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Marketing Chapter 7

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
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
business customers who place an order with the first familiar supplier to satisfy product and delivery requirements
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
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
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
developing a specific marketing mix to influence potential customers' overall perception of a brand, product line, or organization in general
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
changing consumers' perceptions of a brand in relation to competing brands