Deck 8: Segmenting and Targeting Markets

Question 1

The 80/20 principle holds that 20 percent of all customers generate 80 percent of the demand.Although the percentages usually are not exact,the general idea often holds true.Which consumer market segment is described here?

A) Benefit segmentation
B) Geographic segmentation
C) Market segmentation
D) Usage-Rate segmentation

Answer 1

D

Question 2

Why do marketers segment their markets and what are the basic criteria for doing so successfully?

A) Segments must be composed of people with different product needs.
B) Segments must be composed of people with different characteristics.
C) Segments must be large enough to warrant developing and maintaining a special marketing mix.
D) Segments must be divided according to the North American Industry Classification System.

Answer 2

C

Question 3

Terra Corp.produces a wide range of furniture,such as cabinets,book cases,and bureaus.It divides its consumer market into several groups of people who have similar interests in wooden furniture.The strategy of dividing its consumer market most likely:

A) allows Terra Corp.to meet the markets' needs with a single marketing mix.
B) enables Terra Corp.to define customer needs and wants more precisely.
C) eliminate the need for developing marketing objectives.
D) allows Terra Corp.to use an undifferentiated targeting strategy.

Answer 3

B

Question 4

A market is people or organizations with needs or wants and with the ability and the willingness to buy.

Question 5

Market segmentation helps decision makers to more accurately define marketing objectives and better allocate resources.

Question 6

Which of the following is true of usage-rate segmentation?

A) It combines former users,potential users,first-time users,light or irregular users,medium users,and heavy users.
B) Categories of products do not vary with the product in user-rate segmentation.
C) Heavy users often change their preferences.
D) It groups potential customers on the basis of their personality,motives,and lifestyles.

Question 7

The process of defining,dividing,and subdividing a large homogenous market into clear identifiable segments having similar needs,wants,or demand characteristics is identified as _____________________________.

A) market segmentation
B) a consumer market
C) market criteria
D) market concentration

Question 8

Which statement is true of market segmentation?

A) It helps marketers design marketing mixes that match the characteristics of one or more segments.
B) It allows marketers to use an undifferentiated targeting strategy.
C) It allows marketers to adopt a single marketing mix across all market segments.
D) It helps marketers focus on satisfying customer needs.

Question 9

A firm which produces replicas of famous paintings of reputed and great artists has as its target customers: socialites,celebrities,and the hospitality industry.What type of market segmentation is used in this case?

A) Geographic segmentation
B) Psychographic segmentation
C) Benefit segmentation
D) Demographic segmentation

Question 10

Based on age segmentation of a target market,which group is at peak earning power but seeks to spend only on products that provide the best value for money?

A) Generation X
B) Generation Y
C) Generation Z
D) Baby Boomers

Question 11

The key tool in the marketing strategy of every successful organization for reaching the targeted customer is:

A) planning the marketing strategy.
B) improving marketing premises.
C) market segmentation.
D) market criteria.

Question 12

The purpose of market segmentation is to:

A) change consumer attitudes and beliefs toward a product.
B) divide a market into submarkets of equal size and equal number of customers.
C) eliminate the need for developing marketing objectives.
D) enable a marketer to tailor marketing mixes to meet the needs of one or more specific segments.

Question 13

It is possible to define every person and every organization in the world as a market segment because each is unique.

Question 14

A market segment is a subgroup of people or organizations having different characteristics that cause them to have distinct product needs.

Question 15

To develop a successful segmentation scheme,marketers gather data about the population within specific geographic boundaries,the number of people in various age categories,and other social and demographic characteristics.This example describes which of the four basic criteria used to develop useful segment schemes?

A) Sustainability
B) Identifiability and measurability
C) Responsiveness
D) Accessibility

Question 16

Market segmentation helps marketers define customer needs and wants more precisely because market segments do not differ in size and potential.

Question 17

A cosmetic company manufactures products for skin and hair care for both men and women in the 20- to 50-year-old age group.Which type of market segmentation approach does the company undertake?

A) Geographic segmentation
B) Psychographic segmentation
C) Benefit segmentation
D) Demographic segmentation

Question 18

What is the similarity between a stock market and a labor market?

A) Both use a barter system to facilitate the exchange of products.
B) Both are composed of people who are unwilling to spend large sums of money for products or services.
C) Both are composed of people with specific wants that can be satisfied by particular product categories.
D) Both deal in selling high-end,consumer durable products.

Question 19

Which of the following statements is true of markets?

A) They are composed of people or organizations.
B) They thrive only with government funds and subsidies.
C) They provide discounts for every consumer.
D) They influence consumers to buy products they do not need.

