Marketing quốc tế 8 segment and target

Marketing Management, 14e (Kotler/Keller) Chapter Identifying Market Segments and Targets 1) Which of the following statements about market segmentation is true? A) It involves changing the identity of a product, relative to the identity of competing products, in the collective minds of the target market B) It is a process of evaluating each segment's attractiveness and selecting one or more to enter C) It is a process of creating an image or identity of the product in the minds of the target market D) It is a process of identifying and profiling distinct groups of buyers who differ in their needs and wants E) It is the quality of how marketers go to market with the goal of optimizing their spending to achieve good results Answer: D Page Ref: 213 Objective: Difficulty: Moderate 2) Establishing and communicating the distinctive benefit(s) of the company's market offering, for each target segment is called A) market research B) market positioning C) marketing effectiveness D) market segmentation E) market dominance Answer: B Page Ref: 213 Objective: Difficulty: Easy 3) The process of selecting one or more market segments to enter is called A) market targeting B) market dominance C) market positioning D) market segmentation E) market research Answer: A Page Ref: 213 Objective: Difficulty: Easy Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 4) A consists of a group of customers who share a similar set of needs and wants A) vertical marketing system B) market basket C) market share D) market segment E) market level Answer: D Page Ref: 214 Objective: AACSB: Analytic skills Difficulty: Easy 5) Hilton Hotels customizes rooms and lobbies according to location Northeastern hotels are sleeker and more cosmopolitan Southwestern hotels are more rustic This is an example of segmentation A) demographic B) behavioral C) psychographic D) geographic E) cultural Answer: D Page Ref: 214 Objective: AACSB: Analytic skills Difficulty: Moderate 6) When Nike attempts to get close to its customers at the local level by sponsoring local school teams and providing shoes, equipment, and clothing to many of them, Nike is using which of the following marketing formats? A) differentiated marketing B) affiliate marketing C) guerrilla marketing D) affinity marketing E) grassroots marketing Answer: E Page Ref: 214 Objective: AACSB: Analytic skills Difficulty: Moderate Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 7) Regardless of the type of segmentation scheme used, the key is adjusting the marketing program to recognize A) the level of disposable income earned by the target group B) customer differences C) the cost-benefit relationship of narrowing the target market D) customer complaints E) saturated markets Answer: B Page Ref: 214 Objective: Difficulty: Easy 8) If a marketer decides to segment a market based on neighborhoods, the marketer will have chosen the method of segmentation A) demographic B) psychographic C) geographic D) cultural E) behavioral Answer: C Page Ref: 214 Objective: AACSB: Analytic skills Difficulty: Easy 9) If a marketing manager segments the market into culture-oriented, sports-oriented, or outdoororiented groups, he or she is segmenting on the basis of A) loyalty status B) behavioral occasions C) user status D) psychographic lifestyle E) readiness stage Answer: D Page Ref: 215 Objective: AACSB: Analytic skills Difficulty: Easy Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 10) Robert is the owner of an automobile manufacturing company He calls for a board meeting and tells his directors that he wants to build a car that lets the users experience power and exhilaration He tells them that the car must allow his users to soar from 0-60 mph in about seconds He also adds in that the price of the car must be affordable enough for anybody making a good salary In accordance with the given scenario, Robert is trying to segment the market on the basis of A) occupation B) family size C) benefits D) nationality E) user status Answer: C Page Ref: 215 Objective: AACSB: Analytic skills Difficulty: Moderate 11) If a marketing researcher uses such names (categories) as Blue Blood Estates, Winner's Circle, Hometown Retired, or Shotguns and Pickups, when doing segmentation research, the marketing researcher is using clusters A) PRIZM B) behavioral C) psychographic D) demographic E) VALS Answer: A Page Ref: 215 Objective: Difficulty: Easy 12) Pampers divides its market demographically on the basis of into prenatal, new baby, baby, toddler, and preschooler A) life stage B) gender C) age D) income E) social class Answer: C Page Ref: 216 Objective: AACSB: Analytic skills Difficulty: Easy Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 