CHAPTER 3: FOCUSING MARKETING STRATEGY WITH

SEGMENTATION AND POSITIONING

Market
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.
Generic Market
A market with broadly similar needs-and sellers offering various, often diverse, ways
of satisfying those needs.
Product-Market
A market with very similar needs and sellers offering various, often diverse, ways of
satisfyingthose needs.
Segmenting
An aggregating process-clustering people with similar needs into a "market segment".
Market Segment
A (relatively) homogeneous group of customers who will respond to a marketing mix
in a similar way.
Single Target Market Approach
Segmenting the market and picking one of the homogeneous segments as the firm's
target market.
Multiple Target Market Approach
Segmenting the market and choosing two or more segments, and then treating each as
a separate target market needing a different marketing mix.
Combined Target Market Approach
Combining two or more sub-markets into one larger target market as a basis for one
strategy.

Combiners
Try to increase the size of their target markets by combining two or more segments.
Segmenters
Aim at one or more homogeneous segments and try to develop a different marketing
mix for each segment.
Qualifying Dimensions
Those relevant to including a customer type in a product-market.
Determining Dimensions
Those that actually affect the customer's purchase of a specific product or brand in a
product-market.
Clustering Techniques
Try to find similar patterns within sets of data.
Customer Relationship Management (CRM)
The seller fine-tunes the marketing effort with information from a detailed customer
database.
Positioning
Refers to how customers think about proposed or present brands in a market.

1. Tom and Sally Jones are preparing to purchase a new car. Tom currently has a
Toyota Camry and Sally has a Honda Accord. They now have two children under age
5, so they plan to trade in Sally's car to purchase a minivan. Sally and Tom decide on
a Honda Odyssey because Sally is familiar with Hondas and thinks they are very
reliable. In this purchase situation, Tom and Sally's family life cycle stage is a
________ segmenting dimension, and the benefit Sally seeks (reliability) is a
________ segmenting dimension.

A. geographic; behavioral.
B. demographic; geographic.
C. behavioral; demographic.
D. demographic; behavioral.
E. geographic; demographic.
2. A target marketer who uses a single marketing mix strategy to appeal to both office
tablet computer users and home tablet computer users is applying the
A. generic market approach.
B. single target market approach.
C. combined target market approach.
D. broad market approach.
E. multiple target market approach.
3. A digital camera, a computer video camera, and a computer scanner might compete
in the same
A. generic market.
B. combined target market.
C. multiple target market.
D. single target market.
E. product-market.
When doing positioning, a marketing manager should
A. avoid targeting strategies.
B. rely on how customers think about proposed and/or existing brands in a market.
C. plan physical product changes rather than image changes.
D. focus on specific product features of all generic competitors.
E. None of these answers is correct.
Given its interest in the broad product-market for "ready-to-eat, health-conscious
snack foods," which of the following should the Good Health Foods Co. do first?
A. develop each of the Four Ps at the same time
B. decide what low-fat product or products it will offer
C. develop a plan for getting support from intermediaries
D. determine whether to compete on a price basis
E. segment the product-market to try to identify homogeneous submarkets and select
an attractive target market
It is sometimes hard to understand and define generic markets because
A. generic markets are characterized by very few competitors.
B. different product types may compete with each other.
C. generic markets are characterized by broadly different types of needs.
D. products in generic markets have generically-styled package designs.
E. similar product types typically compete with each other.
Which of the following is a characteristic of a product-market?
A. It is a market with a broad set of customers who have a wide variety of needs.
B. It is a market where only tangible goods are sold.
C. It is a market with a single seller but multiple buyers.
D. It is a market in which sellers offer very similar methods of satisfying customer
needs.
E. All of these choices are characteristic of a product-market.
A generic market
A. has customers with broadly similar needs.
B. often includes consumers who will satisfy the same need in quite different ways.
C. often involves sellers who compete in different product-markets.
D. often includes sellers who offer diverse ways of satisfying a need.
E. has all of these characteristics.
A complete product-market definition includes product type, customer needs,
customer types, and
A. resource availability.
B. segmenting dimensions.
C. advertising patterns.
D. marketing intermediaries.
E. geographic area.
Which of the following statements is true of generic markets?
A. In a generic market, similar product types compete with each other.
B. The generic market includes only three of four aspects of the product-market
definition—customer needs, customer types, and geographic area. It does not include
product type.
C. In a generic market, customers' needs differ from each other significantly.
D. A generic market description looks at markets narrowly and from a supplier's
viewpoint.
E. In a generic market, sellers have to focus primarily on how one seller's product is
better than that of another producer.
Which of the following statements about segmenting is accurate?
A. It tries to aggregate individuals who have similar needs and characteristics.
B. It is essentially a disaggregating, or "break it down," process.
C. It assumes that each individual should be treated as a separate target market.
D. It usually results in firms aiming at heterogeneous and less profitable markets.
E. It is the process of positioning a product in the customer's mind.
The first step in the market segmentation process involves
A. creating a positioning map.
B. combining two or more submarkets into one larger target market.
C. naming broad product-markets.
D. developing marketing mixes to meet all customer needs.
E. segmenting markets in order to select target markets.
When segmenting a broad product-market, it is especially important that marketers
create segments
A. that are simple.
B. that are the same with respect to their responses to marketing mix variables.
C. that are small in size.
D. that are operational.
E. where the members of a given segment are as diverse as possible.
Which of the following represents a broad product-market within the generic market
of outdoor adventures?
A. all possible customers
B. people who enjoy outdoor adventures in the United States
C. people who enjoy outdoor adventures
D. people who buy fly fishing equipment for fishing trips
E. loyal customers of Able brand fly fishing reels
Having segmented its broad product-market, Martinez Corp. has decided to treat its
two chosen submarkets as separate target markets, with each requiring different
marketing mixes. Which of the following approaches to developing market-oriented
strategies is Martinez Corp. applying in this scenario?
A. multiple target market approach
B. general target market approach
C. separate target market approach
D. single target market approach
E. combined target market approach

