Segmentation, Targeting & Positioning
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Questions and Answers

What is the first step in the market segmentation process?

  • Selecting the target market
  • Evaluating the segments
  • Profiling the segments
  • Forming market segments (correct)

Which method is primarily used for creating segments in business-to-business markets?

  • Build-up method (correct)
  • Breakdown method
  • Customer journey analysis
  • Market demand forecasting

How are segments evaluated in the segmentation process?

  • Based on their geographical location
  • By financial and strategic criteria (correct)
  • Using qualitative criteria only
  • Through competitor analysis

What is created during the profiling of segments?

<p>Detailed buyer profiles (D)</p> Signup and view all the answers

What characterizes the breakdown method in market segmentation?

<p>It divides large, diverse markets into homogeneous segments. (D)</p> Signup and view all the answers

Which of the following is NOT a basis for profiling segments?

<p>Historical sales data (B)</p> Signup and view all the answers

What is the purpose of the 'target market selection' step in the segmentation process?

<p>To select and focus on a specific market segment (A)</p> Signup and view all the answers

What type of markets does the breakdown method primarily apply to?

<p>Business-to-consumer markets (C)</p> Signup and view all the answers

What is a primary aim of a differentiated marketing strategy?

<p>To increase overall sales by targeting various segments with tailored offerings (D)</p> Signup and view all the answers

Which factor significantly influences the choice of marketing strategy according to company resources?

<p>Product variability and organization’s capacity (D)</p> Signup and view all the answers

What is a risk associated with a differentiated marketing strategy?

<p>Potential overspending on marketing across multiple segments (D)</p> Signup and view all the answers

When is undifferentiated marketing most effective?

<p>When marketing homogeneous products like commodities (A)</p> Signup and view all the answers

What might result from significant rivals entering a market with a concentrated marketing approach?

<p>A potential takeover bid by a larger company (C)</p> Signup and view all the answers

Which aspect should a marketing manager assess when deciding on a marketing approach?

<p>The balance between increased costs and expected sales growth (D)</p> Signup and view all the answers

How does product life cycle influence marketing strategy?

<p>It affects whether a company should use undifferentiated or concentrated marketing (C)</p> Signup and view all the answers

Why might a company choose to focus on only one marketing segment?

<p>To dominate a niche and enhance brand loyalty (B)</p> Signup and view all the answers

What is the market condition that allows for an undifferentiated marketing strategy to be effective?

<p>Consumers have the same preferences and quantity purchased (A)</p> Signup and view all the answers

What does Market Positioning primarily depend on?

<p>Market structure and competitive position (B)</p> Signup and view all the answers

What role does differentiation play in marketing strategy?

<p>Addresses specific consumer needs and preferences (C)</p> Signup and view all the answers

What should a marketing manager consider about competitors when devising their strategy?

<p>The rival's marketing approach and segmentation (D)</p> Signup and view all the answers

Which of the following best defines 'positioning' in a marketing context?

<p>A product's place in the consumer's mind relative to competitors (C)</p> Signup and view all the answers

What is a critical factor for evaluating product positioning?

<p>Consumer and organizational purchasers' views on the product (A)</p> Signup and view all the answers

What strategy should a firm adopt if its competitors are utilizing differentiated marketing strategies?

<p>Invest in product differentiation (D)</p> Signup and view all the answers

How can product image influence market positioning?

<p>It shapes customers' perceptions and attitudes towards the product (C)</p> Signup and view all the answers

What is the primary purpose of market segmentation?

<p>To divide a market into smaller groups with distinct needs (D)</p> Signup and view all the answers

Which type of segmentation divides the market based on consumer location?

<p>Geographic segmentation (A)</p> Signup and view all the answers

According to the definitions provided, which of the following is true?

<p>Segmenting leads to a better understanding of customer requirements (C)</p> Signup and view all the answers

Which of the following categories is NOT a basis of market segmentation?

<p>Interpersonal segmentation (D)</p> Signup and view all the answers

What is one benefit of market segmentation mentioned in the content?

<p>It allows for tailored marketing strategies for different customer groups (C)</p> Signup and view all the answers

Which statement best describes the differences within a market segment?

<p>Buyers within a segment should be similar in wants and needs (B)</p> Signup and view all the answers

How do businesses generally differentiate their segmentation strategies from individual consumer markets?

<p>By varying the method of segmentation based on the market type (A)</p> Signup and view all the answers

What is a potential outcome of effectively understanding customer segments?

<p>Better alignment of offerings with consumer needs (A)</p> Signup and view all the answers

What is primarily exposed when product positioning is coupled with effective market segmentation?

<p>True value of product positioning (C)</p> Signup and view all the answers

Which of the following is NOT a consideration when positioning a product within a product line?

