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									      Chapter 8: Identifying Market Segments and Targets

GENERAL CONCEPT QUESTIONS


Multiple Choice
1. In ________ marketing, the seller engages in the mass production, mass distribution,
   and mass promotion of one product for all buyers.
   a. group
   b. mass
   c. general
   d. segmented
   e. differentiated
Answer: b       Page: 226      Difficulty: Medium AACSB: Analytic Skills

2. The argument for ________ marketing is that it creates the largest potential market,
   which leads to the lowest costs, which in turn can lead to lower prices or higher
   margins.
   a. niche
   b. micro
   c. macro
   d. differentiated
   e. mass
Answer: e       Page: 226      Difficulty: Medium AACSB: Reflective Thinking

3. A ________ consists of a group of customers who share a similar set of needs and
   wants.
   a. market target
   b. market group
   c. market slice
   d. market segment
   e. market level
Answer: d      Page: 226      Difficulty: Medium AACSB: Analytic Skills

4. A ________ consists of two parts: a naked solution and discretionary options.
   a. differentiated market offering
   b. flexible market offering
   c. rigid market offering
   d. vertical market offering
   e. horizontal market offering
Answer: b       Pages: 228       Difficulty: Hard      AACSB: Analytic Skills
Part 3: Connecting with Customers


5. If a marketing manager observes that his or her market shows no natural segments
   and consumers seem to have roughly the same preferences, the marketing manager
   will most likely be faced with a ________ preferences pattern.
   a. homogeneous
   b. heterogeneous
   c. diffused
   d. clustered
   e. scattered
Answer: a       Page: 228        Difficulty: Medium AACSB: Analytic Skills

6. Procter & Gamble has many soap brands. One reason for this is that soap users tend
   to group together in terms of preferences such as bleaching action, softness, stain
   removal, et cetera. Which of the following preferences pattern would most likely
   apply to P&G’s method of response to market needs?
   a. Homogeneous preferences
   b. Diffused preferences
   c. Clustered preferences
   d. Psychological preferences
   e. Cultural preferences
Answer: c      Page: 228        Difficulty: Medium AACSB: Analytic Skills

7. Marketers usually identify niches by ________.
   a. dividing a segment into subsegments
   b. conducting VALS tests
   c. allowing consumers to gravitate toward product brands
   d. examining the demographics section of The Handbook of Marketing
   e. producing products that can be used in a variety of ways
Answer: a      Page: 228         Difficulty: Medium

8. A niche is characterized as being all of the following EXCEPT that ________.
   a. the customers in the niche have a distinct set of needs
   b. the customers will pay a premium to the firm that satisfies their needs
   c. the niche is not likely to attract other competitors
   d. the customers generally have smaller amounts of income
   e. the nicher gains certain economies through specialization
Answer: d       Page: 229          Difficulty: Medium AACSB: Reflective Thinking

9. Those who favor localized marketing see national advertising as wasteful because
   ________.
   a. it gets too up close and personal with consumers
   b. it drives up manufacturing and marketing costs by reducing economies of scale
   c. it magnifies logistical problems
   d. it fails to address local needs
   e. all of the above
Answer: d         Page: 231        Difficulty: Medium AACSB: Reflective Thinking
                                            Chapter 8: Identifying Market Segments and Targets


10. ________ combines operationally driven mass customization with customized
    marketing in a way that empowers consumers to design the product service offering
    of their choice.
    a. Consumptionization
    b. Viral marketing
    c. Virtual marketing
    d. Regionalization
    e. Customerization
Answer: e         Page: 233    Difficulty: Medium AACSB: Analytic Skills

11. All of the following are disadvantages of customerization EXCEPT that ________.
    a. it requires more prior information about the customer than most customers are
        willing to share
    b. it is difficult to implement for complex products
    c. it can raise the cost of goods by more than the customer is willing to pay
    d. some customers don’t know what they want until they see the actual product
    e. the product may be hard to repair and have little sales value
Answer: a          Page: 233       Difficulty: Hard      AACSB: Reflective Thinking

