chapter 9

When a marketer adjusts the marketing mix to give customers a clear, distinctive understanding of what the product does, the marketer is engaging in psychographic segmentation.

False

Paula is trying to determine whether the segments she is considering for her day care center will be profitable. Which of the following will not specifically help her in this analysis?

The average number of school-age children in families sending a child to the day care center

Automobile manufacturers could build cars specially designed for very tall people (for example, over seven feet), but it is likely that this segment is not substantial.

True

Coca-Cola launched Coke Zero to avoid cannibalizing current sales and to attract new customers in a segment they might not get with Diet Coke.

True

For products like pencils and paper clips, marketers should probably use an undifferentiated targeting strategy.

True

Giant Food Stores in suburban Washington, D.C., adjusts its ethnic food aisle offerings based on the ethnic groups living near each store. Giant Foods is using geodemographic segmentation

True

PRIZM and Tapestry by ESRI divide and sort small geographic areas into categories using 60 or more demographic and lifestyle characteristics. These market research tools are examples of __________ segmentation

geodemographic

Retail store chains often use __________ data to identify other locations with similar demographics and purchasing behavior where it might make sense to open additional stores

geodemographic

The phrase "birds of a feather flock together" captures the idea of __________ segmentation

geodemographic

Marketers often employ a combination of segmentation methods, using __________ to identify and target their customers, and __________ to design products and messages to appeal to them

geodemographic segmentation; lifestyle or benefit segmentation

Kim's Kayak Tours initially identified active retirees living in the retirement community nearby as one of its target markets. Kim then tailored her service and marketing message to the interests and schedules of that audience. Kim initially used __________ segmentation and then used __________ segmentation

geodemographic; lifestyle

Differences in weather and climate create opportunities for

geographic segmentation

Carlos has identified four potential market segments for his Rent-A-Chef home meal catering service. He will now compare the segments to see if they are different enough from each other. Carlos is evaluating whether or not each segment is

identifiable.

A company that sells only multigrain, low calorie bread should use an undifferentiated targeting strategy.

False

A complex product that is best described in writing will be difficult to explain to consumers who are unable to read. For this reason, a segment in which many consumers could not read would be considered unattractive because the consumers would not be responsive.

False

A self-values map displays the position of products or brands in the consumer's mind

False

A value proposition compares the price of a product to its benefits.

False

NASCAR redirected its marketing efforts when a survey indicated that almost 50 percent of its fans were female. This is an example of psychographic segmentation

False

The STP process is made up of strategy, targeting, and promotion

False

. __________ is an extreme form of a targeting strategy.

Micromarketing

The Value and Lifestyle Survey (VALS) conducted by Strategic Business Insights (SBI) is a widely used tool for geographic segmentation

False

Marketers like Benetton want their ads to appeal to one's self-concept, suggesting to consumers

"I'm like them, so I should buy their products."

Fiona wants to sell a local advertising calendar. There are 1,000 households in her community, and she estimates that 30 percent will buy a calendar. The printing company will charge a $100 setup fee, and calendars will cost $4.00 each to print. What price will she need to charge to cover all costs and make a $500 profit?

$6.00

"Corporate pilot fish" are former employees who start a new business based primarily on contacts and contracts with their old company. A corporate pilot fish would probably pursue a __________ targeting strategy.

. . micromarketing

Four frequently used targeting strategies are the micromarketing, undifferentiated, differentiated, and __________ targeting strategies.

. concentrated

When Penguin Catering Services first opened, the owner decided to target only events at resorts in its geographic region. Penguin Catering was using a(n) __________ targeting strategy.

. concentrated

Talbots, an upscale women's clothing store, targets college-educated women between 35 and 55 years old with average household income of $75,000 or more. This is a form of __________ segmentation.

. demographic

When Mr. How, a Pennsylvania-based discount lumber and hardware chain, sent snow blowers to its Augusta, Georgia, store in April, it was engaged in

. misguided geographic segmentation.

Adidas Group owns Reebok, Rockport, and Greg Norman brands. Having a variety of brands allows Adidas to

. obtain a bigger share of the shoe market.

. Karen has identified four potential market segments for her Rent-A-Chef home meal catering service. She will now evaluate whether or not each segment is all of the following EXCEPT

. realistic.

__________ segmentation is the segmentation method most directly related to value creation for consumers

Benefit

__________ segmentation is the most common basis of consumer market segmentation because these segments are easy to define and usually easy to reach

Demographic

__________ involves defining the firm's marketing mix variables so that target customers have a clear, distinctive, and desirable understanding of the firm's offerings relative to competitors' offerings

Positioning

Coca-Cola introduced Coke Zero to increase sales without taking away from its existing product sales. Which of the following is NOT true about this effort?