<p>Exclusive pricing strategies for the product (B)</p> Signup and view all the answers

What can be considered an alternative base for positioning a product?

<p>Product attributes and benefits (B)</p> Signup and view all the answers

What is the main focus of benefit positioning?

<p>Discussing what the product does for the customer (A)</p> Signup and view all the answers

Why is segment-based positioning preferred over single positioning strategies?

<p>It caters to the unique variances within market segments (C)</p> Signup and view all the answers

Which approach helps in reducing product duplication within a company's offerings?

<p>Distinctive positioning of each product (D)</p> Signup and view all the answers

Which of the following best describes the concept of 'feature positioning'?

<p>Highlighting both quantifiable advantages and intangible benefits (B)</p> Signup and view all the answers

In market positioning, why is it important to consider rivals' products?

<p>To establish clearer distinctions in the market (B)</p> Signup and view all the answers

What is the main focus of an undifferentiated marketing strategy?

<p>Creating a marketing program for the entire market (B)</p> Signup and view all the answers

What is a significant challenge faced by marketers using an undifferentiated marketing strategy?

<p>Competing with niche marketing strategies (D)</p> Signup and view all the answers

Under what circumstances would a company likely use a concentrated marketing strategy?

<p>When facing high competition and limited resources (A)</p> Signup and view all the answers

What advantage do companies gain from concentrated marketing?

<p>Enhanced operational efficiencies leading to better returns (A)</p> Signup and view all the answers

How do marketers using an undifferentiated strategy approach customer preferences?

<p>By merging preferences into broader patterns (B)</p> Signup and view all the answers

What is one potential downside to a company using an undifferentiated marketing approach?

<p>Challenges in differentiating from competitors (C)</p> Signup and view all the answers

What distinguishes concentrated marketing from undifferentiated marketing?

<p>The former concentrates on specific segments while the latter ignores them. (C)</p> Signup and view all the answers

Which marketing strategy is more likely to succeed for smaller producers?

<p>Concentrated marketing due to market adaptability (A)</p> Signup and view all the answers

Flashcards

Market Segmentation

Dividing a large market into smaller groups of buyers with similar needs, characteristics, or behaviors who might require separate marketing mixes.

Market Segment

A subgroup of buyers within a market, sharing common needs, characteristics, or behaviors.

Geographic Segmentation

Dividing a market based on geographical factors such as location, climate, or population density.

Demographic Segmentation

Segmenting a market based on factors like age, gender, income, occupation, or family size.

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Psychographic Segmentation

Segmenting the market based on lifestyles, values, interests, and personality traits.

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Behavioral Segmentation

Segmenting customers based on their behaviors, such as usage rate, brand loyalty, or purchasing situations.

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Bases of Market Segmentation

The factors used to divide the market into different segments. These can include geographic, demographic, psychographic, and behavioral factors.

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Target Market

A specific group of consumers within a market segment that a company wants to reach.

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Segmentation Basis Variables

Characteristics used to identify different market segments

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Segmentation Process Steps

A four-step process: Form segments, profile segments, evaluate segments, select target market

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B2B Market Segmentation

Segmenting business markets based on consistent demand patterns from multiple buyers.

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Build-up Approach

A method for identifying market segments by analyzing consistent demand patterns of multiple buyers.

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Breakdown Approach

Identifying market segments by dividing large, diverse markets into homogeneous groups with similar demand patterns.

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Segment Profiling

Detailed analysis of each segment to understand its buyer characteristics, searching relationships among segmentation basis variables and descriptive characteristics.

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Undifferentiated Marketing

A marketing strategy where a company ignores market segments and tries to appeal to the entire market with a single product and message.

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Mass Marketing

Another term for undifferentiated marketing, where a company focuses on a broad market with a single marketing approach.

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Challenge of Undifferentiated Marketing

It's difficult to create a product and message that appeals to all consumers with diverse needs and preferences.

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Concentrated Marketing Strategy

A strategy where a company focuses its resources on a specific niche market with a specialized offering.

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Why Use Concentrated Marketing?

It's useful for companies with limited resources, facing intense competition, or wanting to dominate a smaller market.

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Benefits of Concentrated Marketing

It allows companies to gain a strong position in a niche market, build customer loyalty, and achieve operational economies.

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Focused Marketing

Another term for concentrated marketing, emphasizing a company's dedication to a specific market segment.

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Strong Market Position

Concentrated marketing helps a company to develop a strong presence and reputation within its niche, making it a leading player.

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Concentrated Marketing

A marketing strategy where a company focuses its efforts on a single, well-defined market segment, choosing to specialize in meeting the needs of that specific group.

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Risks of Concentrated Marketing

Possible dangers of concentrating marketing efforts on a single segment include potential for competition, takeover, and dependence on that specific market.

