Chapter 6: Target Markets, Segmentation, Evaluation, & PositioningConsumer Market- Purchasers and household members who intend to consume or benefit fromthe purchased products and do not buy products to make profitsBusiness Market- Individuals or groups that purchase a specific kind of product for resale, direct use in producing other products, or use in general daily operationsUndifferentiated Targeting Strategy- A strategy in which an organization designs a single marketing mix and directs it at the entire market for a particular productHomogeneous Market- A market in which a large proportion of customers have similar needs for a productHeterogeneous Market- A market made up of individuals or organizations with diverse needs for products in a specific product classMarket Segmentation- The process of dividing the total market into groups with relatively similar products needs to design a marketing mix that matches those needsMarket Segment- Individuals, groups, or organizations sharing one or more similar characteristics that cause them to have similar product needsConcentrated Targeting Strategy- A market segmentation strategy in which an organization targets a single market segment using one marketing mixDifferentiated Targeting Strategy- A strategy in which an organization targets two or more segments by developing a marketing mix for each segmentSegmentation Variables- Characteristics of individuals, groups, or organizations used to divide a market into segmentsMarket Density- The number of potential customers within a unit of land areaGeodemographic Segmentation- A method of market segmentation that clusters people in zip code areas and smaller neighborhood units based on lifestyle and demographic informationMicromarketing- An approach to market segmentation in which organizations focus precise marketing efforts on very small geographic marketsBenefit Segmentation- The division of a market according to benefits that consumers want from the productMarket Potential- The total amount of a product that customers will purchase within a specifiedperiod at a specific level of industry wide marketing activityCompany Sales Potential- The maximum percentage of market potential that an individual firmwithin an industry can expect to obtain for a specific productBreakdown Approach- Measuring company sales potential based on a general economic forecast for a specific period and the market potential derived from itBuildup Approach- Measuring company sales potential by estimating how much of a product a potential buyer in a specific geographic area will purchase in a given period, multiplying the estimate by the number of potential buyers, and adding the totals of all the geographic areas consideredProduct Positioning- Creating and maintaining a certain concept of a product in customer’s mindsSales Forecast- The amount of a product a company expects to sell during a specific period at a specified level of marketing activitiesExecutive Judgment- A sales forecasting method based on the intuition of one or more executivesCustomer Forecasting Survey- A survey of customers regarding the types and quantities of products they intend to buy during a specific periodSales Force Forecasting Survey- A survey of a firm’s sales force regarding anticipated sales in their territories for a specific periodExpert Forecasting Survey- Sales forecasts prepared by experts outside the firm, such as economists, management consultants, advertising executives, or college professorsDelphi Technique- A procedure in which experts create initial forecasts, submit them to the company for averaging, and then refine the forecastsTime Series Analysis- A forecasting method that uses historical sales data to discover patterns in the firm’s sales over time and generally involve trend, cycle, seasonal, and random factor analysisTrend Analysis- An analysis that focuses on aggregate sales data over a period of many years to determine general trends in annual salesCycle Analysis- An analysis of sales figures for a three-to-five year period to ascertain whether or not sales fluctuate in a consistent, periodic mannerSeasonal Analysis- An analysis of daily, weekly, or monthly sales figures to evaluate the degree to which seasonal factors influence salesRandom Factor Analysis- An analysis attempting to attribute erratic sales, variations to random, nonrecurring eventsRegression Analysis- A method of predicting sales based on finding a relationship between pastsales and one or more independent variables, such as population or incomeMarket Test- Making a product available to buyers in one or more test areas and measuring purchases and consumer responses to marketing effortsChapter 7: Consumer Buying BehaviorBuying Behavior- The decision processes and actions of people involved in buying and using productsConsumer Buying Behavior- The decision processes and purchasing activities of people who purchase products for personal or household use and not for business purposesConsumer Buying Decision Process- A five-stage purchase decision process that includes problem recognition, information search, evaluation of alternatives, purchase, and postpurchase evaluationInternal Search- An information search in which buyers search their memories for information about products that might solve their problemExternal Search- An information search in which buyers seek information from sources other than their memoriesConsideration Set- A group of brands within a product category that buyer views as alternativesfor possible purchaseEvaluative Criteria- Objective and subjective product characteristics that are important to a buyerCognitive Dissonance- A buyer’s doubts shortly after a purchase about whether the decision was the right oneSituational Influences- Influences that result from circumstances, time, and location that affect the consumer buying decision processPsychological Influences- Factors that in part determine people’s general behavior; thus influencing their behavior as consumersPerception- The process of selecting, organizing, and interpreting information inputs to producemeaningInformation Inputs- Sensations received through sight, taste, hearing, smell, and touchSelective Exposure- The process by which some inputs are selected to reach awareness and others are notSelective Distortion- An individual’s changing or twisting of information that is inconsistent with personal feelings or beliefsSelective Retention- Remembering
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