Marketing Management 3Rd Edition By

Marketing Management 3Rd Edition By

Marketing Management, 3e (Marshall)
Chapter 7 Segmentation, Target Marketing, and Positioning

1) One of the basic principles behind segmentation is that subgroups of customers can be identified on some basis of similarity.

2) Marketing (Big M) is not just identifying existing segments but also creating new ones.

3) Occupation segmentation and income segmentation are essentially the same thing.

4) For many marketing managers, segmentation by benefit sought is the best place to start the process of market segmentation.

5) One of the most straightforward and popular methods of segmentation is demographic.

6) Business market segmentation is less straightforward than segmentation of consumer markets.

7) Generation Y, people born between 1978 and 1994, tend to be pragmatic, optimistic, good team players, savvy consumers, and edgy in nature.

8) The largest generation is the Silent Generation.

9) Family and household segmentation has become more complex due to a variety of differing family arrangements.

10) The final step in target marketing is to develop profiles of each segment under consideration for investment as a target market.

11) A tertiary target market has reasonable potential but is not suited for development immediately.

12) A niche strategy is the same as Porter’s focus strategy and is a concentrated target marketing approach.

13) Strategic fit means there is a good match of a target market to the firm’s culture and resource capabilities.

14) Effective positioning is not affected by competitive forces.

15) A perceptual map is used to compare consumer perceptions of each competitor’s delivery against specific paired attributes.
16) Marcia wanted a car she could drive for 10 years, so she bought a Toyota because they are known for their reliability and longevity. This BEST demonstrates the product leadership source of differentiation.

17) In overpositioning, consumers have a very broad understanding of the company, product, or brand.

18) McDonald’s fell victim to confused positioning in the 1990s after introducing too many new products which caused customers to lose track of what the core brand was.

19) Firms that engage in unethical business practices are always aware of the magnitude of damage being done to their brand.

20) Which of the following is one of the basic principles behind segmentation?
A) All customers are alike.
B) Subgroups of customers are not similar.
C) Subgroups will be smaller and more homogeneous than the overall market.
D) Members of a heterogeneous market cannot allow for dividing the market into subgroups.
E) In an undifferentiated market, each person has unique needs and wants.

21) Segmenting markets means that a company is ________.
A) dividing the market into meaningful smaller markets based upon common characteristics
B) selecting the markets to attack in the marketplace
C) selecting a corporate position to communicate to potential customers
D) identifying and calculating the churn rate in different markets
E) identifying the customers who have frequently purchased competitor’s products or services

22) Target marketing is the process by which ________.
A) the market is divided into cohesive groups
B) a company evaluates market segments and decides which ones have the most potential for development
C) a company chooses which advertising strategy to use
D) the customer groups are evaluated on the basis of high or low churn to see which is the most profitable
E) a company collects cookies to track everyone who visits its website
23) Positioning relies on the communication of one or more sources of value to customers in a way that the customer can easily make the connection between the ________.
A) cost of the product and the quality
B) way the 4Ps of the marketing mix work with one another
C) customer’s needs and wants and what the product has to offer
D) product and its advertising
E) salesperson and the customer at a personal level

24) Organizations communicate one or more sources of value to customers in a way that the customer can easily make the connection between his or her needs and wants and what the product has to offer. Execution of this approach is referred to as a firm’s ________ strategy.
A) segmentation
B) positioning
C) production
D) sales
E) distribution

25) In marketing, differentiation is a concept that means ________.
A) consumer choices remain similar around the globe
B) each age segment views products exactly the same
C) products need to appear to be different from one another to be successful in the marketplace
D) communicating and delivering value in different ways to different customer groups
E) evaluating different market segments and deciding which shows the most promise for development

26) While developing a segmentation approach, Walter, the brand manager of a soft drinks manufacturing company says that a segment has sufficient size. He means that the market ________.
A) has a large enough television audience to be worth considering
B) is reachable
C) can provide a positive return on investment
D) has many customers in it
E) is homogeneous

27) Which of the following criteria for market segmentation is least likely to enable successful segmentation?
A) It should be measurable.
B) It should be of sufficient size.
C) It should be readily identifiable.
D) It should be undifferentiated.
E) It should be reachable in terms of communication.
28) Which of the following questions about market segmentation relates to creation and execution of different marketing strategies to the different submarkets identified?
A) Can the segment be reached in terms of physical product?
B) Is the segment of sufficient size to warrant investing in a unique value-creating strategy for that segment as a target market?
C) Is the segment readily identifiable and can it be measured?
D) Can the segment be reached in order to deliver the value of the product, and subsequently can it be effectively and efficiently managed?
E) Is the segment clearly differentiated on one or more important dimensions when communicating the value of the product?

