ch08 Kotler

Chapter 8: Identifying Market Segments and Targets

GENERAL CONCEPT QUESTIONS

Multiple Choice

1. In ________ marketing, the seller engages in the mass production, mass distribution, and mass promotion of one product for all buyers.a. groupb. massc. generald. segmentede. differentiated

Answer: b Page: 226 Difficulty: Medium AACSB: Analytic Skills

2. The argument for ________ marketing is that it creates the largest potential market, which leads to the lowest costs, which in turn can lead to lower prices or higher margins.a. nicheb. microc. macrod. differentiatede. mass

Answer: e Page: 226 Difficulty: Medium AACSB: Reflective Thinking

3. A ________ consists of a group of customers who share a similar set of needs and wants.a. market targetb. market groupc. market sliced. market segmente. market level

Answer: d Page: 226 Difficulty: Medium AACSB: Analytic Skills

4. A ________ consists of two parts: a naked solution and discretionary options. a. differentiated market offeringb. flexible market offeringc. rigid market offeringd. vertical market offeringe. horizontal market offering

Answer: b Pages: 228 Difficulty: Hard AACSB: Analytic Skills

Part 3: Connecting with Customers

5. If a marketing manager observes that his or her market shows no natural segments and consumers seem to have roughly the same preferences, the marketing manager will most likely be faced with a ________ preferences pattern. a. homogeneous b. heterogeneous c. diffusedd. clusterede. scattered

Answer: a Page: 228 Difficulty: Medium AACSB: Analytic Skills

6. Procter & Gamble has many soap brands. One reason for this is that soap users tend to group together in terms of preferences such as bleaching action, softness, stain removal, et cetera. Which of the following preferences pattern would most likely apply to P&G’s method of response to market needs? a. Homogeneous preferencesb. Diffused preferencesc. Clustered preferencesd. Psychological preferencese. Cultural preferences

Answer: c Page: 228 Difficulty: Medium AACSB: Analytic Skills

7. Marketers usually identify niches by ________. a. dividing a segment into subsegmentsb. conducting VALS testsc. allowing consumers to gravitate toward product brandsd. examining the demographics section of The Handbook of Marketinge. producing products that can be used in a variety of ways

Answer: a Page: 228 Difficulty: Medium

8. A niche is characterized as being all of the following EXCEPT that ________. a. the customers in the niche have a distinct set of needsb. the customers will pay a premium to the firm that satisfies their needsc. the niche is not likely to attract other competitorsd. the customers generally have smaller amounts of incomee. the nicher gains certain economies through specialization

Answer: d Page: 229 Difficulty: Medium AACSB: Reflective Thinking

9. Those who favor localized marketing see national advertising as wasteful because ________.a. it gets too up close and personal with consumersb. it drives up manufacturing and marketing costs by reducing economies of scalec. it magnifies logistical problemsd. it fails to address local needse. all of the above



10. ________ combines operationally driven mass customization with customized marketing in a way that empowers consumers to design the product service offering of their choice. a. Consumptionizationb. Viral marketingc. Virtual marketing d. Regionalizatione. Customerization

Answer: e Page: 233 Difficulty: Medium AACSB: Analytic Skills

11. All of the following are disadvantages of customerization EXCEPT that ________.a. it requires more prior information about the customer than most customers are

willing to shareb. it is difficult to implement for complex productsc. it can raise the cost of goods by more than the customer is willing to payd. some customers don’t know what they want until they see the actual producte. the product may be hard to repair and have little sales value

Answer: a Page: 233 Difficulty: Hard AACSB: Reflective Thinking

12. Regardless of the type of segmentation scheme used, the key is adjusting the marketing program to recognize ________.a. the level of disposable income earned by the target groupb. customer differencesc. the cost–benefit relationship of narrowing the target marketd. customer similaritiese. saturated markets

Answer: b Page: 233 Difficulty: Easy

13. If a marketer decides to segment a market based on neighborhoods, the marketer will have chosen the ________ method of segmentation. a. demographicb. psychographicc. geographicd. culturale. social class

Answer: c Page: 233 Difficulty: Easy AACSB: Analytic Skills


14. When segmenting on the basis of family life cycle, all of the following are segment categories EXCEPT ________.a. young, singleb. male, femalec. young, marriedd. older, married, no children under 18e. young, married, youngest child 6 or over


15. If a marketing manager segments the market into culture-oriented, sports-oriented, or outdoor-oriented groups, he or she is segmenting on the basis of ________.a. personalityb. behavioral occasionsc. user statusd. psychographic lifestylee. readiness stage


