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___________________________________________________________________________ 1. Coca-Cola ch08 Student: launched Coke Zero to avoid cannibalizing current sales and to attract new customers in a segment they might not get with Diet Coke. True False 2. 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. True False 3. For products like pencils and paperclips, marketers should probably use an undifferentiated targeting strategy. True False 4. 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 False 5. It would be logical for bathing suit marketers to use geographic segmentation. True False 6. NASCAR redirected its marketing efforts when a survey indicated that almost fifty percent of its fans were female. This is an example of psychographic segmentation. True False 7. The Value and Lifestyle Survey (VALS) conducted by SRI Consulting Business Intelligence is a widely used tool for geographic segmentation. True False 8. 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 False 9. Positioning strategies generally focus either on how the product benefits the consumer or on how it is better than competitors' products. True False 10. A self-values map displays the position of products or brands in the consumer's mind. True False 11. Perceptual maps include positions of current brands as well as ideal points where a segment would want a product to be. True False 12. The STP process is made up of strategy, targeting and promotion. True False 13. The first step in the STP process is to establish a strategy. True False 14. Automobile manufacturers do not manufacture cars specially designed for very tall people, as this segment is not substantial. True False 15. 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. True False 16. A company that sells only multi-grain, low calorie bread should use an undifferentiated targeting strategy. True False 17. 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? A. Segmentation and targeting were of little use compared to developing special advertising. B.The word "diet" was not used in promotion because the target segment of men did not react favorably to the "girly" connotations. C. A special fantasy football game was created to promote the product to the targeted segment. D. Although Coke has more than 400 products, sales to a carefully targeted segment can greatly increase total sales. EAlthough the market for cola is mature, Coke plans to adapt the current products and services to meet . the needs of changing market climate using the segmentation ideas developed in the launch of Coke Zero. 18. Sally is in the new marketing department of a mid-sized 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: A. develop an advertising plan to promote the upcoming sales. B. find marketing interns or hire new staff to help with implementation. C. create pro forma financial statements to complete the package. D. identify and evaluate opportunities by conducting segmentation, targeting and positioning analysis. E. use the Internet, catalogs and vendor information to draw up a list of new products. 19. Segmentation, targeting and positioning: A. are terms that can be used interchangeably in developing marketing plans. B. are part of a firm's marketing strategy. C. should be done simultaneously so synergies can help streamline the effort. D. are part of the marketing plan but bear little direct relationship to the marketing mix. E. All of these. 20. 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. A. mass customization consumers B. geographic segments C. market segments D. self-concept customers E. geodemographic segments 21. 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. better Medicaid and Medicare payments. B. a perceptual map of the imaging landscape. C. more product features than the competition offers. D. lower prices than the competition offers. E. a clear, distinctive, and desirable understanding of their products relative to competing products. 22. The first step in the STP process is to: A. identify the segmentation methods to be used. B. produce a list of strengths and weaknesses of the firm's past marketing strategies. C. clearly articulate the firm's vision or marketing strategy objectives. D. select target markets. E. develop a marketing mix, so that an appropriate segment can later be identified. 23. For products like pencils and paperclips, which provide the same benefit for all consumers, marketers should probably use a(n): A. concentrated targeting strategy. B. lifestyle segmentation strategy. C. benefit segmentation strategy. D. undifferentiated targeting strategy. E. all of these. 24. In a classic example of segmentation strategy, years ago Swift Meat Company transformed turkey meat into "Butterball" turkeys. In the process, the company: A. differentiated its product. B. avoided the SARS virus. C. created a new class of micromarketing. D. raised consumers' self-concepts. E. redefined mass customization. 25. Adidas Group owns Reebok, Rockport, and Greg Norman brands. Adidas uses the different brands to pursue a(n) ________________________ strategy. A. concentrated targeting B. micromarketing C. benefit targeting D. differentiated targeting E. undifferentiated targeting 26. Adidas Group owns Reebok, Rockport, and Greg Norman brands. Having a variety of brands allows Adidas to: A. engage in micromarketing for hard-to-fit shoe customers. B. obtain a bigger share of the shoe market. C. use mass marketing techniques. D. utilize geographic segmentation. E. generate economies of scale in advertising expenditures. 27. One of the benefits of a differentiated targeting strategy is that it allows the firm to diversify its business and: A. decrease advertising spending. B. focus on a single market segment. C. lower overall risk. D. use undifferentiated strategies in micro markets. E. all of these. 28. Although a differentiated targeting strategy can allow a firm to obtain a bigger share of the overall market, this strategy: A. is the cheapest option. B. requires the use of advanced advertising techniques. C. rarely works. D. is often expensive. E. is ineffective without multiple brand names. 