Chapter 7 Study Questions

Which value proposition is difficult to sustain in the long​ run?

"more for less"

differentiated​ marketing

a firm targets several segments and designs different offerings for each.

An example of individual marketing

candy lovers can buy M&M's embossed with images of their kids or pets.

The Westin Stamford Hotel in Singapore failed when it once advertised itself as the​ world's tallest hotel. This difference was not worth establishing because it did not satisfy which of the following​ criteria?

importance; not beneficial to people staying there

​__________ segmentation divides buyers into different segments based on lifestyle or personality characteristics.

psychographic

What is​ positioning?

Arranging for a market offering to occupy a​ clear, distinctive, and desirable place relative to competing products in the minds of target consumers

Which of the following statements regarding segmentation is​ correct? A. Companies that segment based on income primarily target the affluent. B. The business market is homogenous and is not segmented. C. Consumer and business marketers use many similar​ variables, but business marketers use additional variables to segment their markets. D. The use of demographics to segment markets has declined in recent years. E. As gender roles have​ changed, gender is no longer a useful form of segmentation.

C; business marketers include operating​ characteristics, purchasing​ approaches, situational​ factors, and personal characteristics.

Toothpastes claim they​ "whiten teeth,"​ "fight bad​ breath," and​ "reduce plaque." Which base of segmentation is being used in this​ example?

benefits sought

Behavioral segmentation includes...

benefits​ sought, usage​ rate, user and loyalty​ status, and occasion

Amazon and GEICO set themselves apart with their​ smooth-functioning direct delivery strategy referred to as​ __________ differentiation.

channel

individual marketing

form of micromarketing whereby products and marketing programs are tailored to the needs and preferences of individual consumers.

value proposition

how it will create differentiated value for targeted segments and what positions it wants to occupy in those segments. The place the product occupies in consumers' minds relative to competing products is the position. Products are made in factories, but brands happen in the minds of consumers.

One important consideration in using a differentiated targeting strategy is that​ ________.

it can increase costs

The step in designing a customer value-driven marketing strategy in which a company divides a market into distinct groups of buyers is known as market​ _________

segmentation

Using​ a(n) __________ marketing​ strategy, a firm might decide to ignore market segment differences.

undifferentiated: mass marketing (appeal to biggest amount of buyers)

​__________ segmentation divides buyers into segments based on their​ knowledge, attitudes,​ uses, or responses to a product.

behavioral

Anythinglefthanded.com.uk only sells products designed for​ left-handed people. Which targeting strategy is it​ using?

concentrated (niche) marketing: It is going after a large share of one​ (or a​ few) smaller segment, this​ case, left-handed​ people, who comprise only​ 10% of the general population.

Instead of going after a small share of a large​ market, a firm goes after a large share of a smaller niche segment. This type of marketing strategy is known as​ __________.

concentrated marketing​ (or niche​ marketing)

If men and women respond similarly to the same marketing​ mix, they do not constitute different segments. Gender would not be effective in this example because the segment is not​ ________.

differentiable

A company can differentiate itself from competitors using symbols such as​ McDonald's golden​ arches, Twitter's​ bird, and the Nike swoosh. Which type of differentiation is​ this?

image differentiation

5 value propositions

more for more, more for the same, the same for less, less for much less, more for less

Market​ __________ evaluates each market​ segment's attractiveness and selects one or more segments to serve.

targeting

The winning value proposition by discount stores such as Walmart and Best Buy can be categorized as​ __________.

"the same for less"

A colleague wants to evaluate the attractiveness of a particular market segment. Which of the following would be good advice for your​ colleague? A. If a segment is larger than​ others, it should be targeted. B. A segment is attractive if there are substitute products available. C. Fast-growing segments are always attractive. D. Carefully consider the degree of competition and ease of entry into the segment. E. The power of buyers is not a consideration when evaluating the attractiveness of a segment.

D: A segment with a high degree of aggressive competition is less attractive. It is also less attractive if it is easy for new entrants to come into the segment.

Which of the following statements about segmentation is​ true? A. Most companies today mass market and do not segment their markets. B. Buyers within a market segment have different​ needs, characteristics, and behaviors. C. Segmentation identifies individual buyers that can be targeted with a market offering. D. Market segmentation is part of a​ company's value proposition. E. Different segments might require different marketing strategies or mixes.

E

On the My​ M&Ms Web​ site, users can place custom orders for​ M&Ms. They can choose their own​ colors, put a personalized text message on the​ candies, and even upload a photo to be placed on each​ M&M. Which targeting strategy is​ M&M using​ here?

Individual marketing

When marketers target segments such as sports​ fans, do-it-yourselfers,​ commuters, and wine​ enthusiasts, which base of segmentation are they​ using?

Psychographic segmentation: divides buyers based on​ lifestyle, social​ class, or personality characteristics

What is the purpose of​ differentiation?

To create superior customer value

What are perceptual positioning maps used​ for?

To show consumer perceptions of different brands on important buying dimensions; the position of each circle on the map indicates the​ brand's perceived positioning on two​ dimensions: price and orientation​ (luxury versus​ performance). The size of each circle indicates the​ brand's relative market share.