Deck 4: Segmenting the Business Market and Estimating Segment Demand

Question 1

Bases of business or organizational market segmentation that center on the characteristics of the buying organization and the buying situation are broadly categorized as:

A)macrosegmentation.
B)microsegmentation.
C)economic bases.
D)bottom-up bases.
E)concentration bases.

Answer 1

A

Question 2

The business market can be segmented on several bases,broadly classified into two major categories:

A)economic and demographic.
B)macro and micro.
C)top-down and bottom-up.
D)concentration and coverage.
E)organizational and end-use application.

Answer 2

B

Question 3

Concerning segmentation criteria,_____ concerns the degree to which segments respond differently to different marketing mix elements,such as pricing or product features.

A)measurability
B)accessibility
C)substantiality
D)compatibility
E)responsiveness

Answer 3

E

Question 4

All of the following are potential micro bases of business market segmentation except:

A)organizational innovativeness.
B)importance of purchase.
C)personal characteristics.
D)structure of decision-making unit.
E)type of buying situation.

Question 5

The business market can be segmented on several bases. Macro bases of segmentation center on:

A)characteristics of the buying situation.
B)characteristics of the buying organization.
C)the nature of the product application.
D)all of the above
E)both (a)and (c)

Question 6

Which of the following statements concerning business market segmentation is(are)true?

A)The decision to enter a particular market segment carries with it significant long-term resource commitments for the industrial firm.
B)In evaluating alternative bases for segmentation,the marketer is attempting to identify good predictors of differences in buyer behavior.
C)Segmentation decisions can be reversed more easily in the business market than in the consumer market.
D)all of the above
E)(a)and (b)only

Question 7

For the medical x-ray market,Du Pont initiated a formal positioning study among hospital administrators,radiology department administrators,and technical managers in order to identify the firm's relative standing and the specific needs (criteria)for each level of buying influence within each potential segment. This provides an illustration of segmentation on the basis of:

A)the importance of purchase.
B)attitude toward vendors.
C)value-in-use.
D)key criteria.
E)decision-specific conflict.

Question 8

The Thompson Spring Company has developed a separate marketing strategy for each of the industries that uses its products. These industries include makers of machine tools,bicycles,surgical devices,telephones,and missile systems. This provides an illustration of segmentation on the basis of:

A)usage rate.
B)product application.
C)type of buying situation.
D)the structure of procurement.
E)key decision criteria.

Question 9

Bases of business or organizational market segmentation that focus on the characteristics of decision-making units are broadly classified as:

A)macrosegmentation.
B)microsegmentation.
C)economic bases.
D)demographic bases.
E)coverage bases.

Question 10

Lansing Motor Works produces a line of precision motors. Based on feedback from the sales force,management has learned that one of their new motors is especially well-suited to high-speed packaging systems. The new motor requires less maintenance and has a longer useful life than competing offerings. Lansing Motor Works is now concentrating on this segment. This provides an illustration of segmentation on the basis of:

A)usage rate.
B)purchasing strategy.
C)size of firm.
D)value-in-use.
E)organizational innovativeness.

Question 11

The microsegmentation of business markets center on characteristics of:

A)buying organizations (e.g.,the size).
B)the product application (e.g.,end market served).
C)decision-making units (e.g.,decision style).
D)the purchasing situation (e.g.,types of buying situation).
E)geographic regions (e.g.,Midwest).

Question 12

Business market segmentation at the _____ level requires a higher level of market knowledge and,therefore,a greater investment in research.

A)geographic
B)macro
C)micro
D)demographic
E)aggregate

Question 13

Concerning segmentation criteria,_____ refers to the degree to which information on the particular buyer characteristic exists or can be obtained.

A)measurability
B)accessibility
C)substantiality
D)responsiveness
E)enforceability

Question 14

Which of the following statements concerning business market segmentation is(are)false?

