Week 3 – Quiz

1. Dunkin’ Donuts is expanding in several different countries. Its stores offer curry
doughnuts in India, dulce de leche doughnuts in Peru, and cherry brandy doughnuts in
Germany. This is an example of segmentation based primarily on:
a. demographics.
b. behavior.
c. psychographics.
d. geography.
e. customization.
2. Among the segmentation variables related to purchase behavior is consumers’ share of
wallet. This term refers to the:
a. money that a consumer spends with one firm as a share of all the money that the
consumer spends in that category.
b. money that a consumer spends with a representative firm as a share of all the
money spent by similar consumers.
c. money that a consumer spends with one firm as a share of that consumer’s
discretionary income.
d. total amount of money that a consumer spends as a share of that consumer’s
yearly expenditures.
3. Conjoint analysis is an approach used to achieve preference-based segmentation by:
a. extending the multi-attribute model approach to new product categories. XX
b. correlating preference data with response data.
c. forcing consumers to make trade-offs between pairs of products with different
attributes.
d. forcing consumers to articulate why they make certain purchases based on
different attributes.
4. Rockwell Collins is a manufacturer of avionics and communications systems for
corporate aircraft. In response to a general slowdown in the business aviation industry,
Rockwell announced cutbacks for the items it makes for small and midsize jets. Based
on this information, which of the following segmentation variables is Rockwell most likely
to utilize?
a. Geographic
b. “Firmographic”
c. Buying approach
d. Psychographic
5. The segmentation process begins by grouping:
a. competitors with similar needs and preferences.
b. customers with similar lifetime values.
c. market offerings with similar sales potential.
d. customers with similar needs and preferences.
e. customers with similar demographic profiles.
6. A firm should consider three key factors when choosing a target segment, including not
only the external factors of competition and segment characteristics but also the firm’s
internal:
a. revenue targets and market share.
b. resources and competencies.
c. strategic and tactical plans.
d. sales goals and market share.
7. Firms CANNOT create:
a. consumer segments.
b. segmentation strategies.
c. consumer targets.
d. targeting strategies.
e. positioning strategies.
8. During which step in the STP marketing process is a value proposition defined and an
action plan developed?
a. Positioning
b. Planning
c. Segmentation
d. Targeting
e. Profiling
9. Segmentation and targeting influence a company’s resource allocation, potentially
affecting strategic decisions in all of the following areas EXCEPT:
a. price.
b. advertising.
c. customer management.
d. mission formulation.
e. sales force.
10. PRIZM is a commonly used segmentation system that groups consumers into:
a. lifestage groups and social groups.
b. lifestage groups and behavioral groups.
c. social groups and behavioral groups.
d. lifestyle groups and social groups.
11. Specialty retailers like Restoration Hardware, L.L.Bean, and Anthropologie make heavy
use of direct mail catalogs. Such catalog marketers typically segment their markets
based on three factors, each of which describes the nature of different customers’ past
purchases and correlates well with future purchases. Abbreviated as RFM, the factors
are:
a. recency, frequency, and measurability.
b. recall, familiarity, and measurability.
c. recognition, frequency, and monetary value.
d. recency, frequency, and monetary value.
12. California Closets is a maker of closet organizers and custom storage solutions. Its
products are designed for people who live in small spaces. Assuming the company plans
to segment its market based on a single variable, which of the following is most
appropriate?
a. Benefits sought (value)
b. Geography (urban versus suburban)
c. Psychographics (lifestyle)
d. Behavioral (usage rate)
e. Firmographics (global versus regional)
13. The goal of cluster analysis is to group customers and determine the number of
groups, or clusters, so that the:
a. distance between two customers in a cluster is minimized.
b. distance between clusters is averaged.
c. distance between two customers in a cluster is maximized.
d. average distance between clusters is minimized.
14. Which of the following represents the most significant risk to companies using a mass-
marketing approach?
a. They may not realize economies of scale.
b. They may overemphasize the benefits of customized products.
c. They may lose customers to niche marketers.
d. They may lose customers to international marketers.
e. They may lose customers who feel that mass marketers are invading their
privacy.
15. For a segmentation to be useful, it must meet several criteria. Which of the following is
NOT among these criteria?
a. Identifiable
b. Accessible
c. Profitable
d. Substantial
e. Actionable
16. A toothpaste manufacturer believes its most likely customers are parents of young
children who value a brand with a kid-friendly taste and texture. The company’s
segmentation is probably based on:
a. psychographics.
b. a combination of demographics and psychographics.
c. behavioral characteristics.
d. a combination of demographics and benefits sought.
e. a combination of behavioral characteristics and benefits sought.
17. xx