Ch 7: Customer Value-Driven Marketing Strategy (Key Terms)

Market segmentation

Dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors and who might require separate marketing strategies or mixes.

Market targeting (targeting)

Evaluating each market segment's attractiveness and selecting one or more segments to serve.

Differentiation

Designing the market offering to create superior customer value that is distinct from that offered by competitors.

Positioning

Creating a clear, distinctive, and desirable place for a marketing offer relative to competing products in the minds of target consumers.

Geographic segmentation

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

Hyperlocal social marketing

Location-based targeting to consumers in local communities or neighborhoods using digital and social media.

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 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 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.

Occasion segmentation

Dividing the market into segments according to occasions when buyers get the idea to buy, actually make their purchase, or use the purchased item.

Benefit segmentation

Dividing the market into segments according to the different benefits that consumers seek from the product.

Intermarket (cross-market) segmentation

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

Target market

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

Undifferentiated (mass) marketing

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

Differentiated (segmented) marketing

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

Concentrated (niche) marketing

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

Micromarketing

Tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments; it includes local marketing and individual marketing.

Local marketing

Tailoring brands and marketing to the needs and wants of local customer segments—cities, neighborhoods, and even specific stores.

Individual marketing

Tailoring products and marketing programs to the needs and preferences of individual customers.

Product positioning

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

Competitive advantage

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

Value proposition

The full positioning of a brand—the full mix of benefits on which it is positioned.

Positioning statement

A statement that summarizes company or brand positioning using this form: "For (target customers), who (unsolved customer needs), our product is (product description), that provides (key benefits). Unlike (key competing brands), our product (points of difference)."