Deck 6: Targeting Attractive Market Segments

Question 1

Identify the action point that a firm must take when the market attractiveness is moderate and the competitive position is weak.

A)attempt to expand without high risk or minimise investment and focus on operations
B)invest to improve position only in areas where the risk is low
C)emphasise profitability by increasing productivity and build up ability to counter competition
D)seek ways to increase current earnings without speeding market's decline

Answer 1

A

Question 2

Which of the following statements emphasises the impact of income in segmenting markets geographically?

A)Mobile service providers are focusing attention on the 65-plus segment to improve penetration.
B)Toyota has launched an online information service aimed at women as they directly influence 8 out of 10 vehicle purchases.
C)Nokia has launched a subsidiary to create an ultra-exclusive mobile telephone targeting customers buying prestige products.
D)The increase in the number of working women has created needs for specialised goods and services.

Answer 2

C

Question 3

Possible shifts in customer needs and behaviour, the entry or exit of competitors and changes in their strategies are considered during this step of constructing a market-attractiveness-competitive-position matrix for evaluating potential target markets.

A)select market-attractiveness and competitive-position factors
B)project future position for each segment
C)rate segments on each factor and plot results on matrices
D)weigh each of the market-attractiveness and competitive-position factors

Answer 3

B

Question 4

Which of the following illustrations exemplifies behavioural segmentation?

A)Uni-Marts, a convenience store operator, focuses on small towns and rural areas, thereby avoiding big competitors.
B)In the United States, car companies have found ways to cater to the needs of the multicultural segment.
C)The sales of certain kinds of products such as trade magazines are tied closely to occupational type.
D)Over the years, Volvo has emphasised safety whereas Jaguar has emphasised styling, quickness and status.

Question 5

_____ will influence a buyer to consider all transactions with a given supplier on a global basis, to emphasise cost savings and minimise risk.

A)Benefits sought
B)Purchasing structure
C)Average income
D)Purchase influence

Question 6

If in a certain country the population growth has slowed and more product markets are maturing, the result is most likely to be one of:

A)intense competition and increase in brand extensions
B)lower competition among products within a single market segment
C)multimillion-dollar businesses that serve large market segments
D)many new media that appeal to broad and wide interest groups

Question 7

All of the following are benefits managers gain from applying a common analytical framework across segments to evaluate the potential of alternative market segments except:

A)to compare the future potential of different segments using the same set of criteria
B)to prioritise different segments to decide which segments to target
C)to analyse how resources and marketing efforts should be allocated
D)to portray how different segments represent equally attractive opportunities

Question 8

Market segmentation:

A)is the process by which a market is divided into distinct subsets of customers with similar needs and characteristics
B)should only be utilised in developed countries
C)is not conducted until after targeting has been conducted
D)is conducted after positioning has been conducted

Question 9

Identify the process by which a market is divided into distinct subsets of customers with similar needs and characteristics that led them to respond in similar ways to a particular product offering and marketing program.

A)target marketing
B)market segmentation
C)product positioning
D)diversification

Question 10

Which of the following is not an objective entailed in the market segmentation process?

A)identifying a homogeneous segment that differs from other segments
B)specifying criteria that define the segment
C)developing strategic alliances in the decline stage of the product
D)determining segment size and potential

Question 11

All of the following are reasons why the segmentation criteria should describe the market segments clearly except:

A)members can be readily identified and accessed
B)marketers need to know whether a given prospective customer is or is not in the target market
C)to analyse customers' likely responses to differences in the elements of the marketing mix
D)to reach the prospective customer with advertising or other marketing communication messages

Question 12

A key strategic issue in global market segmentation has been:

A)to view a country as a single segment comprising all consumers, but this approach is seriously flawed
B)ensuring that sales to developing countries have precedence over sales to developed countries
C)to target low-population countries
D)to ensure that market entry into a new country always utilises a price penetration strategy

Question 13

A strategy designed to avoid direct competition with larger businesses that are pursuing bigger segments is known as a:

A)niche-market strategy
B)vertical integration strategy
C)broader large-market strategy
D)growth-market strategy

Question 14

Which of the following involves evaluating the firm's mission and capabilities to deliver what each segment wants, in order to choose which segments it will serve?