13) According to PRIZM, the cluster is characterized as being in their late forties and fifties, college-educated, upper-middle-class homeowners that married late, and are still raising children in comfortable suburban subdivisions and pursuing kid-centered lifestyles A) cosmopolitans B) beltway boomers C) young digerati D) winner's circle E) old milltowns Answer: B Page Ref: 216 Objective: AACSB: Reflective thinking Difficulty: Easy 14) According to PRIZM, the cluster is characterized by educated, midscale, and multiethnic, urbane couples in America's fast-growing cities Concentrated in a handful of metros such as Las Vegas, Miami, and Albuquerque, these households feature older home owners, empty nesters, and college graduates A) beltway boomers B) old milltowns C) cosmopolitans D) young digerati E) winner's circle Answer: C Page Ref: 216 Objective: Difficulty: Easy 15) According to PRIZM, the cluster is characterized as the nation's tech-savvy singles and couples, living in areas typically filled with trendy apartments and condos, fitness clubs and clothing boutiques, casual restaurants, and all types of bars-from juice to coffee to microbrew A) beltway boomers B) old milltowns C) young digerati D) cosmopolitans E) winner's circle Answer: C Page Ref: 216 Objective: Difficulty: Easy Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 16) According to PRIZM, the cluster is characterized by retired singles and couples, living on downscaled incomes in pre-1960 homes and apartments, who enjoy gardening, sewing, socializing at veterans clubs, and eating out at casual restaurants A) old milltowns B) young digerati C) winner's circle D) beltway boomers E) cosmopolitans Answer: A Page Ref: 216 Objective: Difficulty: Easy 17) Those who favor localized marketing see national advertising as wasteful because A) it gets too up close and personal with consumers B) it drives up manufacturing and marketing costs by reducing economies of scale C) it magnifies logistical problems D) it fails to address local needs E) it sends conflicting marketing messages Answer: D Page Ref: 216 Objective: AACSB: Reflective thinking Difficulty: Moderate 18) Newlyweds in the United States buy more in the first six months than an established household does in five years Newlyweds are an example of a(n) segment A) life stage B) age C) behavior D) user status E) income Answer: A Page Ref: 217 Objective: AACSB: Analytic skills Difficulty: Moderate Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 19) Jose and Erika have just divorced Which of the following demographic segmentation subsegment formats might be used by marketers to reach Jose or Erika? A) life stage B) benefits C) age segment D) personality type E) social class Answer: A Page Ref: 217 Objective: AACSB: Reflective thinking Difficulty: Easy 20) are products such as Kiehl's skin care and Kendall-Jackson wines that are priced between average middle-market and superpremium old luxury brands and are also based on emotions A) Old Luxury brand extensions B) Accessible superpremium products C) Luxury items D) Hourglass products E) Masstige goods Answer: E Page Ref: 218 Objective: AACSB: Analytic skills Difficulty: Easy 21) are products such as the Mercedes Benz C-class and the American Express Blue card, that extend historically high-priced brands down-market while retaining their cachet A) Hourglass products B) Mass market products C) Old Luxury brand extensions D) Masstige goods E) Accessible superpremium products Answer: C Page Ref: 218 Objective: Difficulty: Easy Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 22) Which of the following statements about Gen Yers is true? A) They are selective, confident, and impatient B) They are more likely to associate retirement with "the beginning of the end" C) They are more pragmatic and individualistic D) They were born between 1964 and 1978 E) They were the first generation to find surpassing their parents' standard of living a serious challenge Answer: A Page Ref: 219 Objective: Difficulty: Easy 23) Rock band Foo Fighters created a digital street team that sends targeted e-mail messages to members who receive exclusive news, previews, and opportunities to win prizes The Foo Fighters are using to reach Generation Y A) student ambassadors B) unconventional sports C) cool events D) computer games E) online buzz Answer: E Page Ref: 220 Objective: AACSB: Reflective thinking Difficulty: Easy 24) If a marketing manager employs such marketing techniques as online buzz, student ambassadors, cool events, and street teams to reach target markets, the manager is most likely appealing to the market A) Generation Z B) Generation X C) Generation Y D) Silent generation E) Baby boomers Answer: C Page Ref: 220 Objective: