ecarter2/CSUB F13 COURSES/Chapter 8 Pool... · Web viewMany firms need to find new ways to generate sales because of sluggish and intensely competitive markets. b. A regional approach

Chapter 8—Segmenting and Targeting Markets

3. A market is people or organizations that have:a. the ability, willingness, and power to buyb. a medium of exchange and products they desirec. needs and wants and an ability and willingness to buyd. unmet needs or wants and products or services that satisfy those unmet needs or wantse. communication, financial, and capital resourcesANS: CA market is defined as having four imperative characteristics: people or organizations, needs and wants, ability to buy, and willingness to buy.PTS: 1 REF: 121 OBJ: 08-1 TOP: AACSB Reflective ThinkingKEY: CB&E Model Customer MSC: BLOOMS Knowledge

4. A(n) _____ is a subgroup of individuals or organizations sharing one or more characteristics that cause them to have similar product needs.a. market universeb. market segmentc. aggregated marketd. segmentation basee. population sampleANS: BThis is the definition of a market segment.PTS: 1 REF: 121 OBJ: 08-1 TOP: AACSB Reflective ThinkingKEY: CB&E Model Customer MSC: BLOOMS Knowledge

7. _____ is the process of dividing a market into meaningful groups that are relatively similar and identifiable.a. Perceptual mappingb. Positioningc. Micromarketingd. Market samplinge. Market segmentationANS: EThis is the definition of market segmentation.PTS: 1 REF: 122 OBJ: 08-1 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Knowledge

8. The purpose of market segmentation is to:a. reduce the market down to a size the firm can handleb. divide the market into equal size and profit regions for sales territoriesc. group a large number of markets together, enabling a company to serve them

simultaneouslyd. develop a generalized definition of the market as a wholee. enable the marketer to tailor marketing mixes to meet the needs of one or more specific

groupsANS: EThe purpose of segmentation is to group similar consumers and to serve their needs with a specialized marketing mix.PTS: 1 REF: 122 OBJ: 08-1 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Comprehension

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11. All of the following are criteria for successful market segmentation EXCEPT:a. substantialityb. identifiability and measurabilityc. accountabilityd. accessibilitye. responsiveness

ANS: CThe four criteria are substantiality, identifiability and measurability, accessibility, and responsiveness.

PTS: 1 REF: 122 OBJ: 08-3 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Analysis

12. To be useful, a segmentation scheme must produce segments that meet four basic criteria. The criteria are:a. segmentability, targetability, reliability and validity, and homogeneityb. tangibility, inseparability, nonperishability, and uniquenessc. substantiality, identifiability and measurability, accessibility, and responsivenessd. reliability, flexibility, tangibility, and unbiasede. complexity, compatability, relative advantage, trialability, and observability

ANS: CUseful segments should be substantial, identifiable and measurable, accessible, and responsive to different marketing mixes.


19. The requirement for a market segment to be responsive means:a. over half of the consumers in the identified segment will be actively interested in the

productb. all the segments identified by a marketer should respond to the marketing mixc. all the segments identified by a marketer should not respond to the marketing mixd. the segments identified by a marketer should not differ in the level of their responsiveness

to the marketing mixe. the segment identified by a marketer should differ in how it responds to the marketing mix

when compared to another segment confronted with the same mix

ANS: EThe target segment should respond differently to the marketing mix compared to other segments.

PTS: 1 REF: 122-123 OBJ: 08-3 TOP: AACSB Reflective ThinkingKEY: CB&E Model Customer MSC: BLOOMS Comprehension

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22. If a market segment is especially motivated by coupons in newspapers, which segmentation success criterion is most influential in the success of this program?a. Responsivenessb. Identifiability and measurabilityc. Substantialityd. Accessibilitye. Functionality

ANS: AResponsiveness is in force when a target segment responds differently (hopefully more positively) to the marketing mix than other segments.

PTS: 1 REF: 122-123 OBJ: 08-3 TOP: AACSB Reflective ThinkingKEY: CB&E Model Customer MSC: BLOOMS Comprehension

23. A health club has a new fitness program for expectant mothers. After flyers were placed at the offices of area obstetricians, classes filled up within two days. Which segmentation success criterion was most influential in the success of this promotion?a. Substantialityb. Identifiabilityc. Measurabilityd. Causalitye. Responsiveness

ANS: EResponsiveness is in force when a target segment responds differently (hopefully more positively) to the marketing mix than other segments.

