Marketing Chapter 7 Key Terms

Demographic Segmentation

#1 Segmentation Segmentation that divides markets by characteristics such as age, gender, income, education, and family size.

Geographic Segmentation

#2 Segmentation Segmentation that divides markets into groups such as nations, regions, states, and neighborhoods.

Psychographic Segmentation

#3 Segmentation The science of using psychology and demographics to segment consumers. -How people think, feel, act, and behave. -VALS

Lifestyle Segmentation

#3a Segmentation Segmentation that divides people into groups based on their opinions and the interests and activities they pursue. *A Subset of Psychographic Segmentation*

Behavioral Segmentation

#4 Segmentation Segmentation that divides consumers according to how they behave with or act toward products. -Loyalty -Price Sensitivity -Occasions -Usage Rate

Global Segmentation

#5a Segmentation Segmentation that is used when a firm can identify a group of consumers with common needs and wants that spans the entire globe. *A subset of International Market Segmentation*

Regional Segmentation

#5b Segmentation Segmentation that is used when the similarity in needs and wants only extends across the region or several countries. *A subset of International Market Segmentation*

Unique Segmentation

#5c Segmentation Segmentation that is used when the similarity in needs and wants only exists within one country. *A subset of International Market Segmentation*

VALS

A breakdown of Psychographic Segmentation. *Values, Attitudes, and Life Styles* 8 Different Categories Innovators (High Resources, High Innovation) --Motivations 1-Ideals -----Thinkers (Higher resources) vs. Believers (lower resources) 2-Achievement -----Achievers (higher resources) vs. Strivers (lower) 3-Self-Expression ------Experiences vs. Makers Survivors (Low Resources, Low Innovation)

Perceptual Map

A competitive analysis tool that creates a visual picture of where products are located in consumers' minds.

Positioning Statement

A succinct description of the core target market to which a product is directed and a compelling picture of how the firm wants that core market to view the product.

Undifferentiated Targeting

A targeting strategy that approaches the marketplace as one large segment.

Niche Marketing

A targeting strategy that involves pursuing a large share of a small market segment.

Differentiated Targeting

A targeting strategy that simultaneously pursues several different market segments, usually with a different strategy for each.

80/20 Rule

A theory that suggests that 20% of heavy users account for 80% of the total demand.

Targeting

The act of evaluating each market segment to determine which segment or segments present the most attractive opportunity to maximize sales. Strategies: 1-Undifferentiated Targeting 2-Differentiated Targeting 3-Niche Marketing Selecting Target Market: -Growth Potential -Level of Competition -Strategic Fit

Repositioning

The act of reestablishing a product's position to respond to changes in the marketplace.

Positioning

The activities a firm undertakes to create a certain perception of its product in the eyes of the target market. Steps: 1-Analyze Competitor's Positions ---Perceptual Maps 2-Clearly Define Your Competitive Advantage ---Price/Quality ---Attributes ---Application ---Core Competencies 3-Evaluate Feedback *How will you position product. Competing for front of mind positioning* -Concept/Positioning Map

Target Market

The group of customers toward which an organization has decided to direct its marketing efforts.

Market Segmentation

The process of dividing a larger market into smaller groups, or market _________s, based on meaningfully shared characteristics. Bases: 1-Demographic 2-Geographic 3-Psychographic 4-Behavioral Criteria: 1-Substantial -are there enough customers to make money if you make the product. 2-Measurable 3-Actionable -can the customer buy them. 4-Differentiable 5-Accessible -can you reach the customer and vice versa.

Market Segments

The relatively homogeneous groups of consumers that result from the segmentation process. Why Segment? -Define Needs and Wants -Design Specific Marketing Strategies -How to Allocate Resources to Maximize Profit