AACSB: Communications Difficulty: Easy Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 25) As part of an antismoking crusade, the American Legacy Foundation hires teens as the "Truth Squad" to hand out T-shirts, bandanas, and dog tags at teen-targeted events The American Legacy Foundation is using to reach Generation Y A) computer games B) street teams C) unconventional sports D) online buzz E) videos Answer: B Page Ref: 221 Objective: Difficulty: Easy 26) Which of the following statements about Gen Xers is true? A) Gen Xers are more optimistic and team-oriented B) Gen Xers are selective, confident, and impatient C) Gen Xers are highly socially conscious and concerned about environmental issues D) Gen Xers feel self-sufficiency and the ability to handle any circumstance are key E) Technology is a barrier for Gen Xers Answer: D Page Ref: 221 Objective: Difficulty: Easy 27) Which of the following statements accurately describes what demographers are calling the "boom-boom effect"? A) consumers are demanding more "bang for their buck" B) Baby boomers still rule the marketplace C) Generation Y and their concern about environmental issues will dominate the market in the future D) products that appeal to 21-year-olds also appeal to baby boomers E) companies must gain success quickly Answer: D Page Ref: 221 Objective: Difficulty: Moderate Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 28) is the science of using psychology and demographics to better understand consumers A) Psychographics B) Interactionism C) Clustering D) Demographic transition E) Customerization Answer: A Page Ref: 225 Objective: AACSB: Analytic skills Difficulty: Easy 29) According to the VALS segmentation system, are successful, sophisticated, active, "take-charge" people with high self-esteem Their purchases often reflect cultivated tastes for relatively upscale, niche-oriented products and services A) innovators B) thinkers C) achievers D) experiencers E) believers Answer: A Page Ref: 226 Objective: AACSB: Analytic skills Difficulty: Easy 30) According to the VALS segmentation system, are successful, goal-oriented people who focus on career and family They favor premium products that demonstrate success to their peers A) thinkers B) innovators C) achievers D) believers E) experiencers Answer: C Page Ref: 226 Objective: Difficulty: Easy 10 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 83) Customer cloning is the practice of identifying the key characteristics of a market segment and then identifying multiple geographic areas where the majority of the population possesses those characteristics Answer: FALSE Page Ref: 214 Objective: Difficulty: Easy 84) Illustrations of personality segmentation would include culture-oriented, sports-centered, or outdoor-oriented subsegments Answer: FALSE Page Ref: 215 Objective: AACSB: Analytic skills Difficulty: Easy 85) Local marketing reflects a growing trend called macromarketing Answer: FALSE Page Ref: 214 Objective: AACSB: Reflective thinking Difficulty: Easy 86) A local service company has decided to segment its market based on occupation; therefore, it has chosen a form of demographic segmentation for its approach Answer: TRUE Page Ref: 216 Objective: AACSB: Analytic skills Difficulty: Easy 87) Beltway Boomers are the nation's tech-savvy singles and couples living in fashionable neighborhoods on the urban fringe Answer: FALSE Page Ref: 216 Objective: Difficulty: Easy 88) Demographic variables are popular because they are often associated with consumer needs and wants and they are easy to measure Answer: TRUE Page Ref: 216 Objective: AACSB: Reflective thinking Difficulty: Easy 28 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 89) Life stage defines a person's age Answer: FALSE Page Ref: 217 Objective: Difficulty: Easy 90) Income always predicts the best customers for a given product Answer: FALSE Page Ref: 218 Objective: Difficulty: Easy 91) Members of the same generational cohort share the same major cultural, political, and economic experiences and have similar outlooks and values Answer: TRUE Page Ref: 219 Objective: AACSB: Reflective thinking Difficulty: Easy 92) Baby boomers are consumers who have been "wired" almost from birth—playing computer games, navigating the Web, downloading music, connecting with friends via instant messaging and mobile phones Answer: FALSE Page Ref: 219 Objective: Difficulty: Easy 93) Members of Generation Y are generally open to overt branding practices and a "hard sell," making product placements in computer and video games a popular way to reach this cohort Answer: FALSE Page Ref: 220 Objective: Difficulty: Easy 94) Unlike the more optimistic, team-oriented Gen Xers, Gen Yers are more pragmatic and