29. Firms use a differentiated targeting strategy because: A. it is easier than mass marketing. B. it helps to obtain a bigger share of the market. C. it is better than focusing on individual or small groups of potential customers. D. most market segments are too small to be profitable. E. banks are more willing to extend credit to companies with this strategic approach. 30. 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. A. concentrated B. micromarketing C. benefit-driven D. differentiated E. undifferentiated 31. __________________ is an extreme form of a targeting strategy. A. Macromarketing B. Micromarketing C. Benefit marketing D. Differentiated targeting E. Concentrated targeting 32. "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. A. macromarketing B. micromarketing C. benefit-based D. differentiated E. undifferentiated 33. 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: A. micromarketing. B. concentrated targeting. C. psychographic segmentation. D. differentiated targeting. E. undifferentiated targeting. 34. Four frequently used targeting strategies are the micromarketing, undifferentiated, differentiated and ________________ targeting strategies. A. geographic B. benefit-based C. economic D. global E. concentrated 35. 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: A. concentrated segmentation. B. geodemographic segmentation. C. benefit segmentation. D. psychographic segmentation. E. misguided geographic segmentation. 36. Differences in weather and climate create opportunities for: A. concentrated targeting. B. geographic segmentation. C. benefit segmentation. D. psychographic segmentation. E. demographic segmentation. 37. NASCAR redirected its marketing efforts when a survey indicated that almost fifty percent of race fans were female. This is an example of ______________ segmentation. A. geographic B. psychographic C. demographic D. benefits E. behavioral 38. ____________________ segmentation is the most common basis of consumer market segmentation because these segments are easy to define and usually easy to reach. A. Geographic B. Psychographic C. Behavioral D. Benefits E. Demographic 39. Beer marketers know one very attractive segment is 25-40 year old, high school-educated, working-class, males. This is a _______________ segment of the beer market. A. demographic B. psychographic C. behavioral D. benefits E. geographic 40. 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. A. demographic B. psychographic C. behavioral D. benefits E. geographic 41. Demographic segmentation is segmentation based on: A. age. B. gender. C. education. D. income. E. any of these. 42. Marketers like Benetton want their ads to appeal to one's self-concept, suggesting to consumers: A. "Trendy products for the masses." B. "I'm like them, so I should buy their products." C. "I will never be rich, but I can dress like I am." D. "Be Peace." E. "All is fair in love, marketing, and war." 43. Psychographics is the segmentation method that delves into how consumers: A. adjust to demographic changes. B. allocate scarce incomes to a variety of goods and services. C. describe themselves. D. value their livelihoods. E. all of these. 44. In order to develop psychographic segments, the marketer must understand consumers': A. age, income, and education. B. gender, race, and religion. C. disposable personal income, benefit perceptions, and alternative egos. D. self-values, self-concept, and lifestyles. E. all of these. 45. 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: A. it is based on behaviors and underlying reasons why people make choices. B. it is easier to use than demographics. C. the travel business doesn't respond well to other approaches to segmentation. D. psychographics is the preferred method for service businesses. E. psychographic segmentation is the least expensive method. 46. Education marketers have learned that the primary motivations of most non-traditional college students are self-respect and self-fulfillment. Understanding the values of this market segment allows marketers to: A. emphasize the benefits these consumers are looking for in a college education. B. lower the price for this market segment. C. offer alternative courses based on geographic location. D. employ loyalty marketing strategies. E. utilize micromarketing strategies. 47. 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. A. geographic B. self-concept C. psychographic D. benefit E. behavioral 48. 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." A. geographic choices B. self-concepts C. loyalty references D. benefit perceptions E. demographics 49. If values provide goals, and self-concept is the way we see ourselves, lifestyles are: A. visual images of how we should live our lives. B. marketing manipulation of consumers' fears. C. the way we live our lives to achieve our goals. D. motivations turned into perceptual maps. E. determined by demographics. 50. VALS is the most widely used __________________ segmentation tool. A. geographic B. behavioral C. psychographic D. benefits E. geodemographic 51. Which of the following is NOT one of the VALS segments? A. Innovators. B. Do-gooders. C. Thinkers. D. Achievers. E. Experiencers. 52. Innovators, Thinkers, Achievers, and Experiencers are VALS classifications based on: A. motivation. B. income. C. health. D. innovativeness. E. all of these. 53. Marketers have found that ___________________ segmentation is often more useful for predicting consumer behavior than ________________ segmentation. A. demographic; psychographic B. geographic; geodemographic C. psychographic; demographic D. demographic; behavioral E. demographic; benefit 54. Firms might use multiple segmentation methods to: A. tailor communications B. design products C. determine the substance of the marketing message D. All of these E. None of these 55. Although marketers have found that psychographics are often more useful for predicting consumer behavior than demographics, psychographics: A. are available only in limited geographic areas. B. are rarely used and unproven. C. offer only one-to-one marketing potential. D. are a more expensive method for identifying potential customers. E. all of these. 