Exam 5: Target Markets: Segmentation and Evaluation

Demographic characteristics are commonly used to segment a market because they are closely related to consumers' product needs and purchasing behavior.

When using personality characteristics as a market segmentation variable, marketers generally:

Through marketing newsprint to newspaper publishers and glass manufacturers that use it in packing, International Paper Inc. segments its market based on:

Discuss the difference between sales forecasts and company sales potential. Why is it important for a marketer to be able to forecast sales?

Family life cycle is a psychological dimension used for segmenting markets.

To find a target market, a firm can use the:

The Gap Inc. has recently produced a new line of athletic wear that closely competes with a designer label in its quality, utility, and appearance. However, it is about half the cost of the designer brand. Product managers for The Gap line plan to use price sensitivity, brand loyalty, and end use as variables to segment their target market. These are all variables for market segmentation.

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. Currently, GE uses several sales forecasting methods. One method is to sell the different locomotive engines to buyers in different countries, and then measuring the purchasing response in each. In this case, GE Transportation is using the method to forecast future sales.

What are the conditions under which an undifferentiated targeting strategy is effective? Why are these conditions essential?

Using the breakdown approach to sales potential, estimates are made:

A company sometimes defines a total market as its target market.

Scenario 5.1 Use the following to answer the questions. Lil' Angels Kids Spa offers various treatments designed to appeal to the younger customers. Treatment options include manicures, pedicures, facials, tea parties, and dress up photos. Parents can even purchase a birthday party package. Currently, Lil' Angels offers its services only to girls under the age of 14. Originally begun in Delaware, Lil' Angels is considering opening its spa/salons in other parts of the country and is planning to expand its offerings to girls aged 14 to 17. The company realizes that some changes may be needed. For example, the management wants to find out if the older girls will be interested in their birthday party and tea party services. -Refer to Scenario 5.1. Which method should Lil' Angels use to forecast sales in new regions?

Budweiser may choose to segment its market based on heavy, moderate, and light drinkers of its alcoholic beverages. This is an example of market segmentation based on:

Family life cycle is most typically based on:

The amount of product a company expects to sell during a specific period at a specified level of marketing activity is called the .

Crest toothpaste is available in several different versions, such as Crest Whitening, Crest Tartar Control, Crest Whitening with mouthwash, and Crest Total Effects. Given these different variations of the product, it appears that the marketers of Crest are segmenting the market by using segmentation.

Trend analysis is a sales forecasting technique based on historical sales data.

A firm operating in a one-state market would not regionalize its market.

A marketer can use regression analysis techniques to predict the sales of new products.

Motives can be used to segment markets.