Marketing Segmentation

Questions and Answers

Which of the following is NOT a benefit of market segmentation?

Creation of a single, universal marketing strategy (correct)

Better understanding of the target audience

Improved customer satisfaction

Increased efficiency in resource allocation

What is the primary purpose of segment evaluation in the target market identification process?

To identify the most competitive segment

To assess each segment's attractiveness (correct)

To create a marketing mix

To select the largest segment

Which type of segmentation is based on characteristics such as occupation, income, and education?

Geographic Segmentation

Behavioral Segmentation

Psychographic Segmentation

Demographic Segmentation (correct)

What is a key characteristic of a well-defined target market?

It is large enough to be profitable, but small enough to be manageable Signup and view all the answers

Which of the following is an example of behavioral segmentation?

Segmenting based on usage rate Signup and view all the answers

What is the purpose of the target market identification process?

To select a specific segment of the market to focus on Signup and view all the answers

Which type of segmentation is used in B2B marketing?

Firmographic Segmentation Signup and view all the answers

What is a key consideration when evaluating the attractiveness of a market segment?

All of the above Signup and view all the answers

Which of the following is NOT a characteristic of a well-defined target market?

It is highly competitive Signup and view all the answers

What is the first step in the target market identification process?

Segmentation Signup and view all the answers

Study Notes

STP: Market Segmentation

Definition: Dividing a larger market into smaller, distinct groups of consumers with similar needs, characteristics, or behaviors.
Benefits:
- Helps businesses understand their target audience better
- Enables creation of tailored marketing strategies
- Increases efficiency in resource allocation
Segmentation Bases:
1. Demographic Segmentation:
  - Age
  - Gender
  - Income
  - Occupation
  - Education
2. Geographic Segmentation:
  - Region
  - City
  - Rural/Urban
3. Psychographic Segmentation:
  - Lifestyle
  - Personality
  - Values
4. Behavioral Segmentation:
  - Usage rate
  - Loyalty
  - Benefits sought
5. Firmographic Segmentation (B2B):
  - Company size
  - Industry
  - Location

STP: Target Market Identification

Definition: Selecting a specific segment of the market to focus on, based on criteria such as size, growth potential, and competitiveness.
Target Market Identification Process:
1. Segmentation: Divide the market into distinct segments
2. Segment Evaluation: Assess each segment's attractiveness based on factors such as size, growth rate, and profitability
3. Segment Selection: Choose the most attractive segment(s) to target
Target Market Characteristics:
- Size: Large enough to be profitable, but small enough to be manageable
- Growth Potential: High growth rate or potential for future growth
- Competitiveness: Low competition or opportunity to differentiate
- Accessibility: Easy to reach and communicate with the target market
- Actionability: Ability to develop marketing strategies that appeal to the target market

STP: Market Segmentation

Market segmentation is the process of dividing a larger market into smaller, distinct groups of consumers with similar needs, characteristics, or behaviors.
Benefits of market segmentation include:
- Better understanding of the target audience
- Creation of tailored marketing strategies
- Increased efficiency in resource allocation
There are five bases for market segmentation:

Demographic Segmentation

Age
Gender
Income
Occupation
Education

Geographic Segmentation

Region
City
Rural/Urban

Psychographic Segmentation

Lifestyle
Personality
Values

Behavioral Segmentation

Usage rate
Loyalty
Benefits sought

Firmographic Segmentation (B2B)

Company size
Industry
Location

STP: Target Market Identification

Target market identification is the process of selecting a specific segment of the market to focus on, based on criteria such as size, growth potential, and competitiveness.
The target market identification process involves:

Segment Evaluation

Assessing each segment's attractiveness based on factors such as size, growth rate, and profitability

Segment Selection

Choosing the most attractive segment(s) to target
Characteristics of a target market include:

Ideal Target Market

Size: large enough to be profitable, but small enough to be manageable
Growth potential: high growth rate or potential for future growth
Competitiveness: low competition or opportunity to differentiate
Accessibility: easy to reach and communicate with the target market
Actionability: ability to develop marketing strategies that appeal to the target market