PTS: 1 REF: 122-123 OBJ: 08-3 TOP: AACSB Reflective ThinkingKEY: CB&E Model Customer MSC: BLOOMS Application

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24. _____ are characteristics of individuals, groups, or organizations that marketers use to divide a total market into segments.a. Differentiation guidesb. Segmentation basesc. Perceptual mapsd. Responsiveness quotientse. Accessibility quotients

ANS: BThis is the definition of segmentation bases.

PTS: 1 REF: 123 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Customer MSC: BLOOMS Knowledge

27. _____ is the segmenting of markets based on the region of the country or the world, market size, market density (number of people within a certain unit of land), or climate.a. Community segmentationb. Geographic segmentationc. Geodemographic segmentationd. PRIZM segmentatione. Demonstrated regionalization

ANS: BThis is the definition of geographic segmentation.

PTS: 1 REF: 123 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Knowledge

PTS: 1 REF: 123-124 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Application

31. Almost all cell phones sold in the United States are black or gray. Almost all cell phones sold in Europe are colorful, and very few black phones are sold. A cell phone manufacturer knowing this information could use _____ segmentation when selling its phones internationally.a. geographicb. economicc. demographicd. benefite. multipositioning

ANS: AGeographic segmentation includes segmenting markets by region of the country or world.

PTS: 1 REF: 123-124 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy | CB&E Model International PerspectiveMSC: BLOOMS Application

32. All of the following statements are reasons why consumer goods companies take a regional approach to marketing rather than a national approach EXCEPT:a. Many firms need to find new ways to generate sales because of sluggish and intensely

competitive markets.

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b. A regional approach gives marketing managers control over the competitive environment.c. Computerized checkout stations with scanners enable retailers to assess accurately which

brands sell the best in each region.d. Many packaged-goods manufacturers are introducing new regional brands intended to

appeal to local preferences.e. A more regional approach allows consumer goods companies to react more quickly to

competition.

ANS: BThe competitive environment is one of the noncontrollable factors in a company’s environment.

PTS: 1 REF: 124 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Distribution | CB&E Model Strategy MSC: BLOOMS Analysis

33. Marketers use _____ to segment markets because this information is widely available, and factors such as age or gender are often related to consumer purchasing and consumption behavior.a. benefitsb. psychographicsc. demographicsd. usage ratese. sociocultural attributes

ANS: CCommon bases of demographic segmentation are age, gender, income, ethnic background, and family life cycle.

PTS: 1 REF: 124 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Comprehension

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34. Income, ethnic background, gender, and age are all examples of _____ segmentation bases.a. geodemographicb. organizationalc. demographicd. socioeconomice. psychographic

ANS: CThese are demographic characteristics of consumers.


44. In Miami, several radio stations broadcast in Spanish and play Latin music for the Hispanic people living in South Florida. The radio stations are using _____ segmentation.a. usage rateb. ethnicc. socioeconomicd. geographice. gender

ANS: BIn this case, ethnicity would be the demographic variable.

PTS: 1 REF: 126 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Application

46. A series of stages determined by a combination of age, marital status, and the presence or absence of children is known as the:a. generation gapb. family life cyclec. maturation processd. segmentation cyclee. psychographic process

ANS: BThis describes the family life cycle.

PTS: 1 REF: 126-127 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Customer MSC: BLOOMS Knowledge

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49. Which of the following businesses would be most likely to use family life cycle segmentation?a. Those that produce and market computer software and hardwareb. The snack industryc. Fast-food restaurantsd. Business-to-business marketerse. Wedding planners, couples-only resorts, and day care centers

ANS: EPeople in different stages of the family life cycle would be most likely getting married, going on a couples-only trip, or needing the services of a day care center.

PTS: 1 REF: 126-127 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Evaluation

50. _____ segmentation is based on personality, motives, and lifestyles.a. Psychographicb. Demographicc. Benefitd. Family life cyclee. Character

ANS: APersonality, motives, and lifestyles are bases of psychographic segmentation.


51. All of the following are bases for psychographic segmentation EXCEPT:a. benefitsb. personalityc. motivesd. lifestylese. geodemographics

ANS: ABenefit segmentation is a different segmentation strategy that groups customers on the basis of their needs and wants.


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57. _____ divides individuals into groups according to the way they spend their time, the importance of items in their surroundings, their beliefs, and socioeconomic characteristics.a. Life cycle segmentationb. Temporal segmentationc. Lifestyle segmentationd. Microsegmentatione. Macrosegmentation

ANS: CThis describes the essence of lifestyle segmentation.


