{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

MKTG Exam 2 Study Guide 6 7 8 9 10

Segmentation is the process of dividing a market into

Info iconThis preview shows pages 7–10. Sign up to view the full content.

View Full Document Right Arrow Icon
Segmentation is the process of dividing a market into meaningful, relatively similar, and identifiable segments or groups. Importance of Segmentation Criteria for Successful Segmentation Substantiality Identifiability and measurability Accessibility Responsiveness Steps in Segmenting a Market Select a market for study 7
Background image of page 7

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Choose bases for segmentation Profile and analyze segments Select descriptors Select target markets Design, implement, maintain marketing mix Bases of Segmentation Characteristics of individuals, groups, or organizations Five possible bases Geography Demographics Psychographics Product benefits Usage rate The bases can be used individually or in combination If possible, give each segment a name Geography Segmenting markets by region, market size, market density, or climate. Examples: Region : (1) Pacific, Mountain, Mid-west … (2) City west, City east, Downtown … Size : under 99,999, 100,000-199,999, 200,000 or over Density : urban, suburban, rural Climate : northern, southern Example: R.J. Reynolds Tobacco Company (Actually a geodemographic segmentation) 4 brands: Winston, Camel, Salem and Doral Segmenting the market of a major American city North Shore Higher education level and concerned more about health Promotes low-tar brands Southeast Blue-collar and conservative Promotes Winston South Side African-American communities Promote the high menthol content of Salem, heavily using the African-American press and billboards. Demographics Segmenting by age, gender, income, ethnic background, and family life-cycle. Psychographics Segmenting by personality, motives, lifestyle, geodemographics. Heavily used by advertising agencies Example: Claritas PRIZM system 8
Background image of page 8
combination of geographic, demographic and lifestyle segments by neighborhoods/zip codes Claritas PRIZM Neighborhoods Product Benefits Segmenting by the benefits consumes seek from the product; it is the most frequently used base for segmentation Usage-rate Segmenting by the amount of product bought. Possible segments: light users, medium users, and heavy users. 80/20 principle : 20 percent of all customers generate 80 percent of the demand Serving and creating heavy users Segmenting Business Markets Company characteristics o Geographic location o Type of company / industry o Company size, etc. o Volume of purchases o Product use Buying processes o Satisficers or optimizers o Buying center characteristics (including individual buyer characteristics) o Buyer power Factors Influencing Segment Attractiveness Segment size and growth current dollar sales, growth rate, profit margins Segment structural attractiveness competitors substitute products power of buyers and suppliers Targeting Strategies Undifferentiated Targeting Multisegment Targeting Concentrated Targeting Niche Marketing A niche is a more narrowly defined group, typically a small market whose needs are not being well served. Usually there is a price premium. 9
Background image of page 9

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 10
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

Page7 / 18

Segmentation is the process of dividing a market into...

This preview shows document pages 7 - 10. Sign up to view the full document.

View Full Document Right Arrow Icon bookmark
Ask a homework question - tutors are online