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Questions and Answers

What is a major difference between Dunkin' Donuts and Starbucks ?

Dunkin' Donuts targets everyday Joes, while Starbucks aims for a more upscale, professional customer.

What is the name of Dunkin' Donuts' long-running ad slogan?

America Runs on Dunkin'.

Which of these is a key difference between the Dunkin' Donuts and Starbucks tribes?

  • Starbucks customers want to be part of a crowd, Dunkin' Donuts customers want to stand out as individuals. (correct)
  • Starbucks customers want to sit on couches, Dunkin' Donuts customers want comfortable booths.
  • Starbucks customers prefer a more upscale environment, Dunkin' Donuts customers prefer a more low-brow environment. (correct)
  • Starbucks customers want to blend in, Dunkin' Donuts customers want to stand out.

What is the primary way that Dunkin' Donuts is seeking to broaden its appeal to new customer segments?

<p>Dunkin' Donuts has been moving upscale, adding new menu items and making changes to its stores.</p> Signup and view all the answers

What is a key reason that demographic variables are the most popular for dividing customers into segments?

<p>Consumer needs, wants, and usage rates often vary closely with demographic variables.</p> Signup and view all the answers

What did Oscar Mayer do to broaden the appeal of its Lunchables product?

<p>Oscar Mayer introduced Lunchables Loaded and Lunchables Uploaded, which were targeted at teenagers.</p> Signup and view all the answers

What is the nickname given to the very loyal customers of Mountain Dew?

<p>Dew Nation</p> Signup and view all the answers

What is the name of the business information service that classifies U.S. households into one of 71 lifestyle segments?

<p>Mosaic USA</p> Signup and view all the answers

What is the name of the digital campaign used by Coca-Cola to target teenagers?

<p>The Ahh Effect</p> Signup and view all the answers

Which of the following is NOT a requirement of effective market segmentation?

<p>Exclusive (E)</p> Signup and view all the answers

What is the difference between differentiated and concentrated marketing?

<p>Differentiated marketing targets several segments with separate offers, while concentrated marketing focuses on a large share of one or a few segments.</p> Signup and view all the answers

Which of these companies is an example of a business that utilizes micromarketing?

<p>Marriott Renaissance Hotels (B)</p> Signup and view all the answers

What is the name of the program used by Marriott Renaissance Hotels to hyper-localize guest experiences?

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

What is the term used to describe the marketing strategy of tailoring products and marketing programs to the needs and preferences of individual customers?

<p>Individual Marketing</p> Signup and view all the answers

Which of these is a factor that should be considered when choosing a market targeting strategy?

<p>Market variability (A), Product life-cycle stage (B), Degree of product variability (C), Company resources (D), Competitors' strategies (E)</p> Signup and view all the answers

What is the biggest concern that marketers have with regard to targeting vulnerable consumers?

<p>Marketers may be promoting potentially harmful products or using deceptive tactics.</p> Signup and view all the answers

What action did McDonald's take to address concerns about its Happy Meals?

<p>McDonald's reduced the calorie count in Happy Meals by 20 percent, added fruit to every meal, and now only promotes Happy Meals with milk, water, and juice.</p> Signup and view all the answers

What is the term for the way a product is defined by consumers on important attributes?

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

What is the difference between the Cadillac Escalade and the Land Cruiser, as depicted in the positioning map?

<p>The Cadillac Escalade is positioned on urban luxury, while the Land Cruiser is positioned as a more adventure-oriented, off-road luxury vehicle.</p> Signup and view all the answers

Which of these is an example of a company that practices 'more for the same' positioning?

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

What is the key difference between 'more for more' and 'more for the same' positioning?

<p>'More for more' positions a product as offering the highest quality and charging a premium price, while 'more for the same' offers similar quality but at a lower price.</p> Signup and view all the answers

Which of these is an example of a company that practices 'Less for Much Less' positioning?

<p>Costco warehouse stores</p> Signup and view all the answers

What is the term for a brand's full positioning - the full mix of benefits on which it is positioned?

<p>Value Proposition</p> Signup and view all the answers

What is the primary difference between 'more for less' positioning and 'more for the same' positioning?

<p>More for less aims to offer higher quality and service at a lower price than competitors, while more for the same offers similar quality at a lower price.</p> Signup and view all the answers

What is the primary function of a positioning statement?