A)In selecting a market segment,the business marketer is also choosing a competitive environment.
B)The cost of research increases if a microlevel of segmentation is required.
C)Compared to their consumer goods counterparts,business marketers can more readily change segmentation strategies,shifting attention from one segment to another.
D)both (a)and (c)

Question 15

A segmentation study found that purchasers of IBM equipment are more concerned about software support and breadth of product line and they are less concerned about absolute price and price flexibility (i.e.,willingness of suppliers to negotiate price). This provides an illustration of segmentation on the basis of:

A)the importance of purchase.
B)key criteria.
C)the structure of the decision-making unit.
D)attitude toward vendors.
E)decision style.

Question 16

Large buying organizations may possess unique requirements and respond to different marketing stimuli than small firms. Research suggests that the degree of influence of presidents,vice presidents,and owners _____ with an increase in corporate size.

A)remains constant
B)increases
C)decreases
D)none of the above

Question 17

All of the following are potential macro bases of business market segmentation except:

A)purchasing strategy.
B)usage rate.
C)size.
D)product application.
E)geographic location.

Question 18

Market segmentation is:

A)more useful to consumer goods marketers than to business marketers.
B)of little value to business marketers that concentrate on the governmental and institutional sectors of the organizational market.
C)difficult to apply in the business market because groups,not individuals,make many purchasing decisions.
D)a useful tool for both business and consumer goods marketers.
E)inappropriate for low market share firms.

Question 19

Park Rapids Electronics divides their market on the basis of NAICS category,end market served,and type of buying situation. They have also developed a special strategy for large centralized buyers. They are emphasizing:

A)macro bases of segmentation.
B)micro bases of segmentation.
C)a blend of macro and micro bases of segmentation.
D)psychographic and economic bases of segmentation.
E)none of the above

Question 20

Chandler Machine Tool has been successful in segmenting their market using the following bases: (1)NAICS category and (2)key purchasing criteria emphasized by particular groups of buyers within each NAICS industry. They are using:

A)macro bases of segmentation.
B)micro bases of segmentation.
C)a blend of macro and micro bases of segmentation.
D)psychographic and economic bases of segmentation.
E)none of the above

Question 21

The classification of customers on a continuum range from nonuser to heavy user is an example of:

A)macro level segmentation.
B)micro level segmentation.
C)product application segmentation.
D)"value in use" segmentation
E)none of the above.

Question 22

The sales forecasting approach that utilizes a panel of experts and converts their opinions into an informed consensus by means of highly structured,multi-stage pooling is:

A)the Delphi method.
B)executive panel method.
C)the sales force composite.
D)organizational learning.
E)the multiple series method.

Question 23

Which of the following are means by which a marketer can implement a microsegmentation strategy?

A)Importance of the purchase.
B)Attitudes toward vendors.
C)Organizational Innovativeness.
D)(a)and (b)only.
E)(a)and (c)only.

Question 24

When a business marketer decides to target only those firms with centralized buying centers,what macrolevel segmentation variable is being used?

A)Geographical location.
B)Usage rate.
C)Structure of procurement.
D)End market served.

Question 25

The industrial chemical industry in England shows a fairly regular rise and fall in demand over four- or five-year periods. This provides an illustration of the _____ component of a time series.

A)trend
B)cycle
C)random
D)seasonal
E)irregular

Question 26

When a business marketer determines whether a buyer is employing a new task,modified rebuy or straight rebuy decision-making process,what macrolevel segmentation variable is being used?

A)Type of buying situation.
B)Structure of procurement.
C)Geographical location.
D)End market being served.

Question 27

A _____ is a group of present or potential customers with some common characteristic which is relevant in explaining and predicting their response to a supplier's marketing stimuli.

A)market segment
B)prospect group
C)business population
D)market opportunity

Question 28

A successful implementation of a segmentation strategy requires attention to:

A)how should the sales force be organized.
B)what adaptations will be needed to serve selected international market segments.
C)which media outlets can be used to target advertising at a new segment.
D)all of the above.
E)(b)and (c)only.

Question 29

Advanced Technologies,Inc. faces a forecasting dilemma. They wish to evaluate the level of sales that a new technology might enjoy in 2014. Historical data is limited and of little value since the new product is not well defined and the product concept is unique. Which forecasting approach would appear to be most appropriate?

A)time series analysis
B)input/output analysis
C)the sales force composite
D)regression analysis
E)the Delphi method

Question 30

Which forecasting technique uses historical data ordered in time to project the trend and growth rate of sales?