Question 20

Discuss the importance of market segmentation.

Question 21

Gamers' Page is a magazine that primarily caters to people who are enthusiastic about sports and who enjoy gaming.In this scenario,the editorial board of Gamers' Page uses _____.

A) gender segmentation
B) geographic segmentation
C) psychographic segmentation
D) family life cycle segmentation

Question 22

In the context of family life cycle segmentation,which of the following statements is true?

A) Young divorced couples without children have the lowest purchase rate.
B) Middle-aged married couples with or without children have high average purchase of durables.
C) Young married couples with children have high liquid assets.
D) Middle-aged divorced couples without dependent children are least satisfied with their financial position.

Question 23

_____ is market segmentation on the basis of personality,motives,lifestyles,and geodemographics.

A) Benefit segmentation
B) Family life cycle segmentation
C) Usage-rate segmentation
D) Psychographic segmentation

Question 24

_____ helps marketers develop marketing programs tailored to prospective buyers who live in small regions or who have very specific lifestyle characteristics.

A) Benefit segmentation
B) Family life cycle segmentation
C) Ethnic segmentation
D) Geodemographic segmentation

Question 25

_____ is a common base of demographic segmentation.

A) Product benefit
B) Usage rate
C) Geography
D) Income

Question 26

Nalpas Inc.,an apparel company,manufactures clothes for men,women,and children.It further divides its core customers according to demographic variables such as income,ethnic background,and family life cycle.These demographic variables are examples of _____.

A) product bases
B) segmentation bases
C) product categories
D) market segments

Question 27

Trower Inc.has launched a new smartphone in two different versions.Both variants of the smartphone have a similar design but have different hardware specifications.The company uses this strategy to make this smartphone more universally affordable.In this scenario,Trower Inc.is most likely using __________________________.

A) usage-rate segmentation
B) income segmentation
C) gender segmentation
D) age segmentation

Question 28

Walmart is a successful example for retailing.The store emphasizes low pricing in its ads and promotes its message that customers can get more for their money.Walmart likely uses _________________________.

A) income segmentation
B) age segmentation
C) gender segmentation
D) ethnic segmentation

Question 29

With regard to age segmentation,the tween and teenage cohort following the Millennials is sometimes called _____.

A) Generation X
B) the Baby Boomer generation
C) Generation Z
D) the Silent Generation

Question 30

According to family life cycle segmentation,middle-aged married couples with or without children:

A) are difficult to promote by advertisement.
B) are better off financially than young married couples with or without children.
C) buy medical care products that aid health,sleep,and digestion.
D) have the highest purchase rate.

Question 31

Pine Groove,a cosmetic brand that primarily caters to women,wants to reach out to the less-traditional male market.It conducts research and develops a new product especially for men.In this example,Pine Groove uses _____.

A) ethnicity segmentation
B) age segmentation
C) gender segmentation
D) psychographic segmentation

Question 32

This group is idealistic and pragmatic and the top brand attributes important to them include trustworthiness,creativity,intelligence,authenticity,and confidence.Identify this group.

A) Generation X
B) Teenagers
C) Millennials
D) Generation Z

Question 33

Zinta Co.has launched a new laptop computer with a bigger monitor and big lettered keyboard.The company uses this model to target senior communities and provides discounts.The company targets thirteen cities in the United States with high populations of seniors.This scenario exemplifies which type of market segmentation?

A) Geodemographic segmentation
B) Psychographic segmentation
C) Benefit segmentation
D) Usage-rate segmentation

Question 34

A ____________segmentation has the advantage of being simpler and easier to use.

A) single-variable
B) double-variable
C) triple-variable
D) multiple-variable

Question 35

Which of the following is a psychographic segmentation variable?

A) Usage rate of a product
B) Geodemographics
C) Gender
D) Ethnicities

Question 36

Which statement is true of gender segmentation in the United States?

A) Women are increasingly part of formerly all-male markets.
B) Women are not an experienced purchasing group,unlike men.
C) Men make 70 to 80 percent of purchases of consumer goods each year.
D) Men tend to be more deliberate than women and to take longer to make investment decisions.

Question 37

_____ involves dividing a market into groups such as newborns,infants,young children,tweens,Millennials,Generation X,Baby Boomers,and seniors.

A) Ethnic segmentation
B) Family life cycle segmentation
C) Age segmentation
D) Psychographic segmentation

Question 38

Which of the following statements is true of lifestyle segmentation?

