Marketing CH 8

What is market segmentation?

• the philosophy that to do a truly excellent job of marketing, a company should concentrate on only one customer segment at a time

• sorting prospective buyers into groups that are willing to pay more than the cost of production for a good or service

• disaggregating prospective buyers from groups into segments of one (individuals) and then creating specific products that will satisfy this person’s unique needs

• aggregating prospective buyers into groups that have common needs and will respond similarly to a marketing action

• the belief that it is possible to satisfy every customer’s needs if you can identify the correct segment within which they belong

New Balance has many offerings. It makes the Minimus line of shoes with a Vibram outsole and REVlite cushioning for those who want to “feel the trail.” Its 1260v2 shoe incorporates Stabilicore technology to “deliver a plush, smooth, and stable ride.” And its top of the line, 990v3 traditional running/walking shoe uses a “premium pigskin upper with mesh inserts for breathability, a stability-enhancing ABZORB insole, and ENCAP to promote a healthy gait.” The strategy of appealing to different types of customers in this way is an example of

• mass customization.

• product definition.

• 
  market segmentation.

• single chain marketing.

• market specific selection.

Market segments are

• the relatively heterogeneous groups of prospective buyers that result from the market segmentation process.

• all buyers of a product or service who have previously purchased a particular firm’s products or services and who intend to repeat that purchase sometime in the future.

• the smallest number of buyers that have similar needs but do not react similarly in a buying situation.

• the relatively homogenous groups of prospective buyers that result from the market segmentation process.

• all potential buyers of a product or service who intend to purchase a firm’s products or services but who have not yet done so.

To be identified as a market segment, members of the group must

• be similar in terms of their consumption behavior.

• represent a large share of the entire market and have buying power.

• have diverse needs and have potential for future growth.

• have diverse needs and be willing and able to purchase the product.

• have the potential for future growth and increased profit or ROI.

Product differentiation is

• a good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies consumers’ needs.

• the unique combination of product benefits received by targeted buyers.

• those characteristics of a product that make it superior to competitive substitutes.

• a marketing strategy using different marketing mix actions to help consumers perceive the product as being different and better than competing products.

• the legal requirement that requires a specified degree of distinction between products to ensure an organization’s intellectual property rights.

Google’s Pixel 4 smartphone has advanced motion sensors that allow a user to skip songs, snooze alarms, and silence phone calls by waving rather than touching. This feature sets the smartphone apart from its competitors and is part of Google’s ___________Blank strategy.

• product segmentation

• market expansion

• 
  product differentiation

• usage segmentation

• psychographic segmentation

A framework to relate the market segments of potential buyers to products offered or potential marketing actions by an organization is a

• needs table.

• cross-tabulation.

• market-product grid.

• growth-share matrix.

• product differentiation table.

The annual Street & Smith’s Baseball magazine had exactly the same stories but with 15 different covers to appeal to baseball fans in each of its U.S. regions. What is the basis of its market segmentation strategy?

• psychographic segmentation

• retail outlet segmentation

• demographic segmentation

• behavioral segmentation

• geographic segmentation

The annual Street & Smith’s Baseball magazine uses 15 different covers featuring a baseball star from each of its regions in the United States, yet each regional issue has the same magazine content. The publisher is using which of these segmentation strategies?

• multiple products with one segment

• one product with one channel of distribution

• one product with multiple market segments

• one product with changes based on customer behavior

• multiple products with multiple segments

Which of these is an example of a multiple products, multiple market segments strategy?

• College Football magazine selects different covers for essentially the same written content in order to appeal to different geographic markets in the United States.

• A new movie used several different movie trailers. One set of previews showed the action scenes in order to attract one audience and the other set showed romantic scenes to attract another audience.

• Nike sells shoes for running, basketball, and golf.

• Arm & Hammer Baking Soda can be used for baking and to remove odors from refrigerators and cat litter boxes.

• Johnson’s Baby Oil is advertised as a skin softener for babies and as a makeup remover for women.