A)input/output analysis
B)the Delphi method
C)causal techniques
D)time series analysis
E)market survey method

Question 31

Qualitative techniques that can be used for forecasting sales include:

A)market surveys.
B)time series.
C)the Delphi method.
D)single series statistical methods.
E)none of these.

Question 32

The qualitative approach that most closely resembles the executive panel method of sales forecasting is:

A)input/output analysis.
B)the sales force composite.
C)market surveys.
D)time series methods.
E)regression analysis.

Question 33

Successful implementation of a business segmentation strategy requires attention to which of the following issues?

A)Adaptations to serve selected international markets.
B)A comprehensive on-line strategy to provide continuous support to customers in the segments.
C)Organization of the sales force.
D)All of the above.
E)Only (b)and (c).

Question 34

Concerning segmentation criteria,_____ refers to the degree to which the segments are large or profitable enough to be worth considering for separate marketing cultivation.

A)measurability
B)accessibility
C)substantiality
D)compatibility
E)responsiveness

Question 35

The criteria marketers use to evaluate the degree to which the firm can effectively focus its marketing efforts on chosen segments is:

A)accessibility.
B)measurability.
C)sustainability.
D)compatibility.
E)responsiveness.

Question 36

Albany Products found that the sales of one of their most important products is logically related to new construction expenditures. If the firm can forecast future values of this variable,which forecasting technique would appear to be most appropriate?

A)time series
B)regression
C)Delphi method
D)trend extension
E)none of the above

Question 37

Which of the following is not one of the criteria for assessing the desirability of a potential market segment?

A)Measurability
B)Accessibility
C)Responsiveness
D)Substantiality
E)Accountability

Question 38

Which sales forecasting approach is effective when intimate knowledge of customer plans is important?

A)executive judgment
B)Delphi method
C)time series
D)sales force composite
E)causal analysis

Question 39

Which of the following is NOT a personal characteristic used in microlevel segmentation?

A)Demographics.
B)Risk.
C)Confidence.
D)Job responsibility.
E)Importance of purchase.

Question 40

Which of the following is a benefit of effective segmentation?

A)The mere attempt to segment business market forces the marketer to become more attuned to the unique needs of customer segments.
B)Knowledge of the needs of particular market segments helps the business appropriately train and deploy the salesforce.
C)It allows the business marketer to focus on product development efforts.
D)all of the above.
E)(b)and (c)only.

Question 41

Company sales,reported on a monthly basis for the past four years,is an example of a:

A)cycle.
B)time series.
C)top-down approach.
D)trend.
E)seasonal index.

Question 42

In time series analysis,the _____ component represents regular,recurring movements within the year.

A)trend
B)cycle
C)seasonal
D)irregular
E)causal

Question 43

If the business marketer can identify meaningful and profitable market segments at the macro level,the segmentation process is complete.

Question 44

Quantitative forecasting includes the primary methodology called:

A)time series.
B)causal.
C)regression.
D)all of the above.
E)(a)and (c)only.

Question 45

Compared to centralized buyers,decentralized purchasing units emphasize short-term cost efficiency.

Question 46

_____ techniques have as their objective the determination of a relationship between sales and one or more variables presumed to be related to sales.

A)Time series
B)Delphi
C)Causal
D)Qualitative
E)Trend extension

Question 47

Sales forecast data is used to:

A)distribute inventory.
B)manage stock levels.
C)directing the entire supply chain process.
D)all of the above.
E)(a)and (b)only.

Question 48

Which of the following are true of qualitative approaches to sales forecasting?

A)Effectiveness depends on close relationships between customers and suppliers.
B)They are more appropriate for well-established products.
C)It brings users of the forecast into the forecasting process.
D)All of the above.
E)Only (a)and (c).

Question 49

The ideal approach to sales forecasting for the business marketer relies on:

A)strictly quantitative approaches.
B)strictly qualitative approaches.
C)a blend of the Delphi method and well-executed market surveys.
D)a combination of qualitative and quantitative approaches.
E)single and multiple statistical series approaches.

Question 50

The _____ component of a time series reflects short-term,random movements in the data that do not conform to a pattern which is regularly related to the calendar.