58. _____ is a method that clusters potential customers into neighborhood lifestyle categories and is a combination of geographic, demographic, and lifestyle segmentations.a. Geodemographic segmentationb. Microsegmentationc. Sociocultural clusteringd. Acculturatione. Lifestyle segmentation

ANS: AThis is the definition of geodemographic segmentation.


62. _____ is the process of grouping customers into market segments according to the benefits sought from the product.a. Benefit segmentationb. Value-added segmentationc. Lifestyle segmentationd. Macrosegmentatione. Psychographic segmentation

ANS: AThis is the definition of benefit segmentation.PTS: 1 REF: 129 OBJ: 08-4 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Knowledge

69. Which type of segmentation divides a market by the amount of product bought or consumed?a. Benefit segmentationb. Characteristic segmentationc. Usage-rate segmentationd. Demographic segmentatione. Psychographic segmentation

ANS: CThis is the definition of usage-rate segmentation.

PTS: 1 REF: 129 OBJ: 08-4 TOP: AACSB Reflective Thinking

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KEY: CB&E Model Strategy MSC: BLOOMS Knowledge

70. Most airline frequent flyer programs reward the most frequent flyers with business class upgrades and flight lounge privileges. Airlines are using these rewards as a means of implementing _____ segmentation.a. lifestyleb. motivec. usage-rated. demographice. personality

ANS: CUsage-rate segmentation divides a market by consumption so that firms can target their heavy users.


74. What does the 80/20 principle propose?a. Roughly 80 percent of the profit comes from 20 percent of the sales.b. Roughly 80 percent of a firm’s customers are repeat business.c. Roughly 50 percent of a firm’s customers purchase 80 percent of the sales volume of the

product.d. Roughly 20 percent of a firm’s customers purchase 80 percent of the sales volume of the

product.e. Sales are equally divided among heavy, medium, and light users, but they all need slightly

different products.

ANS: DThe 80/20 principle proposes that a minority of a firm’s customers purchase a majority of the volume of the product.


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75. The _____ proposes that a minority of a firm’s customers purchase a majority of the volume of the product.a. majority fallacyb. equity fallacyc. 80/20 principled. cannibalization rulee. optimizer principle

ANS: CThis is the definition of the 80/20 principle.


77. Business marketers focus on all of the following market segments EXCEPT:a. institutionsb. producersc. householdsd. resellerse. government

ANS: CThe business market consists of four broad segments: producers, resellers, government, and institutions. Households are part of the consumer market.


80. Firms can be categorized by the type of purchasing strategy they use. _____ usually contact familiar suppliers and place an order with the first that can meet product and delivery requirements.a. Strugglersb. Actualizersc. Optimizersd. Satisficerse. Experiencers

ANS: DThis is the definition of satisficers.


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81. Hank operates a plumbing and electrical supply store. He has categorized its business customers by their purchasing strategy. Hank has found it much easier to serve and satisfy the _____, who usually recontact familiar suppliers and place an order immediately if product and delivery requirements are acceptable.a. adoptersb. adaptersc. optimizersd. innovatorse. satisficers

ANS: ESatisficers use a simple, quick purchasing strategy of looking for the first available adequate supplier.

PTS: 1 REF: 130 OBJ: 08-5 TOP: AACSB Reflective ThinkingKEY: CB&E Model Customer MSC: BLOOMS Application

84. What is the first step in segmenting a market?a. Set the segmentation goalsb. Choose a basis or bases for segmenting the marketc. Select a market or product category for studyd. Profile and analyze segmentse. Select target markets

ANS: CThe steps in segmenting a market are (1) select a market or product category for study; (2) choose a basis or bases for segmenting the market; (3) select segmentation descriptors; (4) profile and analyze segments; (5) select target markets; and (6) design, implement, and maintain appropriate marketing mixes.


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85. All of the following are steps in the market segmenting process EXCEPT:a. determining the objectives of the segmentation strategyb. profiling and analyzing segmentsc. designing, implementing, and maintaining appropriate marketing mixesd. selecting a market or product category for studye. choosing a basis or bases for segmenting the market

ANS: AThe steps in segmenting a market are (1) select a market or product category for study; (2) choose a basis or bases for segmenting the market; (3) select segmentation descriptors; (4) profile and analyze segments; (5) select target markets; and (6) design, implement, and maintain appropriate marketing mixes.


