Target Marketing Concepts in Business
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What is the primary reason companies shift from mass marketing to target marketing?

  • Customers have too diverse desires and buying habits. (correct)
  • To simplify the production process
  • To appeal to a wider range of customers
  • To reduce overall marketing costs

    • Which of the following best describes the first step in target marketing?

  • Identifying product differentiation.
  • Dividing the market into distinct groups. (correct)
  • Determining the marketing mix.
  • Selecting target market segments.

    • What does 'market positioning' refer to in the context of target marketing?

  • Establishing a competitive position for the product. (correct)
  • Evaluating the financial performance of a marketing campaign.
  • Distributing products through optimal channels
  • Identifying specific market segments.

    • Why are demographic variables frequently used for customer segmentation?

    <p>They are easy to measure and classify.</p> Signup and view all the answers

    Which of the following demographic variables is most likely to change a customer’s needs and preferences?

    <p>Age and life cycle stage</p> Signup and view all the answers

    When is product differentiation considered most effective?

    <p>When it uniquely appeals to a specific consumer need</p> Signup and view all the answers

    Why is differentiation more feasible in the hospitality industry than other sectors?

    <p>Because of the wide range of services offered</p> Signup and view all the answers

    What might be a limitation of using age and life cycle stage for demographic segmentation?

    <p>Some people do not fit into neat age-related profiles due to their psychological age.</p> Signup and view all the answers

    How does Southwest Airlines tailor services for senior citizens, based on the concept of psychological age?

    <p>They target active older people in their advertising.</p> Signup and view all the answers

    Differentiation, when successful, should aim to ensure that the customer perceives what?

    <p>A greater perceived value.</p> Signup and view all the answers

    What does the data on business travelers suggest about gender-based segmentation in the hotel industry?

    <p>Hotel corporations should take women’s preferences into account when designing rooms.</p> Signup and view all the answers

    What is the role of product differentiation in competitive strategy?

    <p>To strengthen competitive strategy</p> Signup and view all the answers

    In the context of differentiation, what can be differentiated?

    <p>The product, the message, or the brand.</p> Signup and view all the answers

    Which approach is most effective when using gender as a segmentation variable?

    <p>Combining gender information with lifestyle and demographic information.</p> Signup and view all the answers

    Why is income not always a reliable variable for predicting purchase behavior?

    <p>Because it must be combined with other segmentation variables for proper insight.</p> Signup and view all the answers

    What is the ultimate goal of positioning?

    <p>To establish a unique position in the consumer's mind.</p> Signup and view all the answers

    According to the content, what is the primary initial step before a market can be targeted effectively?

    <p>Segmenting the market.</p> Signup and view all the answers

    Why is the middle-income segment considered a difficult market to attract and retain?

    <p>Because it is the largest segment, leading to high competitive and diverse needs.</p> Signup and view all the answers

    Which of the following best describes how psychographic segmentation divides buyers?

    <p>Based on social class, lifestyle, and personality characteristics.</p> Signup and view all the answers

    What does 'AIO' stand for in the context of psychographic segmentation?

    <p>Activities, Interests, and Opinions</p> Signup and view all the answers

    In psychographic segmentation, lifestyle patterns combine demographics with what other attributes?

    <p>How people live, think, and behave in their everyday lives</p> Signup and view all the answers

    Why is psychographic segmentation considered a valuable area for marketing effectiveness, especially in the hospitality industry?

    <p>It helps to understand the specific needs and preferences of different customer segments.</p> Signup and view all the answers

    How does social class affect consumer preferences for leisure activities?

    <p>It shapes what people think is an appropriate or desired leisure activity.</p> Signup and view all the answers

    What is a primary focus of behavioral segmentation?

    <p>Dividing buyers based on their knowledge, attitude and response to a product.</p> Signup and view all the answers

    Which of the following segmentation types would be most affected by occasions, such as Mother's Day or honeymoons?

    <p>Behavioral Segmentation</p> Signup and view all the answers

    What is a key difference between psychographic and behavioral segmentation?

