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Demographic segmentation is used for targeting specific audiences. The main focus is to help Sysco customers succeed while achieving sales and profit goals established by the company. Nee, E., Due Diligence: The Customer Is Always Right, CIO Insight, May 23, 2003. Eventually, Avon created a separate product called Skin So Soft Bug Guard, which competes with repellents like Off! A framework to relate the market segments of potential buyers to products offered or potential marketing actions by an organization is referred to as a __________. You wouldn't want to spend your time and money making sure your campaigns also make sense to seniorsthat would be a waste. P&G is using which type of segmentation variable? the important attributes for a product or brand class, According Figure 9-5 above, heavy users are the most important segment to a fast-food restaurant because. Transcribed image text: All of the following are criteria for effective market segmentation except: The market segments should be profitable. For instance, few men apply makeup, and most women dont wear boxers. Have you ever gone to their homes and been shocked by their lifestyles and how vastly different they are from yours? Variables such as location, the North American Industry Classification System (NAICS) code, and number of employees are all examples of ways to, A market-product grid is a framework to relate. Moreover, you are very concerned about nutrition and tend not to consume childrens drinks. First, we segment the audience using market segmentation practices. Generations and Characteristics) in the United States. Trade shows and direct mail campaigns are two traditional ways of reaching B2B markets. ppp is in dollars and qqq is the number of units. To find out which category youre in, take a VALS survey at http://www.sric-bi.com/vals/surveynew.shtml. Billboards outside stores tell Virgin Mobile users to switch your Bluetooth on to get free stuff here! (Who wouldnt want free stuff?). Reynolds responded to this problem by creating PotLux cookware, attractive and inexpensive disposable dishes for transporting food. Small athletic shoe manufactures such as vans have targeted niche markets and make shoes designed to satisfy the needs of different specific groups of customers. Which of the following is an example of a multiple products and multiple markets strategy? When compared to a multiple products, multiple market segments strategy, a one product, multiple market segment strategy. tailoring goods or services to the tastes of . 6) The most artistic step in preparing to meet guests' foodservice needs is ________. The Mahogany line is designed to appeal to African-Americans. The increased customer value achieved through performing organizational functions like marketing or manufacturing more efficiently is referred to as . Click on the following link to see a fun one created by Burger King to advertise its Tender Crisp Chicken. Some vacation properties, such as Sandals, exclude children from some of their resorts. 11.All of the following are potential micro bases of business market segmentation except: a.organizational innovativeness. JOB SUMMARY. A key to positioning a product or brand effectively is discovering the perceptions of its potential customers. Home Flashcards Marketing Exam 2 Chapter 9, A graph displaying consumers perceptions of product attributes in two dimensions is referred to as a. Theres no inventory for sale and customers go home empty-handedat least initially. Note that both VALS and PRIZM group buyers are based on their values and lifestyles, but PRIZM also overlays the information with geographic data. Building open and honest relationships with communication is an example of Zappos __________. Marketing professionals want to know why consumers behave the way they do, what is of high priority to them, or how they rank the importance of specific buying criteria. Upscale/Fine Dining Restaurants. In addition to current statistics, the sites contain forecasts of demographic trends, such as whether some segments of the population are expected to grow or decline. Considering the rising number of U.S. women who live without spouses, entrepreneurs have launched handyman services in many markets. Men and women have different needs and also shop differently. The segmentation strategy used by Prince Sports today is. Am I looking at the consumers the way they see themselves? In determining its positioning in the minds of customers, companies take four steps: (1) identify the important attributes for the product or brand class; (2) discover how target customers rate competing products or brands with respect to these attributes; (3) ___________; and (4) reposition the companys product or brand in the minds of potential customers. The menu, which changes almost daily based on seasonal ingredients, is known for elegant shareable dishes like the Asparagi with two-wash ranch duck egg, feta, bacon candy, foie gras hollandaise and a truffle drizzle. The company believes its target market consists of businesses that use a lot of energy like its first customer, a fertilizer manufacturer that was located in a rural area. Well discuss each of these categories in a moment. (Onscreen kissing was evidently too racy for the times.). Not only do age groups and generations differ in their buying habits, but also in how they respond to advertising. If your offering fulfills the needs of a specific demographic group, then the demographic can be an important basis for identifying groups of consumers interested in your product. Kelloggs different types of cereals are each targeted at a different type of user. If you develop fitness programs and know that a majority of your clients prefer the same type of program to be released, youre more likely to make that happen. By dividing its tennis racquet market into three categories, which it labels Performance, Recreational, and