<p>A positioning statement summarizes a company or brand's positioning by outlining its target segment, the need it fulfills, its concept, and its point of difference.</p> Signup and view all the answers

What is the key to building a strong, believable position?

<p>It involves carefully designing the marketing mix and ensuring all elements support the chosen position, from product quality to pricing strategies and advertising tactics.</p> Signup and view all the answers

Why is it often easier to develop a good positioning strategy than to implement it?

<p>Implementing a positioning strategy requires consistent and sustained effort across all aspects of the business, such as product development, pricing, distribution, marketing, and customer service.</p> Signup and view all the answers

Once a company has built a strong position, it can remain stagnant and rely on past successes.

<p>False (B)</p> Signup and view all the answers

Flashcards

Customer Value-Driven Marketing Strategy

Plan for creating value for customers by understanding their needs and desires, segmenting, targeting, differentiating, and positioning the product.

Market Segmentation

Dividing a broad consumer or business market into smaller groups with similar characteristics.

Market Targeting

Selecting the most promising segments to target with specific products.

Market Differentiation

Creating differences between products to appeal to more specific segments.

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Market Positioning

Placing a product in the mind of target consumers to create a distinct impression.

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Dunkin' Donuts

Example of a coffee chain targeting a different customer base than Starbucks.

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Starbucks

High-brow coffee chain targeting a different customer base than Dunkin' Donuts.

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Consumer Segmentation Bases

Criteria used to divide consumer markets into segments; these may include demographics, psychographics, behaviors, and geography.

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Business Segmentation Bases

Criteria used to divide business markets into segments; frequently includes demographics, purchasing behavior, and location.

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Attractive Market Segments

Market segments that offer significant growth potential, profitability, and fit with the company's goals.

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Market-Targeting Strategy

Choosing a target group or groups in a market using strategies like undifferentiated, differentiated, or concentrated.

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Study Notes

Customer Value-Driven Marketing Strategy

  • Dunkin' Donuts targets a different customer base than Starbucks
  • Dunkin' values the average consumer ("average Joe") while Starbucks targets a more affluent, sophisticated consumer
  • Dunkin' customers are more comfortable with a low-brow, everyman approach
  • Dunkin' Donuts' research showed that its customers are turned off by the high-brow atmosphere of Starbucks, and prefer a more casual setting
  • Dunkin' Donuts does not try to target the Starbucks customer
  • Dunkin' focuses on simple fare, affordable prices, and a friendly environment
  • Dunkin' Donuts ad slogan: "America Runs on Dunkin'"
  • Dunkin' is now positioned as an all-day, every-day stop for coffee and baked goods

Market Segmentation

  • Market segmentation is dividing a market into groups with different needs and characteristics
  • Companies need to reach segments efficiently and effectively with products tailored to their needs
  • Consumer market segmentation variables include geographic, demographic, psychographic, and behavioral
  • Geographic segmentation: dividing a market into geographical units (nations, regions, etc.)
  • Demographic segmentation: dividing by age, life Acycle, gender, income, occupation, etc.
  • Psychographic segmentation: dividing by lifestyle or personality characteristics
  • Behavioral segmentation: dividing by consumer knowledge, attitudes, uses, or responses to a product

Market Targeting

  • Evaluating a market segment's attractiveness depends on size, growth, structural attractiveness, and company objectives/resources
  • Companies want segments with right size and growth
  • Factors to consider in structural attractiveness: number of competitors, ease of entry, substitute products, buyer power, supplier power
  • Companies must consider their objectives and resources when selecting a target segment

Differentiation and Positioning

  • Differentiation is providing superior customer value
  • Companies gain competitive advantages by differentiating along product, services, channels, people, or image
  • Product differentiation: features, performance, style, design
  • Services differentiation: speedy or convenient service, high-quality customer service
  • Channel differentiation: channel's coverage, expertise, and performance
  • People differentiation: hiring and training better people
  • Identifying a set of differentiating competitive advantages
  • Choosing the right competitive advantages to promote
  • Selecting an overall positioning strategy (e.g., more for more, more for the same, less for much less)
  • Positioning statement: summarizes company/brand positioning, follows a specific format: "To (target segment and need) our (brand) is (concept) that (point of difference)"
  • A product's position is how consumers perceive it in relation to competing products
  • Positioning maps: show consumer perceptions of brands on important buying dimensions

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