Segmentation and targeting were of little use compared to developing special advertising

It would be logical for bathing suit marketers to use geographic segmentation

True

Perceptual maps include positions of current brands as well as ideal points where a consumer segment would want a product to be

True

Positioning strategies generally focus either on how the product benefits the consumer or on how it is better than competitors' products.

True

The first step in the STP process is to establish an overall strategy

True

When deciding how to promote his new medical oncology center, Dr. Jones decided that he did not need to throw a large grand opening reception. Instead, he promoted the center to the internal medicine doctors in the area, who were the doctors most likely to refer patients to the center. Dr. Jones was engaged in a concentrated targeting strategy.

True

. For each target market, General Imaging Corporation, a manufacturer of imaging equipment, will engage in positioning, adjusting their marketing mix variables in order to give customers

a clear, distinctive, and desirable understanding of their products relative to competing products.

Alexis has selected target markets for her fashion accessories store in a suburban strip mall. She is now deciding how to position the accessories. She could consider positioning based on

all of these

Firms might use multiple segmentation methods to

all of these

In addition to calculating the potential profitability of a market segment, marketers will also consider

all of these

Segmentation, targeting, and positioning

are part of a firm's marketing strategy.

. The Lite beer commercial with the slogan, "less filling, tastes great," was based on __________ segmentation.

benefit

Toothpastes sold in supermarkets and pharmacies promise various results, such as whiter teeth, protection against gum disease, tartar control, or fresh breath. Toothpaste marketers are using __________ segmentation.

benefit

The first step in the STP process is to

clearly articulate the firm's vision or marketing strategy objectives

Beer marketers know that high school educated, working-class males from the ages of 25 to 40 make up an attractive market for their products. This is a __________ segment of the beer market.

demographic

NASCAR redirected its marketing efforts when a survey indicated that almost 50 percent of race fans were female. This is an example of __________ segmentation

demographic

Television advertising has recently expanded to include "mini-ads," which are short ads lasting five to ten seconds. These ads are most useful in advertising to men, since men are more likely than women to channel surf during commercial breaks. This type of advertising will be more useful to marketers engaged in __________ segmentation.

demographic

Psychographics is the segmentation method that delves into how consumers

describe themselves.

. In a classic example of segmentation strategy, years ago Swift Meat Company transformed turkey meat into "Butterball" turkeys. In the process, the company

differentiated its product.

Adidas Group owns Reebok, Rockport, and Greg Norman brands. Adidas uses the different brands to pursue a(n) __________ strategy.

differentiated targeting

After assessing the market growth potential and market competitiveness for his company's baby products in Mexico, Harmon wanted to evaluate market access. To do this, Harmon would consider

ease of accessing or developing distribution channels and brand familiarity.

Education marketers have learned that the primary motivations of most nontraditional college students are self-respect and self-fulfillment. Understanding the values of this market segment allows marketers to

emphasize the benefits these consumers are looking for in a college education

Karen has identified four potential market segments for her Rent-A-Chef home meal catering service. The next step is to

evaluate the attractiveness of each segment.

Airlines were among the first retailers to embrace loyalty segmentation when they created

frequent flyer programs

Golden Years Vitamin Corporation targets consumers living in Florida who are over 65. Golden Years is using __________ segmentation.

geodemographic

Sally is in the new marketing department of a midsized lawn and garden company. She is working on the first marketing plan the firm has ever used. She has defined the mission and objectives, and she just finished a situation analysis for the firm. The next step is to

identify and evaluate opportunities by conducting segmentation, targeting and positioning analysis.

Although marketers have found that psychographics are often more useful for predicting consumer behavior than demographics, psychographic segmentation

is a more expensive method for identifying potential customers

Although a differentiated targeting strategy can allow a firm to obtain a bigger share of the overall market, this strategy

is often expensive

Firms use a differentiated targeting strategy because

it helps to obtain a bigger share of the market

Paul is considering psychographics as a way to segment the market for his small travel agency. This approach to segmentation offers him an advantage because

it is based on underlying reasons why people make choices

Demographic segmentation is segmentation based on all of the following EXCEPT

lifestyle

When Talbots, an upscale women's clothing store, tries to portray an image of "traditional, conservative, and with good taste," they are appealing to their target market's

lifestyle.

One of the benefits of a differentiated targeting strategy is that it allows the firm to diversify its business and

lower overall risk.