individualistic Answer: FALSE Page Ref: 221 Objective: Difficulty: Easy 29 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 95) Baby boomers are also less likely to associate retirement with "the beginning of the end" and see it instead as a new chapter in their lives with new activities, interests, careers, or even relationships Answer: TRUE Page Ref: 221 Objective: Difficulty: Easy 96) The norms, language nuances, buying habits, and business practices of multicultural markets need to be factored into the initial formulation of a marketing strategy, rather than added as an afterthought Answer: TRUE Page Ref: 222 Objective: Difficulty: Easy 97) Psychographics is the science of using psychology and demographics to better understand consumers Answer: TRUE Page Ref: 225 Objective: AACSB: Analytic skills Difficulty: Easy 98) People in the same demographic group generally exhibit similar psychographic profiles Answer: FALSE Page Ref: 226 Objective: Difficulty: Easy 99) The main dimensions of the VALS segmentation framework are consumer motivation and consumer resources Answer: TRUE Page Ref: 226 Objective: Difficulty: Easy 100) In the VALS segmentation system, thinkers are characterized as being successful, sophisticated, active, "take-charge" people with high self-esteem Answer: FALSE Page Ref: 226 Objective: AACSB: Analytic skills Difficulty: Easy 30 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 101) Everyone who buys a given product wants the same benefits from it Answer: FALSE Page Ref: 227 Objective: AACSB: Reflective thinking Difficulty: Easy 102) Believers favor stylish products that emulate the purchases of those with greater material wealth Answer: FALSE Page Ref: 227 Objective: Difficulty: Easy 103) Heavy users of a particular product are often a small percentage of the market but account for a high percentage of total consumption Answer: TRUE Page Ref: 228 Objective: Difficulty: Easy 104) With respect to loyalty status, if a consumer is loyal to two or three brands, he or she is called shifting loyal Answer: FALSE Page Ref: 228 Objective: AACSB: Analytic skills Difficulty: Easy 105) Hard-core loyals can show the firm which brands are most competitive with its own Answer: FALSE Page Ref: 228 Objective: Difficulty: Easy 106) Door-to-door workers in a political campaign use attitude to determine how much time to spend with each voter Answer: TRUE Page Ref: 229 Objective: Difficulty: Easy 31 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 107) Purchasing approaches segmentation variables in the business marketplace include technology, user and nonuser status, and general purchasing policies Answer: FALSE Page Ref: 230 Objective: Difficulty: Easy 108) Situational factor segmentation variables in the business marketplace include urgency, specific application, and size of order Answer: TRUE Page Ref: 230 Objective: AACSB: Analytic skills Difficulty: Easy 109) The last step in the seven-step marketing segmentation process would be to develop a marketing-mix strategy reflective of segment positioning strategies Answer: TRUE Page Ref: 231 Objective: Difficulty: Easy 110) To be useful, market segments must be measurable Answer: TRUE Page Ref: 231 Objective: AACSB: Reflective thinking Difficulty: Easy 111) With respect to market offerings, if a marketer emphasizes a naked solution, he or she is emphasizing the product and service elements that all segment members value Answer: TRUE Page Ref: 231 Objective: AACSB: Analytic skills Difficulty: Easy 112) The most attractive segment is one in which entry barriers are low and exit barriers are high Answer: FALSE Page Ref: 232 Objective: Difficulty: Easy 32 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 113) A segment is attractive when there are actual or potential substitutes for the product Answer: FALSE Page Ref: 232 Objective: Difficulty: Easy 114) A segment is unattractive if the company's suppliers are able to raise prices or reduce quantity supplied Answer: TRUE Page Ref: 232 Objective: Difficulty: Easy 115) An undifferentiated marketing approach to full market coverage designs a marketing program for a product with a superior image that can be sold to the broadest number of buyers Answer: TRUE Page Ref: 233 Objective: AACSB: Analytic skills Difficulty: Easy 116) An attractive niche consists of customers having a distinct set of needs Answer: TRUE Page Ref: 234 Objective: AACSB: Analytic skills Difficulty: Easy 117) The ultimate level of segmentation leads to "segments of one," "customized marketing," or "one-to-one marketing." Answer: TRUE Page Ref: 234 Objective: Difficulty: Easy 118) Companies following a market specialization strategy offer one product to as many markets as possible Answer: FALSE Page