Marketing Segmentation and Product Strategy

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Questions and Answers

What is a primary benefit of demographic segmentation in market research?

It allows for a one-size-fits-all approach.

It does not require consumer input.

It focuses solely on geographic location.

It helps in identifying common needs among different groups. (correct)

Which method is primarily used to group consumers based on the importance they place on product benefits?

Market mapping

Focus groups

Cluster analysis (correct)

Surveys on demographics

What should a company compare across demographic segments to validate a segmentation variable?

Sales figures

Marketing budget

Purchase intentions or liking for products (correct)

Social media presence

Which of the following best describes psychographic segmentation?

Segmentation influenced by personality, lifestyle, and interests. Signup and view all the answers

What is one potential drawback of positioning a product on only one attribute?

It can limit the market segment. Signup and view all the answers

What is a key feature of coupons in the context of price discrimination?

They allow consumers to self-select based on price sensitivity. Signup and view all the answers

What does yield management primarily involve?

Quickly changing prices based on current or forecasted demand. Signup and view all the answers

Which characteristic of successful new products involves adapting to existing consumer beliefs?

Compatibility Signup and view all the answers

Why are firms often hesitant to introduce new products?

They face a high failure rate and significant financial risk. Signup and view all the answers

What does the characteristic of 'Communicability' signify in successful new products?

The product's relative advantage should be easy to communicate. Signup and view all the answers

What is one potential outcome when a firm fails to develop new products?

The firm risks becoming obsolete in the market. Signup and view all the answers

Which of the following statements best describes 'Complexity' for new products?

Low complexity means less consumer education is needed. Signup and view all the answers

What stage of the product lifecycle may extend with product improvements?

Maturity Stage Signup and view all the answers

What is the formula to calculate market share in units?

MS[units] = S[units] / M[units] Signup and view all the answers

What does the Gross Margin Ratio on Selling Price measure?

The proportion of gross margin to the selling price Signup and view all the answers

What is the purpose of calculating break-even volume?

To find out how many units must be sold to cover fixed costs Signup and view all the answers

Which of the following formulas represents gross margin ratio per unit?

GM = P[selling] - COGS Signup and view all the answers

How is sales in monetary value calculated?

S[monetary] = Q * P[selling] Signup and view all the answers

What strategy does Apex boots plan to implement to enhance online sales?

Invest in e-commerce platform and digital marketing Signup and view all the answers

Which group is targeted for potential new partnerships to increase brand visibility?

Ski rental shops Signup and view all the answers

What is the first stage in the consumer purchase process?

Need Recognition Signup and view all the answers

What should be prioritized when optimizing external partnerships with retailers?

Negotiating better terms with high-performing retailers Signup and view all the answers

Which of the following is NOT considered an objective attribute when evaluating products?

Styling Signup and view all the answers

What is a potential outcome of Kevin Tice's decision to reduce the sales force and trade advertising?

Long-term cost savings and improved marketing ROI Signup and view all the answers

What benefit is expected from a hybrid partnership strategy?

Complementing physical retail with online and rental channels Signup and view all the answers

How do consumers create their consideration set?

By selecting a few acceptable products based on perceptions Signup and view all the answers

Which factor can contribute to different preferences between two consumers for the same set of products?

Varying importance of attributes across consumers Signup and view all the answers

Which digital marketing strategy is recommended for future efforts?

Exploring SEO, content marketing, and email marketing Signup and view all the answers

How should Apex boots approach its distributor relationships?

Evaluate distributor performance and consider consolidation Signup and view all the answers

What is the relationship between purchase intentions and purchase behavior?

Purchase intentions precede purchase behavior Signup and view all the answers

What is a recommended approach for engaging with the target audience on social media?

Active engagement on platforms like Instagram and TikTok Signup and view all the answers

Which of the following is NOT a source of information consumers use while gathering details on products?

Mandatory government databases Signup and view all the answers

Why might some consumer-generated ratings be misleading?

They often lack thorough evaluations. Signup and view all the answers

What stage comes after gathering information in the consumer purchase process?

Compare Alternatives Signup and view all the answers

What is a primary disadvantage of using distributors for a firm?

Less control over the marketing mix Signup and view all the answers

What often causes conflict between distributors and manufacturers?

Distributors seek higher margins and commissions Signup and view all the answers

How can firms effectively manage distributor conflict?

Anticipate sources of conflict when drafting contracts Signup and view all the answers

Why might a firm choose to manage its own salesforce in domestic markets?

To reduce reliance on independent distributors Signup and view all the answers

What is a potential drawback of having distributors who do not fully commit to a manufacturer's products?

Distributors could favor competitors’ products Signup and view all the answers

Study Notes

Consumer Decision Making

Consumers recognize needs when they require a product or service.
Need recognition is the first stage in the purchase process.
Sellers can motivate consumers to recognize a need for a product through various means.
Consumers will feel rushed and not ready to purchase if the salesperson misjudges the purchase stage.

Gather Information

Consumers gather information about product attributes to make informed purchase decisions.
Electric cars have objective attributes like charging time, range, and interior space.
Subjective attributes include styling, comfort, handling, and ease of use.
Consumer perceptions of attributes are important.
Information sources include personal (friends, family), commercial (advertising), and public (consumer-rating groups) sources.
Some consumer-generated ratings can be misleading.

Compare Alternatives

Consumer preferences are often indicated by rank order preferences for products.
Consumers may have different preferences even with identical perceptions of products due to different utilities for product attributes which are important to buyers.
The importance of certain attributes in a product (e.g., durability or functionality) often differ between individual consumers.

Purchase and Evaluation

A firm does not make a sale until the consumer makes a purchase.
Consumer purchase behavior is influenced by purchase intentions.
Sellers can motivate consumers to buy sooner rather than later.
Post-purchase, consumers evaluate the product.
Consumers seek to reduce cognitive dissonance by asking themselves if they bought the right product.

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Description

Test your knowledge on key concepts in marketing segmentation and product strategy. This quiz covers demographic and psychographic segmentation, product lifecycle, and the challenges of new product development. Explore the essential features and drawbacks of market strategies in this assessment.