Question 1

While it is important to understand potential business customers' buying processes,this is not a helpful segmentation basis.

Accepted Answer

Many business marketers find it helpful to segment customers and prospective customers on the basis of how they buy.

Question 2

The first step in segmenting a market is to choose a basis or bases for segmenting the markets.

Accepted Answer

The first step is to select a market or product category for study.

Question 3

The 80/20 principle implies that the majority of all demand is due to a minority of the customers.

Accepted Answer

The 80/20 principle, also known as the Pareto principle, states that 80% of effects come from 20% of causes. In business, this often means that 80% of sales come from 20% of customers, indicating that a minority of customers are responsible for the majority of demand.

Question 4

Fisher-Price developed a line of toys for infants in China.Babies make up the market for these products.

Accepted Answer

Infants do not have an ability to buy and,therefore,cannot be called a market.Their parents would constitute a market.

Question 5

Geodemographic segmentation combines geographic,demographic,and lifestyle segmentations.

Accepted Answer

Geodemographic segmentation is a type of segmentation that combines geographic, demographic, and lifestyle characteristics to create homogeneous groups or segments of customers. It considers where people live, their age, gender, income, occupation, education, behavior, interests, values, and attitudes to identify patterns and insights that can be used for targeting and personalization.

Question 6

A market segmentation study done by the University of Thessaly in Greece classified recreational skiers in terms of their gender,age,and income levels.The study used psychographic segmentation variables.

Accepted Answer

These are examples of demographic segmentation variables.

Question 7

A segmentation plan must produce segments that are accessible-that is,the firm must be able to reach members of targeted segments with customized marketing mixes.

Accepted Answer

For a segmentation plan to be effective, the segments identified must be accessible to the firm. This means that the firm must be able to reach members of the targeted segments through customized marketing mixes. If a segment is not accessible, the marketing efforts put towards it may not be effective or efficient.

Question 8

Company characteristics,such as geographic location,type of company,company size,and product use,can be important segmentation variables.

Accepted Answer

Company characteristics can be important variables for market segmentation. Factors such as location, type of company, size, and product use can help identify groups of customers with similar needs and preferences. This information can then be used to tailor marketing strategies and messaging to better reach and appeal to these target segments.

Question 9

Fisher-Price is identifying Asian markets that are interested in their line of talking toys.Fisher-Price is engaged in the process of market segmentation.

Accepted Answer

Fisher-Price is dividing the market into smaller groups based on common characteristics or interests to target their communication and marketing efforts more effectively, which is market segmentation.

Question 10

Abbeville Press published a book by Armin Brott and Jennifer Ash entitled The Expectant Father: Facts,Tips,and Advice for Dads-to-Be.It is an advice book for men whose partners are expecting a baby.The market for this book is based on demographics.

Accepted Answer

The book is targeted specifically towards men who are expecting a baby with their partners, which is a demographic market.

Question 11

Clorox describes individuals who buy lots of cleaning products as heavy users.This is an example of how companies use benefit segmentation.

Accepted Answer

Usage-rate segmentation usually describes product usage with categories like heavy and light.

Question 12

A market segment is deemed to have substantiality if it contains a large number of potential customers.

Accepted Answer

Substantiality of a segment refers to a segment being large enough to warrant developing and maintaining a special marketing mix.This does not necessarily require large numbers of potential customers.

Question 13

One reason marketers use market segmentation as a tool is that once completed,the process need not be repeated.

Accepted Answer

Markets are dynamic,so it is important that companies proactively monitor their segmentation strategies over time.

Question 14

The business market consists of four broad segments: producers,resellers,government,and regions.

Accepted Answer

The four segments are producers,resellers,government,and institutions.

Question 15

Dakin Farms in Vermont uses mass marketing.Marketers would call the strategy an undifferentiated targeting strategy.

Accepted Answer

Dakin Farms uses mass marketing, which means they are not targeting specific groups and instead trying to reach as many people as possible with their advertising. This is an example of undifferentiated targeting strategy.

Question 16

Until the 1990s,few firms practiced market segmentation.

Accepted Answer

Until the 1960s,few firms practiced market segmentation.

Question 17

In market segmentation,individual psychographic variables can be combined with other variables to provide more detailed descriptions of market segments.

Accepted Answer

This statement is true. Market segmentation often involves combining multiple variables, including psychographic variables, to create more specific and targeted market segments.

Question 18

In the United States,women tend to be the key household decision-makers for many products,such as home furnishing purchases,vacations,and autos.

Accepted Answer

This statement is true. Studies have shown that women are the primary decision-makers in the household for many products and services. According to a study by the Boston Consulting Group, women make or influence 70-80% of all consumer purchasing decisions in the US.

Question 19

U.S.paint manufacturers traditionally use different formulas for developing paint to be used in the humid Southeast,the frigid Midwest,and the hot and dry Southwest.This is an example of how demographic segmentation is used.

Accepted Answer

Regional marketing is an example of using geographic segmentation variables.

Question 20

Markets are always segmented by at least two variables.

Accepted Answer

Although it is less precise,single-variable segmentation is possible; it has the advantage of being simpler and easier to use than multiple-variable segmentation.

Quiz 15: Segmenting and Targeting Markets