Ref: 234 Objective: AACSB: Analytic skills Difficulty: Easy 33 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 119) A company is customerized when it is able to respond to individual customers by customizing its products, services, and messages on a one-to-one basis Answer: TRUE Page Ref: 235 Objective: AACSB: Analytic skills Difficulty: Easy 120) All attempts to target marketing to children, minorities, or other special segments are discriminatory and unethical Answer: FALSE Page Ref: 236 Objective: AACSB: Ethical understanding and reasoning abilities Difficulty: Easy 121) There are several major segmentation variables that might be used by a marketer to address a consumer market If the marketer were to use social class, psychographic lifestyle, and readiness stage to segment its market, identify possible segmentation subcategories under each of the three Answer: First, social class would yield the subcategories of lower lowers, upper lowers, working class, middle class, upper middles, lower uppers, and upper uppers Second, psychographic lifestyles would yield culture-oriented, sports-oriented, and outdoor-oriented Lastly, readiness stage would yield unaware, aware, informed, interested, desirous, and intending to buy Other sub-categories might be possible Page Ref: 215 Objective: Difficulty: Easy 122) PRIZM was developed by Claritas Inc What was the purpose of PRIZM? Answer: PRIZM stands for Potential Rating Index by Zip Markets It is a method for geoclustering that classifies over half a million U.S residential neighborhoods into 14 distinct groups and 66 distinct lifestyle segments called PRIZM Clusters The groupings take into consideration 39 factors in five broad categories: (1) education and affluence, (2) family life cycle, (3) urbanization, (4) race and ethnicity, and (5) mobility The neighborhoods are broken down by zip code, zip+4, or census tract and block group The clusters have descriptive titles such as Blue Blood Estates, Winner's Circle, Hometown Retired, Shotguns and Pickups, and Back Country Folks The inhabitants in a cluster tend to lead similar lives, drive similar cars, have similar jobs, and read similar magazines Page Ref: 215 Objective: Difficulty: Moderate 34 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 123) Identify and describe the three main types of New Luxury products Answer: The three main types of New Luxury products are: 1) Accessible superpremium products-They carry a significant premium over middle-market brands, yet consumers can readily trade up to them because they are relatively low-ticket items in affordable categories (2) Old Luxury brand extensions-They extend historically high-priced brands down-market while retaining their cachet (3) Masstige goods-They are priced between average middle-market brands and superpremium Old Luxury brands They are "always based on emotions, and consumers have a much stronger emotional engagement with them than with other goods." Page Ref: 218 Objective: AACSB: Analytic skills Difficulty: Moderate 124) Briefly describe the characteristics of the Millennials Answer: Born between 1979 and 1994, Millennials, also called Gen Y, number 78 million with annual spending power estimated at $187 billion Also known as the Echo Boomers, these consumers have been "wired" almost from birth— playing computer games, navigating the Web, downloading music, connecting with friends via instant messaging and mobile phones They have a sense of entitlement and abundance from growing up during the economic boom and being pampered by their boomer parents Yet they are highly socially conscious and concerned about environmental issues They are selective, confident, and impatient Page Ref: 219 Objective: Difficulty: Moderate 35 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 125) Generation Y members are often turned off by overt branding practices and "hard sell." List and provide examples for the different approaches tried by the marketers to reach and persuade them Answer: The different approaches tried by the markets to reach and persuade Generation Y members include: 1) Online buzz—Rock band Foo Fighters created a digital street team that sends targeted e-mail blasts to members who "get the latest news, exclusive audio/video sneak previews, tons of chances to win great Foo Fighters prizes, and become part of the Foo Fighters Family." 2) Student ambassadors—Red Bull enlisted college students as Red Bull Student Brand Managers to distribute samples, research drinking trends, design on-campus marketing initiatives, and write stories for student newspapers 3) Unconventional sports—Chick-fil-A sponsored the National Amateur Dodgeball Association, "a recreational pursuit for nontraditional sport enthusiasts." 