12. Regardless of the type of segmentation scheme used, the key is adjusting the
    marketing program to recognize ________.
    a. the level of disposable income earned by the target group
    b. customer differences
    c. the cost–benefit relationship of narrowing the target market
    d. customer similarities
    e. saturated markets
Answer: b        Page: 233        Difficulty: Easy

13. If a marketer decides to segment a market based on neighborhoods, the marketer will
    have chosen the ________ method of segmentation.
    a. demographic
    b. psychographic
    c. geographic
    d. cultural
    e. social class
Answer: c        Page: 233       Difficulty: Easy      AACSB: Analytic Skills
Part 3: Connecting with Customers


14. When segmenting on the basis of family life cycle, all of the following are segment
    categories EXCEPT ________.
    a. young, single
    b. male, female
    c. young, married
    d. older, married, no children under 18
    e. young, married, youngest child 6 or over
Answer: b       Page: 236         Difficulty: Medium AACSB: Analytic Skills

15. If a marketing manager segments the market into culture-oriented, sports-oriented, or
    outdoor-oriented groups, he or she is segmenting on the basis of ________.
    a. personality
    b. behavioral occasions
    c. user status
    d. psychographic lifestyle
    e. readiness stage
Answer: d        Page: 241       Difficulty: Medium AACSB: Analytic Skills

16. If a market is segmented according to light, medium, and heavy product users, the
    marketer segmenting this market is using the ________ as the means to segment.
    a. user status
    b. usage rate
    c. buyer-readiness stage
    d. occasion
    e. benefit
Answer: b        Page: 245      Difficulty: Easy       AACSB: Analytic Skills


17. John and May have just divorced. Which of the following demographic segmentation
    subsegment formats might be used by marketers to reach Jose or Erika?
    a. Life stage
    b. Benefits
    c. Age segment
    d. User segment
    e. Occasion segment
Answer: a        Page: 236      Difficulty: Medium AACSB: Reflective Thinking
                                            Chapter 8: Identifying Market Segments and Targets


18. Men and women tend to have different attitudinal and behavioral orientations, based
    partly on genetic makeup and partly on ________.
    a. income
    b. occupation
    c. socialization
    d. heredity
    e. globalization
Answer: c        Page: 243       Difficulty: Medium AACSB: Analytic Skills


19. ________ is the science of using psychology and demographics to better understand
    consumers.
    a. Psychographics
    b. Segmentation
    c. Clustering
    d. Demographics
    e. Social psychology
Answer: a       Page: 241        Difficulty: Medium AACSB: Analytic Skills

20. According to the VALS segmentation system, ________ are successful, sophisticated,
    active, ―take-charge‖ people with high self-esteem. Their purchases often reflect
    cultivated tastes for relatively upscale, niche-oriented products and services.
    a. innovators
    b. thinkers
    c. achievers
    d. experiencers
    e. believers
Answer: a         Page: 242          Difficulty: Hard      AACSB: Analytic Skills

21. Kim is a young professional who enjoys snowboarding and going to rock concerts
    with her friends. According to the VALS eight-part typology segmentation system,
    Kim is best described as a(n) ________.
    a. thinker
    b. achiever
    c. experiencer
    d. striver
    e. survivor
Answer: c        Page: 242        Difficulty: Medium AACSB: Analytic Skills
Part 3: Connecting with Customers


22. According to the VALS segmentation system, ________ are considered to be elderly,
    passive people who are concerned about change and are loyal to their favorite brands.
    a. believers
    b. strivers
    c. makers
    d. survivors
    e. experiencers
Answer: d        Page: 242      Difficulty: Medium AACSB: Analytic Skills