86. June LaVista owns a health and fitness gym. After dividing her customers into four segments based on income range, age, level of fitness, and other selected segmentation descriptors, she wrote out a description of each segment’s size, expected growth, frequency of exercise, and overall profit potential. Which step in segmenting a market is LaVista engaged in?a. Profiling and analyzing her market segmentsb. Positioning her products to her market segmentsc. Targeting promotions to her market segmentsd. Differentiating her market segmentse. Concentrating her marketing mix on the most profitable marketing segments

ANS: AThe profiling and analysis of the segments step in segmenting a market involves analyzing the segments’ size, expected growth, purchase frequency, and so on.


87. After selecting a market for study and choosing bases for segmenting that market, the next step is to:a. select segmentation descriptorsb. implement and maintain a marketing mixc. design a marketing mixd. profile and analyze segmentse. select target markets

ANS: AThe steps in segmenting a market are (1) select a market or product category for study; (2) choose a basis or bases for segmenting the market; (3) select segmentation descriptors; (4) profile and analyze segments; (5) select target markets; and (6) design, implement, and maintain appropriate marketing mixes.


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89. Market segmentation:a. is a scientific technique for selecting ways to attract specific population samplesb. is rarely done by consumer products companiesc. only needs to be done once for each productd. should be redone periodicallye. should be done every time a product enters a new stage of its life cycle

ANS: DMarkets are dynamic, so it is important that companies proactively monitor their segmentation over time.


90. A(n) _____ is a group of people or organizations for which an organization designs, implements, and maintains a marketing mix intended to meet the needs of that group, resulting in mutually satisfying exchanges.a. heterogeneous segmentb. target marketc. responsive segmentd. aggregated markete. undifferentiated target

ANS: BThis is the definition of a target market.PTS: 1 REF: 131 OBJ: 08-7 TOP: AACSB Reflective ThinkingKEY: CB&E Model Customer MSC: BLOOMS Knowledge

93. Which target marketing strategy views the market as one big market with no individual segments and thus uses a single marketing mix?a. Undifferentiatedb. Concentratedc. Niched. Uniforme. Multisegmented

ANS: AA firm using an undifferentiated targeting strategy essentially adopts a mass-market philosophy, viewing the market as one big market with no individual segments.PTS: 1 REF: 131-132 OBJ: 08-7 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Knowledge

96. All of the following are advantages of using a concentrated targeting strategy EXCEPT:a. concentration of resourcesb. can better meet the needs of a narrowly defined segmentc. allows some small firms to better compete with larger firmsd. strong positioninge. cannibalization

ANS: ECannibalization is a disadvantage of multisegment targeting. See Exhibit 8.2.


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97. A(n) _____ strategy entails selecting one segment of a market to target and focuses on understanding the needs, motives, and satisfactions of the members of that segment, as well as on developing a highly specialized marketing mix.a. universal productb. undifferentiated targetingc. concentrated targetingd. market developmente. product development

ANS: CConcentrated targeting strategy selects one segment of a market for targeting marketing efforts.PTS: 1 REF: 133 OBJ: 08-7 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Knowledge

99. When a firm uses a concentrated targeting strategy, it can:a. view the total market as receptive to its productb. offer a highly specialized marketing mixc. reach customers in two or more segments that might otherwise be missedd. avoid the danger of putting all resources in one micromarkete. concentrate on one generalized product to fit the mass market, maximizing sales volume

ANS: BConcentrated targeting focuses on one target market and develops a highly specialized mix.PTS: 1 REF: 133 OBJ: 08-7 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Comprehension

107. _____ is one of the potential disadvantages associated with a multisegment strategy.a. Inadequate demandb. Demarketingc. Lower profitsd. Cannibalizatione. Loss of synergy

ANS: DCannibalization is a situation that occurs when sales of a new product cut into sales of a firm’s existing products.PTS: 1 REF: 134 OBJ: 08-7 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Comprehension

111. An individualized marketing method that utilizes customer information to build long-term, personalized, and profitable relationships with each customer is referred to as:a. 80/20 marketingb. interpersonal marketingc. zoned marketingd. one-to-one marketinge. individual marketing

ANS: DThis is the definition of one-to-one marketing.PTS: 1 REF: 134 OBJ: 08-8 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Knowledge

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114. Increasing share of customer means:a. selling more products to each customerb. increasing the number of customersc. winning market share from competitorsd. the sales due to a customer relative to the costs of attaining and retaining that customere. individual customer revenue minus costs to satisfy that customer

