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Marketing Exam Study!

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          Behavioural variables are:

          • Occasions

          • Benefits sought

          • User status

          • Usage rate

          • Loyalty status

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    Segmenting Business Markets

    • Businesses use the same variables to segment their markets, they also use some additional variables such as operating characteristics, purchasing approaches, situational factors, and personal characteristics

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      Segmenting International Markets

      • Companies can segment international markets using one or a combination of several variables

Requirements for Effective Segmentation

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    There are many ways to segment a market, but not all segmentations are effective

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      To be useful, markets segments must be:

      • Measureable: the size, purchasing power, profiles of the segments, can be measured

      • Accessible: the segments can be effectively reached and served

      • Differentiable: the segments are conceptually distinguishable and respond differently to different marketing mix elements and programs

      • Actionable: effective programs can be designed for attracting and serving the segments

Target marketing

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    A set of buyers sharing common needs or characteristics that the company decides to serve

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    When evaluating market segments, a firm must look at three factors: segment size and growth, segment structural attractiveness, and company objectives and resources

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      Segment Size and Growth

      • Company must first collect and analyze data on current segment sales, growth rates, and expected profitability for various segments

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        Segment Structural Attractiveness

        • Company must examine major structural factors that affect long run segment attractiveness

        • Segment is less attractive it if contains many aggressive competitors, or many substitute products

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        Company Objectives and Resources

        • Even if a segment has the right size and growth is structurally attractive, company must consider its own objectives and resources in relation to that segment

        • Some attractive segments can be dismissed because they do not mesh with the company’s long-run objectives

Selecting Target Segments

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    Undifferentiated (mass) marketing

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      A market-coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer

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        Targeting broadly, focusing on what is common in the needs of the market rather than what is different

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    Differentiated (segmented) marketing 17

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