23. A housewife requests a new treadmill for her birthday. With respect to consumer
    decision roles, which role is the housewife currently playing?
    a. Initiator
    b. Influencer
    c. Decider
    d. Buyer
    e. Gatekeeper
Answer: a        Page: 243          Difficulty: Easy

24. The sale of turkeys in Asian countries like Hongkong, Singapore and The Philippines
    is highest in December, as people buy turkeys to serve at Christmas. Supermarkets
    that specifically advertise turkeys at this time of year are segmenting on the basis of
    ________.
    a. benefits
    b. user status
    c. psychographics
    d. demographics
    e. occasion
Answer: e         Page: 243        Difficulty: Easy       AACSB: Analytic Skills

25. Mothers-to-be are potential users who will turn into heavy users of infant products
    and services. By targeting mothers-to-be as future heavy users, producers of these
    products and services are segmenting consumers on the basis of ________.
    a. usage rate
    b. buyer-readiness stage
    c. loyalty status
    d. user status
    e. benefits
Answer: d        Page: 245       Difficulty: Medium AACSB: Analytic Skills
                                               Chapter 8: Identifying Market Segments and Targets


26. If a buyer is loyal to two or three different brands of soap, this buyer’s loyalty status
    can be described as being among the ________.
    a. switchers
    b. shifting loyals
    c. split loyals
    d. hard-core loyals
    e. antiloyals
Answer: c         Page: 246        Difficulty: Easy

27. Pete always buys Purina dog food for his dog because he believes that it is the best
    value for the nutritional content. Pete’s loyalty status is best described as ________.
    a. split loyal
    b. shifting loyal
    c. consistent loyal
    d. hard-core loyal
    e. switcher
Answer: d         Page: 246        Difficulty: Easy        AACSB: Analytic Skills

28. A company can learn a great deal by analyzing the degrees of brand loyalty. For
    example, by studying the ________ the company can pinpoint which brands are most
    competitive with its own.
    a. hard-core loyals
    b. split loyals
    c. shifting loyals
    d. switchers
    e. antiloyals
Answer: b        Page: 246      Difficulty: Hard    AACSB: Reflective Thinking

29. All of the following are considered to be product attitude segments EXCEPT
    ________.
    a. synergistic
    b. enthusiastic
    c. positive
    d. indifferent
    e. hostile
Answer: a        Page: 247    Difficulty: Medium AACSB: Analytic Skills
Part 3: Connecting with Customers


30. A potato chip manufacturer is concerned about consumers leaving its brand and going
    to competitive alternatives. Which of the following groups (based on strength of
    commitment) would be most likely to leave the company’s offering and go
    somewhere else for snack products?
    a. Convertible
    b. Shallow
    c. Average
    d. Entrenched
    e. Hard rocks
Answer: a        Page: 248       Difficulty: Medium AACSB: Reflective Thinking

31. If a consumer group is designated based on their ―balance of disposition,‖ the
    ________ group can be described as one that is made up of nonusers who are as
    attracted to a competing brand as they are to their current brands.
    a. strongly unavailable
    b. weakly unavailable
    c. ambivalent
    d. available
    e. desirable
Answer: c         Page: 248       Difficulty: Medium AACSB: Analytic Skills


32. If a marketer is seeking to segment a business market, which of the following
    variables is generally felt to be the most important?
    a. Personal characteristics
    b. Demographic variables
    c. Situational factors
    d. Operating variables
    e. Purchasing approaches
Answer: b         Page: 249         Difficulty: Hard      AACSB: Analytic Skills

33. A marketer is interested in segmenting a business market based on technology and
    customer capabilities. Which of the following major segmentation variables would
    most likely be used by the marketer to assist with the task?
    a. Demographic variables
    b. Purchasing approaches
    c. Situational factors
    d. Personal characteristics
    e. Operating variables
Answer: e        Page: 249       Difficulty: Hard         AACSB: Analytic Skills
                                              Chapter 8: Identifying Market Segments and Targets