A)trend
B)cycle
C)seasonal
D)irregular

Question 51

Micro bases of organizational market segmentation require a high degree of market knowledge and focus on the characteristics of decision-making units within each of the various macrosegments.

Question 52

Examples of possible micro bases of business market segmentation include size,geographical location,and usage rate of buying organizations.

Question 53

Typically,causal models are more reliable for:

A)intermediate than for long-range forecasts.
B)long-range than intermediate forecasts.
C)long-range than short-range forecasts.
D)short-range than long range forecasts.
E)short-range than for intermediate forecasts.

Question 54

The information needed for micro level segmentation in the business market can usually be drawn from available secondary sources.

Question 55

Executive judgement methods produce accurate forecasts when:

A)forecasts are made infrequently.
B)the environment is volatile
C)the linkage between decision,action,and feedback is short.
D)all of the above.
E)(a)and (b)only.

Question 56

In time series analysis,the _____ component indicates the long-term general direction of the data.

A)trend
B)cycle
C)seasonal
D)irregular
E)causal

Question 57

The concept of market segmentation is more applicable to consumer-goods marketers than to business marketers.

Question 58

The most crucial limitation(s)associated with causal methods of sales forecasting is(are):

A)the problem of determining future values of the independent or causal variables.
B)the problem of securing unbiased sales estimates from the sales force.
C)that seasonal variations in performance are difficult to precisely estimate.
D)both (b)and (c).
E)All of the above are crucial limitations of causal methods of sales forecasting.

Question 59

The _____ component of a time series reflects intermediate-term,regularly recurring,upswings and downswings of data around the long-term general direction of the data.

A)trend
B)cycle
C)seasonal
D)irregular

Question 60

The Delphi technique is particularly well suited to:

A)new product forecasts.
B)estimation of future events for which historical data are limited.
C)situations that are not suited to quantitative analysis.
D)All of the above.
E)Only (b)and (c).

Question 61

The Delphi method constitutes a highly sophisticated quantitative approach to sales forecasting.

Question 62

The cost of research is greater at the macrolevel of segmentation than at the microlevel.

Question 63

Time series methods are well suited to short-range forecasting because the assumption that the future will be like the past is more reasonable over the short run than over the long run.

Question 64

Qualitative sales forecasting techniques provide a systematic analysis of cause and effect relationships.

Question 65

A well-defined segmentation plan will fail without careful attention to implementing the plan.

Question 66

The fact that sales and some causal variables are correlated implies that the causal variable "caused" sales.

Question 67

By directing its resources to all of its customers evenly,the business marketer is less vulnerable to focused competitors that may seek to "cherry pick" the firm's most valuable customers.

Question 68

If the requirements of segmentation are met,it should provide the business marketer with valuable guidelines for allocating marketing resources.

Question 69

Regression models are useful to industrial firms projecting final consumer demand for items of which their products become a part.

Question 70

Industrial firms lack the flexibility of their consumer-goods counterparts in moving into and out of market segments.

Question 71

In evaluating alternative bases for segmentation,the marketer is attempting to identify good predictors of differences in buyer behavior.

Question 72

Value-in-use constitutes a microlevel base of segmentation.

Question 73

The North American Industrial Classification System (NAICS)is an especially valuable source when segmenting the market on the basis of end use.

Question 74

Time series techniques are especially appropriate when management believes that sales will behave differently in the future than they have in the past.

Question 75

Because a specific industrial good is often used in different ways,the marketer can divide the market using the NAICS.

Question 76

The cycle component in a time series indicates the long term general movement in the data in one direction.

Question 77

Customers that actively seek business marketing firms that can help them create new value to gain a competitive edge in their markets can be segmented using value-based strategies.

Question 78

Buying organizations can be segmented based on the stages of the procurement process,such as new-task or straight rebuy.

Question 79

The personal characteristics of decision-makers in buying centers,such as their decision style and confidence,are examples of macrolevel bases of segmentation.

Question 80

In order to use macrolevel bases of segmentation,the business marketer must move beyond secondary sources of information by soliciting input from the sales force or by conducting a special market segmentation study.