56. _______ segmentation is the segmentation method most directly related to creating value for a customer segment. A. Geographic B. Demographic C. Psychographic D. Benefit E. Geodeomographic 57. A university targeting students based on the benefit of getting a degree quickly and without interfering with the rest of the students' lives would emphasize: A. providing classes at convenient times and offering online courses. B. discount pricing for students taking more than twelve credit hours. C. the higher average salaries earned by college graduates. D. the great variety of classes offered. E. the number of Nobel Prize winners on the faculty. 58. The Lite beer commercial with the slogan, "less filling, tastes great," was based on ______________ segmentation. A. geographic B. geodemographic C. psychographic D. benefit E. loyalty 59. 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. A. benefit B. geodemographic C. psychographic D. loyalty E. demographic 60. Golden Years Vitamin Corporation targets consumers living in Florida who are over 65. Golden Years is using _______________ segmentation. A. benefit B. self-actualization C. psychographic D. loyalty E. geodemographic 61. The phrase "birds of a feather flock together" captures the idea of ______________ segmentation. A. geodemographic B. benefit C. psychographic D. loyalty E. geographic 62. 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. A. geodemographic B. benefit C. psychographic D. loyalty E. geographic 63. 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. A. voter registration lists B. the city phone book C. real estate values by subdivision D. public school enrollment data E. new construction data 64. Geodemographic segmentation can be particularly useful for ____________, because customers typically patronize stores close to their neighborhood. A. Internet marketers B. wholesalers C. retailers D. consumer goods manufacturers E. cable TV networks 65. 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. A. geodemographic B. benefit C. psychographic D. loyalty E. geographic 66. Marketers often create a special marketing mix for loyalty segments because these segments are: A. too large to service with ordinary targeting. B. difficult to identify. C. costly to acquire. D. usually quite profitable. E. all of these. 67. 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. A. benefit B. geodemographic C. psychographic D. loyalty E. geographic 68. Airlines were among the first retailers to embrace loyalty segmentation when they created: A. business-class seating. B. 30-day advance pricing. C. fuel surcharges. D. in flight movies. E. frequent flyer programs. 69. One of the reasons marketers use loyalty segmentation is: A. the high cost of finding new customers. B. government tax incentives for loyalty. C. accounting difficulties associated with identifying new customers. D. rapid population increases. E. the failure of micromarketing as a workable strategy. 70. While demographic and geographic segmentation of retail customers is relatively easy, these characteristics do not help marketers determine: A. how old their customers are. B. what their customers need. C. where their customers live. D. which customers have young children. E. what income brackets their customers are in. 71. 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. A. micromarketing; loyalty B. lifestyle; macromarketing C. geodemographic; lifestyle D. geographic; loyalty E. behavioral; geodemographic 72. 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. A. loyalty segmentation; demographics B. undifferentiated targeting; differentiated targeting C. loyalty segmentation; geodemographics D. geodemographic segmentation; lifestyle or benefit segmentation E. lifestyle segmentation; geographic segmentation 73. Karen has identified four potential market segments for her Rent-A-Chef home meal catering service. The next step is to: A. categorize each market segment by consumer demographics. B. establish her overall objectives. C. decide on a targeting strategy. D. develop a positioning strategy. E. evaluate the attractiveness of each segment. 74. 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: A. substantial. B. responsive. C. profitable. D. reachable. E. all of these. 75. 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: A. identifiable. B. responsive. C. profitable. D. reachable. E. all of these. 76. 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: A. substantial. B. responsive. C. profitable. D. reachable. E. all of these. 77. Ryan wants to sell personal Web site 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: A. substantial. B. perceptive. C. identifiable. D. reachable. E. quantifiable. 78. With access to the Internet nearly universal in the USA, many potential market segments have become more: A. substantial. B. perceptive. C. identifiable. D. reachable. E. quantifiable. 79. 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. A. benefit B. geodemographic C. psychographic D. demographic E. geographic 80. 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: A. lifestyle. B. geodemographics. C. demographics. D. loyalty. E. PRIZM segment. 81. College students can be a less _______________ market segment because students' media habits are quite diverse. A. substantial B. perceptive C. identifiable D. reachable E. quantifiable 82. 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: A. substantial. B. perceptive. C. identifiable. D. reachable. E. responsive. 83. 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. A. responsive B. perceptive C. identifiable D. reachable E. quantifiable 84. 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 made his target market: A. substantial. B. responsive. C. identifiable. D. reachable. E. quantifiable. 85. Caroline is assessing market growth, market competitiveness, and market access for each segment she has identified. Caroline is assessing ________________ of each potential market segment. A. substance B. responsiveness C. identification D. reach E. profitability 86. 