Deck 5: Market Segmentation

Question 1

 Which of the following statements is true about 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 selects a target market first.
D) This decision can be reached only after the firm develops the marketing mix.

Answer 1

B
Explanation: Even if the final decision of a firm is to "mass market" and not segment at all, this decision should be reached only after a market segmentation analysis has been conducted. Thus, market segmentation analysis is a cornerstone of sound marketing planning and decision making.

Question 2

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

Answer 2

C
Explanation: Dividing markets on relevant dimensions is often considered to be the whole of market segmentation (i.e., consumers are grouped on the basis of one or more similarities and treated as a homogeneous segment of a heterogeneous total market). An a priori or post hoc approach to segmentation may be used.

Question 3

 In the case of segmentation for entirely new products,which of the following approaches for determining key market dimensions would you recommend? 

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

Answer 3

B
Explanation: Post hoc segmentation is an approach in which people are grouped into segments on the basis of research findings. In the case of segmentation for entirely new products, a post hoc approach may be useful for determining key market dimensions.

Question 4

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

A) To study employees and their relationship with the organization
B) To study 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

In the market segmentation step involving the study of 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 generation for theoretical strategies, rather than operational concepts
D) modify or enhance offerings with relevant changes in technology for practical benefit

Question 6

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 7

 A new variant of tea that is higher in antioxidant content is being targeted at consumers who are health conscious and seek organic food products by retailing them in stores that sell organic food products only. This is an example of the _____ segmentation approach.

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

Question 8

 Which of the following statements about market segmentation is true? 

A) Market segmentation is the process of dividing an organization's products into different product classes according to their features for sale through a mass marketing mechanism.
B) The decision to mass market a product does not require any market segmentation analysis.
C) The first step in market segmentation is to develop an appropriate product positioning strategy.
D) During market segmentation, consumers are grouped on the basis of one or more similarities and treated as a homogeneous segment of a heterogeneous total market.

Question 9

 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 10

 Identify the approach in which the marketing manager has decided 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

Question 11

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

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

Question 12

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) integrated marketing systems
D) a single product item

Question 13

Which of the following is the first step of the market segmentation process?

A) Determining the consumer needs and wants
B) Dividing the markets on relevant dimensions
C) Delineating the firm's current situation
D) Designing the marketing mix strategy

Question 14

MicroBionics 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 lies in the existence of a competing and well-established brand called BelTone.In terms of the market segmentation process,MicroBionics has completed which of the following steps? 

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 15

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 16

 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) Market segmentation analysis precedes the determination of 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 17

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

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

Question 18

_____ 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 demographic and psychographic profiles are determined.

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

Question 19

Which of the following constitutes a viable market segment?

A) A particular group of consumers who have varying needs and wants from the offerings of the firm
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 large geographic area where consumer of all the different social classes live and shop

Question 20

The second step in the market segmentation process involves determining the_____. 

A) relevant dimensions for market segmentation
B) product positioning strategy to be used
C) consumer needs and wants
D) marketing mix strategy

Question 21

 Which of the following statements about psychographic segmentation is true? 

A) Psychographic segmentation is a form of benefit segmentation.
B) Psychographic segmentation typically follows the a priori model of segmentation.
C) Psychographic segmentation focuses exclusively on the benefits sought by the consumer.
D) Psychographic segmentation focuses on consumer lifestyles, activities, and interests.

Question 22

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 23

Which of the approaches to market segmentation is highly consistent with the approach to marketing suggested by the marketing concept?

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

Question 24

 The best-known psychographic segmentation called _____,was originally developed in the 1970s. 

A) AIO
B) VALS
C) ZIP
D) PRIZM

Question 25

An entrepreneur has developed a self-service soda-bottling machine.Customers can fill their own plastic soda bottles with 18 regular and diet flavors by placing empty bottles under a nozzle,depositing coin and punching a series of buttons.The machine dispenses the requested soda and a bar-coded dietary information sticker,which the customer places on the bottle.The entrepreneur must now determine where to locate the machines by studying the market and then grouping outlets on the basis of her research findings.This is an example of the _____ segmentation approach. 

