Ch 5 Quiz

At what stage of the target market selection process is the marketer first likely to uncover information that makes a segment less attractive than previously thought?

Develop market segment profiles

An undifferentiated targeting strategy uses market segmentation.

False

Scenario 5.2. Angel wants to become a successful brewer. He analyzes the target market for beer and finds that there is a market niche for gluten-free beer. Angel considers the types of markets he can target with his beer. He knows that many people perceive gluten as unhealthy and might be inclined to buy his beer due to its gluten-free nature. However, he also knows there is a strong demand among those who suffer from Celiac Disease. After doing sales and cost estimates, Angel feels ready to make a decision. Refer to Scenario 5.2. Assume that Angel decides that he wants specifically to target those who suffer from Celiac Disease. Although he realizes that many consumers avoid gluten simply for health reasons, he believes putting his marketing muscle behind a marketing strategy that would target one specific market segment is the way to go. Angel is adopting a differentiated targeting strategy.

False

Which of the following statements about sales estimates is correct?

Market potential places absolute limits on company sales potential.

A customer forecasting survey may be useful to a business with relatively few customers.

True

Geodemographic segmentation allows marketers to focus precise marketing efforts on very small geographic markets, such as community and even individual neighborhoods.

True

A buffet restaurant targets its promotions toward those who love "all-you-can-eat" meals. Its promotion targets those who desire to get more for less money and/or those who like variety in their meals. However, the company knows that many of the people who come in will not eat as much. Others, however, may eat way past the value of what they paid. The buffet has balanced this out in its pricing strategy, classifying its diners as light eaters, moderate eaters, and heavy eaters. What type of segmentation strategy is the buffet using?

behavoristic

Scenario 5.4. Mistine is a direct selling cosmetics firm based in Thailand. Originally, it made a name for itself selling an affordable product that was of good quality. It focused mainly on housewives. However, over the years Mistine has expanded its focus, targeting more groups such as teenagers and higher-income women. Unlike many comparable direct selling firms, Mistine engages in much advertising. Its advertising campaigns must be tailored toward the appropriate target market. Refer to Scenario 5.4. Suppose a sales manager at Mistine wants to determine the company's market potential. She first estimates how many cosmetic products potential buyers will purchase in her sales territory during a given period. She multiples that amount by the total number of potential in that area and then performs the same calculations in the other territories in which Mistine operates. She then adds together the totals to get the company's market potential. What type of approach is the sales manager using?

buildup approach

Scenario 5.1. Cynthia works at an engineering firm in Arizona that installs transmission lines and works with the electrical systems of buildings. She is in charge of strategic planning. Mostly her firm has worked with cities such as Tucson and Phoenix. Once in a while they will receive a major project from the state, such as renovating a major government building in the capital. However, Cynthia's firm wants to expand its target market beyond government projects. Under her direction, the marketing team launched an initiative to target more potential clients in different areas. Two areas in which Cynthia would like to expand include colleges and large for-profit businesses. Refer to Scenario 5.1. A market is a group of individuals and/or organizations that have a desire or need for products in a product class and have the ability, willingness, and authority to purchase those products. There are two types of markets. Cynthia's organization targets the _______________ ____________

business market

Scenario 5.3. Eaton sells many industrial products for the lighting and solar industry, including lighting controls, landscape lighting, lighting relay and metering panels, flood lighting, and more. Among its vast array of products, it also sells lighting accessories and lighting solutions for private residences. Refer to Scenario 5.3. Eaton is targeting most of its industrial products to the ____________ market and targeting its residential lighting systems to the _________________ market.

business; consumer

________________ __________ ________________is the maximum percentage share of a market that an individual firm within an industry can expect to capture for a specific product.

company sales potential

Which of the following food products would most likely use an undifferentiated marketing strategy?

corn

Which of the following is calculated during the fourth step of the target market selection process, evaluating relevant market segments?

