Market Segmentation, Targeting, and Positioning

Flashcards covering key concepts related to market segmentation, targeting, positioning, product types, services, and pricing strategies.

Market Segmentation

The process of dividing a target market into smaller, more precisely defined groups of consumers or organizations who have common needs and expected to respond similarly to a marketing action.

Geographic Segmentation

Dividing the market based on geographical areas such as culture, climate, language, population density, or location.

Demographic Segmentation

Segmentation based on characteristics such as gender, income, age, education, race, ethnicity, religion, occupation, and family structure.

Behavioral Segmentation

Dividing consumers based on their behavior, including occasion-based purchase timing and usage level.

Psychographic Segmentation

Segmentation that categorizes consumers based on their interests, activities, opinions, lifestyle, and personality.

Accessible (ADAMS Criteria)

The ability to reach and communicate with a specific consumer segment.

Differentiable (ADAMS Criteria)

The degree to which the segment is distinct and can be differentiated from others.

Actionable (ADAMS Criteria)

The practicality and profitability of reaching the target segment.

Measurable (ADAMS Criteria)

The capacity to accurately estimate the size of the segment.

Substantial (ADAMS Criteria)

The segment must be large enough to be profitable.

Buyer Persona

A fictional character created to represent a target customer, including their name, age, interests, media usage, and financial characteristics.

Undifferentiated Marketing

A strategy that uses a single marketing mix for the entire market, achieving broad market appeal.

Differentiated Marketing

A strategy that identifies several target markets and designs separate strategies for each one.

Concentrated Marketing

A strategy focused on one specific target market with a single marketing mix.

STP Model

The three steps in marketing: Segmenting the market, Targeting the most valuable segments, and Positioning the product.

Positioning

The act of placing a product in the minds of the consumer relative to competing products.

Perceptual Map

A visual representation of where a product or service stands in relation to competitors based on key attributes.

Product Life Cycle

The stages a product goes through from introduction, growth, maturity, to decline.

Service Intangibility

The characteristic of services that cannot be seen, felt, or touched before acquisition.

Service Inseparability

The simultaneous production and consumption of services, meaning they cannot be separated from their providers.

Service Variability

The quality of services can vary depending on who provides them and how, unlike physical products.

Service Perishability

The concept that services cannot be stored and are produced and consumed at the same time.

Price Elasticity of Demand

A measure of how much the quantity demanded changes in response to a change in price.

Elastic Demand

When a small change in price leads to a significant change in quantity demanded.

Inelastic Demand

When a change in price has little effect on the quantity demanded.

Pricing Strategy - Price Skimming

Setting a high initial price for a product and gradually lowering it over time.

Pricing Strategy - Penetration Pricing

Setting a low initial price to attract customers and gain market share.

Price Discrimination

Charging different prices to different consumers for the same product or service, based on various factors.