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: A. mass marketing distribution potential and logistical support. B. the current size of the market and the expected growth rate. C. ease of pricing control and number of promotional outlets. D. the number of competitors, entry barriers, and product substitutes. E. all of these. 87. 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: A. ease of accessing or developing distribution channels and brand familiarity. B. the current size of the market and the expected growth rate. C. ease of pricing control and number of promotional outlets. D. the number of competitors, entry barriers, and product substitutes. E. all of these. 88. Which of the following would NOT be used in calculating the profitability of a segment? A. segment perceptions. B. segment size. C. segment adoption percentage. D. profit margin percentage. E. fixed costs. 89. 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 set up 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? A. $6.00 B. $7.00 C. $8.00 D. $9.00 E. $10.00 90. 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? A. The number of children needing day care in the immediate area. B. The fixed costs of operating the center. C.The percentage of parents in the area who can both afford to send their child or children to day care and who are willing to do so. D. The average number of school-age children in families sending a child to the day care center. E. The price she would charge minus the variable cost of providing service to each child. 91. In addition to calculating the potential profitability of a market segment, marketers will also consider: A. customer loyalty. B. defection rates. C. the cost of replacing customers. D. likely future sales to customers. E. all of these. 92. 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: A. differentiate his product line. B. consider future customer loyalty. C. create a perceptual map. D. select a target market. E. divide geographic segments into lifestyle groups. 93. When selecting a target market, firms should attempt to: A. decide between demographic and geographic segmentation methods. B. seek out opportunities to customize products. C. develop a strong communication plan. D. match the firm's competencies with a market segment's attractiveness. E. reposition the brand. 94. _______________ 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. A. Processing B. Perceptualizing C. Positioning D. Proportioning E. Prospecting 95. 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. A. segmenting B. packaging C. positioning D. pricing E. targeting 96. Regina wants to position her financial services company. Regina can position her services according to: A. value. B. salient attributes. C. symbols. D. competitive comparisons. E. all of these. 97. 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: A. value. B. salient attributes. C. symbols. D. competitive comparisons. E. all of these. 98. We often see advertisements touting a product as being made natural with ingredients, or being longlasting. Marketers using these types of promotions are positioning their products based on: A. value. B. salient attributes. C. symbols. D. competitive comparisons. E. all of these. 99. Alexis is working out how to position her fashion accessories store in a suburban strip mall. She has selected target markets, and she will now consider: A. value. B. salient attributes. C. symbols. D. competitive comparisons. E. all of these. 100.Marco was assigned to help create a positioning strategy for the manufacturing firm where he works by working on the salient attributes. He should consider: A. the features the engineers feel are most important. B. the ways the sales representatives have been positioning the firm's products. C. the characteristics that helped his firm win a state-wide award for excellence in manufacturing. D. what the target market would consider the most important features. E. the safety record of the firm and its products. 101.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: A. value. B. salient attributes. C. symbols. D. the competition. E. all of these. 102.Jim wants to position his firm against his competitors. In doing so he should: A. never select a competitor in the same neighborhood. B. avoid making the competitor's product look undesirable. C. avoid looking too much like the competitor so that he'd confuse the target segment. D. avoid discussing the strengths of his product so that competitors won't be aware of his product quality. E. avoid discussing the weaknesses of his competitors so they won't retaliate. 103.A ____________ is often used to illustrate the position of a firm's products or brands in consumers' minds. A. mass marketing analysis B. psychographic profile C. perceptual map D. loyalty timeline E. PRIZM analysis 104.Within a perceptual map, a(n) _________________ represents where a particular market segment's desired product would lie. A. point of parity B. strategic target C. PRIZM cluster D. ideal point E. benefit centroid 105."Why create a perceptual map?" asked David. Andreas, the senior marketing manager, gave him four reasons. Which of the following is NOT a valid reason? A. "It's a quick way for senior managers to see not only our product but each of our competitors, all at once." B. "It's a way to demonstrate the dimensions that our customers think are important." C. "It shows where we aren't - and where our competitors aren't - in our customers' and prospects' minds." D. "It's a way to show the position of the company in ten years." E. "We can easily show where we are positioned and how large the market is." 106.The perceptions of ________ are being measured in a perceptual map. A. competitors B. strategic planners C. the company's executive team D. the current R&D team E. consumers 107.Which of the following segmentation methods is being used when M&Ms offers special wedding-themed packaging for customized M&Ms (imprinted with the names of the bride and groom)? A. Occasion segmentation B. Geographic segmentation C. Lifestyle segmentation D. Benefit segmentation E. Loyalty segmentation 108.Godiva Chocolates produces specially decorated boxes of candies for Valentine's Day, Easter, and Christmas. This is an example of: A. occasion segmentation B. loyalty segmentation C. geographic segmentation D. psychographic segmentation E. demographic segmentation 109.Which of the following defines a value proposition? A. The unique value that a product or service provides to its customers. B. A special discount offer dropping the price. C. An advertisement that talks about value. D. A display of the position of products or brands in the consumer's mind. E. None of these. 