Deck 5: Market Segmentation

Question 1

Which of the following constitutes a viable market segment?

A) A particular group of consumers who have varying preferences for products and services
B) A particular group of consumers of a single item who can be served profitably by a firm
C) A group of products and services that can be mass marketed profitably by a firm
D) A group of consumers with needs that can be seldom met by a single product item offered by a firm

Answer 1

B

Question 2

Identify the approach in which the marketing manager decides on the appropriate basis for segmentation in advance of conducting a research study on a market.

A) A priori segmentation approach
B) Post hoc segmentation approach
C) Empirical approach
D) Psychographic approach

Answer 2

A

Question 3

Consumer attitudes, preferences, and benefits sought, which are determined through marketing research:

A) are commonly used as operational concepts for segmentation purposes.
B) are directly translated into theoretical concepts about target markets.
C) need not always be aligned with the organization's overall strategic objectives.
D) are unaffected by factors like development of new technology or nature of the industry.

Answer 3

A

Question 4

Which of the following is the primary reason for studying consumer and organizational buyer behavior?

A) To understand employees' relationships with their organization
B) To determine the effectiveness of an organization's marketing department
C) To provide bases for effective market segmentation
D) To determine an organization's distinctive competencies

Question 5

Which of the following statements is true of a firm's decision to "mass market" a product?

A) This decision considers a market segmentation analysis to be an optional requirement.
B) This decision should be reached only after a market segmentation analysis has been conducted.
C) This decision requires that a company select a target market first.
D) This decision can be reached only after the firm develops the marketing mix.

Question 6

When embarking on a new or modified marketing program, a company should conduct a(n) _____ first.

A) a priori segmentation analysis
B) mixed contingency analysis
C) complete situational analysis
D) vendor analysis

Question 7

The process of dividing a market into groups of similar consumers and selecting the most appropriate group(s) for the firm to serve is called _____.

A) test marketing
B) mass marketing
C) market segmentation
D) marketing communication

Question 8

In which of the following stages of the market segmentation process would a firm need to decide whether to use a post hoc or an a priori approach to segmenting a market?

A) Determining customer needs and wants
B) Delineating the firm's current situation
C) Dividing markets on relevant dimensions
D) Deciding a segmentation strategy

Question 9

Which of the following often brings about an investigation of consumer needs and wants for new or modified products and services?

A) Organizational objectives
B) Organizational portfolio
C) New technology
D) Production orientation

Question 10

Which of the following approaches for determining key market dimensions would be useful in the case of segmentation for entirely new products?

A) An a priori approach
B) A post hoc approach
C) An empirical approach
D) A cross-functional approach

Question 11

MicroBionics is a firm that manufactures digital hearing aids which, unlike analog hearing aids, can be programmed to mask out external noise. The company has determined that its competitive advantage lies in its product, while its weakness is the associated manufacturing costs. Target market opportunities exist within the maturing baby boomer segment. One challenge that the company faces is competing with another well-established brand called BelTone. In this case, which of the following steps in the market segmentation process has MicroBionics completed?

A) Development of the product positioning strategy
B) Delineation of the firm's current position
C) Division of the market on relevant segmentation variables
D) Design of the marketing mix strategy

Question 12

In the process of market segmentation, determining customer needs and wants is immediately followed by:

A) dividing the organization's products into different product classes according to their features for sale through a mass marketing mechanism.
B) designing the appropriate marketing mix strategies to be used for each segment.
C) delineating the firm's current situation which aids in developing marketing mixes.
D) grouping consumers on the basis of one or more similarities and treated as a homogeneous segment of a heterogeneous total market.

Question 13

Garnet Inc. is a manufacturing firm that primarily uses surveys to understand customers' attitudes, preferences, and benefits sought in a particular product category. Finally, based on their responses, the firm groups them to form market segments. This implies that Garnet Inc. uses a(n) _____ segmentation approach.

