Question 1

Delta Airlines now offers a preferred seating section on many flights (usually the front part of the coach section of the airplane) to appeal to and reward members of its frequent flyer club. This is an application of product usage segmentation.

Accepted Answer

The use of a preferred seating section to cater to frequent flyer club members is an example of product usage segmentation, as it targets a specific group based on their usage habits and preferences.

Question 2

In the price segmentation model presented in your readings, the "convenience segment" is less concerned with price and wants to have a high level of value and/or product differentiation.

Accepted Answer

The answer of In the price segmentation model presented in...

Question 3

People that live near one another often become more alike over time.

Accepted Answer

This is known as the "neighborhood effect" or "local influence effect," where people are influenced by their immediate surroundings, including their neighbors' opinions, values, and behaviors. This phenomenon has been observed in various studies and can lead to the development of shared attitudes, beliefs, and culture within a community.

Question 4

Home Depot, a home-improvement retail chain, sells scorpion traps in its stores in New Mexico, Texas, Arizona, and California. This is an example of geographic segmentation.

Accepted Answer

Geographic segmentation is the process of dividing a market into different geographical units such as nations, regions, states, counties, cities, or even neighborhoods. In this case, Home Depot is selling scorpion traps in specific states, which is an example of geographic segmentation.

Question 5

Cannibalization is the phenomenon that as market segmentation increases, sales increase; but as market segmentation increases, costs also increase.

Accepted Answer

Cannibalization refers to a reduction in sales volume, revenue, or market share of one product as a result of the introduction of a new product by the same producer. It does not directly relate to market segmentation and its impact on costs.

Question 6

Most pioneer brands position themselves as "standards of comparison."

Accepted Answer

Most pioneer brands aim to set a standard in the industry and position themselves as the benchmark or yardstick against which competitors are measured.

Question 7

Geographic bases for segmenting consumer markets are based on a consumer's physical location.

Accepted Answer

Geographic segmentation divides the market based on consumers' physical location, such as country, region, city, or neighborhood. It is a commonly used segmentation variable to tailor marketing strategies to specific geographical areas.

Question 8

Within the VALS System, Strivers have the fewest resources, often feel powerless, and are primarily concerned with safety and security.

Accepted Answer

Strivers, within the VALS System, are defined as individuals who have fewer resources than other groups but are also more striving and trendy. They are optimistic and concerned with the opinions and approval of others.

Question 9

Procter and Gamble offers a $1.00 coupon when consumers purchase three bottles of Pantene brand shampoo. This strategy represents segments based on geo-demographics.

Accepted Answer

This strategy represents a promotion based on quantity-based discounts, not segments based on geo-demographics.

Question 10

In the United States, as well as world-wide, people no longer want to live in cities and are moving away from urban areas.

Accepted Answer

While there may be some individuals who are moving away from urban areas, overall, cities are continuing to grow in population and urbanization is increasing around the world.

Question 11

Retail operations, such as Pottery Barn Outlet Store, Williams-Sonoma Outlet Store, Designer's Store Warehouse, and Overstock.com, that aim at appealing to the
"value segment" are segmenting the market based on price.

Accepted Answer

Retail operations that aim at appealing to the "value segment" are offering lower prices and segmenting the market based on price.

Question 12

Demographic based segmentation is the most popular segmentation base.

Accepted Answer

Demographic based segmentation is the most common segmentation base used by marketers to identify and target specific consumer groups based on their demographic characteristics such as age, gender, income, education level, occupation, and marital status.

Question 13

The VALS System is a segmentation tool that uses behavioral-based segmentation.

Accepted Answer

The answer of The VALS System is a segmentation tool...

Question 14

The majority fallacy suggests that consumers' tastes are normally distributed.

Accepted Answer

The answer of The majority fallacy suggests that consumers' tastes...

Question 15

An underlying assumption when using geographic-based segmentation is that consumers located in geographic proximity share similar product and service needs and preferences.

Accepted Answer

Geographic-based segmentation assumes that consumers located in close geographical proximity share similar needs and preferences due to their shared environment, culture, and lifestyle factors.

Question 16

Market size is a key factor that is overlooked when a manager commits the majority fallacy.

Accepted Answer

The answer of Market size is a key factor that...

Question 17

PRIZM is a segmentation tool that uses psychographics.

Accepted Answer

The answer of PRIZM is a segmentation tool that uses...

Question 18

Demographic bases for segmenting consumer markets include customers' vital population statistics, such as age, gender, income, and education.

Accepted Answer

Demographic segmentation is based on demographic characteristics such as age, gender, income, education, occupation, etc.

Question 19

Geo-demographic segmentation is sometimes called zip-code marketing.

Accepted Answer

Geo-demographic segmentation is a marketing strategy that divides a population into segments based on their geographic and demographic characteristics, such as age, gender, income, education, and lifestyle. It is often used by businesses to tailor their products and services to particular segments of the population. Zip-code marketing is a form of geo-demographic segmentation that specifically targets customers in a particular geographic region defined by their postal code.

Question 20

Demographic segmentation involves segmenting on the basis of cultural differences among consumers living in different cities, states, regions, or countries.

Accepted Answer

Demographic segmentation involves dividing a market into segments based on variables such as age, gender, income, occupation, education, or family size, rather than cultural differences. Cultural differences are more related to geographic or psychographic segmentation.

Quiz 2: Consumer Segmentation and Positioning