Foundations of Marketing – Chapter 7 – Target Marketing Strategies and Customer Relationship Management

market fragmentation
the creation of many consumer groups due to a diversity of distinct needs and wants in modern society
target marketing strategy
dividing the total market into different segments on the basis of customer characteristics, selecting one or more segments, and developing products to meet the needs of those specific segments
segmentation
the process of dividing a larger market into smaller pieces based on one or more meaningfully shared characteristics
segmentation variables
dimensions that divide the total market into fairly homogeneous groups, each with different needs and preferences
generational marketing
marketing to members of a generation, who tend to share the same outlook and priorities
ways to segment
age, gender, family life cycle, ethnicity, income and social class, place of residence, psychographics
geodemography
a segmentation technique that combines geography with demographics
geocoding
customizing web advertising so that people who long on in different places will see ad banners for local businesses
psychographics
the use of psychological, sociological, and anthropological factors to construct market segments
VALS (Values and Lifestyles)
a psychographic system that divides the entire US population into eight segments
80/20 rule
a marketing rule of thumb that 20 percent of purchases account for 80 percent of a products sales
long tail
a new approach to segmentation based on the idea that companies can make money by selling small amounts of items that only a few people want, provided they sell enough different items
usage occasions
an indicator used in behavioral market segmentation based on when consumers use a product most
target market
the market segments on which an organization focuses its marketing plan and toward which is directs its marketing efforts
segment profile
a description of the “typical” customer in a segment
undifferentiated targeting strategy
appealing to a broad spectrum of people
differentiated targeting strategy
developing one or more products for each of several distinct customer groups and making sure these offerings are kept separate in the marketplace
concentrated targeting strategy
focusing a firm’s efforts on offering one or more products to a single segment
custom marketing strategy
an approach that tailors specific products and the messages about them to individual customers
mass customization
an approach that modifies a basic good or service to meet the needs of the individual
positioning
developing a market strategy to influence how a particular market segment perceives a good or service in comparison to the competition
stages in a positioning decision
1. analyze competitors positions; 2. offer a good or service with a competitive advantage; 3. finalize the marketing mix; 4. evaluate and modify as needed
repositioning
redoing a product’s position to respond to marketplace changes
retro brand
a once-popular brand that has been revived to experience a popularity comeback
brand personality
a distinctive image that captures a good or services character and benefits
perceptual map
a technique to visually describe where brands are located in consumers’ minds relative to competing brands
customer relationship management (crm)
a systematic tracking of consumer preferences and behaviors over time in order to tailor the value proposition as closely as possible to the individual’s unique wants and needs
touchpoint
any point of direct interface between consumers and a company
share of consumer
the percentage of an individual customer’s purchase of a product that is a single brand
customer equity
the financial value of a customer relationship throughout the lifetime of the relationship