34. A marketer is interested in segmenting a business market on ________ if the marketer
    intends to eventually segment the market based on loyalty and attitudes toward risk.
    a. situational factors
    b. purchasing approaches
    c. personal characteristics
    d. operating variables
    e. demographic variables
Answer: c        Page: 249         Difficulty: Medium

35. A marketer interested in segmenting a business market based on ________ intends to
    eventually segment the market based on power structure and purchasing criteria.
    a. situational factors
    b. purchasing approaches
    c. personal characteristics
    d. operating variables
    e. demographic variables
Answer: b        Page: 249       Difficulty: Medium AACSB: Analytic Skills

36. During which step of the segmentation process would the marketer group customers
    into segments based on similar needs and benefits sought by the customer in solving a
    particular consumption problem?
    a. Step 2—segment identification
    b. Step 3—segment attractiveness
    c. Step 6—segment ―acid test‖
    d. Step 1—needs-based segmentation
    e. Step 7—marketing-mix strategy
Answer: d        Page: 250       Difficulty: Medium AACSB: Reflective Thinking

37. If an organization’s marketing department wished to create ―segment storyboards‖ to
    test the attractiveness of each segment’s positioning strategy, this action would most
    likely occur in the ________ step of the segmentation process.
    a. needs-based segmentation
    b. segment identification
    c. segment profitability
    d. segment ―acid test‖
    e. marketing-mix strategy
Answer: d          Page: 250       Difficulty: Hard      AACSB: Analytic Skills

38. In the ________ step of the market segmentation process, the marketer evaluates the
    segment using criteria such as market growth and market access.
    a. need-based segmentation
    b. segment identification
    c. segment attractiveness
    d. segment profitability
    e. segment ―acid test‖
Answer: c       Page: 250         Difficulty: Hard
Part 3: Connecting with Customers




39. To meet the ________ criterion of useful market segments, it must be possible to
    formulate effective programs for attracting and serving the segments.
    a. measurable
    b. substantial
    c. accessible
    d. differentiable
    e. actionable
Answer: e        Page: 250       Difficulty: Medium AACSB: Analytic Skills

40. If married and unmarried women respond similarly to a sale on perfume, these
    hypothetical segments fail the ________ criterion for useful market segments.
    a. measurable
    b. substantial
    c. accessible
    d. differentiable
    e. actionable
Answer: d        Page: 250        Difficulty: Medium

41. According to the ________ criterion for useful market segments, a segment should be
    the largest possible homogenous group worth going after with a tailored marketing
    program.
    a. measurable
    b. substantial
    c. accessible
    d. differentiable
    e. actionable
Answer: b        Page: 250      Difficulty: Medium AACSB: Analytic Skills

42. In evaluating different market segments, the firm must look at two factors: the
    segment’s overall attractiveness and ________.
    a. company’s objectives and resources
    b. the product to be sold
    c. the purchasing process
    d. competition’s strategies
    e. the global nature of the product
Answer: a       Page: 251         Difficulty: Medium AACSB: Reflective Thinking

43. Volkswagen concentrates on the small-car market and Porsche on the sports car
    market. These would be examples of what is called ________.
    a. single-segment concentration
    b. selective specialization
    c. product specialization
    d. market specialization
    e. full market coverage
Answer: a        Page: 251      Difficulty: Easy       AACSB: Analytic Skills
                                             Chapter 8: Identifying Market Segments and Targets




44. All of the following are benefits of following the ________ approach to target market
    selection: a strong knowledge of the segment’s needs, a strong market presence,
    operating economies through specializing in production, distribution, and promotion.
    a. single-segment concentration
    b. selective specialization
    c. product specialization
    d. market specialization
    e. full market coverage
Answer: a         Page: 251       Difficulty: Medium AACSB: Reflective Thinking