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Benefits of Differentiated Marketing

Diversified marketing can lead to increased sales by meeting the needs of multiple segments and achieving dominance within each.

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Factors Affecting Market Coverage Strategy

Factors influencing the choice of a marketing strategy include available resources, product variability, the product's life cycle, and the company's ability to cater to the market.

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Product Variability and Market Coverage

When introducing a new product, companies often choose either undifferentiated or concentrated marketing strategies with a single offering.

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Product Life Cycle and Market Coverage

The product's life cycle is a crucial factor to consider when selecting a market coverage strategy.

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Product Life Cycle Maturity

Stage in a product's life cycle characterized by high market penetration, stable sales, and increased competition. Companies often utilize diverse marketing strategies to maintain market share.

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Market Positioning

How a product or brand is perceived and differentiated in the minds of consumers relative to its competitors.

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Product Image

The overall perception and impression consumers have of a product, often influenced by its features, benefits, branding, and marketing efforts.

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STP Marketing

A strategic marketing framework encompassing Segmentation, Targeting, and Positioning, used to identify and address specific customer needs.

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Product Positioning Evaluation

Assessing consumers' preferences and perceptions of a product compared to its competitors, to understand its positioning effectiveness.

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Mercedes vs. Volvo Positioning

Mercedes is positioned in the luxury segment, emphasizing high-end features and driving experience. Volvo is positioned for safety, focusing on robust safety features and reliability.

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Product Positioning

The process of creating a distinct image and perception of a product in the minds of target customers, emphasizing its unique benefits and value compared to competitors.

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Sustainable Competitive Advantage

A long-term advantage that a company has over its competitors, based on factors like superior product features, lower costs, or stronger customer relationships.

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Product Line Considerations

Evaluating how a product fits within a company's existing product range and how it might be perceived by customers and stakeholders.

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Positioning on Product Attributes

Highlighting specific product features or performance characteristics to differentiate it from competitors.

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Benefit Positioning

Focusing on the benefits or value that a product provides to the customer rather than just its features.

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Problem Solution or Needs Positioning

Positioning a product based on its ability to solve specific customer problems or meet unmet needs.

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Positioning Basis

The specific criteria or factors used to establish a product's position in the market, such as features, benefits, price, or target audience.

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Study Notes

Segmentation, Targeting & Positioning

  • Markets are heterogeneous, with diverse individual needs and desires
  • Market segmentation identifies smaller markets within a larger market
  • Market segmentation allows for creation of marketing mixes tailored to specific groups
  • Market segmentation was first proposed in the mid-1950s by Wendell R. Smith
  • Market segmentation breaks down a large, heterogeneous market into smaller homogenous segments
  • Elements within each segment are more similar to each other than to the total market
  • A separate marketing program is developed to best suit each market segment
  • Market segmentation subdivides a market into distinct and homogenous subgroups
  • Customer groups within a segment are similar in needs, characteristics or behaviors
  • Market segments should be created in such a way that differences between buyers within each segment are minimized

Bases of Market Segmentation

  • Geographic segmentation (e.g., region, size, population density, climate)
  • Demographic segmentation (e.g., age, gender, income, occupation, family size, education)
  • Psychographic segmentation (e.g., lifestyle, values, personality, interests)
  • Behavioral segmentation (e.g., usage rate, brand loyalty, purchase occasion)

Requisites of Effective Segmentation

  • Segments should be identifiable and measurable
  • Segments should be accessible through distribution and communication
  • Segments should be substantial enough to be profitable
  • Segments should be responsive to marketing efforts
  • Segments should be stable for the company to work with for a reasonable period

Processes of Market Segmentation

  • Form segments (decide the basis, profile the segments)
  • Evaluate segments (evaluate segments by means of financial and strategic criteria)
  • Target market selection (select the segment and target the segment)

Target Marketing

  • Target markets are sets of purchasers with shared wants, characteristics
  • Selection of the target market is very important for companies
  • Marketers need to understand customer decision-making criteria, characteristics, and lifestyles
  • Different marketing strategies exist (concentrated, differentiated, undifferentiated)

Differentiation & Positioning

  • Positioning refers to the place a product occupies in the market, relative to competitors
  • Consumers' views of product positions should be considered
  • Benefit positioning focuses on the benefits customers seek from a product
  • Positioning strategies involve identifying and addressing different needs within a market
  • Positioning strategies require communicating the product's key attributes distinctly
  • Differentiation is creating unique value in the minds of consumers

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Week 3 - Segmentation, Targeting & Positioning PDF

Description

This quiz covers the fundamentals of market segmentation, targeting, and positioning. It explores the importance of understanding diverse consumer needs and how to tailor marketing strategies to distinct market segments. Test your knowledge on the various bases of market segmentation and the historic background of the concept.

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