Target marketers who are "combiners"

A. use one marketing mix to appeal to multiple submarkets, even though the
submarkets have some distinct differences.
B. create distinct marketing mixes that enable them to zero-in on the needs of each
distinct submarket.
C. use multiple marketing mixes to appeal to a single market segment in different
ways.
D. try to fine-tune each element of their marketing mix to appeal to various
submarkets.
E. look at various submarkets for differences rather than similarities.
Which of the following statements is true of using a combined target market approach
to developing market-oriented strategies?
A. This approach is especially attractive for firms with limited resources.
B. This approach involves fine-tuning each element of the marketing mix to appeal to
each of the smaller submarkets.
C. It requires more investment than developing different marketing mixes for different
segments.
D. It results in diseconomies of scale.
E. People who follow this approach are referred to as "segmenters."
This approach is especially attractive for firms with limited resources. The balancing
point that determines just how unique a marketing mix a firm can afford to develop
for a particular market segment is
A. supply.
B. opportunity cost.
C. investment.
D. demand.
E. profit.
Segmenting and combining are two alternate approaches to developing market-
oriented strategies. Which of the following statements concerning these approaches is
true?
A. A combiner looks at various submarkets for similarities rather than differences.
B. Segmenters try to develop a marketing mix that will have general appeal to several
market segments.
C. A segmenter assumes that the whole market consists of a fairly homogeneous
group of customers.
D. Both segmenters and combiners try to satisfy few people very well rather than
many peoplefairly well.
E. Combiners treat each submarket as a separate target market.
When creating a marketing strategy and engaging in market segmentation, the ______
dimensions are the dimensions that define which potential customers are included in a
segment.
A. differentiating
B. determining
C. qualifying
D. positioning
E. outlying
In a customer survey conducted by Radwheel Motors, it was found that customers
purchased the company's cars primarily because Radwheel cars were a status symbol
in the survey population. By which type of marketing dimension were Radwheel's
purchasers motivated?
A. determining dimension
B. outlying dimension
C. qualifying dimension
D. unifying dimension
E. distinguishing dimension
What is a buyer persona?
A. a detailed description of a typical, but fictional, customer
B. a detailed description of the daily life of a real-life customer
C. a computer program that enables companies to simulate customer behavior
D. a marketing approach in which a company targets people who are predisposed to
buy
E. an individual who pretends to be a customer to help a company test its offerings
Which of the following types of segmenting dimensions are most helpful in
understanding how customers in a target market decide exactly which brands of
productto buy?
A. qualifying dimension
B. primary dimensions
C. informing dimensions
D. distinguishing dimensions
E. determining dimensions
Workathome Inc. offers to help people establish and manage their own online
businesses,a service for which it charges a fee. Out of several possible market
segments, the firm haschosen to target people with a limited understanding of the
Internet and poor financial literacy. This is an example of using
A. qualifying dimensions to segment.
B. positioning analysis.
C. potentially unethical segmenting.
D. customer relationship management.
E. combined target marketing.

Which of the following statements about clustering techniques for segmenting is true?
A. Clustering techniques try to find dissimilar patterns within sets of customer-related
data.
B. A variation of the clustering approach relies on customer relationship management.
C. Clustering searches all the data for heterogeneous groups of people.
D. Clustering approaches avoid the use of computers.
E. All of these statements about clustering techniques are true.
Which of the following techniques enables marketers to develop "segments of one"
where each customer is targeted with their own marketing mix?
A. demographic analysis
B. buyer personas
C. repositioning
D. single target market
E. customer relationship management
A _____ analysis helps managers understand how customers see their market.
A. positioning
B. regression
C. value chain
D. clustering
E. qualifying
Positioning analysis as it is usually practiced is not well-suited to identifying
A. the relative strengths of competing products.
B. basic shifts in the market.
C. the relative weaknesses of competing products.
D. how customers perceive products.
E. important product features.
When the target customers of a specific brand are not viewing it in the desired way,
the brand ideally needs to be
A. replaced.
B. downsized.
C. withdrawn.
D. sold off.
E. repositioned.

The purpose of a positioning statement is to

A. offer customers a brief and catchy summary of what makes a product or service
unique.
B. analyze the differences between different products in a market and how customers
perceive them.
C. provide focus for a marketing mix by concisely stating its most important features.
D. describe a company's overall marketing strategy in detail.
E. detail which consumers are included in the target market for a given marketing
mix.