A) a priori
B) post hoc
C) unconventional
D) empirical

Question 14

In the process of market segmentation, while determining consumer needs and wants, it is advisable for a company to:

A) forego undiscovered needs even if it possesses adequate venture capital to uncover them.
B) transcend the barriers that the industry places upon its range of need satisfaction activities.
C) use this step for the generation of theoretical strategies, rather than operational concepts.
D) modify or enhance offerings with relevant changes in technology for practical benefit.

Question 15

Which of the following steps of the market segmentation process aids in determining objectives, opportunities, and constraints to be considered when selecting target markets and developing marketing mixes?

A) Delineating a firm's current situation
B) Designing the marketing mix
C) Developing product positioning
D) Deciding segmentation strategy

Question 16

ConiferCraft is a furniture firm that specializes in creating customized furniture for the commercial market. The firm has recently acquired a large amount of funds from investors and is looking to diversify by introducing customized products for the industrial market. The firm has completed a complete situation analysis for the purpose and the results are favorable. According to the market segmentation process model, the firm must next:

A) divide markets on relevant dimensions.
B) decide segmentation strategies.
C) develop product positioning strategies.
D) determine consumer needs and wants.

Question 17

The logic of market segmentation is based on the idea that _____ can seldom meet the needs and wants of all consumers.

A) marketers and sales people
B) marketing communication
C) an integrated marketing system
D) a single product item

Question 18

The group or market segment that a company selects to market to is called a _____.

A) differentiated market
B) customer profile
C) target market
D) business group

Question 19

Which of the following statements about market segmentation is true?

A) According to the model of market segmentation analysis, the process usually begins with deciding the segmentation strategy to be used.
B) In the process of market segmentation, deciding the segmentation strategy precedes the determining the consumer needs and wants.
C) The logic of market segmentation is that a single product item can seldom meet the needs and wants of all consumers.
D) According to the model of market segmentation analysis, the process begins with designing the marketing mix strategy.

Question 20

In the market segmentation process, delineation of a firm's current situation is followed by the determination of:

A) consumer needs and wants.
B) marketing mix strategies.
C) product positioning strategies.
D) relevant dimensions for market segmentation.

Question 21

World Explorer Cruises advertises that it sells "Cruises for your mind, body, and soul. Even better, it comes in a pint-sized budget!" What kind of segmentation is the cruise line using?

A) Demographic segmentation
B) Mass market segmentation
C) Geographic segmentation
D) Benefit segmentation

Question 22

Altron Herbals is trying to market a new sunscreen lotion. In order to identify their target market segment, they have prepared a questionnaire that asks potential consumers about their lifestyles, especially their activities, interests, and opinions. Based on their answers, the consumers will be grouped into separate categories. Which of the following market segmentation approaches has Altron used in this scenario?

A) A priori segmentation
B) Psychographic segmentation
C) Social segmentation
D) Geographic segmentation

Question 23

A company is entering the deodorant market. Its marketing manager decides that the market should be divided on the basis of whether the consumers are nonusers, light users, or heavy users of deodorants. Which of the following approaches to segmentation is the company using?

A) A priori segmentation
B) Empirical segmentation
C) Post hoc segmentation
D) A posteriori segmentation

Question 24

Benefit segmentation is a _____ approach.

A) technology-oriented
B) production-oriented
C) market-oriented
D) mass marketing

Question 25

In the context of psychographic segmentation, what does "VALS" stand for?

A) Values and linkages
B) Values and lifestyles
C) Values and liabilities
D) Values and leverage

Question 26

A company targets a new variant of tea that has a higher content of antioxidants at consumers who are health conscious and want organic food products by retailing them in stores that exclusively sell organic foods. This is an example of a(n) _____ segmentation approach.

A) a priori
B) a posteriori
C) post hoc
D) de facto

Question 27

Which of the following is the primary focus of psychographic segmentation?

A) Mass marketing
B) Consumer benefits
C) Demographic variables
D) Consumer lifestyles

Question 28

The belief underlying the _____ segmentation approach is that the advantages people are seeking in consuming a given product are the basic reasons for the existence of true market segments.

