Chapter 2

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Chapter 2
2015-09-08 23:12:06
Buyer Behavior
Buyer Behavior
Buyer Behavior Chapter 2- Consumer Focused Strategy: Segmentation and Positioning
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  1. Market Segmentation
    The process of dividing the large and diverse mass market into subsets of consumers who share common needs, characteristics, or behaviors, then targeting one or more of those segments with a distinct marketing mix.
  2. Target Market
    The segments toward which a firm's marketing efforts are directed.
  3. Positioning
    The process of communicating with a target market through the use of marketing mix variables-a specific product, price, distribution channel, and promotional appeal-in such a way as to help consumers differentiate a product from competitors and understand how a particular product best satisfies their needs.
  4. Consumer Preference Heterogentiy
    The extent to which tastes and preferences differ among consumers.
  5. Majority Fallacy
    When a company focuses exclusively on large average segments, where the majority of customer preferences lie, and neglect smaller, less typical segments.
  6. Sale-costs trade off
    A trade-off that recognizes that, as market segmentation increases, sales increase because a firm's offerings align more closely to consumers' preferences.
  7. Cannibalization
    Occurs when products offered by the same firm are so similar that they compete among themselves, thus creating a case of over-segmentation.
  8. Demographic Characteristics
    Customers' vital population statistics; includes age, gender, income, education, occupation, social class, marital status, household size, family life cycle, and culture or ethnicity.
  9. Geographic-based segmentation
    Strategy where marketers split the market based on physical location of potential customers.
  10. Geo-Demographic Segmentation
    Combines geography and demographic segmentation bases; sometimes called zip-code marketing, this segmentation strategy relies on the common tendency for people who are similar along demographic dimensions to live in close proximity.
  11. Psychographics
    The measurement of lifestyle, often combined with measures of attitudes, beliefs, and personalities.
  12. Behavior-Based Segmentation
    Groups consumers based on their preference for a particular product attribute or benefit, usage occasion, user status, rate of product usage, and loyalty status.
  13. Core Benefit Proposition
    Relies on a single attribute or benefit that differentiates the brand from competitors' offerings.
  14. Premium Pricing
    Sometimes called prestige pricing, is pricing the brand at the high end of the product category's price range.
  15. Repositioning
    Attempts to change the way consumers perceived a brand, either a firm's own brand or a competitor's.