Principles of Marketing - Chapter 7 Vocabulary Flashcards

Flashcards covering core terminology and concepts for Chapter 7: Customer Value-Driven Marketing Strategy.

Customer Value-Driven Marketing Strategy

A strategy aimed at creating value for targeted customers through two core steps: selecting customers to serve (segmentation and targeting) and deciding on a value proposition (differentiation and positioning).

Market Segmentation

Dividing a market into smaller segments with distinct needs, characteristics, or behaviors that might require separate marketing strategies or mixes.

Geographic Segmentation

Dividing the market into different geographical units such as nations, regions, states, counties, cities, or neighborhoods.

Demographic Segmentation

Dividing the market into segments based on variables such as age, life-cycle stage, gender, income, occupation, education, religion, ethnicity, and generation.

Age and Life-Cycle Stage Segmentation

Dividing a market into different age and life-cycle groups.

Gender Segmentation

Dividing a market into different segments based on gender.

Income Segmentation

Dividing a market into different income segments.

Psychographic Segmentation

Dividing a market into different segments based on social class, lifestyle, or personality characteristics.

Behavioral Segmentation

Dividing a market into segments based on consumer knowledge, attitudes, uses of a product, or responses to a product.

Intermarket Segmentation

Forming segments of consumers who have similar needs and buying behaviors even though they are located in different countries.

Requirements for Effective Segmentation

The five essential traits market segments must have to be useful: measurable, accessible, substantial, differentiable, and actionable.

Target Market

A set of buyers who share common needs or characteristics that the company decides to serve.

Market-Targeting Strategies Continuum

The range of target marketing strategies extending from targeting broadly (undifferentiated/mass marketing) to targeting narrowly (micromarketing).

Undifferentiated Marketing

A market-coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer (mass marketing).

Differentiated Marketing

A market-coverage strategy in which a firm targets several market segments and designs separate offers for each.

Concentrated Marketing

A market-coverage strategy in which a firm goes after a large share of one or a few smaller segments or niches.

Micromarketing

The practice of tailoring products and marketing programs to suit the tastes of specific individuals and locations.

Local Marketing

Tailoring brands and promotions to the needs and wants of local customer segments, such as cities, neighborhoods, and specific stores.

Individual Marketing

Tailoring products and marketing programs to the needs and preferences of individual customers; also known as one-to-one marketing or mass customization.

Product Position

The way a product is defined by consumers on important attributes—the place it occupies in consumers' minds relative to competing products.

Positioning Map

A visual map showing consumer perceptions of competing brands versus a company's brand on key buying dimensions, such as price and performance.

Competitive Advantage

An advantage over competitors gained by offering consumers greater value, either through lower prices or by providing more benefits that justify higher prices.

Value Proposition

The full mix of benefits upon which a brand is differentiated and positioned.

Possible Value Propositions Grid

A matrix comparing benefits against price to categorize winning strategies (such as 'More for more' or 'Same for less') and losing strategies.

Positioning Statement

A statement that summarizes company or brand positioning using the form: To (target segment and need) our (brand) is (concept) that (point of difference).