation
- Accessibility: the firm must be able to reach members of targeted segments with customized marketing mixes.
- Responsiveness: markets can be segmented using any criteria that seem logical, but only if one market segment responds to a marketing mix differently from other segments.
- Substantiality: a segment must be large enough to warrant developing and maintaining a special marketing mix.
- Identifiability and measurability: segments must be identifiable and their size measurable.
Bases for Segmenting Consumer Markets
Geographic Segmentation
- Segmenting markets by region of a country or the world, market size, market density, or climate.
Demographic Segmentation
- Segmenting markets by age, gender, income, ethnic background, and family life cycle.
Psychographic Segmentation
- Market segmentation on the basis of personality, motives, and lifestyles.
Behavioral Segmentation
- Grouping customers according to their behavior when making purchasing decisions, including readiness to buy, level of loyalty, interactions with a brand or product, and usage experience.
Benefit Segmentation
- Grouping customers based on the benefits they seek from a product, including perceived value, advantages, features, quality, and customer service.
Market Targeting
- A target market is a group of people or organizations for which an organization designs, implements, and maintains a marketing mix intended to meet the needs of that group, resulting in mutually satisfying exchanges.
- A marketer may need to develop different marketing mixes to appeal to more than one segment of the market.
Learn about the key criteria for successful market segmentation, including accessibility and responsiveness. Understand the importance of being able to reach and tailor marketing mixes to specific target segments.
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