A) It divides people into groups based on their traits,attitudes,and habits.
B) It divides a market by the amount of product bought or consumed.
C) It divides people into market segments according to the benefits they seek from a product.
D) It divides people into groups based on socioeconomic characteristics such as income and education.

Question 39

Demographics provide the skeleton for developing segmentation strategies,but ___________adds meat to the bones.

A) geographic segmentation
B) benefit-usage segmentation
C) psychographic segmentation
D) benefit segmentation

Question 40

_____ refers to segmenting markets by region of a country or the world,market size,market density,or climate.

A) Geographic segmentation
B) Benefit segmentation
C) Demographic segmentation
D) Usage-rate segmentation

Question 41

Wester Helix,a watch manufacturing company,is a brand mostly associated with men.Although they also manufacture products for women,these products are less popular.To increase the sale of these products,Wester Helix opens a sister company that caters solely to women.In this scenario,Wester Helix uses age segmentation.

Question 42

The step of choosing a basis or bases for segmenting a market requires creativity,market knowledge,and ________.

A) managerial insight
B) technical savvy
C) organizational skills
D) managerial directive

Question 43

Wesley Electronics Inc.manufactures electronic gadgets.Its marketing team spent a great deal of money on advertising to create awareness about the company's products among potential customers and employs a variety of methods,such as print,broadcast,and online advertising.According to the steps involved in segmenting a market,Wesley Electronics most likely is:

A) selecting a market or product category for study.
B) designing and implementing its marketing mix.
C) profiling and analyzing market segments.
D) selecting segmentation descriptors for a market.

Question 44

There are many scientific procedures for selecting segmentation variables to use in identifying a market and there is no need for having market knowledge for segmenting the market.

Question 45

What is geographic segmentation? Briefly explain why consumer goods companies take a geographic approach to marketing.

Question 46

According to family life cycle segmentation,consumption patterns among people of the same age and gender differ because they are in different stages of the family life cycle.

Question 47

Rolls Royce cars target only the premium car market segment.This is a classic example of:

A) multisegment targeting.
B) undifferentiated targeting.
C) differentiated targeting.
D) concentrated targeting.

Question 48

The combination of demographics,lifestyles,and geographic categories leads to ______________.

A) geodemographic segmentation
B) benefit segmentation
C) usage-rate segmentation
D) psychographic segmentation

Question 49

Ethnic segmentation involves segmenting potential customers into neighborhood lifestyle categories.

Question 50

This demographic group belonged to the Great Depression generation and had the ability to quietly persevere through great hardships.They were taught to play by the rules and tend to be cautious and are the healthiest,most educated,and wealthiest group of elders.Identify which demographic group is described.

A) The silent generation
B) The sandwich generation
C) Generation Z
D) Generation Y

Question 51

Women tend to accumulate money for the sake of accumulation and rarely associate it with security,independence,or quality of life.

Question 52

Segmentation descriptors identify the specific segmentation variables to use in segmenting a market.

Question 53

Titan Company manufactures watches for all age groups,gender,and income and also for all important family occasions.This company exemplifies ________________________.

A) income segmentation
B) ethnic segmentation
C) gender segmentation
D) family life cycle segmentation

Question 54

According to family life cycle segmentation,young married or divorced couples with children have high liquid assets.

Question 55

Customers looking for luxury want products that exhibit careful craftsmanship,timeless design,prestige,and exclusivity.This type of market is segmented by ethnicity.

Question 56

Generation Y grew up as latchkey kids,meaning that they spent time alone at home while their (often divorced)parents worked long into the night,and they were the best-educated generation.

Question 57

Single-variable segmentation has the advantage of being more precise than multiple-variable segmentation.

Question 58

Mr.Shaw wants to buy corporate gifts for his employees.He considers numerous suppliers of corporate gifts,both familiar and new,solicits bids,and studies all proposals carefully before selecting a supplier.Mr.Shaw's purchasing profile could be characterized as a(n)_________.

A) satisficer
B) optimizer
C) venturist
D) close-fisted buyer

Question 59

When segmenting markets by age,Baby Boomers expect everything to be instantaneous because they have always lived in a world with Internet.

Question 60

Julie works as a public relations executive in a firm and is definitive in her choice of office clothes and accessories.She prefers to wear only certain brands.Hence,she is always seen in clothes from Banana Republic and carries only Coach handbags to office.Which psychographic variable is Julie exhibiting?

A) Motives
B) Personality
C) Geodemographics
D) Attributes

Question 61

The final step in market segmentation is selecting segmentation descriptors.

Question 62

When selecting strategies for targeting markets,which of the following is a disadvantage of an undifferentiated targeting strategy?

