Marketing: Chapter 9

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Market segments

Groups that result from market segmentation

Market-product grid

Framework relating the segments of a market to products of the firm

Product differentiation

A marketing strategy using different marketing mix activities to help consumers perceive a product as being different from and better than competing products

Perceptual map

A means or method of displaying the position of products or brands in consumers' minds

Usage rate

Quantity consumed or services rendered during a specific period

Product positioning

The Place a product occupies in consumers' minds on important features relative to competing products

Market segmentation

Sorting potential buyers into groups that have common needs and will respond similarly to a marketing action

organizational synergy

the increased customer value achieved through performing organizational functions more efficiently

cannibalization

reduction in sales volume, revenue, or market share of one product as a result of introduction of a new product by the same producer

grouping potential buyers into segments

five criteria in forming market segments: simplicity and cost effectiveness of assigning potential buyers to segments, potential for increased profit, similarity of needs of potential buyers within a segment, difference of needs of buyers among segments, potential of a marketing action to reach a segment.

geographic segmentation

Segmenting markets by region of a country or the world, market size, market density, or climate (ex. spicier campbell's soup for different parts of u.s.)

demographic segmentation

Segmenting markets by age, gender, income, ethnic background, and family life cycle (ex. serving size of campbell's soups)

psychographic segmentation

dividing a market into different groups based on social class, lifestyle, or personality characteristics.

behavioral segmentation: product features

understanding what features are important to different costumers (ex.microfridges for college students)

usage rate

(in behavioral segmentation) quantity consumed or times visited during a specific period

80/20 rule

A marketing heuristic that claims that 20% of purchasers account for 80% of a product's sales.

geographic segmentation: statistical area

type of sales call depending on whether area is metropolitan or micropolitan

demographic segmentation: naics or number of employees

printing needs, size of firm (different # of emloyees = different system)

market-product grid

a framework to relate the market segments of potential buyers to products offered or potential marketing actions by an organization... used to determine which product market segments to select and which product groupings to offer

rows

markets on the market-product grid

colums

product groupings on the market-product grid

cells

the unique market-product combination on the market-product grid

criteria used to select target markets

market size, expected growth, competitive position, cost of reaching the segment, compatibility with the organization's objectives and resources

marketing synergy

streamlines products towards one target market

product synergy

streamlines a company towards only one product that caters to many markets

product positioning

refers to the place an offering occupies in consumer's mind on important attributes relative to competitive offerings.

product repositioning

changes the place a product occupies in a consumer's mind relative to competitive products

perceptual map

means of displaying the position of products or brands in the consumers' minds

head-to-head positioning

competing directly with competitors on similar products attributes in the same target market

differentiation positioning

seeking a less competitive smaller market niche in which to locate a brand

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