ANS: AShare of customer represents how much a customer spends with a business, so increasing customer share attempts to sell more products to each customer rather than attempting to gain more customers overall.PTS: 1 REF: 134 OBJ: 08-8 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Comprehension

115. The basic goal of one-to-one marketing is to:a. increase the market for the product category to new and current customersb. eliminate the use of mass media for promotion and locate a direct communications

channelc. increase operating costs and locate new customersd. reduce the number of company employees and increase overall salese. reduce costs through customer retention and increase revenue through customer loyalty

ANS: ELoyal customers are less costly to maintain than acquiring new customers.PTS: 1 REF: 134 OBJ: 08-8 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Comprehension

116. All of the following have been identified as trends that will lead to the continuing growth of one-to-one marketing EXCEPT:a. the growing number of customers who do not have time to spend shoppingb. the fact that consumers do not want to be treated like the massesc. technology that allows the collection of detailed information on customersd. consumers are loyal to companies and brands that have earned their loyalty and reinforce

it at every purchase occasione. mass marketing is no longer appropriate, especially for consumer packaged-goods

products

ANS: EAll of these are trends impacting the growth of one-to-one marketing except the inappropriateness of mass marketing for consumer packaged-goods products.


118. Product positioning is the process of:a. finding the correct location for retail outlets to sell a product categoryb. finding the right channel of distribution for a productc. creating the desired image of the firm’s productd. competing with competitors’ products in the retailers’ stores for the best position on the

shelfe. pricing the product to be at a competitive level with other brands on the market

ANS: C

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Positioning is developing a specific marketing mix to influence potential customers’ overall perception of a brand, product line, or organization in general.PTS: 1 REF: 135 OBJ: 08-9 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Knowledge

119. _____ is the development of a specific marketing mix to influence potential customers’ overall perception of a brand, product line, or organization in general and is related to the place a product occupies in consumers’ minds relative to competing offerings.a. Market differentiationb. Diversificationc. Combination marketingd. Positioninge. Market aggregation

ANS: DThis is the definition of positioning.PTS: 1 REF: 135 OBJ: 08-9 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Knowledge

121. The place a product, brand, or group of products occupies in consumers’ minds relative to competing offerings is referred to as a product’s:a. statusb. equityc. framed. rolee. position

ANS: EThis is the definition of a product’s position.PTS: 1 REF: 135 OBJ: 08-9 TOP: AACSB Reflective ThinkingKEY: CB&E Model Product MSC: BLOOMS Knowledge

124. Products such as bleaches, aspirin, unleaded regular gasoline, and some soaps are distinguished by differences such as brand names, packaging, color, smell, or “secret” additives. With these products, marketers attempt to convince customers that their product is significantly different from the others and should therefore be demanded over competing brands. These marketers are using:a. cannibalizationb. perceptual mappingc. psychographic targetingd. integrated marketinge. product differentiation

ANS: EProduct differentiation is a positioning strategy that some firms use to distinguish their products from those of competitors.PTS: 1 REF: 135 OBJ: 08-9 TOP: AACSB Reflective ThinkingKEY: CB&E Model Product MSC: BLOOMS Application

127. Which of the following is a means of displaying or graphing, in two or more dimensions, the location of products, brands, or groups of products in customers’ minds?a. Perceptual mappingb. Product positioningc. Market segmentationd. Product tracinge. Laddering

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ANS: AThis is the definition of perceptual mapping.PTS: 1 REF: 136 OBJ: 08-9 TOP: AACSB Reflective ThinkingKEY: CB&E Model Product MSC: BLOOMS Knowledge

129. All of the following are typical bases for positioning EXCEPT:a. attributeb. price and qualityc. distributiond. emotione. product user

ANS: CTypical bases for positioning include attribute, price and quality, use or application, product user, product class, competitor, and emotion.

PTS: 1 REF: 136-137 OBJ: 08-9 TOP: AACSB Reflective ThinkingKEY: CB&E Model Strategy MSC: BLOOMS Analysis

133. Changing consumers’ perceptions of a brand in relation to competing brands is known as:a. positioningb. repositioningc. reintermediationd. demarketinge. reengineering

ANS: BThis is the definition of repositioning.


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ecarter2/CSUB F13 COURSES/Chapter 8 Pool... · Web viewMany firms need to find new ways to generate sales because of sluggish and intensely competitive markets. b. A regional approach