Chapter6 - Chapter 6 Outline Market Segmentation and the...

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Chapter 6 Outline Market Segmentation and the Marketing Mix: Determinants of Advertising  Strategy Chapter 6 Objectives 1. Identify the various methods  advertisers use to segment both  consumer and business markets. 2. Explain the importance of  aggregation to marketing and  advertising. 3. Discuss how target marketing affects  the firm’s advertising strategy. 4. Describe the elements of the  marketing mix and the role of  advertising in the mix. 5. Explain the purpose and importance  of branding. The Market Segmentation Process is a two-step strategy : 1. Identifying groups of people (or organizations) with certain shared characteristics  within the broad markets for consumer or business products. 2. Aggregating (combining) these groups into larger market segments according to their  mutual interest in the product’s utility. Behavioristic Segmentation  is the grouping of consumers by their purchase behavior.  Behavioral segments are determined by many variables, but the most important are: o User-status variables o Usage-Rate variables  o Purchase-occasion variables  o Benefits-Sought variable Geographic Segmentation Demographic Segmentation   o geodemographic segmentation . Psychographic Segmentation   - Consumers are targeted on their psychological make- up including factors like values, personality, attitude, and lifestyle ( psychographics ). o  VALS  o Mindbase o BehaviorGraphics Limitations of Consumer Segmentation Methods  Advocates of VALS and other psychographic methods claim these methods help  them address the emotional factors that motivate consumers. 1
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However, since the markets for many products include a broad cross section of  consumers, psychographics may offer little real value, especially since they  oversimplify consumer personalities and purchase behavior. VALS is also criticized for being complicated and lacking the proper theoretical  underpinnings. Segmenting Business and Government Markets Business  (or industrial)  markets   1. Business Purchasing Procedures   a. The business purchase decision is more complex and rigid than the  consumer purchase decision and may depend on factors besides product  quality or price.  b. The purchase decision normally takes longer—weeks, months, and  sometimes years. c.
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Chapter6 - Chapter 6 Outline Market Segmentation and the...

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