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

Question 29

The _____ dimension of the VALS™ framework segments people based on the degree to which they are innovative and have resources such as income, education, intelligence, and energy.

A) horizontal
B) qualitative
C) vertical
D) quantitative

Question 30

The best-known psychographic segmentation called _____, which was originally developed in the 1970s, explains and predicts consumer behavior.

A) AIO
B) VALS
C) ZIP
D) PRIZM

Question 31

"The Greedy Hand" is a book on the U.S. income tax system. Its publisher has targeted people who hold Libertarian political beliefs and listen to conservative radio talk shows. The publisher has used _____ segmentation in this scenario.

A) mass market
B) post hoc
C) psychographic
D) geodemographic

Question 32

Which of the following is the most market-oriented approach to segmentation?

A) Segmentation based on social class
B) Segmentation based on different customer lifestyles and purchasing habits
C) Segmentation based on geographic area
D) Segmentation based on benefits that potential customers are seeking

Question 33

How are consumer lifestyles measured during psychographic segmentation?

A) Consumers are asked about their health and known medical conditions.
B) Consumers are asked about their activities, interests, and opinions.
C) Consumers are asked to rate products in terms of the benefits they offer.
D) Consumers are asked to list the types of product features that they want.

Question 34

Which of the following segmentation bases of consumer markets includes income?

A) Geographic
B) Behavior
C) Psychographic
D) Demographic

Question 35

In the VALS™ framework, the _____ dimension of primary motivation provides context about an individual's self-perception and worldview.

A) horizontal
B) external
C) vertical
D) internal

Question 36

An entrepreneur has developed a self-service soda-bottling machine. Customers can fill their own plastic soda bottles with 18 regular and diet flavors. In order to decide where to locate the machines, the entrepreneur conducts research to study the market and groups people into segments based on the research findings. This is an example of the _____ segmentation approach.

A) psychographic
B) a priori
C) mass market
D) post hoc

Question 37

Chewies has been the favorite candy of many Southerners for years. The caramel, peanut, marshmallow, and chocolate confectionery is distributed through retail outlets in the South-Eastern regions of America. Its manufacturers recently started selling the candy through certain mail-order catalogs. Through previous research and experience, the marketing managers were able to use the _____ segmentation approach to gather information that would help determine the appropriate target groups for mail-order catalogs for Chewies.

A) a priori
B) a posteriori
C) post hoc
D) mass market

Question 38

_____ segmentation and benefit segmentation are the two commonly used approaches for segmenting markets.

A) Psychographic
B) Situational
C) Profit
D) Mass marketing

Question 39

Vet Meds is the pharmaceutical branch of a large medical research center for animals. Vet Meds often conducts surveys at veterinary hospitals and private vet clinics to identify potential areas for improvisation and growth. The company noted that many domestic pet-owners reported finding it extremely difficult to give their dogs oral medications owing to the bitter taste of the medicines, which remained even when the medicines were mixed with food. In response to this finding, Vet Meds released oral medicines for dogs which came in various meat flavors. Which of the following segmentation approaches is used by Vet Meds to satisfy consumer needs?

A) Benefit segmentation
B) Psychographic segmentation
C) A priori segmentation
D) Social segmentation

Question 40

_____ segmentation refers to a market segmentation approach in which people are grouped into segments on the basis of research findings, and then the size of each of these groups and their demographic and psychographic profiles are determined.

A) Post hoc
B) Empirical
C) Benefit
D) Psychographic

Question 41

Dawson & Peters' new line of leather boots are marketed as the hottest fashion trend of the season. The company puts up posters on billboards that featured several celebrities wearing the boots. The concept of the television ads was how wearing the boots could make you the envy of all those around you. According to the VALS™ framework, which of the following psychographic groups is Dawson & Peters targeting?