29) American credit card companies would like to offer their services to people in a country in East Africa. However, they are finding it difficult because of language barriers and infrastructure challenges. These issues are related to which of the following questions about market segmentation?
A) Do the people in this market segment have access to sufficient financial resources?
B) Is the segment of sufficient size to warrant investing in a unique value-creating strategy for that segment as a target market?
C) Is the segment readily identifiable and can it be measured?
D) Can the segment be reached in order to deliver the value of the product, and subsequently can it be effectively and efficiently managed?
E) Is the segment clearly differentiated on one or more important dimensions when communicating the value of the product?

30) The ability to get secondary and/or primary data on a market being considered for segmentation relates to which of the following questions about marketing?
A) Can the segment be reached in terms of physical product?
B) Is the segment of sufficient size to warrant investing in a unique value-creating strategy for that segment as a target market?
C) Is the segment readily identifiable and can it be measured?
D) Can the segment be reached in order to deliver the value of the product, and subsequently can it be effectively and efficiently managed?
E) Is the segment clearly differentiated on one or more important dimensions when communicating the value of the product?

31) Approaches to geographic segmentation include all of these EXCEPT ________.
A) region
B) density of population
C) size of population
D) gender of population
E) climate
32) The region, the density of the population, and the size of the population are various approaches to use in ________.
A) positioning
B) differentiation
C) democratic segmentation
D) population parameter estimation
E) geographic segmentation

33) Marketers use geographic segmentation when ________.
A) certain geographic regions have more diverse populations
B) geography determines one’s likes and dislikes
C) there is evidence that consumers respond differently to marketing strategies and programs based on where they live
D) there is a strong demand for the products and services of the company in some geographic regions
E) people in some regions are richer than people in other regions

34) When a retail chain sells winter coats, it sends them to different stores at different times of the year. Which of the following approaches to geographic segmentation in the United States does this scenario exemplify?
A) by region
B) by climate
C) by size of population
D) by growth in population
E) by density of population

35) Which of the following statements is TRUE of geographic segmentation?
A) It divides consumer groups based on a variety of readily measurable descriptive factors about the group.
B) In most instances, it is an insufficient criterion in and of itself.
C) It does not consider climate while segmenting markets.
D) It does not consider the size of population while segmenting markets.
E) It is useful because the demand for all kinds of products is determined by where a person lives.

36) Demographic segmentation is one of the most popular segmentation approaches because ________.
A) it takes into account the climate of different regions.
B) the needs and wants of customers remain constant based on demographic differences
C) it uses easily identifiable characteristics of human populations such as lifestyle
D) it is relatively easy to measure the variables used in this approach to segmentation
E) the demand for all kinds of products is determined by where a person lives
37) Age is a commonly used method of segmentation. Age alone, however, may be dangerous because ________.
A) grouping older customers into one group is an approach that fails to consider the vast differences in other important variables
B) chronological age and psychological age are the same
C) older consumers exhibit very little differences from person to person on things such as income, mobility, and work status
D) this approach ignores chronological age
E) this approach presumes irregularity of consumer needs and wants by age

38) Demographic segmentation is best described as using characteristics of ________ to segment the market.
A) human populations
B) geography
C) economics
D) political stability
E) government regulations

39) Sociologists look for defining events such as major economic upheaval, wars, and ________ as triggers for generational change.
A) political stability
B) marketing opportunities
C) sociocultural revolution
D) foreign policy changes
E) population growth

40) Which of the following statements is TRUE of the baby boomers generational group?
A) The baby boomers have been traditionally ignored by the marketing managers.
B) The majority of baby boomers are in their early 80s.
C) The baby boomers have an old outlook of life and the future.
D) The baby boomers think that they don’t age.
E) The baby boomers will have limited impact on marketing decisions in the future.

41) Generation X is often referred to as the ________.
A) spoiled generation
B) nonconsumption generation
C) millennial generation
D) baby bust generation
E) optimistic generation
42) Katherine was born in 1970. She is environmentally conscious and media-savvy. She is most likely to be a member of which generational group?
A) baby boomer generation
B) GI generation
C) silent generation
D) Generation X
E) Generation Y

43) Cateleya was born in 2001. She is a member of ________.
A) the baby boomer generation
B) the millennial generation
C) Generation Y
D) Generation X
E) Generation Z

44) Catalina was born in 1940. She is a member of ________.
A) the baby boomer generation
B) the silent generation
C) Generation Y
D) Generation X
E) the Millennial generation

45) Which of the following would NOT be a good product for using gender segmentation?
A) Nail polish
B) Perfume
C) Toothpaste
D) Cigars
E) Pregnancy tests