4) Cool events—Hurley, which defined itself as an authentic "Microphone for Youth" brand rooted in surf, skate, art, music, and beach cultures, became the title sponsor of the U.S Open of Surfing Other sponsors included Casio, Converse, Corona, Paul Mitchell, and Southwest Airlines 5) Computer games—Product placement is not restricted to movies or TV: Mountain Dew, Oakley, and Harley-Davidson all made deals to put logos on Tony Hawk's Pro Skater from Activision 6) Videos—Burton ensures its snowboards and riders are clearly visible in any videos that are shot 7) Street teams—As part of an antismoking crusade, the American Legacy Foundation hires teens as the "Truth Squad" to hand out T-shirts, bandanas, and dog tags at teen-targeted events Page Ref: 220- 221 Objective: Difficulty: Moderate 126) Identify the four market segment groups based on brand loyalty status and list what a company can learn from analyzing the degrees of brand loyalty Answer: Marketers usually envision four groups based on brand loyalty status: (1) hard-core loyals, (2) split loyals, (3) shifting loyals, and (4) switchers Hard-core loyals can help identify the products' strengths Split loyals can show the firm which brands are most competitive with its own By looking at customers who are shifting away from its brand, the company can learn about its marketing weaknesses and attempt to correct them Page Ref: 228 Objective: AACSB: Reflective thinking Difficulty: Moderate 36 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 127) Briefly describe the steps in the segmentation process Answer: The seven steps in the segmentation process include: 1) Needs-Based Segmentation-Group customers into segments based on similar needs and benefits sought by customers in solving a particular consumption problem 2) Segment Identification-For each needs-based segment, determine which demographics, lifestyles, and usage behaviors make the segment distinct and identifiable (actionable) 3) Segment Attractiveness-Using predetermined segment attractiveness criteria (such as market growth, competitive intensity, and market access), determine the overall attractiveness of each segment 4) Segment Profitability-Determine segment profitability 5) Segment Positioning-For each segment, create a "value proposition" and product-price positioning strategy based on that segment's unique customer needs and characteristics 6) Segment "Acid Test"-Create "segment storyboard" to test the attractiveness of each segment's positioning strategy 7) Marketing-Mix Strategy-Expand segment positioning strategy to include all aspects of the marketing mix: product, price, promotion, and place Page Ref: 231 Objective: Difficulty: Moderate 128) Briefly describe single-segment concentration with an example Answer: With single-segment concentration, the firm markets to only one particular segment Porsche concentrates on the sports car market and Volkswagen on the small-car market—its foray into the large-car market with the Phaeton was a failure in the United States Through concentrated marketing, the firm gains deep knowledge of the segment's needs and achieves a strong market presence It also enjoys operating economies by specializing its production, distribution, and promotion If it captures segment leadership, the firm can earn a high return on its investment Page Ref: 234 Objective: AACSB: Analytic skills Difficulty: Moderate 37 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 129) Briefly describe product specialization and market specialization Answer: With product specialization, the firm sells a certain product to several different market segments A microscope manufacturer, for instance, sells to university, government, and commercial laboratories, making different instruments for each and building a strong reputation in the specific product area The downside risk is that the product may be supplanted by an entirely new technology With market specialization, the firm concentrates on serving many needs of a particular customer group, such as by selling an assortment of products only to university laboratories The firm gains a strong reputation among this customer group and becomes a channel for additional products its members can use The downside risk is that the customer group may suffer budget cuts or shrink in size Page Ref: 234 Objective: AACSB: Analytic skills Difficulty: Moderate 130) List the three premises on which Anderson's long tail theory is based and the two aspects of internet shopping that supports these premises Answer: Anderson's long tail theory is based on three premises: (1) Lower costs of distribution make it economically easier to sell products without precise predictions of demand; (2) The more products available