    <p>Psychographic segmentation focuses on internal attitudes, while behavioral segmentation focuses on observable actions.</p> Signup and view all the answers

    Which of the following best describes the relationship between brand loyalty and price sensitivity?

    <p>Loyal customers are generally less price sensitive.</p> Signup and view all the answers

    In the context of buyer readiness, which stage immediately precedes the 'intends to buy' stage?

    <p>Wants</p> Signup and view all the answers

    Which of the following segmentation approaches considers the nature of the purchase?

    <p>Usage segmentation</p> Signup and view all the answers

    A customer seeking a product known for its durability and reliability falls under which type of benefit segmentation?

    <p>Safety</p> Signup and view all the answers

    Price segmentation can be viewed as a more visible and tangible subset of which segmentation approach?

    <p>Benefit segmentation</p> Signup and view all the answers

    Why do marketers often employ multiple segmentation bases rather than relying on just one?

    <p>To identify smaller, better-defined target groups</p> Signup and view all the answers

    What is the primary factor that determines the validity of a distinct market segment?

    <p>Its different behavior</p> Signup and view all the answers

    Which of the following best describes the essence of target marketing?

    <p>Selecting specific segments and tailoring products to their needs.</p> Signup and view all the answers

    What is the underlying concept behind mass customization?

    <p>Personalizing products to meet individual customer specifications.</p> Signup and view all the answers

    Which requirement for effective segmentation refers to the ability to determine the size, purchasing power, and profiles of market segments?

    <p>Measurable</p> Signup and view all the answers

    What is the primary characteristic of an undifferentiated marketing strategy?

    <p>Ignoring market segmentation and targeting the entire market with one offer.</p> Signup and view all the answers

    Which of the following is a potential benefit of undifferentiated marketing?

    <p>Reduced costs in production, inventory, and transportation.</p> Signup and view all the answers

    What is a key characteristic of a bifurcated marketing strategy?

    <p>Serving two distinct segments with different needs.</p> Signup and view all the answers

    What is a key example of a company using a differentiated marketing strategy?

    <p>A large hotel group with multiple brands catering each segment.</p> Signup and view all the answers

    What is a core disadvantage of a differentiated marketing strategy?

    <p>It typically incurs higher costs in areas like research and advertising for each brand.</p> Signup and view all the answers

    Which of the following represents a concentrated marketing approach?

    <p>A company focusing on a few select market segments such as city hotels.</p> Signup and view all the answers

    Why do many modern firms express doubts about using an undifferentiated marketing strategy?

    <p>It often fails to meet the specific needs of niche markets and their increased segmentation.</p> Signup and view all the answers

    What is generally true about Accor Hotels' results when using a differentiated marketing strategy with three brands in one city, compared to using only one brand?

    <p>Their hotel room market share is higher.</p> Signup and view all the answers

    Which of the following best exemplifies service differentiation in the hospitality industry?

    <p>A hotel providing in-room check-in services.</p> Signup and view all the answers

    What is the primary way that companies can achieve personnel differentiation?

    <p>By hiring and training better quality staff than competitors.</p> Signup and view all the answers

    How can a hospitality or travel firm leverage location for competitive advantage?

    <p>By using benefits created by their location and promoting it in their marketing.</p> Signup and view all the answers

    If a motel near a freeway exit doubles its occupancy, what type of competitive advantage does it primarily demonstrate?

    <p>Location Differentiation</p> Signup and view all the answers

    Which factor is LEAST likely to contribute to a brand's image differentiation?

    <p>The specific location of the business.</p> Signup and view all the answers

    What is the key aspect of image differentiation?

    <p>To communicate the company’s major benefits and positioning with a singular, distinctive message.</p> Signup and view all the answers

    When choosing competitive advantages for positioning, what do many marketers believe about promoting benefits?

    <p>Companies should only promote one key benefit aggressively.</p> Signup and view all the answers

    When selecting which competitive advantage to promote, which of the following is a key consideration?

