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11 Cards in this Set
- Front
- Back
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Define a Market
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A group of potential customers with similar needs who are willing to exchange something of value with sellers offering various goods or services – that is, ways of satisfying those needs.
Ex) Greeting card market |
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Define a Generic Market
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Is a market with broadly similar needs – and sellers offering various, often diverse, ways of satisfying those needs.
Ex) People in the Entertainment market want to be entertained in some way. Sellers offer many options that allow someone to be entertained. o TIVO and a Flat screen TV o Cruise on the Carnival line o Dave and Busters offer video games and drinking. |
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Define a Product Market
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Is a market with very similar needs and sellers offering various close substitute ways of satisfying those needs.
Ex) Camcorder market has many different substitutes. o Flip camera for an hour worth of HD recording. o High Value Sony Camera’s that have longest length for recording and best equipment. o Regular Camcorder from HP |
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Define Market Segmentation
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A two step process of
(1) naming broad product-markets and... (2) segmenting these broad product-markets in order to select target markets and develop suitable marketing mixes. |
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What are characteristics of “good” market segments?
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1) Homogenous within (all the same) - the customers in a market segment should be as similar as possible with respect to their likely responses to marketing mix variables and their segmenting dimensions.
2) Heterogenous (different) between – the customers in different segments should be as different as possible with respect to their likely responses to marketing mix variables and their segmenting dimensions. 3) Substantial – the segment should be big enough to be profitable. 4) Operational – the segmenting dimensions should be useful for identifying customers and deciding on marketing mix variables. |
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What are the difference between segmenting and combining.
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Segmenting
• An aggregating process that clusters people with similar needs into a market segment. • Single target or multiple target market approach Combining • Trying to increase the size of their target markets by combining two or more segments. • Look at various submarkets for similarities rather than differences. • Combined target market approach. |
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What are the advantages and disadvantages of “combining” market segments?
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Advantages
• Helps achieve economies of scale • Requires less investment than developing different marketing mixes for different segments – making it especially attractive for firms with limited resources. Disadvantages • It is harder to develop marketing mixes that can satisfy potential customers. • Other companies (innovators) can come in and chip away at various segments of the combined target market. |
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What is the difference between a qualifying dimension and a determining dimension?
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Qualifying Dimension
• The dimensions that are relevant to including a customer type in a product market. Determining dimension • The dimensions that actually affect the customers purchase of a specific product or brand in a product-market. |
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Be able to identify and recognize examples of consumer segmenting dimensions
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Behavioral
• Needs, Benefits sought, Thoughts, Rate of Use, Purchase Relationship, Brand familiarity, Kind of shopping, Type of Problem solving, Information required. Geographic • Region of World (country), region in Country, Size of City Demographic • Income, Sex, Age, Family Size, Family Life cycle, Occupation, Education, Ethnicity, Social Class |
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How do you segment business markets?
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Kind of relationship you have with the business
Type of customer (business) they are • Private, non-profit, government agency, wholesale, retail, etc. Demographics • Where they are located, their size, How many facilities they have How customer will use the product • Raw materials, supplies, components, etc. Type of buying situation • How they buy it from you Purchasing method • E-commerce purchases, negotiated contracts, Internet bidding, purchase specifications, etc. |
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What is positioning, how and why is it used?
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o Refers to how customers think about proposed or present brands in a market.
o A marketing manager needs a realistic view of how customers think about offerings in the market. Without it, it is hard to differentiate. |
