MKTG Exam 2 Chs 6 to 10

Geographic segmentation refers to segmenting markets

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Geographic Segmentation : refers to segmenting markets by region of a country or the world, market size, market density, or climate.
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Demographic Segmentation : segmenting markets by age, gender, income, ethnic background, and family life cycle Age Segmentation : Gender Segmentation : Income Segmentation : Ethnic Segmentation : Family Life Cycle [Segmentation] (FLC): is a series of stages determined by a combination of age, marital status, and the presence or absence of children. Psychographic Segmentation: is a market segmentation on the basis of: Personality Motives Lifestyles: Geodemographics: Benefit Segmentation: the process of grouping customers into market segments according to the benefits they seek from the product. Usage Rate Segmentation: divides a market by the amount of product bought or consumed. 80/20 Printiple: holds that 20% of all customers generate 80% of the demand. LO 5: Bases for Segmenting Business Markets The business market consists of four board segments: producers, resellers, government, and institutions. Satisficers: business customers who place an order with the first familiar supplier to satisfy product and delivery requirements Optimizers: business customers who consider numerous suppliers (both familiar and unfamiliar) solicit bids, and study all proposals carefully before selecting one LO 6: Steps in Segmenting a Market The purpose of market segmentation, in both consumer and business markets, is to identify marketing opportunities. 1. Select a market or product category for study 2. Choose a basis or bases for segmenting the market 3. Select segmentation descriptors 4. Profile and analyze segments 5. Select target markets 6. Design, implement, and maintain appropriate marketing mixes LO 7: Strategies for Selecting Target Markets So far, the chapter has focused on the market segmentation process, which is only the first step in deciding whom to approach about buying a product. 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 strategies: a marketing approach that views the markets 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 Multisegment targeting strategy: chooses two or more well-defined market segments and develops a distinct marketing mix for each
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Cannibalization: a situation that occurs when sales of a new product cut into sales of a firm’s existing product One-to-One Marketing: an individualized marketing method that utilizes customer information to build long-term, personalized, and profitable relationships with each customer LO 8 One-to-one marketing: Most business today use a mass-marketing approach designed to increase market share by selling their products to the greatest number of people.
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