for sale, the greater the likelihood of tapping into latent demand for niche tastes unreachable through traditional retail channels; and (3) If enough niche tastes are aggregated, a big new market can result Anderson identifies two aspects of Internet shopping that support these premises First, the increased inventory and variety afforded online permit greater choice Second, the search costs for relevant new products are lowered due to the wealth of information online, the filtering of product recommendations based on user preferences that vendors can provide, and the word-ofmouth network of Internet users Page Ref: 235 Objective: Difficulty: Moderate 131) Local marketing reflects a growing trend called grassroots marketing What are the characteristics of grassroots marketing? Answer: In grassroots marketing, marketing activities concentrate on getting as close and personally relevant to individual customers as possible Page Ref: 214 Objective: AACSB: Analytic skills Difficulty: Easy 38 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 132) What is customer cloning and how is it used? Answer: Customer cloning is a way of identifying new prospects by assuming that the best prospects live where most of a company's existing customers come from Page Ref: 214 Objective: AACSB: Analytic skills Difficulty: Easy 133) Not everyone is in favor of local marketing Identify two arguments made against local marketing Answer: Those against local marketing argue that it drives up manufacturing and marketing costs by reducing economies of scale and magnifying logistical problems A brand's overall image might be diluted if the product and message are different in different localities Page Ref: 216 Objective: AACSB: Analytic skills Difficulty: Easy 134) Identify ways in which shopping behaviors differ between men and women Answer: Women tend to be more communal minded and men tend to be more self-expressive and goal directed Women tend to take in more of the data in their immediate environment, whereas men focus on the part of the environment that helps them achieve a goal When shopping, men often need to be invited to touch a product, whereas women are likely to pick it up without prompting Men like to read product information, whereas women may relate to a product on a more personal level Page Ref: 217 Objective: AACSB: Reflective thinking Difficulty: Moderate 135) Increasingly, companies are finding that their markets are "hourglass shaped." What does this mean for consumers and for marketers? Answer: Middle-market U.S consumers are migrating toward both discount and premium products Companies that miss out on this new market risk being "trapped in the middle" and seeing their market share steadily decline Page Ref: 218 Objective: AACSB: Reflective thinking Difficulty: Easy 39 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 136) Although we can make distinctions between them, different generational cohorts also influence each other Give an example of this Answer: Many members of Generation Y are living with their boomer parents, because of which parents are being influenced by what demographers are calling a "boom-boom" effect Page Ref: 221 Objective: AACSB: Analytic skills Difficulty: Moderate 137) Characterize psychographic segmentation Answer: In psychographic segmentation, buyers are divided into different groups on the basis of psychological/personality traits, lifestyle, or values Page Ref: 225- 226 Objective: Difficulty: Easy 138) The VALS segmentation system has evolved into an eight-part typology List the categories of the eight-part typology Answer: The eight parts of the VALS segmentation system include the following: (1) innovators, (2) thinkers, (3) achievers, (4) experiencers, (5) believers, (6) strivers, (7) makers, and (8) survivors Page Ref: 226- 227 Objective: Difficulty: Easy 139) Professor Albert advises his students to purchase the book "Microbiology by Pelczar," to acquaint themselves with the fundamentals of microbiology What role does he play in the buying decision of his students? Answer: Professor Albert plays the role of an influencer in the buying decision of his students An influencer is a person who explicitly or implicitly has some influence on the final buying decision of others Page Ref: 227 Objective: AACSB: Analytic skills Difficulty: Moderate 140) List the four groups of consumers based on loyalty status Answer: The four groups of consumers based on loyalty status are: 1) hard-core loyals, 2) split loyals, 3) shifting loyals, and 4) switchers Page Ref: 228 Objective: Difficulty: Easy 40 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 141) Consumer attitudes are an interesting way to segment a market What are the five different