16. If a market is segmented according to light, medium, and heavy product users, the marketer segmenting this market is using the ________ as the means to segment. a. user statusb. usage ratec. buyer-readiness staged. occasion e. benefit

Answer: b Page: 245 Difficulty: Easy AACSB: Analytic Skills

17. John and May have just divorced. Which of the following demographic segmentation subsegment formats might be used by marketers to reach Jose or Erika? a. Life stageb. Benefitsc. Age segmentd. User segmente. Occasion segment

Answer: a Page: 236 Difficulty: Medium AACSB: Reflective Thinking


18. Men and women tend to have different attitudinal and behavioral orientations, based partly on genetic makeup and partly on ________. a. incomeb. occupationc. socializationd. hereditye. globalization


19. ________ is the science of using psychology and demographics to better understand consumers. a. Psychographicsb. Segmentationc. Clusteringd. Demographicse. Social psychology


20. According to the VALS segmentation system, ________ are successful, sophisticated, active, “take-charge” people with high self-esteem. Their purchases often reflect cultivated tastes for relatively upscale, niche-oriented products and services. a. innovatorsb. thinkersc. achieversd. experiencerse. believers

Answer: a Page: 242 Difficulty: Hard AACSB: Analytic Skills

21. Kim is a young professional who enjoys snowboarding and going to rock concerts with her friends. According to the VALS eight-part typology segmentation system, Kim is best described as a(n) ________.a. thinkerb. achieverc. experiencerd. strivere. survivor



22. According to the VALS segmentation system, ________ are considered to be elderly, passive people who are concerned about change and are loyal to their favorite brands. a. believersb. striversc. makersd. survivorse. experiencers


23. A housewife requests a new treadmill for her birthday. With respect to consumer decision roles, which role is the housewife currently playing?a. Initiatorb. Influencerc. Deciderd. Buyere. Gatekeeper

Answer: a Page: 243 Difficulty: Easy

24. The sale of turkeys in Asian countries like Hongkong, Singapore and The Philippines is highest in December, as people buy turkeys to serve at Christmas. Supermarkets that specifically advertise turkeys at this time of year are segmenting on the basis of ________.a. benefitsb. user statusc. psychographicsd. demographicse. occasion

Answer: e Page: 243 Difficulty: Easy AACSB: Analytic Skills

25. Mothers-to-be are potential users who will turn into heavy users of infant products and services. By targeting mothers-to-be as future heavy users, producers of these products and services are segmenting consumers on the basis of ________.a. usage rateb. buyer-readiness stagec. loyalty statusd. user status e. benefits



26. If a buyer is loyal to two or three different brands of soap, this buyer’s loyalty status can be described as being among the ________.a. switchersb. shifting loyalsc. split loyalsd. hard-core loyalse. antiloyals

Answer: c Page: 246 Difficulty: Easy

27. Pete always buys Purina dog food for his dog because he believes that it is the best value for the nutritional content. Pete’s loyalty status is best described as ________.a. split loyalb. shifting loyalc. consistent loyald. hard-core loyale. switcher

Answer: d Page: 246 Difficulty: Easy AACSB: Analytic Skills

28. A company can learn a great deal by analyzing the degrees of brand loyalty. For example, by studying the ________ the company can pinpoint which brands are most competitive with its own. a. hard-core loyalsb. split loyalsc. shifting loyalsd. switcherse. antiloyals

Answer: b Page: 246 Difficulty: Hard AACSB: Reflective Thinking

29. All of the following are considered to be product attitude segments EXCEPT ________. a. synergistic b. enthusiastic c. positived. indifferente. hostile



30. A potato chip manufacturer is concerned about consumers leaving its brand and going to competitive alternatives. Which of the following groups (based on strength of commitment) would be most likely to leave the company’s offering and go somewhere else for snack products? a. Convertibleb. Shallowc. Averaged. Entrenchede. Hard rocks


31. If a consumer group is designated based on their “balance of disposition,” the ________ group can be described as one that is made up of nonusers who are as attracted to a competing brand as they are to their current brands. a. strongly unavailableb. weakly unavailablec. ambivalentd. availablee. desirable


32. If a marketer is seeking to segment a business market, which of the following variables is generally felt to be the most important? a. Personal characteristicsb. Demographic variablesc. Situational factorsd. Operating variablese. Purchasing approaches

Answer: b Page: 249 Difficulty: Hard AACSB: Analytic Skills

33. A marketer is interested in segmenting a business market based on technology and customer capabilities. Which of the following major segmentation variables would most likely be used by the marketer to assist with the task? a. Demographic variablesb. Purchasing approachesc. Situational factorsd. Personal characteristicse. Operating variables

