M300 Ch. 8

  1. market segmentation
    • Aggregates prospective buyers into groups that have common needs and will respond similarly to a marketing action.
    • Three strategies:
    • One product and multiple segments
    • Multiple Products and Multiple Segments
    • Segments of One: Mass Customization
  2. product differentiation
    The strategy of using different marketing mix actions to help consumers perceive a product as being different and better than competing products.
  3. A market-product grid
    is a framework to relate the market segments of potential buyers to products offered or potential marketing action
  4. organizational synergy
    the increased customer value achieved through performing organizational functions such as marketing or manufacturing more efficiently
  5. Cannibalization
    new products or stores that steal sales from older products or stores in the same company
  6. Criteria for Forming Segments
    • 1.Simplicity and cost-effectiveness of assigning potential buyers to segments
    • 2.Potential for increased profit
    • 3. Similarity of needs of potential buyers within a segment
    • 4. Difference of needs of buyers among segments
    • 5.Potential of a marketing action to reach a segment
  7. usage rate
    The quantity consumed or the number of store visits during a specific period.
  8. Ways to Segment Consumer Market
    • 1. Geographic segmentation -Region
    • 2. Demographic segmentation -Household size
    • 3.Psychographic segmentation: Lifestyle
    • 4.Behavioral segmentation -  Product features
    • 5. Behavioral segmentation: Usage rate.
  9. Ways to Segment Business (Organizational) Markets
    • 1. Geographic segmentation: Statistical area
    • 2.Demographic segmentation: NAICS code
    • 3.Demographic segmentation: Number of employees
    • 4.Behavioral segmentation: Usage rate
  10. Criteria to use in selecting Target Segments
    • 1. Market size
    • 2. Expected growth
    • 3.Competitive position
    • 4. Cost of reaching the segment
    • 5. Compatibility with the organization’s objectives and resources
  11. product positioning
    The place a product occupies in consumers’ minds based on important attributes relative to competitive products.
  12. product repositioning
    Changing the place a product occupies in consumers’ minds relative to competitive products.
  13. Product Positioning using perceptual Maps
    1. Identify the important attributes for a product or brand class. 2. Discover how target customers rate competing products or brands with respect to these attributes. 3. Discover where the company’s product or brand is on these attributes in the minds of potential customers. 4. Reposition the company’s product or brand in the minds of potential customers.
  14. perceptual map
    A means of displaying the location of products or brands in consumers’ minds.
Card Set
M300 Ch. 8