consumer attitudes about a product that can be found in the market? Answer: The five attitude groups are: (1) enthusiastic, (2) positive, (3) indifferent, (4) negative, and (5) hostile Page Ref: 229 Objective: AACSB: Analytic skills Difficulty: Easy 142) A flexible market offering consists of two parts Identify and describe these two parts Answer: A flexible market offering consists of two parts: a naked solution containing the product and service elements that all segment members value, and discretionary options that some segment members value Page Ref: 231 Objective: Difficulty: Easy 143) To be useful, market segments must rate favorably on five key criteria What are those criteria? Answer: To be useful, market segments must be: (1) measurable, (2) substantial, (3) accessible, (4) differentiable, and (5) actionable Page Ref: 231- 232 Objective: AACSB: Reflective thinking Difficulty: Easy 144) List the five forces identified by Michael Porter that determine the intrinsic long-run attractiveness of a market or market segment Answer: The five forces identified by Michael Porter that determine the intrinsic long-run attractiveness of a market or market segment are industry competitors, potential entrants, substitutes, buyers, and suppliers Page Ref: 232 Objective: Difficulty: Easy 145) List the threats posed by the five forces identified by Michael Porter that determine the intrinsic long-run attractiveness of a market or market segment Answer: The threats posed by the five forces are: 1) Threat of intense segment rivalry 2) Threat of new entrants 3) Threat of substitute products 4) Threat of buyers' growing bargaining power 5) Threat of suppliers' growing bargaining power Page Ref: 232 Objective: Difficulty: Easy 41 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall 146) Give an example of how a company might target products to children in an ethical way Answer: The public is concerned when marketers take unfair advantage of vulnerable groups, such as children However, not all attempts to target children draw criticism Socially responsible marketing calls for targeting that serves not only the company's interests, but also the interests of those targeted For example, Colgate Junior toothpaste has special features designed to get children to brush longer and more often Page Ref: 232 Objective: AACSB: Ethical understanding and reasoning abilities Difficulty: Moderate 147) Explain the concept of mass marketing Answer: In mass marketing, the firm ignores segment differences and goes after the whole market with one offer It designs a marketing program for a product with a superior image that can be sold to the broadest number of buyers via mass distribution and mass communications Page Ref: 233 Objective: AACSB: Analytic skills Difficulty: Easy 148) Explain the concept of differentiated marketing Answer: In differentiated marketing, the firm sells different products to all the different segments of the market Page Ref: 233 Objective: Difficulty: Easy 149) Assume that you have decided to use a niche strategy to advance your marketing goals Characterize an attractive niche Answer: An attractive niche is distinguished as follows: (1) The customers in the niche have a distinct set of needs; (2) they will pay a premium to the firm that best satisfies their needs; (3) the niche is not likely to attract other competitors; (4) the niche gains certain economies through specialization; and (5) the niche is fairly small but has size, profit, and growth potential Page Ref: 234 Objective: AACSB: Reflective thinking Difficulty: Easy 150) A new trend in marketing is toward customerization Describe what customerization is and how marketers are using it Answer: Customerization combines operationally driven mass customization with customized marketing in a way that empowers consumers to design the product or service offering of their choice A company is customerized when it is able to respond to individual customers by customizing its products, services, and messages on a one-to-one basis Page Ref: 234- 235 Objective: Difficulty: Easy 42 Copyright © 2012 Pearson Education, Inc Publishing as Prentice Hall ... lifestyles, and usage behaviors make each needs-based segment distinct and identifiable A) segment "acid test" B) segment attractiveness C) segment profitability D) need-based segmentation E) segment. .. buying on the basis of price, service, and quality A) global segmentation B) microsegmentation C) short-term segmentation D) macrosegmentation E) geographic segmentation Answer: B Page Ref: 230-... Prentice Hall 58) In the step of the market segmentation process, the marketer evaluates the segment using criteria such as market growth and market access A) need-based segmentation B) segment