When Ron complained to his bank about the unprofessional behavior of one teller, the branch manager added a code into his accounts alerting all tellers that Ron was a valued customer and to provide whatever service he requests. The branch management included Ron in its __________ segmentation.

loyalty

Alex has found that both commercial and residential real estate buyers respond positively to his marketing communication message. Alex has identified __________ that respond similarly to his marketing efforts.

market segments

When selecting a target market, firms should attempt to

match the firm's competencies with a market segment's attractiveness

. Many companies use the Internet to allow consumers to design customized products; for example, Nike allows customers to order shoes with custom color combinations. This is a form of

micromarketing.

Whenever Donald calls on potential pest control customers, he emphasizes the fact that, unlike the national franchise competitors, he is a local business person and has been in business over twenty years. Donald is __________ his business relative to his competition.

positioning

We often see advertisements touting a product as being made with natural ingredients, or being longlasting. Marketers using these types of promotions are positioning their products based on

product attributes.

Caroline is assessing market growth, market competitiveness, and market access for each segment she has identified. Caroline is assessing __________ of each potential market segment.

profitability

Regina wants to position her financial services company. Regina can position her services according to all of the following EXCEPT

profitability

A university using benefit segmentation and targeting students who want to get a degree quickly while still working full time would focus on

providing classes at convenient times and offering online courses.

Baby Boomers represent a huge demographic segment for travel marketers. Baby Boomers are also heavily motivated by self-fulfillment, which creates the possibility of __________ segmentation.

psychographic

VALS is the most widely used __________ segmentation tool

psychographic

Marketers have found that __________ segmentation is often more useful for predicting consumer behavior than __________ segmentation

psychographic; demographic

. College students can be a less __________ market segment because students' media habits are quite diverse

reachable

Ryan wants to sell personal website services to American soldiers in Afghanistan. Because of the difficulty of communicating with people in a war zone, Ryan may have trouble with this segment not being

reachable.

With access to the Internet nearly universal in the United States, many potential market segments have become more

reachable.

Gloria is opening an upscale women's clothing store in a growing suburban residential area. Gloria knows her target market is upper-income women living within twenty miles. She can't afford to purchase a PRIZM or Tapestry analysis so she will most likely use __________ as a basis for targeting her market

real estate values by subdivision

When Starbucks first opened, many critics suggested, "No one will pay $4.00 for a cup of coffee." Starbucks' critics suggested consumers would not be __________ to the company's offerings.

responsive

For a segmentation strategy to be successful, the customers in the segment must react similarly and positively to the firm's marketing mix. The market segment must be

responsive.

The manager of Plantation River Country Club wanted members of the very upscale club to use the bar and dining facilities more frequently. He offered a two-for-one "happy hour" special but few members showed up. The manager did not have a grasp of what would make his target market

responsive.

Geodemographic segmentation can be particularly useful for __________, because customers typically patronize stores close to their neighborhood.

retailers

Which of the following would NOT be used in calculating the profitability of a segment?

segment perceptions

Ronaldo wants to develop an Internet auction-based business and is working through the STP process. After establishing his objectives, describing potential market segments, and evaluating the attractiveness of each segment, Ronaldo now has to

select a target market.

Beverage companies often use television commercials with images of young people laughing and enjoying themselves on a beach or in a club. These images are designed to appeal to consumers' __________, suggesting "be like me."

self-concepts

In order to develop psychographic segments, the marketer must understand consumers'

self-values, self-concept, and lifestyles.

Greta is concerned that one of the potential market segments she has identified for her dog grooming service is too small and has too little income to have sufficient buying power. Greta is concerned with whether the segment is

substantial.

Almost all U.S. political candidates use some combination of red, white, and blue in their campaign posters. They are trying to position themselves in voters' minds using

symbols.

One of the reasons marketers use loyalty segmentation is

the high cost of finding new customers.

. After assessing the market growth potential for his company's baby products in Mexico, Harmon wanted to evaluate market competitiveness. To do this, Harmon would consider

the number of competitors, entry barriers, and product substitutes

Whenever the president of the local public university promotes the institution, he emphasizes the university's price (much lower than neighboring private colleges) and high quality. He is positioning the institution based on

the value proposition.

. If values provide goals, and self-concept is the way we see ourselves, lifestyles are

the way we live our lives to achieve our goals

For products like pencils and paper clips, which provide the same benefit for all consumers, marketers should probably use a(n)

undifferentiated targeting strategy

Marketers often create a special marketing mix for loyalty segments because these segments are

usually quite profitable

Marco was assigned to help create a positioning strategy for his employer's products based on product attributes. He should consider

what the target market would consider the most important features.

While demographic and geographic segmentation of retail customers is relatively easy, these characteristics do NOT help marketers determine

what their customers need.