Answer: e Page: 249 Difficulty: Hard AACSB: Analytic Skills


34. A marketer is interested in segmenting a business market on ________ if the marketer intends to eventually segment the market based on loyalty and attitudes toward risk. a. situational factors b. purchasing approachesc. personal characteristicsd. operating variablese. demographic variables

Answer: c Page: 249 Difficulty: Medium

35. A marketer interested in segmenting a business market based on ________ intends to eventually segment the market based on power structure and purchasing criteria. a. situational factors b. purchasing approachesc. personal characteristicsd. operating variablese. demographic variables


36. During which step of the segmentation process would the marketer group customers into segments based on similar needs and benefits sought by the customer in solving a particular consumption problem? a. Step 2—segment identificationb. Step 3—segment attractivenessc. Step 6—segment “acid test”d. Step 1—needs-based segmentatione. Step 7—marketing-mix strategy


37. If an organization’s marketing department wished to create “segment storyboards” to test the attractiveness of each segment’s positioning strategy, this action would most likely occur in the ________ step of the segmentation process. a. needs-based segmentation b. segment identification c. segment profitabilityd. segment “acid test” e. marketing-mix strategy

Answer: d Page: 250 Difficulty: Hard AACSB: Analytic Skills

38. In the ________ step of the market segmentation process, the marketer evaluates the segment using criteria such as market growth and market access.a. need-based segmentationb. segment identificationc. segment attractivenessd. segment profitabilitye. segment “acid test”

Answer: c Page: 250 Difficulty: Hard


39. To meet the ________ criterion of useful market segments, it must be possible to formulate effective programs for attracting and serving the segments. a. measurableb. substantialc. accessibled. differentiablee. actionable


40. If married and unmarried women respond similarly to a sale on perfume, these hypothetical segments fail the ________ criterion for useful market segments.a. measurableb. substantialc. accessibled. differentiablee. actionable

Answer: d Page: 250 Difficulty: Medium

41. According to the ________ criterion for useful market segments, a segment should be the largest possible homogenous group worth going after with a tailored marketing program.a. measurableb. substantialc. accessibled. differentiablee. actionable


42. In evaluating different market segments, the firm must look at two factors: the segment’s overall attractiveness and ________. a. company’s objectives and resourcesb. the product to be soldc. the purchasing processd. competition’s strategiese. the global nature of the product


43. Volkswagen concentrates on the small-car market and Porsche on the sports car market. These would be examples of what is called ________. a. single-segment concentrationb. selective specializationc. product specializationd. market specializatione. full market coverage

Answer: a Page: 251 Difficulty: Easy AACSB: Analytic Skills


44. All of the following are benefits of following the ________ approach to target market selection: a strong knowledge of the segment’s needs, a strong market presence, operating economies through specializing in production, distribution, and promotion. a. single-segment concentrationb. selective specializationc. product specializationd. market specializatione. full market coverage


45. When a symphony orchestra targets people who have broad cultural interests, rather than only those who regularly attend concerts, the orchestra is targeting ________. a. market mavensb. strategic segmentsc. supersegmentsd. occasion segmentse. psychodemographic segments

Answer: c Page: 251 Difficulty: Hard AACSB: Analytic Skills

46. The chief disadvantage to a firm that decides to follow a product specialization strategy in selecting target markets is that ________.a. no synergy existsb. logistics can become a nightmarec. the product may be supplanted by an entirely new technologyd. competitors can easily copy any new product introductionse. e-commerce becomes difficult for the company

Answer: c Page: 251 Difficulty: Hard AACSB: Reflective Thinking

47. With ________ as a target market strategy, the firm concentrates on serving many needs of a particular customer group. a. single-segment concentrationb. selective specializationc. product specializationd. market specializatione. full market coverage

Answer: d Page: 252 Difficulty: Easy AACSB: Analytic Skills

48. In ________ marketing, the firm operates in several market segments and designs different products for each segment. a. segmentedb. undifferentiatedc. differentiatedd. geodemographic e. niche



49. Johnson & Johnson broadened its target market for its baby shampoo to include adults through ________.a. countersegmentationb. metamarketingc. undifferentiated marketingd. product specializatione. single-segment concentration


50. ________ is the strategic coordination of economic, psychological, political, and public relations skills, to gain the cooperation of a number of parties in order to enter or operate in a given market. a. Metamarketingb. Macromarketingc. Micromarketingd. Megamarketinge. Modular marketing


51. When Coca-Cola sold only one kind of Coke in a 6.5-ounce bottle, it was practicing what is called ________. a. primary marketingb. micromarketingc. macromarketingd. segmented marketing e. mass marketing