110.Overriding desires that drive how we live our lives are called: A. self-values. B. self-concept. C. self-esteem. D. self-confidence. E. self-control. 111.When Victoria's Secret offers clients different colors, fabrics and styles, they are trying to capture the market by: A. segmenting, targeting and positioning. B. offering everything to everyone. C. trying lots of options to find out which one works. D. continual test marketing. E. focusing exclusively on its Pink brand. 112.By designing subcompact cars specifically for Chinese consumers, American and Japanese auto makers are engaging in: A. geographic segmentation B. psychographic segmentation C. geodemographic segmentation D. demographic segmentation E. behavioral segmentation 113.Unilever used the technique of "crowdsourcing" to assist in marketing mix design for its Axe personal care products for men. What is crowdsourcing? A. Tapping directly into needs and ideas of a target audience by inviting broad-based input. B. Identifying trends by observing a large group of people in a public place. C. Conducting focus group research. D. Conducting a test market. E. Estimating wide-scale sales from a test with a small crowd. 114.China Mobile has identified segments for its services including rural farmers, college students, and wealthy businessmen. These are examples of _________ segments. A. demographic B. geographic C. psychographic D. benefit E. behavioral 115.When evaluating the attractiveness of the segment, if a segment is expected to react positively to the firm's offering, we say that the segment is: A. responsive B. identifiable C. reachable D. substantial E. reactive 116.What lessons could Coca-Cola apply from its success with Coke Zero to other potential new products? 117.Why must a firm's STP strategy be consistent with and derived from the firm's mission and objectives? 118.In theory, why is micromarketing the ultimate in STP strategy? What is the weakness associated with micromarketing? 119.Assume you are the marketing consultant for your university. Your university wants to focus their marketing effort on retention of current students. You have a choice of segmenting the undergraduate student market on either a geographic or psychographic basis. What is the difference between the two? Which would you recommend, and why? 120.Assume you are the marketing consultant for your university. Your university wants to focus their marketing effort on recruiting new students. You have a choice of segmenting the undergraduate student market on either a demographic or benefit basis. What is the difference between the two? Which would you recommend, and why? 121.Consider a fast-food restaurant chain that does business in your area. Describe the company's target market, and explain how its marketing mix is designed to appeal to this target market. 122.Develop a lifestyle segmentation scheme for students at this university, and label and describe three segments. You can think of this as developing your own version of the VALS tool, but specifically for college students. 123.Marketers find psychographics a valuable segmentation approach. What are some of the limitations of psychographic segmentation and what can marketers do to offset those limitations? 124.The text states that "geodemographic segmentation can be particularly useful for retailers." Use a local retailer to describe how geodemographic segmentation could be useful. 125.Why does loyalty segmentation make so much sense? Describe how a local pizza restaurant could employ loyalty segmentation. 126.Kim's Kayak Tours identified active retirees living in the retirement community nearby as one of her potential target markets. She knows she can tailor her service and marketing message to the schedules and interests of this audience. How will Kim evaluate the attractiveness of this segment? 127.Abigail wants to sell a local advertising calendar. She knows there are 2000 households in her community, and estimates 30 percent will buy a calendar. The printing company will charge a $400 set up fee and calendars will cost $4.00 each to print. What price will she need to charge to cover all costs and make a $2000 total profit? Show your calculations. 128.Segment profitability asked marketers to consider segment size, segment adoption percentage, purchase behavior, profit margin percentage and fixed costs. Select three of these five elements and explain where marketers will find solid quantifiable information to make the calculations. 129.Ronaldo is developing an Internet auction-based business. After establishing his objectives, describing potential market segments, and evaluating the attractiveness of each segment, Ronaldo now has to choose which target market to focus his efforts on. What factors should influence his decision? 130.Create a positioning strategy for your school's business program. How do you want potential students to view your program? 131.There are three major competitors in the private package delivery market; UPS, FedEx, and DHL. The fourth competitor is the USPS. Choose one of the four firms and describe its positioning efforts. 132.When developing a positioning strategy, marketers may choose to position their offerings against the offerings of competitors. If you were to do so, what would you expect your competitors to do? 133.How do you create and use a perceptual map? What positioning criteria might toothpaste manufacturers use in creating a perceptual map? 134.In a perceptual map of two dimensions, how are these dimensions determined? 