Principles of Marketing, 15e (Kotler/Armstrong)
Chapter 7 Customer-Driven Marketing Strategy: Creating Value for Target Customers
1) ________ consists of evaluating each market segment’s attractiveness and selecting one or
more market segments to enter.
A) Positioning
B) Mass customization
C) Market targeting
D) Market segmentation
E) Differentiation
2) ________ involves dividing a market into smaller segments of buyers with distinct needs,
characteristics, or behaviors that might require separate marketing strategies or mixes.
A) Mass customization
B) Market targeting
C) Market segmentation
D) Differentiation
E) Positioning
3) ________ involves actually distinguishing the firm’s market offering to create superior
customer value.
A) Mass customization
B) Differentiation
C) Market segmentation
D) Diversifying
E) Targeting
4) When marketers at Fair & Leigh Inc. selected the Millennials, a demographic group that
includes college students, as an untapped group of potential customers for their new line of
products, they were engaging in ________.
A) occasion segmenting
B) local marketing
C) market diversification
D) market targeting
E) product positioning
5) ________ consists of arranging for a market offering to occupy a clear, distinctive, and
desirable place relative to competing products in the minds of target consumers.
A) Mass customization
B) Positioning
C) Segmentation
D) Differentiation
E) Targeting
6) ________ calls for dividing the market into regions, states, counties, cities, or even
neighborhoods.
A) Benefit segmentation
B) Geographic segmentation
C) Demographic segmentation
D) Psychographic segmentation
E) Occasion segmentation
7) “Many companies today are localizing their products, advertising, promotion, and sales efforts
to fit the needs of individual regions, cities, and neighborhoods.” This is an example of
________.
A) geographic segmentation
B) product diversification
C) branding
D) psychographic segmentation
E) demographic segmentation
8) ________ segmentation divides the market into segments based on variables such as age, life-
cycle stage, gender, income, occupation, education, religion, ethnicity, and generation.
A) Geographic
B) Benefit
C) Occasion
D) Psychographic
E) Demographic
9) Delta Motorworks markets its cars based on the age, gender, and income of its customers.
Which of the following types of market segmentation is evident here?
A) geographic segmentation
B) benefit segmentation
C) occasion segmentation
D) demographic segmentation
E) psychographic segmentation
10) A company selling child care products ran a television ad depicting women as being
primarily responsible for child care. Many women viewers considered this regressive alleging
that the ad failed to recognize the much more diversified role of women in today’s world. This is
an example of ________.
A) cause marketing
B) stereotyping
C) niche marketing
D) scapegoating
E) positioning
11) ________ segmentation has long been used in clothing, cosmetics, toiletries, and magazines.
A) Behavioral
B) Gender
C) Benefit
D) Occasion
E) Geographic
12) Gilron Holidays runs a premium membership club which caters to customers whose annual
salary exceeds $100,000. Members of this club are offered seasonal discounts on select luxury
hotels in select cities worldwide. Gilron Holidays most likely follows a(n) ________
segmentation approach.
A) gender
B) income
C) occasion
D) benefit
E) geographic
13) ________ segmentation divides buyers into different segments based on social class,
lifestyle, or personality characteristics.
A) Benefit
B) Occasion
C) Geographic
D) Demographic
E) Psychographic
14) Marketers who use ________ often segment their markets by consumer lifestyles and base
their marketing strategies on lifestyle appeals.
A) demographic segmentation
B) geographic segmentation
C) benefit segmentation
D) psychographic segmentation
E) occasion segmentation
15) ________ segmentation divides buyers into segments based on their knowledge, attitudes,
uses, or responses concerning a product.
A) Behavioral
B) Psychographic
C) Age and life-cycle
D) Gender
E) Geographic
16) ________ segmentation refers to dividing the market into segments according to occasions
when buyers get the idea to buy, actually make their purchase, or use the purchased item.
A) Gender
B) Psychographic
C) Occasion
D) Geographic
E) Income
17) Malcolm Sanders, a graduate student from Boston, makes customized snowboards for local
snowboarding enthusiasts. The demand for snowboards peaks during the winter months, a busy
time for Malcolm. He advertises more aggressively and sells most of his snowboards around this
time. Which market segmentation approach does Malcolm most likely use?
A) gender segmentation
B) psychographic segmentation
C) occasion segmentation
D) geographic segmentation
E) age and life-cycle segmentation
18) ________ requires finding the major advantages people look for in a product class, the kinds
of people who look for each positive aspect of a product, and the major brands that deliver it.
A) Gender segmentation
B) Psychographic segmentation
C) Benefit segmentation
D) Geographic segmentation
E) Age and life-cycle segmentation
19) Calypso Motors recently rolled out its hatchback, Proteus. Proteus combines the
attractiveness of a luxury car with the excellent agility of a sports car. Calypso Motors is
confident that Proteus will appeal to both sports car enthusiasts as well as the luxury segment.
Which of the following types of market segmentation is evident here?
A) gender segmentation
B) income segmentation
C) benefit segmentation
D) geographic segmentation
E) age and life-cycle segmentation
20) Which of the following refers to a behavioral segmentation variable that involves segmenting
markets into nonusers, ex-users, potential users, first-time users, and regular users of a product?
A) user status
B) usage rates
C) gender status
D) income status
E) loyalty status
21) In the context of behavioral segmentation, who among the following is a potential user?
A) Anita, who recently had a baby
B) Peter, who recently changed his job
C) Mary, who enrolled as a graduate student in a university last year
D) Gina, who opened a dental clinic in Orange County
E) Raj, who is planning a trip to Hawaii with friends
22) In the context of behavioral segmentation, markets segmented by ________ can be
categorized into light, medium, and heavy product users.
