Mktg 351 Cousley Test 2 – Flashcards

group of people, individuals, or organizations who have needs for products in a product class and have the ability, willingness, and authority to purchase such products

a group of people that lacks any of the four requirements Ex: Teenagers may have desire, money, and willingness to buy alcohol but the law prevents them from having authority to

1. Consumer 2. Business

-purchasers and household members who intend to consume or benefit from the purchased products and do not buy products to make profits -business to consumer markets (B2C)

-individuals, organizations, or groups that purchase a specific kind of product for resale, direct use in producing other products, or use in general daily operations -business to business (B2B), industrial, or organizational markets -classified into 4 categories

Producer, Reseller, Government, Institutional

1. identify the appropriate targeting strategy 2. determine which segmentation variables to use 3. develop market segment profiles 4. evaluate relevant market segments 5. select specific target markets

-strategy used to select target market is affected by target market characteristics, product attributes, and organizations objectives and resources -undifferentiated strategy -concentrated strategy -differentiated strategy

group of people or organizations for which a business creates and maintains a marketing mix specifically designed to satisfy the needs of group members

a company designs a single marketing mix and directs it at the entire market -effective for homogeneous markets -one promotional program, one distribution channel

where a large proportion of people in a target market have a similar needs for a product

-process of dividing a total market into groups of customers with similar product needs and designing a marketing mix to meet those needs -used for heterogenous markets -for success, five conditions must exist

made up of individuals or organizations with diverse needs for products in a specific product class

consist of customers that share one or more similar characteristics causing them to have similar product needs

allow a tailored marketing mix

-customers needs must be heterogenous -segments must be identifiable and divisible -segments must be comparable to one another with respect to estimated sales potential, costs, and profits -one segment just show enough profit potential to justify developing a special marketing mix -the firm mist be able to reach the chosen segment with a particular marketing mix

-means a company targets a single market segment using one marketing mix -advantages: allows specialization, a small firm can compete -disadvantages: profits fall with demand, difficult to diversify

an organization directs its marketing efforts at two or more segments, developing a marketing mix for each segment -advantages: could mean increased sales, uses excess production capacity -disadvantages: production costs are higher

Target Strategy Examples: 1. baking soda 2. mont blanc pens 3. iphones 4. lululemon yoga gear 5. tesla automobiles 6. black pepper

characteristics of individuals, groups or organizations used to divide a market into segments -demographic, geographic, psychographic, and behavioristic

-variable should relate to the customers needs for, uses of or behavior toward the product -variable must be measurable -company resources and capabilities -product type and variations in customer needs

age, gender, race, ethnicity, income, education, occupation, family size, family life cycle, religion, social class

region, urban/suburban/rural, city size, county size, state size, market density, climate, terrain

volume usage, end use, benefit expectations, brand loyalty, price sensitivity

Ex: American Eagle Outfitters sells jeans, polo shirts, T-shirts, swimsuits, and more. The company has become very popular among teenagers and young adults of both genders. The target market for the retailer is between the ages of 15 to 25. It is frequently located in malls and sells apparel at prices generally considered to be affordable. -what appears to be the key variable in segmenting American Eagle's target market?

refers to the number of potential customers within a unit of land area

clusters people in zip code areas and even smaller neighborhood units based on lifestyle and demographic information

focuses precise marketing efforts on very small geographic markets

division if a market according to benefits consumers want from the product

Ex: Skullcandy founder Rick Alden got the idea to develop trendy, functional headphones for music lovers who enjoy active sports and want to look fashionable. Age is a consideration as customers tend to be younger, but Skullcandy products are geared more toward sports enthusiasts. Skullcandy earbuds are brightly colored to appeal to sport-lovers who care about fashion. They come in different styles and designs for both genders. -from the description above, which type of variable is most important in segmenting Skullcandy's target market: demographic, geographic, psychographic, or behavioristic? -do you think Skullcandy has an undifferentiated, concentrated, or differentiated target strategy?