A) It results in market segments that are either too small or that shrink because of environmental changes.
B) It often results in sterile,unimaginative product offerings that have little appeal to anyone.
C) It results in cannibalization of products.
D) It increases the production and marketing costs of a firm.

Question 63

Promotion is one of the components that forms a marketing mix.

Question 64

Tennot Inc.sells used cars.It focuses solely on low-income customers who prefer to buy a used car rather than a new one.Therefore,it develops one marketing mix that targets a low-income demographic group.In this scenario,Tennot Inc.most likely uses a(n)_____.

A) undifferentiated targeting strategy
B) multisegment targeting strategy
C) concentrated targeting strategy
D) universal targeting strategy

Question 65

Which of the following is an advantage of a multisegment targeting strategy?

A) It significantly reduces the risk of product cannibalization.
B) It provides economies of scale in manufacturing and marketing.
C) It does not require firms to tailor marketing mixes to the preferences of market segments.
D) It decreases the costs involved in product design,marketing research,and management.

Question 66

A firm that adopts an undifferentiated targeting strategy assumes that:

A) a market is composed of narrowly defined market segments.
B) small firms can compete effectively with large firms.
C) concentrating all resources on understanding the needs of a single market may lead to cannibalization.
D) individual customers have similar needs that can be met with a common marketing mix.

Question 67

Which of the following occurs when sales of a new product cut into sales of a firm's existing products?

A) Cannibalization
B) Product churning
C) Backward invention
D) Commodification

Question 68

Unilever is an example of multinational company with a multisegment targeting strategy that has many products in its product line.

Question 69

Which of the following statements is true of a concentrated targeting strategy?

A) It allows a firm to serve two or more well-defined market segments simultaneously.
B) It is often adopted by small firms to compete effectively with much larger firms.
C) It follows a mass-market philosophy by viewing the market as one big market without any individual segments.
D) It results in cannibalization of products.

Question 70

Chipotle stated they were "in the market for Mexican food" by competing on quality instead of price.Chipotle is a company that prides itself on serving "food with integrity." Which mass market targeting strategy did it use when entering the market?

A) Undifferentiated targeting
B) Concentrated targeting
C) Multisegment targeting
D) Differentiated marketing

Question 71

Laelle is a confectionery company that manufactures candies.It does not use specific strategies to target children when marketing its products.Instead it uses the same strategies to promote its candies among all consumers in the market.In this scenario,Laelle uses a(n)_____.

A) multisegment targeting strategy
B) individual targeting strategy
C) undifferentiated targeting strategy
D) concentrated targeting strategy

Question 72

Segmenting by customer type allows business marketers to tailor their marketing mixes to the common needs of particular types of organizations or industries.

Question 73

A concentrated targeting strategy differs from an undifferentiated targeting strategy in that a concentrated targeting strategy:

A) results in cannibalization of products.
B) involves the selection of a market niche to target the marketing efforts of a firm.
C) views the market as one big market with no individual segments.
D) reduces the production and marketing costs of a firm.

Question 74

Prisly Inc.is a multinational company that specializes in manufacturing and selling high-end cars.It launches a new car,the Gwen 2.0,that becomes highly successful in the market because of its economical price and excellent features.However,this leads to a significant decline in the sales of Prisly Inc.'s other cars.This scenario exemplifies _____.

A) segmentation
B) differentiation
C) cannibalization
D) personalization

Question 75

A firm using a(n)_____ essentially adopts a mass-market philosophy,viewing the market as one big market with no individual segments.

A) undifferentiated targeting strategy
B) niche targeting strategy
C) individual targeting strategy
D) concentrated targeting strategy

Question 76

Explain the steps involved in segmenting a market.

Question 77

Apple saw a huge drop in the sales of its iPhone 6s when they launched the iPhone 7.This situation exemplifies _________________,that is,when a new product cuts into the sales of existing products within the same company.

A) cannibalization
B) positioning
C) repositioning
D) competition

Question 78

Chipotle has become popular with a variety of people.It recently identified a primary customer segment in Millennials.To win over this demographic group,traditional media is less authentic in the perception of Millennials,therefore,Chipotle does not use traditional media,and its marketing and promotion focus on maintaining a large online and social media presence.Here Chipotle is likely to use:

A) undifferentiated targeting.
B) concentrated targeting.
C) multisegment targeting.
D) differentiated marketing.

Question 79

A dynamic segmentation approach adjusts to fit the changes that occur in customers' lives.

Question 80

A company selling plain toilet paper is an example of a firm that uses an undifferentiated targeting strategy.