Unit 3 Segmentation, targeting and positioning

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Questions and Answers

What type of segmentation involves dividing a market based on variables such as education and age?

  • Demographic segmentation (correct)
  • Geographic segmentation
  • Behavioral segmentation
  • Psychographic segmentation

Which of the following is NOT a characteristic used in psychographic segmentation?

  • Income (correct)
  • Social class
  • Lifestyle
  • Personality

In market segmentation, what is the primary focus of geographic segmentation?

  • Understanding consumer behavior and attitudes
  • Analyzing income levels across demographics
  • Dividing the market based on geographical units (correct)
  • Identifying consumer lifestyle choices

Which of the following factors would NOT typically be considered when segmenting business markets?

<p>Cultural factors (D)</p>
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Intermarket segmentation is primarily concerned with which of the following?

<p>Creating consumer segments with similar needs across countries (A)</p>
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What is the correct definition of a target market?

<p>A set of buyers identified for a specific marketing strategy (A)</p>
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Which variable is NOT commonly used in consumer market segmentation?

<p>Customer operating characteristics (D)</p>
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Why is understanding cultural factors important in international market segmentation?

<p>It influences consumer preferences and purchasing behaviors. (A)</p>
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Which characteristic is NOT a requirement for effective segmentation?

<p>Affordable (D)</p>
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What is a primary goal of differentiated marketing?

<p>To achieve higher sales and a stronger position (A)</p>
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Which of the following best describes micromarketing?

<p>Tailoring products and marketing to specific individuals or locations (C)</p>
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What does positioning primarily refer to?

<p>The place that the brand occupies in the consumer's mind (B)</p>
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Which of the following is a characteristic of concentrated marketing?

<p>Focuses on a large share of a smaller market (D)</p>
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When evaluating market segments, which factor is NOT considered?

<p>Company brand recognition (B)</p>
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Which of the following aspects is NOT part of a competitive advantage?

<p>Standardized (A)</p>
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Flashcards

Market Segmentation

Dividing a market into smaller groups with similar needs, characteristics, or behaviors. Each group might need a different marketing strategy.

Target Market

A specific group of buyers that a company aims to serve with tailored marketing efforts.

Geographic Segmentation

Segmenting a market based on where people live, like countries, regions, or neighborhoods.

Demographic Segmentation

Dividing a market based on age, gender, income, education, or other personal characteristics.

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Psychographic Segmentation

Segmenting a market based on how customers think and feel, such as their lifestyle, personality, or values.

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Behavioral Segmentation

Segmenting a market based on how customers use a product, their level of knowledge, or their response to it.

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Segmenting Business Markets

Segmenting a market based on factors like customer size, industry, or purchasing approach.

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Intermarket Segmentation

Creating segments of consumers who have similar needs and buying behaviors across countries.

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Measurable Segment

A segment should be clearly defined and easily measured. You should be able to quantify its size, growth, and other important characteristics.

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Differentiable Segment

A target market should differ in needs and wants from your other target segments. You can't effectively design products or marketing for everyone.

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Accessible Segment

The segment should be accessible to your marketing efforts. Can you reach them with your marketing message and products?

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Substantial Segment

The defined customer segment should have sufficient buying power and interest in your offerings. It should be large enough to be profitable.

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Undifferentiated Marketing

A business strategy where a company targets the entire market with a single product offering. Focuses on common needs.

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Differentiated Marketing

A business strategy where a company differentiates its products and marketing for distinct segments. It aims to capture a larger portion of the market.

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Concentrated Marketing

A focused business strategy where a company prioritizes a large share of a smaller, specific market segment. It's efficient with limited resources.

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Study Notes

Market Segmentation

  • Definition: Dividing a market into smaller segments with distinct needs, characteristics, or behaviors requiring separate marketing strategies.
  • Target Market: A group of buyers who share common needs and characteristics that a company decides to serve.
  • Consumer Market Segmentation:
    • Geographic: Dividing by geographic units (nations, regions, states, cities).
    • Demographic: Dividing by age, life cycle, gender, income, occupation, education, religion, ethnicity, generation.
    • Psychographic: Dividing by social class, lifestyle, personality characteristics.
    • Behavioral: Dividing by consumer knowledge, attitudes, use of a product, or responses to a product.
  • Business Market Segmentation: Uses variables similar to consumer markets, plus:
    • Customer operating characteristics
    • Purchasing approaches
    • Situational factors
    • Personal characteristics
  • International Market Segmentation:
    • Geographic location (e.g., Western Europe, Latin America).
    • Economic factors (income, economic development).
    • Political and legal factors (government stability).
    • Cultural factors (language, religion).
    • Intermarket segmentation: forming segments of consumers with similar needs and buying behaviors across different countries.

Market Targeting

  • Requirements for Effective Segmentation:
    • Measurable
    • Accessible
    • Substantial
    • Differentiable
    • Actionable
  • Market Targeting Strategies:
    • Undifferentiated (mass) marketing: Targets the whole market with one offer.
    • Differentiated marketing: Targets several segments and offers a separate offer for each.
    • Concentrated marketing: Targets a large share of only a smaller market (niche marketing).
    • Micromarketing: Tailoring products and marketing to specific individuals or locations (local or individual marketing).

Differentiation and Positioning

  • Differentiation: Creating value for the company's offer by differentiating the market offerings.
  • Positioning: Placing a brand in the consumer's mind by developing a value proposition.
  • Competitive Advantage Requirements:
    • Important
    • Distinctive
    • Superior
    • Communicable
    • Pre-emptive
    • Affordable
    • Profitable

Evaluating Market Segments

  • Factors Considered:
    • Segment size and growth
    • Segment structural attractiveness
    • Company objectives and resources

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