Deck 8: Market Segmentation, Targeting, and Positioning

Question 1

Which of the following is a characteristic of a Geographic Information Systems (GIS)?

A) It is very expensive to use because of the high cost of leasing the technology from the military.
B) It is complicated to use because the data is produced using logarithmic displays that most small computer systems cannot handle.
C) It has very sophisticated digital readouts that require three-dimensional colour coding to read.
D) It assembles, stores, and displays data by location.

Answer 1

D

Question 2

What is one of the two largest metropolitan areas in the world?

A) Montreal
B) Tokyo
C) New York
D) London

Answer 2

B

Question 3

Concerning market segmentation, which of the following statements is NOT correct?

A) Only for-profit organizations practice market segmentation.
B) Firms that practice market segmentation don't necessarily change their products to meet the needs of different market segments.
C) There are too many variables to attract all customers using the same marketing mix.
D) Market segmentation attempts to divide the total market into smaller groups.

Answer 3

A

Question 4

What is the lumber a carpenter purchases to finish a client's basement known as?

A) a raw material
B) a business product
C) a consumer good
D) a home-improvement product

Question 5

An automobile manufacturer generates approximately one-half of its sales in two provinces in Canada. What do these provinces constitute for the company?

A) its primary consumer market
B) its core region
C) its secondary market
D) its sales region

Question 6

What is the MOST common method of market segmentation?

A) product-related segmentation
B) demographic segmentation
C) economic segmentation
D) psychographic segmentation

Question 7

Based on the MOST recent census data, where does 68 percent of the Canadian population live?

A) in Toronto, Ontario
B) between Montreal, Quebec, and Windsor, Ontario
C) in 33 metropolitan areas across the country
D) in Calgary, Alberta

Question 8

Generally speaking, what are rubber and raw cotton examples of?

A) business products
B) consumer products
C) fabricated materials
D) nonpersonal products

Question 9

What do pizza delivery companies use to succeed in delivering thousands of pizzas to Canadian homes on Super Bowl Sunday?

A) advertising shown during the game
B) statistical databases and written reports from area managers
C) motor scooters rather than automobiles as delivery vehicles
D) a geographic information system that can display location-specific data

Question 10

Which of the following market segments could a marketing organization MOST effectively promote to and serve based on the segment's size and profit potential?

A) the staff of foreign embassies from European countries
B) baby boomers
C) captains and crews of sea-going vessels
D) collectors of classic MG sports cars

Question 11

What is a commonly used basis for segmenting consumer markets?

A) geographic segmentation based on locations
B) career segmentation based on industry affiliation
C) national segmentation based on citizenship
D) institutional segmentation based on membership

Question 12

Kyle plans to buy new tires for a converted bus his family uses for camping trips.The tires are the same type used on General Motors commercial trucks and can be purchased from Industrial Tire Company.How are the tires that Kyle will buy for this bus classified?

A) as business products
B) as service products
C) as commercial products
D) as consumer products

Question 13

Which of the following is NOT a common basis for segmenting consumer markets?

A) geographic
B) psychographic
C) competitive
D) demographic

Question 14

What are goods and services purchased by the ultimate user for personal use called?

A) personal products
B) purchased products
C) consumer products
D) commercial products

Question 15

When one product becomes part of another product that is destined for resale, what is the first product considered?

A) a consumer product
B) a business product
C) a commercial market product
D) an industrial market product

Question 16

What is the basis for determining whether pencils are consumer products or business products?

A) the purpose for which the pencils are purchased
B) the number of pencils that are purchased
C) where the pencils are purchased from
D) the total price paid for the number of pencils

Question 17

How might business products be identified?

A) as goods and services purchased for use either directly or indirectly in the production of other goods and services for resale
B) as goods and services of any kind bought for use in the home, but sold later as used items
C) as goods and services, such as legal services, that can be bought by businesses or individuals but do not enter into the production of finished goods
D) as goods and services sold in a finished state for use in the home or the business office

Question 18

Which of the following basic requirements must market segmentation meet to be effective?

A) The firm must avoid focusing on non-variables, such as profitability and volume.
B) The market segment must reflect the population's changing attitudes and lifestyles.
C) The company must expand beyond its marketing capabilities to capture growing markets.
D) The market segment must have measurable purchasing power and size.

Question 19

In addition to population and geography, a researcher might combine other indicators to segment markets geographically.Of the indicators listed, what would marketers be LEAST likely to use?

