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Chapter 6 key terms
Terms in this set (58)
Define the major steps in designing a customer-driven marketing strategy: market segmentation, targeting, differentiation, and positioning.
Customer driven strategy
Create value for targeted customers. A company must identify the parts of the market that it can serve best and most profitably. Consists of four steps: market segmentation, market targeting, differentiation, positioning.
Dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors, and who might require separate products or marketing programs.
Market targeting (targeting)
The process of evaluating each market segment's attractiveness and selecting one or more segments to enter.
Actually differentiating the market offering to create superior customer value.
Arranging for a market offering to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers.
List and discuss the major bases for segmenting consumer and business markets.
Dividing a market into different geographical units, such as nations, states, regions, counties, cities, or even neighborhoods.
Dividing the market into segments based on variables such as age, life-cycle stage, gender, income, occupation, education, religion, ethnicity, and generation.
Age and life-cycle segmentation
Dividing a market into different age and life-cycle groups.
Dividing a market into different segments based on gender.
Dividing a market into different income segments.
Dividing a market into different segments based on social class, lifestyle, or personality characteristics.
Dividing a market into segments based on consumer knowledge, attitudes, uses, or responses to a product.
Dividing the market into segments according to occasions when buyers get the idea to buy, actually make their purchase, or use the purchased item.
Dividing the market into segments according to the different benefits that consumers seek from the product.
segments include nonusers, ex-users, potential users, first-time users, and regular users
markets can also be segmented into light, medium, and heavy product users
buyers can be divided into groups according to their degree of loyalty
Segmenting business markets
operating characteristics, purchasing approaches, situational factors, personal characteristics
Segmenting international markets
geographic location, economic factors, political and legal factors, cultural factors
Inter-market (cross-market) segmentation
Forming segments of consumers who have similar needs and buying behaviors even though they are located in different countries.
measurable, accessible, substantial, differentiable, actionable
Explain how companies identify attractive market segments and choose a market-targeting strategy.
evaluating and looking at segment size and growth, segment structural attractiveness, company objectives and resources. Companies can target very broadly (undifferentiated marketing), very narrowly (micromarketing), or somewhere in between (differentiated or concentrated marketing).
A set of buyers sharing common needs or characteristics that the company decides to serve.
Undifferentiated (mass) marketing
A market-coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer. Focuses on what is common in the needs of consumers, designs a product that will appeal to the largest number of buyers
Differentiated (segmented) marketing
A market-coverage strategy in which a firm decides to target several market segments and designs separate offers for each.
Concentrated (niche) marketing
A market-coverage strategy in which a firm goes after a large share of one or a few segments or niches. Can fine-tune its products, prices, and programs to the needs of carefully defined segments
Tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments; it includes local marketing and individual marketing.
Tailoring brands and promotions to the needs and wants of local customer segments- cities, neighborhoods, and even specific stores.
Tailoring products and marketing programs to the needs and preferences of individual customers.
factors to consider in choosing: company resources, market variability, product's life-cycle stage, market variability, competitor's marketing strategies
Socially responsible marketing
marketing generates concern when targeting: vulnerable, minority, or disadvantaged populations, children and teens
Discuss how companies differentiate and position their products for maximum competitive advantage.
The way a product is defined by consumers on important attributes- the place the product occupies in consumers' minds relative to competing products.
Perceptual Positioning Maps
show consumer perceptions of their brands versus competing products on important buying dimensions.
Differentiation and Positioning strategy
consists of three steps: identifying a set of differentiating competitive advantages on which to build a position, choosing the right competitive advantages, and selecting an overall positioning strategy.
An advantage over competitors gained by offering greater customer value, either by having lower prices or providing more benefits that justify higher prices.
Brands can be differentiated on features, performance, or style and design
Beyond differentiating its physical product, a firm can also differentiate the services that accompany the product. They gain services differentiation through speedy, convenient, or careful delivery.
Gain competitive advantage through the way they design their channel's coverage, expertise, and performance.
Hiring and training better people than their competitors do. Requires that a company selects its customer-contact people carefully and train them well.
should convey a product's distinctive benefits and positioning
The difference delivers a highly valued benefit to target buyers.
Competitors do not offer the difference, or the company can offer it in a more distinctive way.
The difference is superior to other ways that customers might obtain the same benefit.
The difference is communicable and visible to buyers.
Competitors cannot easily copy the difference
Buyers can afford to pay for the difference.
The Company can introduce the difference profitably.
The full positioning of a brand- the full mix of benefits on which it is positioned. How will it create differentiated value for targeted segments and what positions it wants to occupy in those segments.
More for more
provide the most upscale product and charge a higher price to cover the higher costs
More for the same
attack a competitor's positioning by introducing a brand offering comparable quality at a lower price
The same for less
offer similar products at much reduced prices
Less for much less
meet consumers' lower performance or quality requirements at a much lower price
More for less
offer the best products at the lowest prices
A statement that summarizes company or brand positioning using this form: To (target segment and need) our (brand) is (concept) that (point of difference). All the company's marketing mix efforts must support the chosen positioning strategy
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