A) Survivors
B) Strivers
C) Thinkers
D) Makers

Question 42

According to the VALS™ model, Strivers are:

A) driven by knowledge and principles.
B) driven to demonstrate success.
C) driven by a desire for social or physical activity.
D) driven by a desire for risk taking.

Question 43

What does the horizontal dimension of the VALS™ framework represent?

A) Degree of innovativeness
B) Level of resources
C) Consumer needs
D) Primary motivation

Question 44

According to the VALS™ framework, consumers driven by a desire for social or physical activity, variety, and risk taking are motivated primarily by _____.

A) ideals
B) achievements
C) self-expression
D) extrinsic rewards

Question 45

According to VALS™, _____ are the type of consumers who have few resources, are more concerned with safety and security, and do not show a very strong primary motivation.

A) Achievers
B) Strivers
C) Makers
D) Survivors

Question 46

According to the VALS™ framework, consumers who are driven by a goal of demonstrating success to their peers and are motivated primarily by achievement can be best classified as _____.

A) Strivers
B) Makers
C) Believers
D) Thinkers

Question 47

According to the VALS™ framework, _____ are consumers who are change leaders and are most receptive to new ideas and technologies.

A) Innovators
B) Survivors
C) Thinkers
D) Believers

Question 48

According to the VALS™ framework, consumers who are driven by a desire for social or physical activity, variety, and risk taking, and are motivated primarily by self-expression can be best classified as _____.

A) Believers
B) Makers
C) Thinkers
D) Strivers

Question 49

A firm introduces electronic goods with new technology into the market. The firm decides to target consumers who are most receptive to new ideas and technologies. Which of the following groups of consumers should the firm target according the VALS™ framework?

A) Makers
B) Survivors
C) Innovators
D) Thinkers

Question 50

According to the VALS™ model, Experiencers are:

A) driven by the level of resources and innovation.
B) driven by knowledge and principles.
C) driven to demonstrate success.
D) driven by a desire for social or physical activity.

Question 51

According to the VALS™ framework, which of the following psychographic groups have the most abundant resources and may be motivated by any of the three motivations of achievement, self-expression, and ideals?

A) Innovators
B) Thinkers
C) Achievers
D) Strivers

Question 52

Bill is a carpenter who loves his job. Even when he is not working, he spends his time designing and building furniture and bookshelves for his house. Bill does not care much for material possessions and considers his job to be an act of self-expression, rather than a mere occupation. According to the VALS™ framework, Bill can be categorized as a(n) _____.

A) Striver
B) Achiever
C) Maker
D) Survivor

Question 53

Johnson & Coleman has created a new line of premium quality writing desks. The company marketed the product by highlighting its durability and functionality. According to the VALS™, to which of the following psychographic groups would the writing desk appeal the most?

A) Achievers
B) Strivers
C) Experiencers
D) Thinkers

Question 54

According to the VALS™ framework, consumers categorized as Experiencers and Makers are motivated primarily by _____.

A) ideals
B) achievement
C) role models
D) self-expression

Question 55

According to the VALS™ framework, consumers who are classified as _____ are predictable, and they choose familiar products and established brands.

A) Strivers
B) Makers
C) Believers
D) Experiencers

Question 56

According to the VALS™ framework, consumers driven by knowledge and principles are motivated primarily by _____.

A) ideals
B) achievement
C) self-expression
D) success

Question 57

Indie Frost is a website that sells snowboarding gear. A common strategy the website employs is to offer a high discount on one of its products for a short period. The website has found this strategy to have a high success rate since consumers tend to buy the product impulsively due to its low cost. The nature of the website and its marketing strategy suggests that Indie Frost targets the _____ of the VALS™ framework.

A) Thinkers
B) Experiencers
C) Survivors
D) Believers

Question 58

Believers, according to the VALS™ model, are:

A) driven by knowledge and principles.
B) driven to demonstrate success to their peers.
C) driven by a desire for social or physical activity.
D) driven by a desire for variety and risk taking.