A) income and job growth
B) migration patterns
C) average size of the households
D) product-usage patterns

Question 20

How would a geographic area surrounding an urban core with a population of at least 100 000 be classified?

A) as a census metropolitan area (CMA)
B) as a primary metropolitan region (PMR)
C) as a metropolitan statistical area (MSA)
D) as a census agglomeration (CA)

Question 21

Compared with other ethnic groups, Chinese Canadians represent the ________ ethnic group in Canada, and are a more ________ segment.

A) smallest; homogenous
B) smallest; heterogeneous
C) largest; homogenous
D) largest; heterogeneous

Question 22

What does the cohort effect describe?

A) why members of the same psychographic group decide to vote the same way
B) how Generation X uses its financial power to influence product trends
C) the predictability of demographic characteristics in analyzing purchase habits, as well as product-usage rates, and brand preference
D) the tendency of members of a generation to be influenced and bound together by events occurring during the key formative years

Question 23

How can Chinese Canadian consumers be described?

A) as trusting in family, hardworking, and thrifty
B) as having a preference for North American food products and groceries
C) as being part of a homogenous segment
D) as more likely to obtain information about products and services from national media sources

Question 24

According to Engel's laws, what happens as family income increases?

A) the percentage spent on recreation and education increases
B) the percentage spent for clothing and household operations increases
C) the percentage spent for food and household operations decreases
D) the percentage spent on housing and food decreases

Question 25

VALS™ defines eight personality types that impact purchasing decisions.Which of the following set of traits is NOT part of the VALS matrix?

A) Achievers and Strivers
B) Experiencers and Survivors
C) Thinkers and Believers
D) Makers and Definers

Question 26

What is a characteristic of using demographic segmentation abroad?

A) challenging, because many countries do not take regular censuses
B) standardized, with most countries using the same global guidelines
C) simplified, due to the wealth of income data available in certain countries, such as Italy and Japan
D) sometimes worthless, because the integrity of the data is called into question

Question 27

What is the largest segment that values professional and material goals more than other groups?

A) strivers
B) devouts
C) altruists
D) fun seekers

Question 28

Which of the following age groups would marketers of life insurance MOST likely target?

A) teenagers
B) between 25 and 35 years old
C) baby boomers
D) over 60 years old

Question 29

Five years ago, Joshua spent 28 percent of his $45 000 yearly income on his bachelor apartment.Today, Joshua is earning $60 000 annually.According to Engel's laws, what percentage of income will he spend on his new apartment?

A) less than 19 percent
B) about 28 percent
C) about 52 percent
D) more than 71 percent

Question 30

What is psychographic segmentation based on?

A) the quantitative side of the consumer demographic analysis
B) the quantitative side of the consumer geographic analysis
C) the individual's residential patterns and life cycle preferences
D) the group's psychological characteristics, values, and lifestyles

Question 31

Ford Motor Company surveyed 10 000 customers to analyze their needs and preferences in automobiles.At the end of the survey, respondents were asked to provide demographic information, including age.Responses concerning preferences were strikingly similar for each group within a specific five-year age range.What effect is this a result of?

A) the income effect
B) the life-cycle effect
C) the cohort effect
D) the global-generation effect

Question 32

A marketer of a new brand of outdoor furniture wants to know more about the personalities and lifestyles of the intended consumer market in order to help match its product offerings with this segment's needs. What would be wise to use as a means of achieving this goal?

A) demographic segmentation
B) geographic segmentation
C) psychographic segmentation
D) geographic information systems

Question 33

What greatly attributes to the Canadian population growth and change in Canada's racial and ethnic make-up?

A) North American Free Trade Agreement
B) immigration among some minority groups
C) shifts in population to urban areas
D) increasing birth rate for the entire population

Question 34

What type of segmentation divides a population into groups with similar psychological characteristics, values, and lifestyles?

A) demographic
B) polymorphic
C) psychographic
D) parallelgraphic

Question 35

Which of the following statements is NOT true regarding socioeconomic market segmentation?

A) It is easy in foreign markets where income and life-cycle stage are not measured.
B) It is the most common type of market segmentation.
C) It is defined by variables that include age, gender, income, occupation, and education.
D) It is most often compiled through data taken from Statistics Canada.

Question 36

What is another name for socioeconomic market segmentation?

A) product-related segmentation
B) demographic segmentation
C) psychographic segmentation
D) geographic segmentation

Question 37

Which of the following is NOT a life-cycle stage?

A) unmarried
B) first-child families
C) remarried
D) empty nesters

Question 38

What does the family life cycle refer to?

