Deck 6: Segmenting, Targeting and Positioning

Question 1

Most markets for products are made up of individuals or groups with diverse needs for products and are called ____ markets.

A) undifferentiated
B) concentrated
C) homogenous
D) differentiated
E) heterogeneous

Answer 1

E

Question 2

Explore the link between market segmentation and customer relationship management (CRM)?

Answer 2

Segmentation is part of a wider process of understanding the wants and needs of customers. Analyzing customers to identify a market segment is useful but it is more useful to look at ways to maintain a relationship with those customers and continually adjust and modify the market segmentation variables according to their needs and wants. CRM is a term used to describe this process of managing relationships, allowing companies to continually improve their profiles of purchasing behaviours and regularly communicating with selected customers.

Question 3

When marketing research shows that a group of people does not desire a particular product, the people in that group:

A) are a market.
B) do not have the ability to purchase the product.
C) do not have the authority to purchase the product.
D) are not a market for the product.
E) are a market but will not purchase the product.

Answer 3

D

Question 4

Which of the following is not a characteristic of a consumer market?

A) it consists of purchasers who intend to consume or benefit from the purchased products
B) they do not buy products for the main purpose of making a profit
C) they are sometimes referred to as B2C markets
D) their purchasing decisions are always made by only one individual
E) each of us belongs to numerous markets of this type

Question 5

Why is it important for marketers to assess competitors before entering a market?

Question 6

What are the conditions under which an undifferentiated targeting strategy is effective? Why are these conditions essential?

Question 7

Compare and contrast the concentrated and differentiated targeting strategies of market segmentation.

Question 8

Using Figure 6.1, identify at least three market segments for a company that you're familiar with.

Question 9

Critically look at why marketers rely heavily on demographic characteristics when segmenting consumer markets.

Question 10

How do business market segments differ from consumer markets?

Question 11

Which of these statements is not true about business markets?

A) the purchase may be made to resell the item
B) the purchase is always made by more than one individual
C) the purchase may be made to use in general daily operations
D) the purchase may be made to use in production of another product
E) they can also be referred to as organizational markets

Question 12

A market in which a large proportion of customers have similar needs for a product is called a(n) ____ market.

A) undifferentiated
B) heterogeneous
C) homogenous
D) differentiated
E) concentrated

Question 13

Any group of people who, as individuals or as organizations, have needs for products in a product class and who have the ability, willingness, and authority to buy such products is a(n):

A) business market.
B) market.
C) undifferentiated market
D) segmented market
E) market variable

Question 14

When the needs of individual consumers in a target market for a specific product are similar and the organization can satisfy most customers with a single marketing mix, the best approach to use may be the ____ strategy.

A) undifferentiated
B) differentiated
C) segmented
D) concentrated
E) heterogeneous

Question 15

Using an example compare and contrast the undifferentiated and differentiated approach to the market segmentation.

Question 16

Several conditions must exist for market segmentation to be successful. These conditions include all of the following except:

A) the total market should be divided so that segments can be compared on sales potential, costs, and profits.
B) customers' needs for the product must be homogeneous.
C) the company must be able to reach the chosen segment with a particular marketing mix.
D) segments must be identifiable and divisible.
E) at least one segment must have enough profit potential to justify developing and maintaining a special marketing mix for that segment.

Question 17

The process of dividing a total market into market groups because people within each group have relatively similar product needs is called:

A) segmentation.
B) diversification.
C) target marketing.
D) concentration.
E) customization.

Question 18

The ability to purchase a product is a function of ______

A) buying power.
B) desire.
C) willingness.
D) authority.
E) needs.

Question 19

To find a target market, a firm can use the:

A) total market strategy and the undifferentiated strategy.
B) product differentiation strategy and the customer differentiation strategy.
C) demographic strategy and the psychographic strategy.
D) socioeconomic strategy and the psychological strategy.
E) undifferentiated strategy, the concentrated strategy, and the differentiated strategy.

Question 20

In order to be considered a market, people do not have to have:

A) a need or desire for a particular product.
B) the ability to purchase the product.
C) discretionary income to purchase the product.
D) the willingness to use their buying power.
E) the authority to buy the specific products.

Question 21

Segmentation variables are characteristics of individuals, groups, or organizations in a total market.

Question 22

Evaluating and making product positioning decisions is important for:

A) new products only.
B) existing products only.
C) new and existing products.
D) product deletions only.
E) new products and product deletions.

Question 23

Which of the following is not a requirement or characteristic of a market?

A) The ability to purchase a product
B) A large number of people or organizations
C) The authority to buy a product
D) The willingness to use buying power
E) The need for a specific product in a specific product category

Question 24

When a marketer is engaged in the target market selection process and has assessed relevant market segments by considering such factors as sales estimates, competition, and estimated costs, the marketer is ready for the next step, which is to:

A) identify the appropriate targeting strategy.
B) determine which segmentation variables to use.
C) develop market segment profiles.
D) evaluate relevant market segments.
E) select specific target markets.

Question 25

A disadvantage of the concentrated targeting strategy is that:

A) the firm's financial condition is tied to a single and specialized marketing mix.
B) large sales volumes cannot be generated.
C) production costs may be higher than with other strategies.
D) marketing personnel may become dissatisfied with the limited opportunities provided by this approach.
E) marketing costs are often higher than for other strategies.