52. The marketer ________ the segments; the marketer’s task is to identify the segments and decide which one(s) to target. a. plansb. createsc. does not created. rarely controlse. controls

Answer: c Page: 226 Difficulty: Hard AACSB: Reflective Thinking

53. The recipe for Internet niching success is to ________. a. find a need and fill itb. choose a hard-to-find product that customers do not need to see and touchc. choose a low-budget product that is heavily demanded by Gen Y


d. choose an exclusive product sold primarily to seniorse. find a product that has some attraction to a health-conscious market

Answer: b Page: 228 Difficulty: Medium AACSB: Reflective Thinking

54. Hilton Hotels customizes rooms and lobbies according to location. Northeastern hotels are sleeker and more cosmopolitan. Southwestern hotels are more rustic. This is an example of ________ segmentation.a. demographicb. behavioralc. psychographicd. geographice. user status

Answer: d Page: 233 Difficulty: Easy

55. Pampers divides its market demographically on the basis of ________ into prenatal, new baby, baby, toddler, and preschooler. a. life stageb. genderc. aged. incomee. social class

Answer: c Page: 235 Difficulty: Easy AACSB: Analytic Skills

56. Newlyweds in the Asia buy more in the first six months than an established household does in five years. Newlyweds are an example of a(n) ________ segment.a. life stageb. genderc. behaviord. user statuse. income


57. Which of the following statements accurately describes what demographers are calling the “boom-boom effect”? a. Consumers are demanding more “bang for their buck.”b. Baby boomers still rule the marketplace.c. Generation X and its taste for violence will dominate the market in the future.d. Products that appeal to 20-somethings also appeal to baby boomers.e. Companies must have success quickly or go bust.

Answer: d Page: 238 Difficulty: Medium

58. If a marketing manager employs such marketing techniques as online buzz, student ambassadors, cool events, and street teams to reach target markets, the manager is most likely appealing to the ________ market.a.pre-school b. Generation X


c.Generation Yd. Generation Ze.latent baby boomers

Answer: c Page: 238 Difficulty: Easy AACSB: Communications

59. Mature and reflective people who seek durability, functionality, and value in products are most likely to be categorized as ________ in the VALS system.a. innovatorsb. thinkersc. achieversd. experiencerse. strivers

Answer: b Pages: 241-242 Difficulty: Medium AACSB: Analytic Skills

60. A hardware store is interested in reaching people who are characterized by the VALS system as being practical, down-to-earth, and self-sufficient who like to work with their hands, the ________ category. a.believersb. striversc.survivorsd. experiencerse.makers

Answer: e Pages: 241-242 Difficulty: Hard AACSB: Reflective Thinking

61. The key to attracting potential users, or even possibly nonusers, is ________.a. understanding the reasons they are not usingb. offering financial incentives for first-time usec. increasing the usage rate of existing usersd. developing a new product that better meets their needse. increasing advertising expenditures


62. ________ are often a small percentage of the market but account for a high percentage of total consumption.a. Light usersb. Medium usersc. Heavy usersd. Nonuserse. None of the above


63. By analyzing the behaviors of ________, companies can learn about their marketing weaknesses and attempt to correct them.a. hard-core loyalsb. split loyalsc. shifting loyals


d. switcherse. ambivalents

Answer: d Page: 246 Difficulty: Medium AACSB: Reflective Thinking 64. Users of a brand can be segmented into several groups based on the strength of

commitment to the brand. If a brand manager is seeking to identify those users who are actively considering alternative brands, he or she should look for users that are labeled as ________. a.convertibleb. shallowc.averaged. entrenchede.latent

Answer: b Page: 248 Difficulty: Medium

65. You have decided to take a purchasing approach to segmenting a proposed business market. All of the following would be potential means (subsegments) for segmenting under the “purchasing approach” EXCEPT ________. a. purchasing-function organizationb. power structurec. specific applicationd. nature of existing relationshipse. purchasing criteria

Answer: c Page: 249 Difficulty: Hard AACSB: Analytic Skills

66. If your assignment was (for each segment) to create a value proposition and product-price positioning strategy based on the segment’s unique customer needs and characteristics, you would be in which of the following steps of the segmentation process? a. Needs-based segmentationb. Segment identificationc. Segment attractivenessd. Segment positioninge. Segment “acid-test”


67. As a brand manager you have decided to use the ________ full market coverage approach in marketing to your customers, whereby your firm will operate in several market segments and design different products for each segment. a.undifferentiatedb. differentiatedc.concentratedd. introvertede.parallel


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