A) a way to apply psychographic segmentation
B) the process of family formation and dissolution
C) insights into relationships among age, occupation, income, and housing
D) the 11 stages of personal growth from infancy to retirement

Question 39

What has been an observed change in family life cycle behaviour noted by researchers in the past decade?

A) the tendency of unmarried people becoming customers for new homes and expensive furnishings
B) the tendency of newly married people cooking at home almost every meal instead of dining out
C) the tendency of "boomerang" children returning home, sometimes with their own families
D) the tendency of parents with a second or subsequent child buying new sets of cribs, changing tables, and so forth for each child

Question 40

In terms of numbers, which age group is the largest?

A) baby boomers
B) Generation X
C) 9/11 Generation
D) World War II Generation

Question 41

What is the strategy that is sometimes referred to as mass marketing?

A) concentrated marketing
B) macromarketing
C) undifferentiated marketing
D) differentiated marketing

Question 42

In the process of market segmentation, what is the next step once market potential has been estimated?

A) forecast probable market share
B) determine potential sales
C) develop a marketing mix
D) seek strategies to meet the outcomes

Question 43

What factor sets the upper limit on demand generated by a particular market segment?

A) market potential for the segment under analysis
B) market share held by the firm
C) geographic dispersion of potential customers
D) lifestyle characteristics of area population

Question 44

What can sometimes drive a company from undifferentiated to differentiated marketing?

A) competitive pressures
B) efficient production
C) homogeneous products
D) lower promotional costs

Question 45

What marketing strategy does Burt's Bees skin-care products, manufactured with all natural ingredients, use?

A) undifferentiated marketing
B) differentiated marketing
C) micromarketing
D) concentrated marketing

Question 46

As compared with undifferentiated marketing, what might the firm that practises differentiated marketing generally expect?

A) fewer sales by segment
B) lower total production costs
C) greater total promotional costs
D) lower inventory costs

Question 47

What is the product-related segment of the consumer market that is based on the attributes people seek when they buy a product?

A) the price-shopper segment
B) the lifestyle segment
C) the expenditure pattern segment
D) the benefits-sought segment

Question 48

What is the purpose of conducting market segmentation and market opportunity analysis in the second stage of the market segmentation process?

A) to identify the specific members of each segment and contact each of them directly
B) to determine the level of resources that must be committed to each segment
C) to produce a forecast of market potential within each segment
D) to design a marketing strategy and tactics to reinforce the firm's image

Question 49

From which point of view is an undifferentiated marketing strategy efficient?

A) It serves the consumer better because the products offered are designed to meet the needs of a specific group of people.
B) It maintains control of short production runs.
C) It captures high profits in small segments of the market.
D) It supports mass production and promotion.

Question 50

The Gap markets apparel to children, teens, and adults through different storefronts, including The Gap, Gap Kids, and Baby Gap.What is this practice called?

A) undifferentiated marketing
B) differentiated marketing
C) mass marketing
D) micromarketing

Question 51

Which of the following describes the 80/20 principle?

A) Market segmentation succeeds about 80 percent of the time and fails 20 percent.
B) Roughly 80 percent of total product sales come from 20 percent of customers.
C) Roughly 80 percent of the market segment is tapped and 20 percent has not yet been reached.
D) Roughly 80 percent of the market can be segmented and 20 percent cannot.

Question 52

What is the product-related segmentation of consumers that is based on the strength of their attachment and allegiance to their preferred products?

A) values and lifestyles segmentation
B) business-to-business segmentation
C) psychographic segmentation
D) brand loyalty segmentation

Question 53

What is a firm practising when it chooses to target potential customers by postal code, specific occupation, or even lifestyle?

A) megamarketing
B) hypermarketing
C) micromarketing
D) concentrated marketing

Question 54

While researching the idea of opening his own health club, Tomas learned that 90 percent of health club members are between the ages of 18 and 49.They prefer to exercise with people of their own gender, are more likely to buy foreign-brand cars, and are urban dwellers.How can Tomas use this assembled information?

A) in observational analysis
B) in identifying dimensions for segmenting markets
C) in forecasting total market potential
D) in developing a market segment profile

Question 55

When can product-usage segmentation be an important tool for marketers?

A) as they attempt to eliminate competition
B) as they attempt to identify heavy users
C) as they attempt to reduce costs from 80 percent to 20 percent
D) as they attempt to increase profitability

Question 56

What would be the best choice of product to market using an undifferentiated marketing strategy?

