Nu-quizlet MKTG EXAM 2

Market Segment

• Subgroup of people or organizations sharing one or more characteristics

• Similar Product needs

Successful market segmentation criteria

-Sustainability
-Identifiability & Measurability
-Accessibility
-Responsiveness

Substantiality

segment is large enough to warrant developing special marketing mix

Identifiability & Measurability

Number of people in various age categories, other social and demographic characteristics

Accessibility

Firms must be able to reach members, customized marketing mixes

Responsiveness

Markets are segmented using criteria that seems logical unless one market segment responds to a marketing mix differently than others

Segmentation Bases

Characteristics/variables that divide a total market into segments

Geographic Segmentation

Segment markets by

Region
Size
Climate
Density (people per unit of land)

Demographic Segmentation

Age
Gender
Income
Ethnic
Family-Life Cycle (age, marital status, presence/absence of children)

Psychographic Segmentation

Personality (attitudes/habits)
Motives (appeals to emotion)
Lifestyles (beliefs/socioeconomic characteristics)
Geodemographics (combines geographic, demographic, lifestyle)

Benefit Segmentation

Benefits customers seek from product
Basis of needs rather than characteristics

Usage-Rate Segmentation

Amount of product bought or consumed
Includes:

former users
potential users
first-time users
light or irregular users
medium users
heavy users

Perceptual Mapping

Displaying, graphing location of products brands or groups in people’s minds

Product Positioning

Choosing which segment or segments to target with targeting mix
Influences potential customers’ perception of brand

Position

Place product, brand, group of products occupies

Positioning Bases

Attribute - feature of product
Price & Quality - Indicates value
Use or Application - Indicates effectiveness
Product User - Type of user
Product Class - Associated with specific products
Competitor - Compare to other products
Emotion - Convey message

Repositioning

Change consumers’ perception of brands in relation to competitors

Target Market

Group of people or organizations that a company maintains a marketing mix for

Undifferentiated Targeting

-Mass-Market philosophy
-Uses one marketing mix
-Saves on production and marketing costs
-More susceptible to being beaten by competition

Concentrated Targeting

-Firm selects niche
-Concentrates on needs, motives, satisfaction of segment’s member
-Highly specialized marketing mix
-Concentrating resources and meeting needs of narrow market can be more profitable
-Can fail if segment is too small or shrinks

Multisegment Targeting

-Serves two or more well-defined market segments
-Offers potentially greater sales volume, higher profits, larger market sale
-Cannibalization can occur when sales of new product cut into sales of firm’s existing products

CRM (Customer Relationship Management)

Tracking interactions with customers to optimize customer satisfaction

Includes:

-Personalization (consumers treated as individuals)
-Time savings (saves consumers’ time)
-Loyalty (brands have reinforced this at every purchase occasion)
-Technology (cost effective, personalized messages or ads)

Chapter 9

Probability Sample

Sample in which every element in the population has a known statistical likelihood of being selected.

Simple Random Sample

Every member of the population has a known and equal chance of selection

Stratified Sample

-Divided into mutually exclusive groups
-Random samples are drawn from each group.

Cluster Sample

-The population is divided into mutually exclusive groups
-Random sample of clusters is selected.

Systemic Sample

-List of the population is obtained
-A skip interval is obtained by dividing the sample size by the population size.
-The beginning number is randomly chosen within the skip interval.

Nonprobability Samples

Any sample in which little or no attempt is made to get a representative cross section of the population

Convenience Sample

-Uses respondents who are readily accessible to researcher
-Employees, friends, or relatives.

Measurement Errors

Difference between info desired by researcher and info provided by measurement process.

Sampling error

-Sample somehow does not represent the target population
-Nonresponse (sample interviewed is different from sample drawn)

Frame Error

If the sample drawn from a population differs from the target population

Random Error

-Selected sample is an imperfect representation of overall population
-Random error represents how accurately the chosen sample’s true average (mean) value reflects the population’s true average (mean) value

Primary Data

-Information collected for the first time
-Current
-Source is known
-Can be expensive
-Can answer questions secondary data can’t

Survey Research

-Primary data is survey research
-Researcher interacts with people or posts a questionnaire online to obtain facts, opinions, and attitudes

Secondary Data

-Data previously collected for any purpose other than the one at hand
-Saves time and money
-May not have detailed/relevant info
-Tough to assess quality or relevance
-Can aid in formulating the problem statement
-Suggest research methods and other types of data needed for solving the problem

