BUAD 332 Exam 2-Mark Moon Questions with Answers (All Answers Correct)

Goal of Customer- Driven marketing strategy - to create VALUE for targeted customers Market Segmentation - Dividing a market into smaller groups with distinct needs, characteristics, or behaviors that might require separate marketing strategies or mixes. (taking heterogeneous customers and dividing them into more homogeneous groups) selecting customers to serve - - "Who is our customer?" -Selecting customers to serve using segmentation and targeting -We cannot make any other decisions as marketers until we figure this out. deciding on a value proposition - -"What do our customers think about when they think of us?" -Differentiation and Positioning Key market segmentation variables - -geographic (region, state, density, climate) -demographic (gender, age, etc) -psychographic -behavioral (no single way to segment is best. often we combine MORE THAN ONE) demographic segmentation - dividing the market into segments based on variables such as age, life-cycle stage, gender, income, occupation, education, religion, ethnicity, and generation. MOST POPULAR basis for segmentation easier to measure than most variablesgender segmentation - -often requires different products variations for men and women. -neglected segments can offer new opportunities Income segmentation - Identifies and targets the affluent for luxury goods. People with lower levels can be a lucrative market. Some manufacturers have different grades of products for different markets. (Honda and Acura) psychographic segmentation - Dividing a market into different groups based on social class, lifestyle, or personality characteristics. Behavioral Segmentation - Dividing buyers into groups based on consumer attitudes, uses, or responses to a product (ex: non-users, ex users, first-time users light usage, medium usage, heavy usage loyalty status) Multiple Segmentation - -Marketers will frequently use more than one segmentation variable -Use bases in order to identify smaller, better-defined target groups. -Start with a single base and then expand to other bases. -The goal: Create a homogeneous customer group that might be a good target for marketing activitySegmenting Business Markets - -use many of the same variables as consumer marktetsfor segmentation. -can also use: Operating characteristics Purchasing approaches Situational factors Personal characteristics Effective Segmentation - must be: measurable, accessible, substantial, differentiable, actionable Targeting - Selecting the market segments that will become the chosen areas of opportunity (from the segments that have been identified, pick those segment(s) to whom you plan to market your products or services) Segment size and growth - targeting tactic to: Analyze current segment sales, growth rates, and expected profitability. segment structural attractiveness - targeting tactic to: Consider competition, existence of substitute products, and the power of buyers and suppliersCompany Objectives and Resources - targeting tactic to: -Examine company skills and resources needed to succeed in that segment. -Offer superior value and gain advantages over competitors. undifferentiated marketing - -also known as mass marketing -ignores segmentation opportunities -such products rarely succeed for long in any developed marketplace differentiated marking - -also known as segmented marketing -Targets several segments and designs separate offers for each -ex: Coca-cola, P&G, Toyota Undifferentiated, Segmented - in 1915, Ford Motors introduced a SINGLE product of the Model T that they sold to ANYONE and EVERYONE. this is ____________ marketing. Later, in 1925, General Motors produced Chevy, Buick and Cadillac cars that appealed to MULTIPLE segments. this is __________ marketing Concentrated marketing - -Also known as NICHE marketing. Targets one or a couple of small segments; have very specialized interests. Ex. Ferrari: goes after one market segment. (Startups typically begin targeting one segment until they have enough resources to expand.) micromarketing - tailoring products and marketing programs to suit the tastes of specific individuals and locationsincludes local marketing and individual marketing local marketing - Tailoring brands and promotions to the needs and wants of nearby customer groups—cities, neighborhoods, specific stores. individual marketing - Tailoring products and marketing programs to the needs and preferences of individual customers. choosing a targeting strategy - -Company resources -Product variability -Product's life-cycle stage -Market variability -Competitors' marketing strategies