Marketing Final 6

Front 1

Market Segmentation stresses...Aggregating

Back 1

.... or grouping – people or organizations in a market according to the similarity of their wants/needs and the benefits they are looking for in making a purchase
- Needs/wants and benefits must be related to specific, tangible marketing actions the organization can take, such as using the marketing mix factors

Front 2

When to segment Markets

Back 2

- benefits must outweigh the costs of segmenting
- will segmentation result in increased sales? Profits? Return on investment?
- Expenses greater than potential benefits = should not segment the markets
- Finding the idea balance between satisfying a customer’s individual wants and achieving organizational synergy (improved efficiency)

Front 3

Market Segmentation

Back 3

- Involves aggregating prospective buyers into groups that:
1. have common needs/wants and
2. will respond similarly into a marketing action (the marketing Mix)
- Result: Market Segments
- Product Differentiation among segments

Front 4

Steps in Segmenting / Targeting Markets

Back 4

1. Form potential buyers into segments – would segmentation be worth doing and is it possible?
a. Examples of successful segmentation
i. potential for increased profit
ii. similarity of needs of potential buyers within a segment
iii. difference of needs of buyers among segments
iv. feasibility of marketing action to reach a segment
v. simplicity and cost of assigning potential buyers to segments
2. Form products to be sold into Groups – meaningful categories so that customers can relate to them
3. Develop a market – product grid and estimate size of markets
4. Select Target Markets – Not too narrow, not too broad
a. criteria:
i. market size
ii. Expected growth
iii. Competitive Position
iv. Cost of reaching this segment
v. Compatibility with organization’s objectives
5. Take Marketing Action to Reach Target Markets (who what when where and how)

Front 5

Usage Rate

Back 5

quantity consumed patronage during a specific period

Front 6

Frequency marketing

Back 6

using a product/service frequently
- 20% of customers are responsible for 80% of revenue and profitability (SECOND ESSAY QUESTION ON FINAL)
o Because some people buy so often

Front 7

Perceptual Maps

Back 7

technique used to determine position and preferences of consumers of a product/brand: (QUESTION ON EXAM)
o two dimensional
o attributes of product
o Judgments of where existing products/brands exist
o Location of the firms own product or brand regarding these attributes
o Ideal position

Front 8

Product Line

Back 8

group of products that are physically similar or are intended for a similar product

Front 9

Product Mix

Back 9

the combination of product lines offered by the manufacturer

Front 10

Product Differentiation

Back 10

(EXAM QUESTION)
- The creation of real product differences or perceptions that make one product seem superior to others
- Marketing creates perceptions of a unique attractive product
- Different products different marketing strategies