A) luxury automobiles
B) snack foods
C) table salt
D) imported wine

Question 57

Why is segmentation by benefits used?

A) to determine the marketer's effectiveness in satisfying the consumer
B) to measure brand loyalty
C) to evaluate post-consumption
D) to focus on the attributes that people seek in a product

Question 58

In the market segmentation process, what can be expected from demand forecasts and cost projections used to determine the profit and return on investment?

A) certain demographics
B) each market segment being considered
C) the overall population
D) the general marketing mix

Question 59

Regina is an independent strategy consultant.She has guided her client's company through the market segmentation process and has posed the question: "Does the potential for achieving company goals justify committing resources to develop each or any of these segments?" What stage of the market segmentation process is the company at?

A) estimating cost-benefit for each segment
B) developing a relevant profile for each segment
C) forecasting market potential
D) selecting specific market segments

Question 60

What should a firm do before beginning the market segmentation process?

A) identify bases for segmenting markets
B) forecast total market potential
C) forecast market share
D) select target market segments

Question 61

What does a positioning map demonstrate?

A) which companies utilize undifferentiated marketing strategies
B) what will remain constant through the entire product life cycle
C) how consumers view a product relative to competitive products
D) how to introduce a new product to the marketplace

Question 62

What are marketers who apply a positioning strategy wanting to do?

A) make their product look as much like the market leader as possible
B) emphasize a product's unique advantages
C) make sure they clearly outline the product's possible applications
D) talk to specific, known users of the product

Question 63

A hotel purchases towels for use in its rooms.These towels are considered business products.

Question 64

What positioning strategy would use the slogan "You don't pay more, you get more"?

A) price/quality
B) attributes
C) users
D) competitors

Question 65

Consumer products are items purchased by consumers or businesses to be used in their homes, offices, or factories.

Question 66

By identifying, evaluating, and selecting a target market to pursue, marketers are able to develop more efficient and effective marketing strategies.

Question 67

Items can be classified as business products not because of what they are but because of how they will be used, such as shovels and rakes purchased by a lawn care service.

Question 68

The target market for a product is the specific segment of consumers most likely to purchase that particular product.

Question 69

Goods and services generally purchased by manufacturers are classified as business products.

Question 70

A market comprises any person or entity that has the willingness, authority, and purchasing power to buy a product.

Question 71

What interactive medium might help micromarketers boost the effectiveness of their strategy by tracking specific demographics and communicating directly to individuals who are MOST likely to buy that product?

A) customized direct-mail packages
B) the Internet
C) personalized telemarketing messages
D) fax marketing

Question 72

Why are micromarketing techniques used?

A) primarily to sell services or other intangibles
B) to maximize revenue potential of large firms that have abundant financial resources only by mass marketers
C) for the sale of industrial goods by vendors only
D) to target very specific groups or individuals

Question 73

Which of the following LEAST describes concentrated marketing?

A) It is very effective for large corporate competitors that have marketplace clout.
B) Firms that wish to focus on multiple segments utilize it.
C) It is an effective strategy for specialty or unique products.
D) It is more impacted by shifts in consumer buying habits and other external factors.

Question 74

Which of the following is one of the basic determinants of a market-specific segmentation strategy?

A) product demand
B) competitors' strategies
C) environmental constraints
D) organizational efficiencies

Question 75

What strategy is a company using when they choose to focus its efforts on satisfying only one market segment for profit?

A) niche marketing
B) elimination marketing
C) undifferentiated marketing
D) designer marketing

Question 76

Business products are defined as contributing directly to the production of other goods.

Question 77

Home Depot introduced a new line of riding lawn mowers.However, the company believed the residence location of the population in certain areas did not merit carrying the mowers in that population.Which of the following BEST describes why the company MOST likely made this decision?

A) it decided to use concentrated marketing
B) it determined the market was saturated.
C) it decided to re-position the product
D) it determined re-segmentation was necessary.

Question 78

What is the basis for a positioning strategy that uses the slogan "Crest is a cavity fighter"?

A) product price/quality
B) product class
C) product attributes
D) product users

Question 79

A company is advertising a new cordless shaver during the Grey Cup and NHL telecasts, enabling the cordless shaver to become a big success.What was the MOST likely market segmentation strategy used?

A) Lifestyle
B) Usage rates
C) Gender
D) Household type

Question 80

Since rubber purchased by Goodyear is utilized to manufacture tires that are ultimately used by consumers on the automobiles they purchase, rubber is a consumer product for Goodyear.