Junior tennis players, Prince Sports is using a marketing strategy called, Custom Foot runs six retail locations. Geocoding can help businesses see where prospective customers might be clustered and target them with various ad campaigns, including direct mail. If the firm decides to expand to the U.S., it most likely will use which of the following strategies to segment its market? Market segmentation stresses __________ and relating them to specific marketing actions. Which of the following is a consumer demographic segmentation variable? Age is the most basic variable of them all, albeit the most important because consumer preferences continually change with age. For example, because women make many of the purchases for their households, market researchers sometimes try to further divide them into subsegments. A basic test of the usefulness of the market segmentation process is whether it leads to tangible marketing actions that can. a) A client with amyotrophic lateral sclerosis (ALS) tells the nurse, "Sometimes I feel so frustrated. Similarly, Glad, the company that makes plastic wrap and bags, found out customers were using its Pressn Seal wrap in ways the company could never have imagined. Scholastic Press, the publisher of the Harry Potter books in the U.S., is using which of the following segmentation strategies? B Marketers should use segmentation bases in this order to reduce potential costs: behavioral. There are five steps involved in segmenting and targeting markets. Market segmentation is the process of dividing a market of potential customers into groups or segments based on different characteristics important to you. offering the absolute best selection of shoes and the absolute best service. The first step in segmenting and targeting markets that links customer needs to marketing actions is to group potential buyers into segments 59. If 85% of your clients range from 20-35 years old, this is the segment youre going to target. Just like peoples demographics change, so do their tastes. 1 / 46. CHAPTER 7 MARKET SEGMENTATION, TARGETING, AND POSITIONING. e.type of buying situation. A well-executed market segment strategy provides a firm with all of the following EXCEPT: a. develops a clearer focus on market strategy. The first step in segmenting and targeting markets that links customer needs to marketing actions is to group potential buyers into segments. The makers of upscale products such as Rolexes and Lamborghinis aim their products at high-income groups. 8) Centrally located storage areas where food and supplies are received until they are requisitioned. It allows them to identify with your brand and feel like you are an advocate for their needs, which makes them more likely to do business with you over longer periods. Tornoe, J. G., Hispanic Marketing Basics: Segmentation of the Hispanic Market, January 18, 2008, http://learn.latpro.com/segmentation-of-the-hispanic-market/ (accessed December 2, 2009). Work with our consultant to learn what to alter. Likewise, the Chrysler 300 looks more like a muscle car than the old Chrysler Fifth Avenue your great-grandpa might have driven. the usage index per person is highest for that segment. If a business firm goes to the trouble and expense of segmenting its markets, it expects to increase its sales, profits, and return on investment. There are probably a few specific ones burned into your memory. Which benefit is most important to you when you buy a toothpaste: The toothpastes price, ability to whiten your teeth, fight tooth decay, freshen your breath, or something else? Another great example is McDonald's. So, of course, McDonald's adapted, even though they are a burger chain, by advertising their non-red-meat and vegetarian options. MicroFridge is using which basis of segmentation? 1Generation Y Lacking Savings, Fort Worth Star-Telegram, September 13, 2009, 2D. High energy costs, the credit crunch, and concern for the environment are leading people to demand smaller houses. Manufacturing these different cereals is clearly more expensive than producing one, but seems worthwhile if it serves customers needs better, doesnt reduce quality or increase price, and. If you sell ski equipment, you probably will want to locate your shop somewhere in the vicinity of a mountain range where there is skiing. Michigans biggest travel segment are Chicagoans in certain zip codes consisting of upper-middle-class households with childrenor the kids in cul-de-sacs group, as Claritas puts it. Companies are aware that many consumers want to be in higher income groups and behave like they are already part of them. After all, are you really going to develop different products and different marketing campaigns and communications for each group? Frequency marketing is a strategy that focuses on usage rate. Marketing professionals believe they appealed to baby boomers because they reminded them of better timestimes when they didnt have to worry about being laid off, about losing their homes, or about their retirement funds and pensions drying up. If Wendys customers are buying an eating experience, which of the following rationales would make the most sense if you were to group the products Wendys sells? 