Question 59

Thinkers, according to the VALS™ model, are motivated primarily by _____.

A) self-expression
B) ideals
C) achievement
D) image

Question 60

The 2002 promotional campaign for a line of cruises by Celebration, a travel and tourism company, emphasized the various activities, such as hang gliding, mountaineering, hiking, and scuba diving that people taking any of the Celebration cruises could participate in. The ads were trying to dispel the misconception that cruises are boring and meant only for older and more conservative people. To which of the following categories of consumers, according to the VALS™ framework, would Celebration's advertisements appeal the most?

A) Survivors
B) Believers
C) Experiencers
D) Thinkers

Question 61

Why is it inadvisable for a follower to attempt to directly position its product against the industry leader?

A) Competing with market leaders can be costly and not often successful.
B) A follower's product usually dominates in sales and in the minds of customers.
C) It is difficult for followers to select segmentation strategies.
D) A follower can never compete with the industry leader in terms of product quality.

Question 62

HealthPro cereal ads show the cereal being used as a topping on yogurt, as a snack food when topped with honey, and served hot as an alternative to oatmeal. In this case, HealthPro is using a positioning strategy based on:

A) superiority to competitive products.
B) consumer lifestyles.
C) particular types of product users.
D) use or application.

Question 63

What is the function of the Nielsen PRIZM?

A) It is a system that enables firms to understand and improve the position of their technology, brands, products, media, or channels.
B) It is a form of psychographic segmentation that classifies consumers according to their lifestyles and predicted behavior.
C) It is a form of geodemographic segmentation that classifies every U.S. neighborhood into one of 14 groups.
D) It is a type of mass marketing strategy based on the benefits that consumers want from the products they purchase.

Question 64

Which of the following observations about geodemographic segmentation is true?

A) It identifies specific individuals or households within a market.
B) It creates classifications of actual, addressable, mappable neighborhoods where consumers live and shop.
C) It is primarily based on the assumption that consumers in a particular neighborhood vary in many respects and lack similar consumption patterns.
D) It identifies consumer needs and wants in new markets and for new products as existing markets are saturated.

Question 65

The Nielsen PRIZM system includes maps of different areas that:

A) rank neighborhoods on their potential to purchase specific products.
B) group consumers in particular countries that are similar in many respects.
C) help implement and control the strategic plan of that area.
D) are used for providing slotting allowances to retailers.

Question 66

Which of the following statements is true of a positioning map?

A) It is a mathematical estimate of the rate at which new products will have to be developed to maintain control over the market share.
B) It is a written document outlining the marketing research study that was undertaken before the launch of a new product.
C) It is a type of documentation used by the U.S. Department of Commerce to create a geodemographic model of the nation.
D) It is a visual description of customers' perceptions of competitive products, brands, or models.

Question 67

An advertisement for Utopia Bank describes the bank as not only providing all banking services a consumer could ever want, but also offering brokerage house services. Instead of just competing against banks, Utopia Bank increased its versatility by positioning its services:

A) directly against particular competitors.
B) in terms of particular types of service users.
C) relative to a class of products or services.
D) in terms of its position as a cost leader.

Question 68

A positioning map is:

A) constructed by surveying customers about various product attributes and developing a graph indicating the relative position of competitors.
B) used solely with benefit segmentation and includes an assessment of lifestyle choices based on activities, interests, and opinions.
C) implemented when marketers want to differentiate between the Young Digerati, Cosmopolitans, and American dreams.
D) an indication of the number of Experiencers and Strivers within a geographic area based on PRIZM analysis.

Question 69

Which of the following describes the function of geodemographic segmentation?

A) It stresses the belief that the benefits people are seeking in consuming a given product are the basic reasons for the existence of true market segments.
B) It identifies the specific households in a market by focusing on local neighborhood areas and creates classifications of neighborhoods where people live and shop.
C) It determines the type of lifestyles that consumers have by asking them about their activities, interests, and opinions, and groups them based on the similarity of their responses.
D) It identifies the consumers' primary motivations and whether they are driven by ideals, achievement, and/or self-expression.