46) The ________ race and ethnicity market segment is about 12 percent of the U.S. population and is not growing rapidly.
A) African-American
B) Hispanic
C) Asian-American
D) Caucasian
E) Indian-American
47) At one time, specialized companies catered to markets segmented by race. Today ________.
A) the segments are indistinguishable
B) the segments have declined in size
C) the segments have become targets of mainstream businesses that offer specialized products
D) the segments consist of such people who tend to buy the same type of products
E) the segments lack differentiation

48) The razor is an example of a product that appeals to both men and women, but companies figured out that ________.
A) the same product class cannot be used to attack different gender markets
B) grooming equipment may be needed by men but certainly not by women
C) there are different needs and wants for the same product category among different genders
D) markets should not be segmented based on gender
E) all products are clearly marketed for the primary consumption of both men and women

49) At about 17 percent of the U.S. population, ________ remain the largest minority group.
A) Hispanics/Latinos
B) Asians
C) Indians
D) Native Americans
E) African Americans

50) Which of the following statements is TRUE of income segmentation?
A) It is usually analyzed in incremental ranges.
B) It is based on a very quantifiable geographic variable.
C) Marketers seldom use income as a segmenting approach.
D) It is time consuming to study consumers’ buying habits based on their income.
E) There is a direct correlation between income and price preferences.

51) ________ segmentation recognizes that there may be a number of consistent needs and wants demonstrated by consumers based on what type of job they have.
A) Occupational
B) Social
C) Age
D) Gender
E) Educational
52) Offering credit cards to high school seniors is an example of ________ segmentation.
A) income
B) occupational
C) educational
D) lifestyle
E) gender

53) Everything else being equal, ________ segmentation might lead a firm to offer its products based on some anticipated future payoff from the consumer.
A) income
B) occupational
C) educational
D) lifestyle
E) gender

54) Social class has declined as a method of segmentation as a result of ________.
A) higher education rates in the United States
B) readily available credit flattening the classes
C) the increase in minority consumers
D) stores appealing to everyone
E) wealthy individuals spending lavishly on luxury products

55) A marketing manager using the database called PRIZM is interested in ________ segmentation.
A) geographic
B) psychographic
C) geodemographic
D) occupational
E) educational

56) A marketing manager using VALS is interested in ________ segmentation.
A) geographic
B) psychographic
C) geodemographic
D) occupational
E) educational

57) An approach to segmenting consumer markets is ________ segmentation, which relies on consumer variables such as personality and AIOs (activities, interests, and opinions) to segment a market.
A) occupational
B) psychographic
C) geographic
D) educational
E) gender

58) ________ segmentation is sometimes referred to as segmentation by lifestyle or values.
A) Occupational
B) Psychographic
C) Geographic
D) Educational
E) G ender

59) ________ segmentation divides customers into groups according to similarities in benefits sought or product usage patterns.
A) Behavioral
B) Income
C) Geographic
D) Gender
E) Educational

60) Advertisements with messages like “Orange juice—It’s not just for breakfast anymore!” or “Soup can be a delicious way to start a cold winter’s day” are using ________ segmentation.
A) benefits sought
B) lifestyle
C) psychographic
D) usage patterns
E) geographic

61) ________ segmentation focuses on why people buy what they buy.
A) Benefits sought
B) Usage rate
C) Demographic
D) Social class
E) Occasion
62) In analyzing the attractiveness of market segments, which of the following is NOT one of the most important variables?
A) segment size
B) growth potential
C) strategic fit with the firm’s goals
D) location of the segment
E) competitive forces related to the segment

63) Primary target markets differ from secondary and tertiary target markets by the ________.
A) expected level of ROI derived from the market
B) difficulty of attacking the market
C) consumers’ ability to buy multiple units
D) advertising effort needed for the market
E) average age of the consumers

64) Companies sometimes pick a one-market strategy. This marketing approach is called ________.
A) mass approach
B) undifferentiated target marketing
C) differentiated strategy
D) low-cost approach
E) efficiency marketing

65) Differentiated target marketing means that a company is ________.
A) offering different prices for different markets
B) developing different products for the same market
C) developing different value offerings for different targeted markets
D) using the push and pull strategy to differentiate markets
E) using a one-market strategy for different markets

66) Concentrated target marketing is often used by ________.
A) large companies to dominate a market
B) start-up firms to enter a market as a focus player
C) multinational companies to enter a new market
D) software consulting firms that use Internet marketing
E) large e-commerce businesses to attract new customers

67) Firms that develop such close relationships with customers that they seem to deliver customized goods and services are engaged in ________ marketing.
A) concentrated target marketing
B) one-to-one marketing
C) differentiated marketing
D) undifferentiated marketing
E) shotgun marketing
68) Once market segments have been defined and analyzed and target markets have been selected for development, the firm must turn its attention to creating, communicating, delivering, and exchanging offerings that have value to the target markets. This process is known as ________.
A) positioning
B) target marketing
C) niche marketing
D) outsourcing
E) selling

