BMGT350 Test 2 Study Guide Chapter 8 Segmenting and Targeting Markets Market People or organizations with needs or wants and the ability and willingness to buy Market Segment A subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs Sustainability Market Segmentation The process of dividing a market into meaningful relatively similar and identifiable segments or groups Must meet four basic criteria Accessibility Responsiveness Identifiably and measurability Segmentation Bases Variables Characteristics of individuals groups or organizations Geographic Segmentation Segmenting markets by region of a country or the world market size market density or climate Demographic Segmentation Segmenting markets by age gender income ethnic background and family cycle Family Life Cycle FLC A series of stages determined by a combination of age marital status and the presence or absence of children Psychographic Segmentation Market segmentation on the basis of personality motives lifestyles and geodemographics Benefit Segmentation The process of grouping customers into market segments according to the benefits they seek from the product Usage Rate Segmentation Dividing a market by the amount of product bought or consumed percent of demand 80 20 Principle That 20 percent of all customers generate 80 Segmenting Business Markets Consists of four broad segments producers resellers government and institutions To segment these markets relies on Company Characteristics Buying Processes o Satisficers Business customers who place an order with the first familiar suppler to satisfy product and delivery requirements Consider numerous suppliers both familiar and o Optimizers unfamiliar solicit bids and study all proposals carefully before selecting one Steps in Segmenting a Market 6 Target Market A group of people or organizations for which an organization designs implements and maintains a marketing mix intended to meet the needs of that group resulting in mutually satisfying exchanges Undifferentiated Targeting Strategy A marketing approach that views the market as one big market with no individual segments and thus uses a single marketing mix Concentrated Targeting Strategy A strategy used to select one segment of a market for targeting marketing efforts Niche One segment of a market Multisegement Targeting Strategy A strategy that chooses two or more well defined market segments and develops a distinct marketing mix for each Cannibalization A situation that occurs when sales of a new product cut into sales of firm s existing products One to One Marketing An individualized marketing method that utilizes customer information to build long term personalized and profitable relationships with each customer Positioning Developing a specific marketing mix to influence potential customers overall perception of a brand product line or organization in general Position The place a product brand or group of products occupies in consumers minds relative to competing offerings Product Differentiation A positioning strategy that some use to distinguish their products from those of competitors Perceptual Mapping A means of displaying or graphing in two or more dimensions the location of products brands or groups of products in customers minds competing brands Repositioning Changing customers perceptions of a brand in relation to Chapter 9 Decision Support Systems and Marketing Research Marketing Information Everyday information about developments in the marketing environment that managers use to prepare and adjust marketing plans are making decisions Decision Support System An interactive flexible computerized information system that enables managers to obtain and manipulate information as they Database Marketing The creation of a large computerized file of customers and potential customers profiles and purchase patterns Marketing Research The process of planning collecting and analyzing data relevant to a marketing decision Marketing research is descriptive diagnostic and predictive Marketing Research Problem Determining what information is needed and how that information can be obtained efficiently Marketing Research Objective The specific information needed to solve a marketing research problem the objective should be to provide insightful decision making information Secondary Data Data previously collected for any purpose than the one at hand research firms Marketing Research Aggregator A company that acquires catalogs reformats segments and resells reports already published by marketing Research Design Specifies which research questions must be answered how and when the data will be gathered and how the data will be analyzed Primary Data Information that is collected for the first time used for solving the particular problem under investigation Survey Research Most popular technique for gathering primary data in which a researcher interacts with people to obtain facts opinions and attitudes Types Include In home interviews mall intercept interviews mall surveys telephone calls executive interviews and focus groups Open Ended Question An interview question that encourages an answer phrased in the responders words Closed Ended Question An interview question that asks the respondent to make a selection from a limited list of responses Scaled Response Question A closed ended question designed to measure the intensity of a respondents answer Observation Research A research method that relies on four types of observation people watching people people watching an activity machines watching people and a machine watching an activity Mystery Shoppers Researchers posing as customers who gather observational data about a store Behavioral Targeting A form of observation marketing research that uses data mining coupled with identifying Web surfers by their IP addresses Ethnographic Research The study of human behavior in its natural context involves observation of behavior and physical setting Sample A subset from a larger population Types of samples subcontracted basis questions among themselves Field Service Firm A firm that specializes in interviewing respondents on a Cross Tabulation A method of analyzing data that lets the analyst look at the responses to one question in a relation to the responses to one or more other Consumer Generated Media Media that consumers generate and share Trusted more than traditional advertising Scanner Based Research Is a system for
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