Secondary Data Examples

-Company’s websites
-Annual reports
-reports to stockholders
-blogs
-product testing results perhaps made available to the news media
-YouTube videos
-social media posts
-house periodicals composed by the company’s personnel for communication

Primary Data Examples

-In Home Personal Interviews
-Mall intercept Interviews
-Telephone Interviews
-Mail Surveys
-Executive Interviews (interview office workers or business people)
-Focus Groups

One-way frequency counts

-Record answers to questions
-Are always done first

Cross-Tabulation

Lets analysts look at responses to one question in relation to other questions

Competitive Intelligence

-Assess competitors and vendors to be more efficient and effective competitors
-Intelligence (analyzed info)

Chapter 14

Product Line Width and Depth

-Width: selling many different things
-Depth: selling different types of one thing (focused, specialty)

Department Store (in relation to things)

• Level of Service: Moderately high to high

• Product Assortment: Broad

• Price: Moderate to high

• Gross Margin: Moderately high

Specialty Store (in relation to things)

• Level of Service: High

• Product Assortment: Narrow

• Price: Moderate to high

• Gross Margin: High

Supermarket (in relation to things)

• Level of Service: Low

• Product Assortment: Broad

• Price: Moderate

• Gross Margin: Low

Drugstore (in relation to things)

• Level of Service: Low to moderate

• Product Assortment: Medium

• Price: Moderate

• Gross Margin: Low

Convenience Store (in relation to things)

• Level of Service: Low

• Product Assortment: Medium to narrow

• Price: Moderately high

• Gross Margin: Moderately high

Full-line Discount Store (in relation to things)

• Level of Service: Moderate to low

• Product Assortment: Medium to broad

• Price: Moderately low

• Gross Margin: Moderately low

Specialty Discount Store (in relation to things)

• Level of Service: Moderate to low

• Product Assortment: Medium to broad

• Price: Moderately low to low

• Gross Margin: Moderately low

Warehouse Club (in relation to things)

• Level of Service: Low

• Product Assortment: Broad

• Price: Low to very low

• Gross Margin: Low

Off-price Retailer (in relation to things)

• Level of Service: Low

• Product Assortment: Medium to narrow

• Price: Low

• Gross Margin: Low

Restaurant (in relation to things)

• Level of Service: Low to high

• Product Assortment: Narrow

• Price: Low to high

• Gross Margin: Low to high

Nonstore retailers

-Automatic Vending: use of machines for sale of goods
-Self-service technologies: Automatic services where customers make purchases themselves
-Direct Retailing: Door to door selling or in-home sales parties
-Direct Marketing: Techniques to elicit purchases from consumers in convenient locations
-Telemarketing: Outbound and inbound telephone contacts to sell directly to consumers
-Telemarketing: Outbound and inbound telephone contacts to sell directly
-Direct Mail: you mail stuff to people
-Shop-at-home television networks: Display merch to home viewers to call toll free lines
-Online Retailing (e-tailing): Customers shop over internet and get things delivered

Presentation (extra P)

-Determines store’s image in consumer’s mind
-Employee type + density: employee characteristics and number per square foot
-Merchandise Type + density: Brand names and arrangement of items
-Fixture type and density: parts of building in store
-Sound: Music influences purchases
-Odors: Smell can stimulate or detract from sales
-Visual Factors: Use of colors
-Layout: Use space effectively

Personnel (Extra P)

-Provide customers with amount of service prescribed by retail strategy
-Persuade shoppers to buy
-Challenging due to customer expectations varying

Big Data Analytics

Retailers use mathematical models to make better product decisions

Beacons

-Device that sends out connecting signals to customer devices
-Recognize when a customer is near the store
-Customer receives marketing message via text or email

RFID (Radio-Frequency Identification)

-Use radio waves to identify people or objects

Voice Assistants

-Conversational AI
-Emerging tech develops highly personalized relationship with customers

Goals of Promotion

-Inform
-Persuade
-Remind
-Connect

Elements of Promotion Mix

-Advertising: any form of impersonal paid communication
-Public Relations: Doing action to earn public acceptance
-Sales Promotion: Consists of all marketing activities other than ads, pr, personal selling.
-Personal Selling: Personal paid-for communication between two people
-Social Media: SEO, Paid search, display advertising

AIDA Model

Four steps in the purchase-decision process
-Attention: Create Awareness
-Interest: Demonstrations, early adopters
-Desire: Convince people product/service is the best solution
-Action: Get people to make a purchase