cost estimates

Scenario 5.4. Mistine is a direct selling cosmetics firm based in Thailand. Originally, it made a name for itself selling an affordable product that was of good quality. It focused mainly on housewives. However, over the years Mistine has expanded its focus, targeting more groups such as teenagers and higher-income women. Unlike many comparable direct selling firms, Mistine engages in much advertising. Its advertising campaigns must be tailored toward the appropriate target market. Refer to Scenario 5.4. What type of segmentation strategy is Mistine using?

differentiated targeting strategy

Which of the following is the fourth step of the target market selection process?

evaluate relevant market segmentations

Which of the following would be a cost-effective, fairly accurate way of coming up with a sales forecast if product demand is relatively stable and managers at the firm have a long tenure in the field?

executive judgement

Scenario 5.4. Mistine is a direct selling cosmetics firm based in Thailand. Originally, it made a name for itself selling an affordable product that was of good quality. It focused mainly on housewives. However, over the years Mistine has expanded its focus, targeting more groups such as teenagers and higher-income women. Unlike many comparable direct selling firms, Mistine engages in much advertising. Its advertising campaigns must be tailored toward the appropriate target market. Refer to Scenario 5.4. Assume that Mistine wants to break into the Kenyan market. It is entering the market for the first time and is unsure about how successful its products will be. Mistine's management team wants to develop a sales forecast for the area. Which of the following would be most appropriate in terms of accuracy?

market tests

Scenario 5.3. Eaton sells many industrial products for the lighting and solar industry, including lighting controls, landscape lighting, lighting relay and metering panels, flood lighting, and more. Among its vast array of products, it also sells lighting accessories and lighting solutions for private residences. Refer to Scenario 5.3. On Eaton's website, the firm segments its product offerings as aerospace, filtration, hybrid power, electrical, hydraulics, industrial clutches and brakes, plastic extrusion, and vehicle. What type of segmentation strategy has Eaton most likely adopted?

product use

Scenario 5.2. Angel wants to become a successful brewer. He analyzes the target market for beer and finds that there is a market niche for gluten-free beer. Angel considers the types of markets he can target with his beer. He knows that many people perceive gluten as unhealthy and might be inclined to buy his beer due to its gluten-free nature. However, he also knows there is a strong demand among those who suffer from Celiac Disease. After doing sales and cost estimates, Angel feels ready to make a decision. Refer to Scenario 5.2. Angel is segmenting the market based on what type of segmentation variable?

psychographic

Shawn works at a retail store that sells a variety of items, including umbrellas. Shawn knows that people buy umbrellas more in the summer season because of the higher frequency of storms. He has identified a formula based on past umbrella sales during the summer season. Shawn believes he can use this formula to predict future sales forecasts with a high degree of accuracy. This is an example of what type of sales forecast?

regression analysis

The first of two major components of developing a marketing strategy is to __________________.

select a target market

At what stage of the target market selection process is management likely to investigate whether the organization has sufficient financial resources, managerial skills, employee expertise, and facilities to compete effectively in selected segments?

select specific target markets

Scenario 5.2. Angel wants to become a successful brewer. He analyzes the target market for beer and finds that there is a market niche for gluten-free beer. Angel considers the types of markets he can target with his beer. He knows that many people perceive gluten as unhealthy and might be inclined to buy his beer due to its gluten-free nature. However, he also knows there is a strong demand among those who suffer from Celiac Disease. After doing sales and cost estimates, Angel feels ready to make a decision. Refer to Scenario 5.2. In making his decision, Angel is at what stage in the target market selection process?

select specific target markets

A market segment profile describes the _____________ among potential customers within a segment and explains the ________________ among people and organizations in different segments.

similarities; differences

Scenario 5.1. Cynthia works at an engineering firm in Arizona that installs transmission lines and works with the electrical systems of buildings. She is in charge of strategic planning. Mostly her firm has worked with cities such as Tucson and Phoenix. Once in a while they will receive a major project from the state, such as renovating a major government building in the capital. However, Cynthia's firm wants to expand its target market beyond government projects. Under her direction, the marketing team launched an initiative to target more potential clients in different areas. Two areas in which Cynthia would like to expand include colleges and large for-profit businesses. Refer to Scenario 5.1. How is Cynthia's company segmenting the market for its services?

type of organization