1. Customer-Driven Marketing Strategy:Creating Value for Target Customers Market Segmentation Market Targeting Differentiation and Positioning Topic Outline

2. Market Segmentation Market segmentation is the process that companies use to divide large heterogeneous markets into small markets that can be reached more efficiently and effectively with products and services that match their unique needs

3. Market Segmentation

4. Market Segmentation Segmenting consumer markets Segmenting business markets Segmenting international markets Requirements for effective segmentation

5. Market Segmentation Segmenting Consumer Markets

6. Market Segmentation Geographic segmentation divides the market into different geographical units such as nations, regions, states, counties, or cities Segmenting Consumer Markets

7. Market Segmentation Demographic segmentation divides the market into groups based on variables such as age, gender, family size, family life cycle, income, occupation, education, religion, race, generation, and nationality Segmenting Consumer Markets

8. Market Segmentation Age and life-cycle stage segmentation is the process of offering different products or using different marketing approaches for different age and life-cycle groups Gender segmentation divides the market based on sex (male or female)

9. Market Segmentation Income segmentation divides the market into affluent or low-income consumers Psychographic segmentation divides buyers into different groups based on social class, lifestyle, or personality traits Segmenting Consumer Markets

10. Market Segmentation Behavioral segmentation divides buyers into groups based on their knowledge, attitudes, uses, or responses to a product Occasions Benefits sought User status Usage rate Loyalty status Segmenting Consumer Markets

11. Market Segmentation Using Multiple Segmentation Bases Multiple segmentation is used to identify smaller, better-defined target groups Geodemographic segmentation is an example of multivariable segmentation that divides groups into consumer lifestyle patterns

12. Market Segmentation PRIZM NE classifies every American household into 66 unique segments organized into 14 different social groups. These groups segment people and locations into marketable groups of like-minded consumers that exhibit unique characteristics and buying behavior based on a host of demographic factors Using Multiple Segmentation Bases

13. Which of the following is not a way to segment consumer markets? Geographic Psychographic Demographic Derived demand

14. Which of the following is not a way to segment consumer markets? Geographic Psychographic Demographic Derived demand

15. Dividing a market based on consumer attitude, use, or response to a product is called ________ segmentation. occasion psychographic behavioral market

16. Dividing a market based on consumer attitude, use, or response to a product is called ________ segmentation. occasion psychographic behavioral market

17. A marketer selling different offerings in different communities would be using ________ segmentation. geographic psychographic demographic behavioral

18. A marketer selling different offerings in different communities would be using ________ segmentation. geographic psychographic demographic behavioral

19. Marketers selling luxury cars often use income as a segmenting variable. Income is one component of ________ segmentation. geographic psychographic demographic behavioral

20. Marketers selling luxury cars often use income as a segmenting variable. Income is one component of ________ segmentation. geographic psychographic demographic behavioral

21. Many marketers believe that ________ variables are the best starting point for building market segments. geographic psychographic demographic behavioral

22. Many marketers believe that ________ variables are the best starting point for building market segments. geographic psychographic demographic behavioral

23. Market Segmentation Segmenting International markets

24. Market Segmentation Intermarket segmentation divides consumers into groups with similar needs and buying behaviors even though they are located in different countries Segmenting Business Markets

25. Mercedes Benz targets the world’s well-to-do and IKEA targets the aspiring global middle class. These companies are involved with ________ segmentation. positioning differentiation intermarket lifecycle

26. Mercedes Benz targets the world’s well-to-do and IKEA targets the aspiring global middle class. These companies are involved with ________ segmentation. positioning differentiation intermarket lifecycle

27. Market Segmentation To be useful, market segments must be: Requirements for Effective Segmentation

29. In order to be useful, market segments need to be which of the following? Differentiable Accessible Substantial All of the above

30. In order to be useful, market segments need to be which of the following? Differentiable Accessible Substantial All of the above

31. Market Targeting Target market consists of a set of buyers who share common needs or characteristics that the company decides to serve Selecting Target Market Segments

32. Market Targeting Segment size and growth Segment structural attractiveness Company objectives and resources Evaluating Market Segments .

33. Which of the following structural factors is not related to a segment’s attractiveness? The presence of strong competitors in the segment. The existence of potential substitute products. The lack of raw materials. A number of powerful suppliers.

34. Which of the following structural factors is not related to a segment’s attractiveness? The presence of strong competitors in the segment. The existence of potential substitute products. The lack of raw materials. A number of powerful suppliers.