135.Segmentation, targeting and positioning involve a number of processes, many decisions and many different options. With all that effort, why are marketers so concerned with STP? 136.For which types of products should marketers consider using an undifferentiated targeting strategy? 137.NASCAR re-directed its marketing efforts when a survey indicated that almost fifty percent of their race fans were female. What type of segmentation was used based on the survey results? 138.Create an example of geodemographic segmentation. 139.How have airline companies implemented loyalty segmentation? 140.Which of the segmentation attractiveness criteria is addressed when Magnolia Caf asks the question, "Are there enough employees in the government center to justify targeting the center for lunch delivery service?" 141.Which of the segmentation attractiveness criteria is addressed when Magnolia Pizzeria asks the question, "Are private food service companies allowed to deliver pizzas on the military base?" 142.Which of the segmentation attractiveness criteria is assumed by the statement, "Build it, and they will come"? 143.Rick's Computer and Copying Center has decided to target students at a new branch of the university. Which of the marketing mix variables will Rick use when developing a positioning strategy for his firm? 144.Why do marketers often use perceptual maps when developing positioning strategies? 145.List the steps in the Segmentation, Targeting and Positioning Process. 146.A firm must evaluate segments based on their attractiveness: identify the five criteria and explain how a firm would use this information to establish if a segment is worth pursuing. 147.Identify two segmentation methods used in segmenting markets and give an example of a situation where each might be used. 148.Identify how a company who manufactures salt can use a differentiated targeting strategy. 149.Why would a company use a micromarketing strategy versus an undifferentiated strategy? 150.A laptop manufacturer is considering designing and marketing a left-handed laptop, with the keyboard rearranged to better suit left-handed people. The CEO is left-handed, and has pointed out to senior management that over ten percent of the population is left-handed. It will not be inexpensive to design this new model, so the laptop manufacturer wants to make sure that this is an attractive segment. For each of the five criteria of segment attractiveness, list a question the laptop manufacturer will want to consider to evaluate attractiveness of "left-handed laptop users" as a segment. ch08 Key 1. (p. 255, Chapter case study) TRUE 2. (p. 246) FALSE 3. (p. 243) TRUE 4. (p. 244) TRUE 5. (p. 231) TRUE 6. (p. 233) FALSE 7. (p. 234) FALSE 8. (p. 236) TRUE 9. (p. 246) TRUE 10. (p. 250) FALSE 11. (p. 250) TRUE 12. (p. 230) FALSE 13. (p. 230) TRUE 14. (p. 241) TRUE 15. (p. 241) FALSE 16. (p. 244) FALSE 17. (p. 255-256, Chapter case study) A 18. (p. 230) D 19. (p. 230) B 20. (p. 231) C 21. (p. 246) E 22. (p. 230) C 23. (p. 243) D 24. (p. 244) A 25. (p. 244) D 26. (p. 244) B 27. (p. 244) C 28. (p. 244) D 29. (p. 244) B 30. (p. 244) A 31. (p. 245) B 32. (p. 245) B 33. (p. 245) A 34. (p. 244) E 35. (p. 231) E 36. (p. 231) B 37. (p. 232) C 38. (p. 232) E 39. (p. 232) A 40. (p. 232) A 41. (p. 232) E 42. (p. 233) B 43. (p. 233) C 44. (p. 233) D 45. (p. 233) A 46. (p. 233) A 47. (p. 233) C 48. (p. 233) B 49. (p. 234) C 50. (p. 234) C 51. (p. 235) B 52. (p. 234) E 53. (p. 234) C 54. (p. 238-239) D 55. (p. 234) D 56. (p. 237) D 57. (p. 237) A 58. (p. 237) D 59. (p. 237) A 60. (p. 236) E 61. (p. 236) A 62. (p. 236) A 63. (p. 236) C 64. (p. 236) C 65. (p. 236) A 66. (p. 238) D 67. (p. 238) D 68. (p. 238) E 69. (p. 238) A 70. (p. 238) B 71. (p. 238-239) C 72. (p. 238-239) D 73. (p. 241) E 74. (p. 241) E 75. (p. 241) A 76. (p. 241) A 77. (p. 242) D 78. (p. 242) D 79. (p. 232) D 80. (p. 234) A 81. (p. 242) D 82. (p. 242) E 83. (p. 242) A 84. (p. 242) B 85. (p. 242-243) E 86. (p. 242) D 87. (p. 242) A 88. (p. 242) A 89. (p. 242-243) A 90. (p. 242-243) D 91. (p. 242-243) E 92. (p. 243) D 93. (p. 243) D 94. (p. 246) C 95. (p. 249) C 96. (p. 246) E 97. (p. 246) A 98. (p. 247-249) B 99. (p. 246-249) E 100. (p. 247-249) D 101. (p. 249) C 102. (p. 249) C 103. (p. 250-251) C 104. (p. 250-251) D 105. (p. 250-251) D 106. (p. 250-251) E 107. (p. 238) A 108. (p. 238) A 109. (p. 246) A 110. (p. 233) A 111. (p. 229-230, Opening vignette) A 112. (p. 232, Adding Value 8.1) A 113. (p. 237, Power of the Internet 8.1) A 114. (p. 239-240, Adding Value 8.2) A 115. (p. 242) A 116. (p. 255-256) The student should demonstrate above all an understanding of the segmentation, targeting and positioning process. More astute students will identify research. Most students will capture ideas about promotion, but responses should include much more than promotion. 117. (p. 230) Segmentation, targeting, and positioning begins with the recognition that no firm has sufficient resources to be all things to all customers. When a firm's STP strategy is consistent with and derived from its mission and objectives, it focuses the firm towards opportunities that grow out of what the firm is doing well and not in a random, spurious direction. Focused STP strategy acknowledges weaknesses and threats and builds upon strengths and opportunities. 118. (p. 245) Micromarketing (or one-to-one marketing) is tailoring a firm's products or services to suit an individual--or a segment of one person. Micromarketing then creates value on an individual basis, adjusting the product or service to meet the particular needs of each customer. The weakness is it can be very expensive. 119. (p. 231-235) Answers will vary by the type of institution. Geographic segmentation organizes customer on the basis of where they live. University students could be divided geographically into on-campus and off-campus segments or in-state and out-of-state basis. Psychographic segmentation divides students based on how students see themselves including self-values, self-concept, and lifestyles. For example, students could be divided into groups such as "nerds," "jocks," "socialites," and party-goers. Which to recommend will vary but, since the university is focusing on retention, psychographics may be more appropriate since it addresses why people attend the school. 