Chapter 4 – Segmentation, Targeting and the Marketing Mix-advertising

behavioristic segmentation
Method of segmenting consumers based on the benefits being sought.
benefits
The particular product attributes offered to customers, such as high quality, low price, status, speed, sex appeal, good taste, and so on.
benefit segmentation
Method of segmenting consumers based on the benefits being sought.
brand
That combination of name, words, symbols, or design that identifies the product and its source and distinguishes it from competing products—the fundamental differentiating device for all products.
brand equity
The totality of what consumers, distributors, dealers, and competitors feel and think about a brand over an extended period of time; in short, it is the value of the brand’s capital.
branding
A marketing function that identifies products and their source and differentiates them from all other products.
business markets
Organizations that buy natural resources, component products, and services that they resell, use to conduct their business, or use to manufacture another product.
cooperative advertising
The sharing of advertising costs by the manufacturer and the distributor or retailer.
copy points
Copywriting themes in a product’s advertising.
decline stage
The stage in the product life cycle when sales begin to decline due to obsolescence, new technology, or changing consumer tastes.
demographic segmentation
Based on a population’s statistical characteristics such as gender, age, ethnicity, education, occupation, income, or other quantifiable factors.
direct distribution
The method of marketing in which the manufacturer sells directly to the customers without the use of retailers.
distribution channel
The network of all the firms and individuals that take title, or assist in taking title, to the product as it moves from the producer to the consumer.
early adopters
Prospects who are most willing to try new products and services.
exchange
The trading of one thing of value for another thing of value.
exclusive distribution
The strategy of limiting the number of wholesalers or retailers who can sell a product in order to gain a prestige image, maintain premium prices, or protect other dealers in a geographic region.
family brand
The marketing of various products under the same umbrella name.
four Ps (4 Ps)
Product, price, place, and promotion used by every company.
franchising
A type of vertical marketing system in which dealers pay a fee to operate under the guidelines and direction of the parent company or manufacturer.
geodemographic segmentation
Combining demographics with geographic segmentation to select target markets in advertising.
geographic segmentation
A method of segmenting markets by geographic regions based on the shared characteristics, needs, or wants of people within a region.
growth stage
The period in a product life cycle that is marked by market expansion as more and more customers make their first purchases while others are already making their second and third purchases.
hidden differences
Imperceptible but existing differences that may affect the desirability of a product.
individual brand
Assigning a unique name to each product a manufacturer produces.
induced differences
Distinguishing characteristics of products effected through unique branding, packaging, distribution, merchandising, and advertising.
intensive distribution
A distribution strategy based on making the product available to consumers at every possible location so that the consumers can buy with a minimum of effort.
introductory phase
The initial phase of the product life cycle (also called the pioneering phase) when a new product is introduced, costs are highest, and profits are lowest.
licensed brands
Brand names that other companies can buy the right to use.
market segmentation
Strategy of identifying groups of people or organizations with certain shared needs and characteristics within the broad markets for consumer or business products and aggregating these groups into larger market segments according to their mutual interest in the product’s utility.
marketing communications
The various efforts and tools companies use to initiate and maintain communication with customers and prospects, including advertising, personal selling, sales promotion, direct marketing, public relations, and social media.
marketing mix
Four elements, called the 4Ps (product, price, place, and promotion), that every company has the option of adding, subtracting, or modifying in order to create a desired marketing strategy.
maturity stage
That point in the product life cycle when the market has become saturated with products, the number of new customers has dwindled, and competition is most intense.
national brands
Product brands that are marketed in several regions of the country.
network marketing
A method of direct distribution in which individuals act as independent distributors for a manufacturer or private-label marketer.
North American Industry Classification System (NAICS) codes
North American Industry Classification System (NAICS) codes -Method used by the U.S. Department of Commerce to classify all businesses. The NAICS codes are based on broad industry groups, subgroups, and detailed groups of firms in smaller lines of business.
perceptible differences
Differences between products that are visibly apparent to the consumer.
place (distribution) element
How and where customers will buy a company’s product; either direct or indirect distribution.
position
The way in which a product is ranked in the consumer’s mind by the benefits it offers, by the way it is classified or differentiated from the competition, or by its relationship to certain target markets.
price element
In the marketing mix, the amount charged for the good or service—including deals, discounts, terms, warranties, and so on. The factors affecting price are market demand, cost of production and distribution, competition, and corporate objectives.
primary demand
Consumer demand for a whole product category.
primary motivation
The pattern of attitudes and activities that help people reinforce, sustain, or modify their social and self-image. An understanding of the primary motivation of individuals helps advertisers promote and sell goods and services.
private labels
Personalized brands applied by distributors or dealers to products supplied by manufacturers. Private brands are typically sold at lower prices in large retail chain stores.
product concept
The consumer’s perception of a product as a “bundle” of utilitarian and symbolic values that satisfy functional, social, psychological, and other wants and needs.
product element
The most important element of the marketing mix: the good or service being offered and the values associated with it—including the way the product is designed and classified, positioned, branded, and packaged.
product life cycle
Includes all market-related communications between the seller and the buyer.
promotion (communication) element
Includes all market-related communications between the seller and the buyer.
psychographics
The grouping of consumers into market segments on the basis of psychological makeup—values, attitudes, personality, and lifestyle.
psychographic segmentation
Method of defining consumer markets based on psychological variables including values, attitudes, personality, and lifestyle.
psychological pricing
Using price as a means of influencing a consumer’s behavior or perceptions; for example, using high prices to reinforce a quality image, or selling at $2.99 instead of $3.00 to make a product appear less expensive.
pull strategy
Marketing, advertising, and sales promotion activities aimed at inducing trial purchase and repurchase by consumers.
purchase occasion
A method of segmenting markets on the basis ofwhen consumers buy and use a good or service.
push strategy
Marketing, advertising, and sales promotion activities aimed at getting products into the dealer pipeline and accelerating sales by offering inducements to dealers, retailers, and salespeople.
reseller
Businesses that buy products from manufacturers or wholesalers and then resell the merchandise to consumers or other buyers; also called middlemen. The most common examples of resellers are retail stores and catalog retailers.
resources
A term in the Values and Lifestyles (VALS) typology relating to the range of psychological, physical, demographic, and material capacities that consumers can draw upon. The resource axis includes education, income, self-confidence, health, eagerness to buy, and energy level.
retail cooperative
A group of independent retailers who establish a central buying organization (a wholesaler) to acquire discounts from manufacturers and gain economies from joint advertising and promotion efforts.
selective demand
Consumer demand for the particular advantages of one brand over another.
selective distribution
Strategy of limiting the distribution of a product to select outlets in order to reduce distribution and promotion costs.
target audience
The specific group of individuals to whom the advertising message is directed.
target market
The market segment or group within the market segment toward which all marketing activities will be directed.
target marketing
The process by which an advertiser focuses its marketing efforts on a target market.
usage rates
The extent to which consumers use a product: light, medium, or heavy.
user status
Six categories into which consumers can be placed, which reflect varying degrees of loyalty to certain brands and products. The categories are sole users, semisole users, discount users, aware nontriers, trial/rejectors, and repertoire users.
utility
A product’s ability to satisfy both functional needs and symbolic or psychological wants. A product’s problem-solving potential may include form, task, possession, time, or place utility.
vertical marketing system, (VMS)
A system in which the main members of a distribution channel—producer, wholesaler, and retailer—work together as a cooperative group to meet consumer needs.
volume segmentation
Defining consumers as light, medium, or heavy users of products.