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

Question 26

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

A) innovators
B) survivors
C) thinkers
D) believers

Question 27

What are the two commonly used approaches for segmenting markets? 

A) Benefit segmentation and psychographic segmentation
B) Advertising segmentation and financial segmentation
C) Nonprofit segmentation and profit segmentation
D) Mass marketing segmentation and geodemographic segmentation

Question 28

 Chewies has been a favorite candy for many Southerners for years.The caramel,peanut,marshmallow and chocolate confectionaries are 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 the mail-order catalogs for Chewies. 

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

Question 29

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) survivors

Question 30

 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) survivors

Question 31

 Vet Meds is the pharmaceutical branch of a large medical research centre for animals.Vet Meds often conducts surveys at veterinary hospitals and private clinics for animals 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.Vet Meds used which of the following segmentation approaches to satisfy consumer needs? 

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

Question 32

What does psychographic segmentation focus on? 

A) Organizational strengths
B) Quantitative research
C) Test marketing
D) Consumer lifestyles

Question 33

What does "VALS" stand for? 

A) Values and Linkages
B) Values and Lifestyles
C) Values and Liabilities
D) Values and Leverage

Question 34

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 the benefits that potential customers are seeking

Question 35

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

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

Question 36

 "The Greedy Hand" is a book on the U.S.income tax system.Its publisher has targeted the book at people who hold Libertarian political beliefs and who 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 37

Altron Herbals is trying to market a new sunscreen lotion.In order to find out which segment of the market they should target,they have prepared a questionnaire that asks potential consumers about lifestyles,especially their activities,interests,and opinions.Based on their answers,the consumers are 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 38

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

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

Question 39

 Benefit segmentation is clearly a _____.

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

Question 40

The _____ of the VALS™ framework segments people based on the degree to which they are innovative and have requisite resources.

A) horizontal dimension
B) social groups
C) vertical dimension
D) primary motivation dimension

Question 41

 Let's say you 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 your alley in the western province of Alberta,you would have used a _____ segmentation strategy. 

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

Question 42

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 43

 According to VALS™,_____ are the type of consumers that 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 44

Dawson & Peters' new line of leather boots are marketed as the hottest fashion trend of the season.The company put 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 was Dawson & Peters targeting?

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

Question 45

 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 46

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 own home.While not thrifty,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,which of the following psychographic groups does Bill belong to?

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

Question 47

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 geography 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.
D) It identifies the consumers' primary motivations and whether they are driven by ideals, achievement, and/or self-expression.

Question 48

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

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

Question 49

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

A) Secondary needs
B) Resources
C) Consumer needs
D) Primary motivation

Question 50

Which of the following steps would a company 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 51

 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 52

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

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

Question 53

 The 2002 promotional campaign for a line of cruises by Celebration 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 cruise line was trying to dispel the misconception that cruises are boring and meant only for older and more conservative people.Which of the following categories of consumers,according to the VALS™ framework,would Celebration's advertisements appeal to the most? 

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

Question 54

What assumption is the Nielsen PRIZM system based on? 

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 55

 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) self-motivation

Question 56

 What is the function of the Nielsen PRIZM? 

A) It is a system that provides studies enabling clients 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 57

_____ refers to an approach that identifies specific households in a market by focusing on local neighborhood geography (such as zip codes)to create classifications of actual,addressable,mappable neighborhoods where consumers live and shop.

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

Question 58

The Hector & Gable Corporation conducted a research study that 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 59

The Nielsen PRIZM system includes maps of different areas that: 

A) rank neighborhoods on their potential to purchase specific products or services.
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 60

Johnson & Coleman has created a new line of premium quality writing desks.The desks are being marketed to consumers who value knowledge and principles.According to the VALS™,which of the following psychographic groups would the writing desk appeal to the most?

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

Question 61

Which of the following is the last stage of the market segmentation process?

A) Delineating the firm's current situation
B) Deciding the marketing mix strategy
C) Dividing markets on relevant dimensions
D) Developing product positioning

Question 62

In which of the following situations is it appropriate for a firm to become a mass marketer?