120. (p. 231-237) Answers will vary by the type of institution. Potential students could be segmented demographically by age, gender, or income. Knowing what past students valued by demographic characteristics would allow the university to create targeted messages for each demographic group. Benefit segmentation would divide students on a basis of what they expect or want from an education: jobs, prestige, social interaction, entry into graduate school, etc. While this would be useful in developing a marketing campaign, it might be difficult to identify potential students who seek the various benefits. If possible, a combination of the two bases could be used to develop a strong marketing campaign. 121. (p. 246-249) Answers will vary. Professors may want to substitute the name of the nearest fast-food restaurant chain. Taking McDonald's; the Golden Arches clearly are designed to attract the attention of young children. Even kids who cannot read recognize the McDonald's symbol. Parents with young kids have been known drive out of their way to avoid passing the local McDonald's! The colorful playgrounds and frequent promotional tie-ins with Disney are also targeted toward young children. Ronald McDonald is another effort to target young children. Food, the company's product, is in many ways secondary. 122. (p. 234-235) Again, answers will vary but creative students will have fun with this. Applying the VALS dimensions (resources and motivation) to college students might produce segments like Workers (middle or lower income students with high energy levels and motivation) and Floaters (middle or upper income students with low energy levels and low motivation). 123. (p. 234-235) Psychographics are not as objective as demographics and not as easy to develop as geographic segmentation. As a result, marketers will often combine psychographics with other segmentation methods. Students should be able to contrast various segmentation methods. 124. (p. 236) Answers will vary. Professors might want to substitute the name of a local retailer students are familiar with. Responses should include a discussion defining geodemographic segmentation as segmentation based both on where people live and on demographics. Geodemographic segmentation is particularly useful to brick and mortar retailers because customers typically patronize stores close to their neighborhoods. 125. (p. 238) Loyalty segmentation makes sense because loyal customers make repeat purchases, create word-of-mouth referrals, and are usually a firm's most profitable segment. A local pizza restaurant could reinforce loyalty by a punch card with the tenth pizza free. It could also have an annual private pizza party for regulars. Simply remembering regular customers' names and preferences reinforces loyalty. 126. (p. 241-243) She has already identified the segment; active retirees in a local retirement community. Next, she will assess if the segment is substantial. That can be done by finding an estimate of the number of people living in the community, and by estimating the percentage that are active and healthy enough to engage in kayaking. The next question is, is the segment reachable? Can she access this group with marketing messages, or does the retirement community control access (or perhaps already provide outdoor recreational services like kayaking?) Her next criterion is responsiveness. Are the people in this segment likely to react similarly and positively to her marketing efforts? Do they want to go kayaking? Lastly, she will assess profitability--can she make a profit leading these types of tours for this audience? Price = $8 $4800 = 600 X Price $2000 = 600 X Price - $2400 - $400 $2000 = 600 X (Price - $4) - $400 $2000 = (2000 X .30 X 1 X (Price - $4)) - $400 Substituting the values from the homework We will assume that purchase frequency = 1 (that each household buys just one calendar). We don't know the price or profit margin percentage, but (price X profit margin %) can be restated as (price - variable cost) = Price - $4. 127. (p. 242-243) Segment profitability = (Segment Size X Segment adoption percentage X purchase frequency X price X profit margin percentage) - Fixed costs. 128. (p. 242) Students' answers will depend on the choice they make. They should be able to identify internal and external sources. Their answers should also explore the nature of the data and how reliable it might be. New products will challenge the students. 129. (p. 243) His ability to pursue each target segment is a key factor. Since it is an Internet auction-based business, Ronaldo should be able to access information about past sales of similar products, number of bidders, and prices. This will help determine the attractiveness of each segment. He should also consider his strengths and weaknesses relative to the other competitors and look for opportunities and potential threats. 130. (p. 246) Answers will vary but should start with the goal of providing potential students with a clear, distinctive, and desirable understanding of what the business program is about and how it compares with other programs both on campus and at nearby competing institutions. A positioning strategy for the business program will likely include persuasive communication about value and product attributes, probably focusing on career opportunities, salaries, and reputation of the program. USPS, of course, has a government-created monopoly for mail delivery. USPS is generally known for universal delivery where the others do not deliver to P.O boxes. DHL is less known in the U.S. market but well known in Europe. Its yellow and red trucks are distinctive and eye-catching. Similarly, FedEx uses its red, white, and blue colors and more recently a green, white, and blue combination. FedEx also acquired Kinko's creating added convenience as a positioning strategy. Both FedEx and UPS emphasize global distribution. FedEx frequently uses placement advertising (think Tom Hanks in Castaway) to promote its services. 