Marketing Chapter 7

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market

people or organizations with needs or wants and the ability and willingness to buy

market segment

a subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs

market segmentation

the process of dividing a market into meaningful, relatively similar, and identifiable segments or groups

segmentation bases (variables)

characteristics of individuals, groups, or organizations

geographic segmentation

segmenting markets by region of a country or the world, market size, market density, or climate

demographic segmentation

segmenting markets by age, gender, income, ethnic background, and family life cycle

family life cycle (FLC)

a series of stages determined by a combination of age, marital status, and the presence or absence of children

psychographic segmentation

market segmentation on the basis of a personality, motives, lifestyles, and geodemographics

geodemographics

segmenting potential customers into neightborhood lifestyle categories

benefit segmentation

the process of grouping customers into market segments according to the benefits they seem from the product

usage-rate segmentation

dividing a market by the amount of product bought or consumed

80/20 principle

a principle holding that 20 percent of all customers generation 80 percent of the demand

satisficers

business customers who place an order with the first familiar supplier to satisfy product and delivery requirements

optimizers

business customers who consider numerous suppliers, both familiar and unfamiliar, solicit bids, and study all proposals carefully before selecting one

target market

a group of people or organizations for which an organization designs, implements, and maintains a marketing mix intended to meet the needs of that group, resulting in mutually satisfying exchanges

undifferentiated targeting strategy

a marketing approach that views the market as one big market with no individual segments and thus uses a single marketing mix

concentrated targeting strategy

a strategy used to select one segment of a market for targeting marketing efforts

niche

one segment of a market

multisegment targeting strategy

a strategy that chooses two or more well-defined market segments and develops a distinct marketing mix for each

cannibalization

a situation that occurs when sales of a new product cut into sales of a firm's existing products

one-to-one marketing

an individualized marketing method that utilizes customer information to build long-term, personalized, and profitable relationships with each customer

positioning

developing a specific marketing mix to influence potential customers' overall perception of a brand, product line, or organization in general

position

the place of a product, brand, or group of products occupies in consumers' minds relative to competing offerings

product differentiation

a positioning strategy that some firms use to distinguish their products from those of competitors

perceptual mapping

a means of displaying or graphing, in two or more dimensions, the location of products, brands, or groups of products in consumers' minds

repositioning

changing consumers' perceptions of a brand in relation to competing brands

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