A) The market is large and consists of several segments that are almost equal in size.
B) Heavy users make up such a large proportion of the sales volume that they are the only relevant target.
C) The largest segment is composed of light users, and hence, targeting them would yield the highest profits for the firm.
D) Potential consumers constitute such a small group that they don't form a meaningful segment.

Question 63

Gable Brothers,Inc.is trying to find viable market for its new brand fountain pen.After conducting a psychographic segmentation,it found that the segment of potential consumers is so small that the volume in sales would not be profitable for the company.Therefore,top management has decided to not release the product into the market.Which of the following stages of the market segmentation process is the company currently in?

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

Question 64

 An advertisement for First Union 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,First Union increased its versatility by positioning its services: 

A) based on superiority to competitive products.
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 65

 A meaningful segment is one that: 

A) is large enough to offer long-run profits for the firm.
B) has a well-defined geodemographic profile.
C) can be reached and served by direct marketers in an efficient manner.
D) is driven by the desire for instant gratification.

Question 66

 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) relative to a product class.

Question 67

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 their line of wristwatches:

A) in terms of particular types of product users.
B) in terms of superiority to competing products.
C) relative to a particular product class.
D) directly against a particular competitor.

Question 68

 Three important criteria on which to base a segmentation strategy decision are that a viable segment must be: 

A) continual, presentable, and restricted.
B) measurable, meaningful, and marketable.
C) political, cultural, and assured.
D) prestigious, non-deceptive, and demographic.

Question 69

In which of the following stages does a firm decide not to enter the market after conducting a suitable analysis of the viability of the market?

A) Developing product positioning
B) Dividing the market on relevant dimensions
C) Determining consumer needs and wants
D) Deciding the segmentation strategy

Question 70

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

A) superiority to competitive products.
B) the product's superiority over a particular competing brand.
C) particular types of product users.
D) use or application.

Question 71

 Which of the following statements is true with regard to 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 72

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

A) Competing with market leaders can be costly and not often successful
B) A follower's product already dominates in sales and in the minds of customers
C) Followers find it difficult to select segmentation strategies
D) A follower can never compete with the industry leader in terms of product quality

Question 73

 For a segment to be measurable,the firm must be able to measure its: 

A) homogeneous preferences.
B) size and characteristics.
C) postpurchase satisfaction.
D) potential for test marketing.

Question 74

 A positioning map is: 

A) constructed by surveying customers about various product attributes and developing dimensions and 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 75

 While churches are still places for traditional religious ceremonies and training,some churches are trying to reach new segments of the population by offering music-based services,youth-led services,and televised services.Churches are using positioning: 

A) based on superiority to competitive products.
B) in terms of superior product users.
C) relative to the position of their competitors.
D) by use or application.

Question 76

 EasyClean vacuum cleaners used the slogan: "Anything else is a compromise." The manufacturer of EasyClean vacuum cleaners uses positioning: 

A) based on superiority to competitive products.
B) in terms of use or application.
C) in terms of particular types of product users.
D) relative to a product class.

Question 77

What is a marketable segment? 

A) A firm that is large enough to have some sales and growth potential and involves no competitors
B) A segment that includes innovators in high proportion along with containing few survivors
C) A firm that has good customer-relationship and employs at least one form of quality assurance
D) A segment that can be reached and served by the firm in an efficient manner.

Question 78

Imagine that you work for K-Swiss athletic shoes manufacturers.You want to know how consumers perceive K-Swiss shoes when compared to all other athletic shoes currently in the market.A survey is developed and administered and it indicates that the important attributes consumers looked for in athletic shoes included price,durability,fit,and support.By using a _____,you could determine how K-Swiss ranks against other brands like Nike and Adidas. 

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

Question 79

 Clear Spring is a brand of bottled that is marketed as a much better product than Cool Blue,which is a competing brand of bottled water.The Clear Spring brand of bottled water is positioned:

A) by use or application.
B) in terms of particular types of product users.
C) relative to a product class.
D) directly against a particular competitor.