131. (p. 246-249) UPS uses its distinctive brown color both on trucks and delivery personnel. It acts as a strong symbol. UPS also enforces strict rules about professional dress and even facial hair for their employees. All four firms offer an array of delivery services, times, and prices with none of the competitors have a distinct position. 132. (p. 249) Students should identify the dynamic nature of competition and expect the competition will respond accordingly. Some competitors will retaliate. Others may simply choose a different position. Others might engage in legal action if they feel sufficiently threatened. Toothpaste manufacturers might include criteria such as tartar control, gum disease-prevention, helping bad breath, teeth whitening, taste, health or safety. - Monitoring the positioning strategy - Selecting a position - Determining consumer preferences - Identifying competitors' positions - Determining consumers' perceptions and evaluations of a product in relation to competitors' 133. (p. 250-251) Creating a perceptual map involves five steps: 134. (p. 250-251) Students should identify the marketing research component, but they should also stress the importance of customers' perceptions. Some may focus on the competitors' positions, but the key is consumer. 135. (p. 230-252) Students should demonstrate an overall understanding of STP, and they should reflect on the importance of leveraging resources, working with customers' needs, establishing value and creating the kinds of competitive advantages based on building relationships with customers. 136. (p. 243) An undifferentiated targeting strategy is appropriate for commodities and products that provide the same benefits to everyone. 137. (p. 232) This is an example of demographic segmentation. 138. (p. 236) Answers will vary but should combine geographic and demographic bases for segmentation. 139. (p. 238) Airlines started with frequent flyer programs and have added priority upgrades, seating, and other services for their most loyal customers. 140. (p. 241-242) This addresses the question of whether the segment is substantial. 141. (p. 242) This addresses the question of whether the segment is reachable. 142. (p. 242) This assumes the segment will be responsive. 143. (p. 246) All four Ps may be adjusted. 144. (p. 250-251) Perceptual maps help marketers visualize their product's position relative to competitor's offerings. 145. (p. 230) Segmentation (Step 1 - Strategy or Objectives and Step 2 - Segmentation Methods); Targeting (Step 3 - Evaluate Segment Attractiveness and Step 4 - Select Target market); Positioning (Step 5 - Develop Positioning Strategy). 146. (p. 241-242) IDENTIFIABLE: A firm must be able to identify who is in a segment to be able to design products or services to meet their needs. It is also important that segments are distinct from one another. SUBSTANTIAL - A firm should measure the size of the potential market and identify if the size and buying power are sufficient to justify targeting the segment. REACHABLE - Products or services will not have any impact, no matter how identifiable or substantial the target market is, if the market cannot be reached both for marketing communications and for product distribution. RESPONSIVE - A customer should react positively to the firm's offering. If a company feels that it cannot provide products or services that will be attractive to the segment, it should not target it. PROFITABLE - A firm should assess the potential profitability of each segment, both current and future. Included in this analysis should be market growth, market competitiveness and market access. 147. (p. 231-240) Answers will vary; the student should correctly apply each of the two selected methods to an example. 148. (p. 244) Answers may vary. Although basic table salt may seem undifferentiated, we can still target several market segments with a different offering for each segment i.e. Kosher salt; Crystalline Sea Salt, Flaked Sea Salt; Rock Salt, Pickling Salt, for different needs in terms of how finely (or coarsely) the salt is ground. Salt providers also promote flavor differences based on additional minerals in the salt. 149. (p. 243-245) A company would choose to use a micromarketing strategy if it would need to tailor its product or service to suit customers' wants or needs, either on an individual basis or serving very small segments. An undifferentiated strategy would consider everyone to be a potential user of its product or service, with similar needs. 150. (p. 241-243) Answers can vary; however, here are some possibilities: (1) Identifiable--Can we identify who left-handed laptop users are? Are they distinct from other laptop users? (At present, they are not treated as a distinct segment.) (2) Substantial--Are there enough left-handed laptop users, and do they have sufficient buying power? Based on the CEO's information, there is a fairly large potential market. (3) Reachable--Can we reach the members of the segment? (4) Responsive--Do left-handed people want a specialized laptop, or are they satisfied with "normal" laptops? (5) Profitable--Can the company sell enough left-handed laptops to make up for the design costs? ch08 Summary Category AACSB: Analytic Blooms: Apply Blooms: Knowledge Blooms: Remember Blooms: Understand Grewal - Chapter 08 Learning Objective: 08-01 Identify the five steps in the segmentation; targeting; and positioning process. Learning Objective: 08-02 Outline the different methods of segmenting a market. Learning Objective: 08-03 Describe how firms determine whether a segment is attractive and therefore worth pursuing. Learning Objective: 0804 Articulate the difference among targeting strategies: undifferentiated; differentiated; concentrated; or micromarketing. Learning Objective: 08-05 Define positioning; and describe how firms do it. Level: Easy Level: Hard Level: Medium Topic: Develop Positioning Strategy Topic: Evaluate Segment Attractiveness Topic: Segmentation Methods Topic: Segmentation, Targeting, and Positioning Topic: Select Target Market Topic: The Segmentation, Targeting, and Positioning Process # of Questions 150 47 5 20 78 150 13 61 27 22 27 19 49 82 27 27 59 5 22 10 ... View Full Document

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