2Telecommunications Marketing Opportunities to Ethnic Groups: Segmenting Consumer Markets by Ethnicity, Age, Income and Household Buying Patterns, 19982003, The Insight Research Corporation, 2003, http://www.insight-corp.com/reports/ethnic.asp (accessed December 2, 2009). This is an example of, A key question to ask before using the product differentiation and market segmentation strategies is, "Will our new products steal customers or sales from our older ones?". Demographic segmentation allows you to get more specific with your marketing strategies. Social b. Psychographics c. Demographics d. Behavioral Expert Solution Want to see the full answer? They purposely targeted them on Facebook for the most engagement and click-throughs. In China, KFC sells a spicier chicken the farther away its restaurants are from the coastal areas. Cannibalization would MOST LIKELY occur if. the relatively homogeneous groups of prospective buyers that result from the market segmentation process. Teams of engineers from Intuit visit peoples homes and spend a couple of hours watching consumers use Quicken. Probably not, but you need to perform your due diligence and understand where the majority of the people you are trying to reach land on this matrix, modifying your message according to this insight, Tornoe explains (Tornoe, 2008). The Premier Road is made with extra cushioning for pavement runners. The tourism bureau for the state of Michigan was able to identify and target different customer profiles using PRIZM. Both companies advertise globally, but localize their campaigns for each country, too. The baby boomer generation is the second largest, and over the course of the last thirty years or so, has been a very attractive market for sellers. The O3 technology refers to an innovative tennis racquet Prince Sports developed that simultaneously delivers faster racquet speed and a bigger "sweet spot" in the middle of the frame. Oftentimes a firm uses multiple bases to get a fuller picture of its customers and create value for them. When the coupons are redeemed, the store can find out where its customers are locatedor not located. Thats why they try to segment consumers by their ages. 59. This strongly affects their buying habits and your sales process. Generations and Characteristics, Table 5.3 Major U.S. Moreover, both the Asian and Hispanic market segments include new immigrants, people who immigrated to the United States years ago, and native-born Americans. Market segmentation involves aggregating prospective buyers into groups that 1)____ and 2) will respond similarly to a marketing action. Behavioral segmentation divides people and organization into groups according to how they behave with or act toward products. Gender is another way to segment consumers. Proximity marketing is an interesting new technology firms are using to segment and target buyers geographically within a few hundred feet of their businesses using wireless technology. All of the following are geographic segmentation variables EXCEPT: Which of the following data are collected from consumers to develop a perceptual map for a particular product? What question should they ask when considering the potential for cannibalization on these strategies? Think about brides (and want-to-be brides) and all the products targeted at them, including Web sites and television shows such as Say Yes to the Dress, My Fair Wedding, Platinum Weddings, and Bridezillas. Online events such as the fashion shows broadcast over the Web are also getting the attention of younger consumers, as are text, e-mail, and Twitter messages they can sign up to receive so as to get coupons, cash, and free merchandise. selecting target market segments to reach. E. Procter & Gamble adds a new line of baby clothing to its Pamper's stable of products. The aggregation of prospective buyers into groups that 1) have common needs and 2) will respond similarly to a marketing action is referred to as_________. 1) one product and multiple market segments 2) multiple products and multiple market segments and 3) "segments of one" or mass customization. This is an example of multiple products aimed at multiple markets. Harrison, M., Paul Hague, and Nick Hague, Why Is Business-to-Business Marketing Special?(whitepaper), B2B International, http://www.b2binternational.com/library/whitepapers/whitepapers04.php (accessed January 27, 2010). Gaps Banana Republic chain sells blue jeans for $58, whereas its Old Navy stores sell a slightly different version for $22. According to the Apple market-product grid above, Apple would most likely get the LEAST market synergies from. For example, over the past few decades U.S. families have been getting smaller. This is an example of, Today, marketers are increasingly emphasizing a Tiffany/Walmart strategy, which is to offer. TexMex restaurants are more commonly found in the southwestern United States. When Procter & Gamble introduced Crest toothpaste, the first fluoride toothpaste, it was intended for use by children and was therefore given a child-appealing bubblegum flavor. All of the following are market segmentation strategies EXCEPT: Which of the following statements regarding segmentation bases is most accurate? Households with a single occupant are more commonplace than ever, but until recently, that hasnt stopped people from demanding bigger cars (and more of them) as well as larger houses, or what some people jokingly refer to as McMansions.. All of the following are examples of increased customer value from organizational synergy EXCEPT: When a new product or a new retail chain steals customers and sales from older existing ones of an organization, it is referred to as, Cannibalization would mostly likely occur if. Products and services in the spa market used to be aimed squarely at adults, but not anymore. They can better understand the similarities between individuals in the audience to determine what messages they are likely to respond to. Targeting is the act of providing specific, tailored content to an audience that meets a certain set of data criteria. Researchers Matthew Harrison, Paul Hague, and Nick Hague have theorized that there are fewer behavioral and needs-based segments in B2B markets than in business-to-consumer (B2C) markets for two reasons: (1) business markets are made up of a few hundred customers whereas consumer markets can be made up of hundreds of thousands of customers, and (2) businesses arent as fickle as consumers. Dividing the market into smaller segments, each with a common variable, allows companies to use their time and resources more efficiently. Try the world's most advanced landing page platform today.