    <p>Focusing on a single, unique benefit that’s most relevant to the target market.</p> Signup and view all the answers

    Study Notes

    Introduction to Market Segmentation

    • A market comprises all potential and actual buyers of a product or service
    • Customers have diverse needs and wants, making each a potentially separate market
    • Market segmentation is a complementary strategy to differentiation

    Market Segmentation Strategies

    • Dividing the market into distinct groups requiring separate products/marketing mixes
    • Analyzing segment attractiveness and targeting one or more segments
    • Developing a competitive positioning and appropriate marketing mix for each segment

    Stages of Marketing

    • Mass Marketing: Appealing to all customers in the same way
    • Product Variety Marketing: Offering various product items within the same product line
    • Target Marketing: Focusing on specific customer groups' needs and wants
    • Micromarketing: Tailoring products/services to individual customer preferences
    • Customized Marketing: Completely personalized products tailored to unique individual needs

    Requirements for Effective Segmentation

    • Measurable: Size, purchasing power, and profiles of segments must be measurable
    • Accessible: Segments can be effectively reached and served
    • Substantial: Segments are large or profitable enough to be worth serving
    • Actionable: Effective programs can be designed to attract and serve the segments

    Evaluating Market Segments

    • When evaluating segments, consider these three factors:
      • Segment size and growth
      • Segment structural attractiveness
      • Company objectives and resources

    Market Segmentation Strategies

    • Mass Market Strategy: Organization provides a single marketing mix for the entire market
    • Concentration Strategy: Organization focuses its marketing mix on one segment
    • Multisegment Strategy: Organization adopts distinct marketing mixes to serve more than one segment

    Examples of Market Segmentation

    • Mass Market (1960s-1970s): Tourists (no segmentation)
    • Multi Level Segmentation (1990s): Wealthy older couples; ethnic older couples
    • Simple Market Segmentation (1980s): Older couples; younger couples
    • Niche/Individualized Segmentation (2000s): Postal codes; Mr. Johnson

    Target Marketing

    • Companies select specific segments to create products/services matching their needs and wants
    • More detailed segmenting rules apply in this scenario
    • Undifferentiated, strong targeting, and differentiated multi-target marketing strategies are possible

    Mass Customization

    • Modern technology allows for personalized products tailored to individual customer specifications
    • Databases track customer behavior for precise customization

    Product Differentiation

    • A company differentiates its product by offering something competitors can't match
    • Attributes, service, personnel, location, and image all play into differentiation

    Physical Attributes Differentiation

    • The physical environment offers uniqueness, differentiating the business from competitors
    • Examples include renovated classic hotels and attractions like memorabilia

    Service Differentiation

    • Providing services tailored to consumers creates product differentiation
    • Examples include in-room check-in and customer waiting-list options

    Personnel Differentiation

    • Company hires and trains people better than competitors, which creates a strong competitive advantage
    • This includes excellent flight attendants as an example

    Location Differentiation

    • A business's location can be a critical differentiator
    • Examples include hotels located near parks or close to freeway exits

    Image Differentiation

    • A company's brand image should communicate its unique benefits, a critical aspect of positioning
    • Examples include Chili's as a neighborhood restaurant or a hotel emphasizing value and location

    Selecting the Right Competitive Advantages

    • Companies choose one or more distinct aspects for competitive advantage
    • This includes focusing on best quality, best service, lowest price, location, or value leadership

    Which Differences to Promote

    • Certain criteria must be met for a difference to be suitable for promotion (important, distinctive, superior, communicable, preemptive, affordable, profitable)

    Communicating and Delivering the Chosen Position

    • The company must communicate its position to customers with consistent efforts across marketing mix activities
    • This ensures consistency in advertising, employee training, service delivery, and related actions

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    Marketing for Hospitality and Tourism PDF

    Description

    Explore key concepts in target marketing through this quiz. Understand the reasons behind the shift from mass marketing to targeted approaches, the importance of demographic segmentation, and how product differentiation applies, especially in the hospitality industry. Test your knowledge on market positioning and customer needs.

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