Exam 5: Target Markets: Segmentation and Evaluation

When a firm designs a single marketing mix and directs it at an entire market for a particular product, the company is using a(n) targeting strategy.

A differentiated targeting strategy is when the organization targets two or more markets by developing a single marketing mix.

The sum of firms' marketing efforts equals industry marketing efforts.

The five-step process usually used for target market selection includes identifying the appropriate targeting strategy, determining which segmentation variables to use, developing market segment profiles, evaluating relevant market segments, and deciding which targeting strategy to use.

Define market potential. Explain the various factors that affect the same.

Scenario 5.2 Use the following to answer the questions. GE Transportation Corp produces locomotive engines for sale in countries around the world. After looking at the total market for locomotive engines, the company found that various rail lines wanted different types of engines. Major rail lines in the U.S. and South America wanted engines to haul heavy freight. Rail lines in Sweden and Germany were interested in a cleaner, greener locomotive engine. Rail lines operated by several Eastern European countries wanted locomotive engines for running short distances between cities in their own country. GE Transportation is currently manufacturing its GE 4400 for heavy freight, its Hybrid Eco-Engine, and its Dash 9, suited for shortline transport. -Refer to Scenario 5.2. Researchers at GE Transportation estimate that 1,000 rail lines throughout the world will purchase some kind of locomotive engine next year. That number represents the:

A market segment profile describes the similarities among potential customers within a segment and explains the differences among people across market segments.

Consideration of the firm's overall objectives usually does not influence the final selection of a target market segment.

When markets are comprised of people with differing product needs, the marketing manager should use a(n) _____ targeting strategy.

Market potential is the amount of a product that an organization could sell during a specified time period.

The undifferentiated targeting strategy for finding a target market will likely not be successful if:

A segmentation variable is used to group smaller markets into one larger market.

The process of dividing a total market into market groups because people within each group have relatively similar product needs is called:

Scenario 5.2 Use the following to answer the questions. GE Transportation Corp produces locomotive engines for sale in countries around the world. After looking at the total market for locomotive engines, the company found that various rail lines wanted different types of engines. Major rail lines in the U.S. and South America wanted engines to haul heavy freight. Rail lines in Sweden and Germany were interested in a cleaner, greener locomotive engine. Rail lines operated by several Eastern European countries wanted locomotive engines for running short distances between cities in their own country. GE Transportation is currently manufacturing its GE 4400 for heavy freight, its Hybrid Eco-Engine, and its Dash 9, suited for shortline transport. -Refer to Scenario 5.2. If a GE Transportation researcher analyzes monthly sales data for a four-year time frame, looking for periodic fluctuations, the researcher is doing a analysis.

A targeting strategy in which an organization directs its marketing efforts at several segments is called a(n) targeting strategy.

When a firm's management is making the final selection of specific target markets to enter, it should consider whether the organization has the financial resources, managerial skills, expertise, and facilities needed to effectively compete in the selected segments.

The Pillsbury Company defines all individual consumers who are purchasers of flour as its target market. It also defines all businesses that purchase flour as its target market. Which targeting strategy would be most appropriate in this case?

The sales forecasting method that involves making a product available to buyers in one or more test areas and measuring purchases and consumer responses to the product, distribution, promotion, and price is called .

Kelly's Kids is a home-based business that sells high-quality children's clothing at premium prices using in-home parties. These in-home parties typically cater to families with small children and middle- to upper-middle-class income. Kelly's Kids is using variables to segment its market.

How do business markets differ from consumer markets?