69) Positioning strategy is a process that often starts with ________, which help(s) develop a set of attributes for further analysis.
A) focus groups
B) surveys
C) case studies
D) panel research
E) interviews

70) Which of the following statements is TRUE of repositioning?
A) It involves targeting a large portion of a small market.
B) It involves understanding the marketing mix approach necessary to change present consumer perceptions of the product.
C) It is popularly called a focus strategy or a niche strategy.
D) It involves developing different value offerings for different targeted segments.
E) It advocates that firms should direct energy and resources into establishing a learning relationship with each customer.

71) The local sandwich shop has always sold calorie-laden sandwiches and recently introduced six new sandwiches featuring vegetables and lower-calorie meats and cheeses to appeal to health-conscious customers. What strategy is the sandwich shop pursuing?
A) repositioning
B) one-to-one marketing
C) concentration
D) tertiary target marketing
E) 80/20 rule

72) When a company tries to constantly develop the “next new thing,” it is trying to establish ________ leadership as a source of differentiation.
A) service
B) image
C) price
D) personnel
E) innovative
73) When a company only hires employees who are competent, reliable, courteous, credible, responsive, and able to communicate clearly, it achieves ________ leadership as a source of differentiation.
A) personnel
B) convenience
C) image
D) price
E) service

74) Michael believes that the only motorcycle anyone should ever buy is a Harley-Davidson. Whenever he sees the Harley Davidson logo on a product, he knows that product is a leader in the market. What source of differentiation has Harley Davidson achieved?
A) personnel
B) convenience
C) image
D) price
E) service

75) When a company tries to make the product or service significantly easier to obtain than the competition, it is trying to achieve ________ leadership as a source of differentiation.
A) service
B) image
C) price
D) personnel
E) convenience

76) Pamela only bought her cars from Lexis because they made it so easy to get them serviced by picking her car up and bringing it back to her. Lexis shows ________ leadership.
A) innovative
B) image
C) price
D) personnel
E) service

77) Harold buys most of his groceries at Aldi because it has the cheapest groceries even though he has to bring his own bags and bag his own groceries. Aldi demonstrates ________ leadership.
A) innovative
B) image
C) price
D) personnel
E) service
78) Millie prefers to stay at the Omni Hotel rather than the Embassy Suites because she knows the Omni provides high-end bedding, luxurious robes and toiletry products for every customer. What differentiation factor is affecting Millie’s decision?
A) innovative
B) convenience
C) price
D) personnel
E) service

79) In the context of positioning errors, when consumers have only a vague idea about the company and its products, and do not perceive any real differentiation, it is called ________.
A) repositioning
B) overpositioning
C) underpositioning
D) uninformed positioning
E) fuzzy positioning

80) In the context of positioning errors, when the claims made for the product or brand are not regarded as credible by consumers, it is called ________.
A) underpositioning
B) repositioning
C) doubtful positioning
D) fuzzy positioning
E) overpositioning

81) NovoTech Inc. is a manufacturer of PCs, and most of its revenue is generated by selling PCs to consumers. However, the company is struggling to extend the brand into other lucrative product lines such as tablets and smartphones. In this scenario, NovoTech is suffering from the error of ________.
A) underpositioning
B) doubtful positioning
C) overpositioning
D) confused positioning
E) repositioning
82) In the 1970s, Michelob beer changed its advertising messages frequently and saw sales plummet. Slogans like “Weekends were made for Michelob,” “Put a little weekend into your weekday,” and “Special times deserve a special beer” had consumers checking their calendars to find the right time to drink a Michelob. Michelob was suffering from the positioning error of ________.
A) underpositioning
B) doubtful positioning
C) overpositioning
D) confused positioning
E) repositioning

83) HerboCare, a company that sells herbal soaps, has failed to increase its sales, as consumers could not understand how soaps made by HerboCare were different or better than other herbal soaps available in the market. In this scenario, HerboCare is suffering from the positioning error of ________.
A) underpositioning
B) doubtful positioning
C) overpositioning
D) confused positioning
E) repositioning

84) Define the terms market segmentation, target marketing, and positioning.

85) What are the questions a marketing manager must answer in order to create effective segmentation?

86) What are the four consumer market segmentation approaches? Give an example of when you might use each one.

87) Describe the VALS framework.

88) Describe the three steps in target marketing. Explain what factors/options should be considered for each step.

89) Describe the four basic approaches to target marketing.

90) What are perceptual maps? How are they used to reposition a product?