45. When a symphony orchestra targets people who have broad cultural interests, rather
    than only those who regularly attend concerts, the orchestra is targeting ________.
    a. market mavens
    b. strategic segments
    c. supersegments
    d. occasion segments
    e. psychodemographic segments
Answer: c        Page: 251       Difficulty: Hard        AACSB: Analytic Skills

46. The chief disadvantage to a firm that decides to follow a product specialization
    strategy in selecting target markets is that ________.
    a. no synergy exists
    b. logistics can become a nightmare
    c. the product may be supplanted by an entirely new technology
    d. competitors can easily copy any new product introductions
    e. e-commerce becomes difficult for the company
Answer: c         Page: 251        Difficulty: Hard       AACSB: Reflective Thinking

47. With ________ as a target market strategy, the firm concentrates on serving many
    needs of a particular customer group.
    a. single-segment concentration
    b. selective specialization
    c. product specialization
    d. market specialization
    e. full market coverage
Answer: d        Page: 252        Difficulty: Easy    AACSB: Analytic Skills

48. In ________ marketing, the firm operates in several market segments and designs
    different products for each segment.
    a. segmented
    b. undifferentiated
    c. differentiated
    d. geodemographic
    e. niche
Answer: c        Page: 252         Difficulty: Easy
Part 3: Connecting with Customers


49. Johnson & Johnson broadened its target market for its baby shampoo to include
    adults through ________.
    a. countersegmentation
    b. metamarketing
    c. undifferentiated marketing
    d. product specialization
    e. single-segment concentration
Answer: a        Page: 252       Difficulty: Medium AACSB: Analytic Skills


50. ________ is the strategic coordination of economic, psychological, political, and
    public relations skills, to gain the cooperation of a number of parties in order to enter
    or operate in a given market.
    a. Metamarketing
    b. Macromarketing
    c. Micromarketing
    d. Megamarketing
    e. Modular marketing
Answer: d         Page: 254         Difficulty: Medium AACSB: Analytic Skills



51. When Coca-Cola sold only one kind of Coke in a 6.5-ounce bottle, it was practicing
    what is called ________.
    a. primary marketing
    b. micromarketing
    c. macromarketing
    d. segmented marketing
    e. mass marketing
Answer: e         Page: 226   Difficulty: Medium AACSB: Analytic Skills


52. The marketer ________ the segments; the marketer’s task is to identify the segments
    and decide which one(s) to target.
    a. plans
    b. creates
    c. does not create
    d. rarely controls
    e. controls
Answer: c       Page: 226         Difficulty: Hard  AACSB: Reflective Thinking


53. The recipe for Internet niching success is to ________.
    a. find a need and fill it
    b. choose a hard-to-find product that customers do not need to see and touch
    c. choose a low-budget product that is heavily demanded by Gen Y
                                            Chapter 8: Identifying Market Segments and Targets


   d. choose an exclusive product sold primarily to seniors
   e. find a product that has some attraction to a health-conscious market
Answer: b       Page: 228        Difficulty: Medium AACSB: Reflective Thinking

54. Hilton Hotels customizes rooms and lobbies according to location. Northeastern
    hotels are sleeker and more cosmopolitan. Southwestern hotels are more rustic. This
    is an example of ________ segmentation.
    a. demographic
    b. behavioral
    c. psychographic
    d. geographic
    e. user status
Answer: d         Page: 233       Difficulty: Easy

55. Pampers divides its market demographically on the basis of ________ into prenatal,
    new baby, baby, toddler, and preschooler.
    a. life stage
    b. gender
    c. age
    d. income
    e. social class
Answer: c         Page: 235      Difficulty: Easy    AACSB: Analytic Skills

56. Newlyweds in the Asia buy more in the first six months than an established
    household does in five years. Newlyweds are an example of a(n) ________ segment.
    a. life stage
    b. gender
    c. behavior
    d. user status
    e. income
Answer: a         Page: 236       Difficulty: Medium AACSB: Analytic Skills