A)market penetration
B)market segmentation
C)product development
D)target marketing

Question 15

Principle-oriented consumers are consumers who:

A)are motivated by abstract and idealised criteria for products or services
B)shop for products that demonstrate the consumer's success
C)are guided by the need for social or physical activity, variety and risk taking
D)provide consumer-inputs to marketers during product development

Question 16

The competitive environment in some industries is witnessing developments such as build-to-order processes, mass-customisation of products and computer-aided design technology.What reason can be attributed to the rising importance of marketing segmentation in such an environment?

A)Population growth has increased, and more product markets are maturing.
B)Social and economic forces have resulted in customers with less disposable income.
C)An increasing trend toward microsegmentation exists in which extremely small market segments are targeted.
D)Competitive inertia during the market shakeout period as the market transitions from product maturity to the decline stage.

Question 17

Which of the following statements about geographic segmentation is incorrect?

A)It is used only in consumer markets
B)It is used when customers are unwilling to travel very far to obtain the goods they require.
C)It is particularly important in retailing and many services businesses.
D)It is helpful as regions vary in their sales potential, customer needs, etc.

Question 18

Consumers evaluate product or brand alternative on the basis of desired characteristics and how valuable each characteristic is.This is referred to as the:

A)purchase influence for the product
B)buying situation for the consumer
C)choice criteria of the consumer
D)centralised purchasing structure

Question 19

Which of the following occurs when some element, such as price or delivery schedules, has changed in a client-supplier relationship?

A)straight rebuy
B)new task rebuy
C)modified rebuy
D)new buying situation

Question 20

Which of the following marketing questions underlines the market-attractiveness of a firm?

A)Are there unmet or underserved needs we can satisfy?
B)Can we perform against critical success factors?
C)Stage of competing products in product life cycle: is the timing right?
D)Can we differentiate?

Question 21

Explain Step 5 of constructing a market-attractiveness-competitive-position matrix for evaluating potential target markets.

Question 22

Most successful entrepreneurial ventures target narrowly defined market segments at the outset.

Question 23

The 7Ps of marketing are: product, price, promotion, place, positioning, process, physical atmosphere.

Question 24

Because markets tend to be homogenous, developing a marketing segmentation strategy is typically done only by highly diversified firms such as Coca Cola.

Question 25

There are five steps in the process known as the market attractiveness/competitive position matrix.They are, in order: (1) select market attractiveness and competitive position factors; (2) weight each factor; (3) rate segments on each factor and plot results on matrices; (4) project the future position of each segment; and (5) choose segments to target and allocate resources.

Question 26

Most successful entrepreneurial ventures target narrowly defined market segments at the outset because:

A)most entrepreneurs are risk-takers who are naturally disposed to seek differentiated market opportunities
B)narrowly defined market segments are increasingly attractive due to the availability of modern technology
C)start-up costs are typically lower in narrowly defined markets as a result of underexposure and green field advantages
D)doing so puts the nascent business in a position to achieve early success in a market segment that it understands particularly well

Question 27

There are three important steps in the market segmentation process.

Question 28

Explain niche-market and growth-market strategies.Provide relevant examples.

Question 29

The three decision processes-market segmentation, target marketing and positioning-are closely linked and strongly interdependent.

Question 30

The various criteria used to segment markets are called descriptors.Gender, occupation, education and culture are some examples of psychographic descriptors.

Question 31

The Nielsen PRIZM service is a tool used by market researchers to examine and identify which of the following?

A)buying intention of teenagers
B)social class
C)keywords appearing in blogs and online communities
D)race

Question 32

Marketers often combine different descriptors such as psychographic and behavioural dimensions together with demographic profiles to more precisely target an attractive segment in a particular geographic region.This strategy is known as initiative segmentation.

Question 33

When targeting attractive market segments different targeting strategies suit different opportunities.The three target market strategies available to marketing managers are niche-market strategies, broader large-market strategies and growth-market strategies.

Question 34

Whereas geodemographic descriptors identify consumer target market segments based on who they are, what they do and where they are; behavioural descriptors identify consumer target market segments based on how consumers behave.