Question 26

A market is a group of people who, as individuals, have needs for products in a product class and have the ability, willingness, and authority to purchase such products.

Question 27

Only one variable can be used to segment a market.

Question 28

Population density and city size are ____ variables used for market segmentation.

A) geographic
B) demographic
C) psychographic
D) environmental
E) geodemographic

Question 29

Any group of people who, as individuals or as organizations, have needs for products in a product class and who have the ability, willingness, and authority to buy such products is a(n):

A) business market.
B) market.
C) undifferentiated market
D) segmented market
E) market variable

Question 30

Which of the following is the biggest drawback to using psychographic variables?

A) They are not strongly reflective of consumer behaviour.
B) They are difficult to measure.
C) They give poor information about consumer needs.
D) They do not reflect socioeconomic characteristics of consumers.
E) The resulting segments are difficult to be reached.

Question 31

Generally speaking, individuals who are unemployed would not be considered a target market for Mercedes or other luxury European import sedans because:

A) they would not desire such products.
B) they would not be willing to purchase such products.
C) they would not have the ability to purchase such products.
D) such markets are narrowly defined geographically.
E) they are not authorized to purchase such products.

Question 32

A segmentation variable is used to group smaller markets into one larger market.

Question 33

One problem with using psychographic variables for segmentation purposes is that they are difficult to measure accurately.

Question 34

After an organization has determined which of the many segmentation variables it will use, the next step in the target market selection process is:

A) evaluating each of the relevant market segments.
B) selecting the specific target markets.
C) reviewing the appropriate marketing strategy.
D) analyzing the interaction between segmentation variables.
E) developing market segment profiles.

Question 35

If a company segments its market on the basis of their reasons for purchasing a particular product, the primary segmentation variable in use is _______

A) lifestyle.
B) motives.
C) personality.
D) benefit expectations.
E) personality attributes.

Question 36

Segmentation variables are usually grouped into four categories:

A) demographic, geographic, religion, and income.
B) geopolitical, income, behavioristic, and psychographic.
C) attitudes, lifestyles, behaviors, and gender.
D) geographic, demographic, psychographic, and attitudes.
E) demographic, geographic, psychographic, and behavioristic.

Question 37

When evaluating market segments, assessment of competitors is important because:

A) it is difficult to segment a market when it has multiple competitors.
B) an absence of competitors usually creates difficulties in accurately measuring segment sales potential.
C) sales estimates may cause a segment to appear to be lucrative, but there may be several competitors that together have a large share of that segment.
D) a competitive analysis may lead to confusion as to who are the key competitors.
E) competition is generally not a major problem as long as a marketer is aware of it.

Question 38

The undifferentiated strategy can be effective for an organization that has a homogeneous market and can develop and maintain a single marketing mix.

Question 39

A person who has buying power also has the authority to buy.

Question 40

McDonald's uses a segmentation strategy for its sandwiches based on market characteristics such as age, gender, or income. Which of the following segmentation variables is McDonald's using?

A) Demographic
B) Geographic
C) Psychographic
D) Product-related
E) Education

Question 41

The information yielded by market segment profiles usually is not very useful later in the marketing process.

Question 42

One way marketers can segment business markets is according to their geographic location.

Question 43

A market segment profile describes the similarities among potential customers within a segment and explains the differences among people across market segments.

Question 44

A differentiated targeting strategy is when the organization targets two or more markets by developing a single marketing mix.

Question 45

A market segment profile deals primarily with demographic characteristics.

Question 46

The five-step process usually used for target market selection includes identifying the appropriate targeting strategy, determining which segmentation variables to use, developing market segment profiles, evaluating relevant market segments, and deciding which targeting strategy to use.

Question 47

When a firm's management is making the final selection of specific target markets to enter, it should consider whether the organization has the financial resources, managerial skills, expertise, and facilities needed to effectively compete in the selected segments.

Question 48

The five-step process usually used for target market selection includes identifying the appropriate targeting strategy, determining which segmentation variables to use, developing market segment profiles, evaluating relevant market segments, and deciding which targeting strategy to use.

Question 49

In developing a company sales forecast, the forecasting methods are limited to surveys and correlation methods.

Question 50

A product can be repositioned by changing its image through promotional efforts directed at customers.

Question 51

A market segment profile may cover such aspects as demographic characteristics, geographic factors, product benefits sought, lifestyles, brand preferences, and usage rates.

Question 52

A market segment profile provides customers with an understanding of how a business can use its capabilities.

Question 53

Market segment profiles help determine the most desirable segment or segments in relation to the firm's strengths, weaknesses, objectives, and resources.

Question 54

A market segment profile describes the similarities among potential customers within a segment and explains the differences among people across market segments.

Question 55

A marketer may segment a market in terms of the benefits that customers expect to receive from a particular product.

Question 56

The concentrated targeting strategy is one in which an organization directs its marketing efforts toward a single market segment through one marketing mix.

Question 57

The four requirements of a market are that the individuals in the market must have a need for the product and the ability, willingness, and authority to buy it.

Question 58

Demographic characteristics are commonly used to segment a market because they are closely related to consumers' product needs and purchasing behaviour.