57. Which of the following statements accurately describes what demographers are
    calling the ―boom-boom effect‖?
    a. Consumers are demanding more ―bang for their buck.‖
    b. Baby boomers still rule the marketplace.
    c. Generation X and its taste for violence will dominate the market in the future.
    d. Products that appeal to 20-somethings also appeal to baby boomers.
    e. Companies must have success quickly or go bust.
Answer: d         Page: 238      Difficulty: Medium

58. If a marketing manager employs such marketing techniques as online buzz, student
    ambassadors, cool events, and street teams to reach target markets, the manager is
    most likely appealing to the ________ market.
    a. pre-school
    b.Generation X
Part 3: Connecting with Customers


   c. Generation Y
   d.Generation Z
   e. latent baby boomers
Answer: c        Page: 238          Difficulty: Easy    AACSB: Communications

59. Mature and reflective people who seek durability, functionality, and value in products
    are most likely to be categorized as ________ in the VALS system.
    a. innovators
    b. thinkers
    c. achievers
    d. experiencers
    e. strivers
Answer: b        Pages: 241-242 Difficulty: Medium AACSB: Analytic Skills

60. A hardware store is interested in reaching people who are characterized by the VALS
    system as being practical, down-to-earth, and self-sufficient who like to work with
    their hands, the ________ category.
    a. believers
    b.strivers
    c. survivors
    d.experiencers
    e. makers
Answer: e         Pages: 241-242 Difficulty: Hard       AACSB: Reflective Thinking

61. The key to attracting potential users, or even possibly nonusers, is ________.
    a. understanding the reasons they are not using
    b. offering financial incentives for first-time use
    c. increasing the usage rate of existing users
    d. developing a new product that better meets their needs
    e. increasing advertising expenditures
Answer: a        Page: 245         Difficulty: Medium AACSB: Reflective Thinking

62. ________ are often a small percentage of the market but account for a high
    percentage of total consumption.
    a. Light users
    b. Medium users
    c. Heavy users
    d. Nonusers
    e. None of the above
Answer: c        Page: 245       Difficulty: Easy

63. By analyzing the behaviors of ________, companies can learn about their marketing
    weaknesses and attempt to correct them.
    a. hard-core loyals
    b. split loyals
    c. shifting loyals
                                             Chapter 8: Identifying Market Segments and Targets


   d. switchers
   e. ambivalents
Answer: d      Page: 246         Difficulty: Medium AACSB: Reflective Thinking

64. Users of a brand can be segmented into several groups based on the strength of
    commitment to the brand. If a brand manager is seeking to identify those users who
    are actively considering alternative brands, he or she should look for users that are
    labeled as ________.
    a. convertible
    b.shallow
    c. average
    d.entrenched
    e. latent
Answer: b          Page: 248      Difficulty: Medium

65. You have decided to take a purchasing approach to segmenting a proposed business
    market. All of the following would be potential means (subsegments) for segmenting
    under the ―purchasing approach‖ EXCEPT ________.
    a. purchasing-function organization
    b. power structure
    c. specific application
    d. nature of existing relationships
    e. purchasing criteria
Answer: c        Page: 249         Difficulty: Hard    AACSB: Analytic Skills

66. If your assignment was (for each segment) to create a value proposition and product-
    price positioning strategy based on the segment’s unique customer needs and
    characteristics, you would be in which of the following steps of the segmentation
    process?
    a. Needs-based segmentation
    b. Segment identification
    c. Segment attractiveness
    d. Segment positioning
    e. Segment ―acid-test‖
Answer: d         Page: 250      Difficulty: Medium AACSB: Analytic Skills

67. As a brand manager you have decided to use the ________ full market coverage
    approach in marketing to your customers, whereby your firm will operate in several
    market segments and design different products for each segment.
    a. undifferentiated
    b.differentiated
    c. concentrated
    d.introverted
    e. parallel
Answer: b         Page: 252     Difficulty: Medium AACSB: Analytic Skills

								
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