35. Internet Exercise Go to the Timex website (www.timex.com) and use the drop-down list or site map to go to the “Latest Products” section. Based on the needs that a product is designed to meet, can you identify the characteristics of the product’s target market? 35

36. Market Targeting Target Marketing Strategies

37. Market Targeting Undifferentiated marketing targets the whole market with one offer Mass marketing Focuses on common needs rather than what’s different Target Marketing Strategies

38. Market Targeting Differentiated marketing targets several different market segments and designs separate offers for each Goal is to achieve higher sales and stronger position More expensive than undifferentiated marketing Target Marketing Strategies

39. When using a(n) ________ marketing (mass-marketing) strategy, a firm decides to ignore market segment differences and target the whole market with one offer. differentiated undifferentiated positioning segmentation

40. When using a(n) _____ marketing (mass-marketing) strategy, a firm decides to ignore market segment differences and target the whole market with one offer. differentiated undifferentiated positioning segmentation

41. Market Targeting Concentrated marketing targets a small share of a large market Limited company resources Knowledge of the market More effective and efficient Target Market Strategies

43. Marketing Targeting Micromarketing is the practice of tailoring products and marketing programs to suit the tastes of specific individuals and locations Local marketing Individual marketing Target Market Strategies

44. Market Targeting Local marketing involves tailoring brands and promotion to the needs and wants of local customer groups Cities Neighborhoods Stores Target Market Strategies

45. Market Targeting Individual marketing involves tailoring products and marketing programs to the needs and preferences of individual customers Also known as: One-to-one marketing Mass customization Markets-of-one marketing Target Market Strategies

46. This type of micromarketing is also known as one-to-one marketing or mass customization. Local marketing Tailored marketing Niche marketing Individual marketing

47. This type of micromarketing is also known as one-to-one marketing or mass customization. Local marketing Tailored marketing Niche marketing Individual marketing

48. Market Targeting Depends on: Company resources Product variability Product life-cycle stage Market variability Competitor’s marketing strategies Choosing a Target Market

49. Market Targeting Socially Responsible Target Marketing Benefits customers with specific needs Concern for vulnerable segments Children Alcohol Cigarettes Internet abuses

50. If a beer manufacturer were to place a commercial on a TV show that was predominantly viewed by children, it could be considered using ________. socially irresponsible targeting socially responsible targeting adult targeting niche targeting

51. If a beer manufacturer were to place a commercial on a TV show that was predominantly viewed by children, it could be considered using ________ . socially irresponsible targeting socially responsible targeting adult targeting niche targeting

52. Differentiation and Positioning Product position is the way the product is defined by consumers on important attributes—the place the product occupies in consumers’ minds relative to competing products Perceptions Impressions Feelings

53. Differentiation and Positioning Positioning maps show consumer perceptions of their brands versus competing products on important buying dimensions

54. Differentiation and Positioning Choosing a Differentiation and Positioning Strategy Identifying a set of possible competitive advantages to build a position Choosing the right competitive advantages Selecting an overall positioning strategy Developing a positioning statement

55. A product’s ________ is the way the product is defined by consumers on important attributes relative to the competition. image equity position value

56. A product’s ________ is the way the product is defined by consumers on important attributes relative to the competition. image equity position value

57. Differentiation and Positioning Competitive advantage is an advantage over competitors gained by offering consumers greater value, either through lower prices or by providing more benefits that justify higher prices Identifying Possible Value Differences and Competitive Advantage

58. Differentiation and Positioning Choosing a Differentiation and Positioning Strategy Identifying a set of possible competitive advantages to build a position by providing superior value from:

59. A firm that practices ________ differentiation gains competitive advantage by the way it designs its channel coverage. services product people channel

60. A firm that practices ________ differentiation gains competitive advantage by the way it designs its channel coverage. services product people channel

61. Differentiation and Positioning Choosing the Right Competitive Advantage Difference to promote should be:

62. Differentiation and Positioning Value proposition is the full mix of benefits upon which a brand is positioned Selecting an Overall Positioning Strategy

63. Differentiation and Positioning To (target segment and need) our (brand) is (concept) that (point of difference) Developing a Positioning Statement Web link

64. Communication and Delivering the Chosen Position Choosing the positioning is often easier than implementing the position.

65. What is the first step in target marketing? Market positioning Market segmentation Target marketing None of the above

66. What is the first step in target marketing? Market positioning Market segmentation Target marketing None of the above

67. Which of the following steps of target marketing takes into account competitors’ offerings to the market? Market positioning Market segmentation Market targeting All of the above