Question 70

Danko Inc. has manufactured a new line of wristwatches that can withstand extreme conditions such as below freezing temperatures. The watches are also waterproof and heat-resistant. The company is marketing these watches specifically to adventurers and extreme sports enthusiasts, such as mountain climbers and scuba divers. Danko positioned its line of wristwatches:

A) in terms of particular types of product users.
B) in terms of consumer attitudes and preferences.
C) relative to a particular product class.
D) directly against a particular competitor.

Question 71

The Hector & Gable Corporation conducted a research study and found that vacuum brick-packs of coffee sell much better in the urban uptown than coffee that is canned. As a result, Hector & Gable repackaged their Danver brand of coffee for the urban uptown and developed an advertising campaign to market them to the region. Sales of Danver coffee in this region were found to have increased by 32 percent. In this example, Hector & Gable used _____ segmentation to market its coffee.

A) mass marketing
B) psychographic
C) person/situation
D) geodemographic

Question 72

Mike wanted to build a bowling alley in Canada. Market research shows that Western Canadians enjoy bowling and similar pastimes significantly more than those in Eastern Canada. By locating his alley in the Western province of Alberta, Mike used a _____ segmentation strategy.

A) post hoc
B) mass market
C) psychographic
D) geodemographic

Question 73

According to the market segmentation process model, which of the following steps is a company likely to undertake after it has determined the basic segments of the market that could potentially be satisfied with its product?

A) Developing the product positioning plan
B) Deciding the segmentation strategy
C) Designing the marketing mix strategy
D) Determining the product mix

Question 74

The ad for Concordia kitchen cabinets states, "For an exceptional look in cabinetry that you won't find anywhere else, buy Concordia cabinets." This is an example of positioning:

A) based on superiority to competitive products.
B) in terms of superior product users.
C) based on being a cost-leader in the market.
D) in terms of where consumers live and shop.

Question 75

Jake is the marketing manager at Z-T athletic shoes manufacturers. Jake wanted to know how consumers perceive Z-T shoes when compared to all other athletic shoes currently in the market. He develops and administers a survey which indicates that the important attributes consumers look for in athletic shoes include price, durability, fit, and support. In this case, Jake could determine how Z-T ranks against other brands by using a _____.

A) perceptual map
B) product mix
C) positioning map
D) competitive chart

Question 76

In the VALS™ framework, _____ can be viewed as the opposite of Innovators in terms of resources and innovations.

A) Strivers
B) Makers
C) Achievers
D) Survivors

Question 77

The Nielsen PRIZM system is based on the assumptions that:

A) consumer lifestyles remain constant throughout different geodemographic segments of consumers, making geodemographic segmentation less effective.
B) consumers in particular neighborhoods are similar in many respects and the best prospects are those who actually use a product or other consumers like them.
C) implementation and control of the marketing plan requires segmentation based on psychographic lines.
D) achievement-oriented targets need to be made in order to increase sales of an organization.

Question 78

Identify the step in the market segmentation process that involves focusing on a product's superiority to competitive products based on one or more attributes.

A) Determining the consumer needs and wants
B) Deciding the segmentation strategy
C) Designing the marketing mix strategy
D) Developing the product positioning plan

Question 79

A store that sells art supplies has established the Makers segment of the VALS™ framework to be the most ideal segment to target. According to the market segmentation process, which of the following steps must the store undertake next?

A) Complete a situation analysis to determine objectives and threats
B) Decide on the segmentation approach to be used
C) Position the product favorably in the minds of its customers
D) Finalize the marketing mix or mixes to be used for the segment

Question 80

_____ segmentation refers to an approach that identifies specific households in a market by focusing on local neighborhood areas to create classifications of actual, addressable, mappable neighborhoods where consumers live and shop.

A) Psychographic
B) Social
C) Benefit
D) Geodemographic