A) benefits sought
B) loyalty status
C) usage rate
D) user status
E) occasion
23) A recent study conducted by Estelle Cosmetics Company showed that heavy users of
Estelle’s products comprise a small percentage of the market. The study indicated that less than 7
percent of all shoppers buy nearly 71 percent of Estelle’s products in the United States. This is an
example of ________.
A) benefit segmentation
B) segmentation by loyalty status
C) segmentation by usage rate
D) psychographic segmentation
E) occasion segmentation
24) Consumers who show their allegiance to brands, stores, or companies help marketers to
segment consumers by their ________.
A) user status
B) degree of loyalty
C) income
D) geographic location
E) benefit-seeking attitudes
25) Which of the following is true about behavioral segmentation on the basis of the loyalty
variable?
A) Consumers tend to pay more for products that are targeted at their respective age-group or
generation.
B) By looking at customers who are shifting away from its brand, a company can learn about its
marketing weaknesses and take actions to correct them.
C) Highly loyal customers of a brand are less likely to engage in word-of-mouth publicity than
those who are not.
D) Completely loyal customers of a brand are typically loyal to two or three brands of a given
product.
E) Only consumers who seek premium or luxury services are subjected to behavioral
segmentation based on the loyalty variable.
26) Which of the following is true about multivariable segmentation systems?
A) Marketers using multiple segmentation bases tend to ignore smaller markets.
B) Marketers often use multiple segmentation bases to control inflation.
C) Multiple segmentation rarely involves the use of demographic data.
D) Multiple segmentation is ineffective in large markets.
E) Multiple segmentation bases help identify smaller, better-defined target groups.
27) Which of the following is NOT a common variable used by both consumer and business
marketers while segmenting markets?
A) operating characteristics
B) loyalty status
C) usage rate
D) geographic location
E) benefits sought
28) ________ assumes that nations close to one another will have many common traits and
behaviors.
A) Geographic segmentation
B) Occasion segmentation
C) Psychographic segmentation
D) Benefit segmentation
E) Demographic segmentation
29) Double Drill Inc. segments its foreign markets by per capita income. This firm segments the
international markets based on ________.
A) political factors
B) legal factors
C) geographic location
D) economic factors
E) cultural factors
30) Pacific Fisheries divides its customers into different regional units, such as Asia, Australia,
and the Americas. This is an example of ________.
A) age and life-cycle segmentation
B) psychographic segmentation
C) geographic segmentation
D) occasion segmentation
E) benefit segmentation
31) Marketers often segment international markets according to the type and stability of
government. In such instances, they segment markets based on ________.
A) geographic location
B) economic factors
C) cultural factors
D) political factors
E) socio-cultural factors
32) Which of the following refers to a cultural factor in the context of segmenting international
markets?
A) receptivity of foreign firms
B) economic development of the country
C) population income levels
D) stability of the government
E) values and attitudes
33) Using ________, marketers form segments of consumers who have similar needs and buying
behaviors even though they are located in different countries.
A) psychographic segmentation
B) demographic segmentation
C) occasion segmentation
D) benefit segmentation
E) intermarket segmentation
34) Orion Inc. markets luxury watches and chronographs. It targets the wealthy global elite
segment, regardless of their geographic location. Orion most likely uses ________ segmentation.
A) income
B) age-group
C) occasion
D) benefit
E) cross-market
35) Teen Mania Inc., a company marketing adventure sports merchandise for teenagers, targets
the world’s teenagers, who have similar needs and buying behavior even though they are located
in different countries. Which of the following market segmentation is evident here?
A) income segmentation
B) psychographic segmentation
C) gender segmentation
D) intermarket segmentation
E) occasions segmentation
36) An American cola-manufacturing company that primarily targets rebellious and adventurous
people most likely uses ________ segmentation.
A) occasion segmentation
B) geographic segmentation
C) income segmentation
D) benefit segmentation
E) psychographic segmentation
37) Venus Inc., a company designing and marketing branded diamond jewelry, targets wealthy
consumers with similar needs and buying behaviors, even though the consumers are located in
different countries. This is an example of ________.
A) intermarket segmentation
B) loyalty segmentation
C) life-cycle segmentation
D) income segmentation
E) psychographic segmentation
38) Papillon, a popular retailer of chic women’s clothing, segments its market according to
consumer lifestyles. Papillon most likely uses ________ for segmenting its market.
A) geographic segmentation
B) psychographic segmentation
C) benefit segmentation
D) age and life-cycle segmentation
E) occasion segmentation
39) When the size, purchasing power, and profiles of a market segment can be calculated, the
market is ________.
A) measurable
B) profitable
C) substantial
D) actionable
E) competitive
40) A market segment that is large or profitable enough to serve is ________.
A) measurable
B) accessible
C) substantial
D) profitable
E) differentiable
41) When an effective program can be designed for attracting and serving a chosen segment, the
segment is best described as ________.
A) accessible
B) measurable
C) competitive
D) actionable
E) differentiable
42) Bailey’s Burgers promotes the Bailey’s Jumbo Burger as a fun snack for teens and young
adults. In this instance, Bailey’s Burgers is practicing ________ segmentation.
A) benefit
B) age and life-cycle
C) psychographic
D) geographic
E) gender
43) ________ segments are conceptually distinguishable and respond differently to different
marketing mix elements and programs.
A) Complex
B) Measurable
C) Competitive
D) Differentiable
E) Homogeneous
44) Market segments that can be effectively reached and served are ________.
A) measurable
B) accessible
C) substantial
D) actionable
E) profitable
45) Different soft drinks target different personalities. This is an example of ________
segmentation.
A) psychographic
B) demographic
C) occasion
D) life-cycle
E) benefits
46) Which of the following is LEAST relevant when a firm evaluates different market segments?
A) segment size and growth
B) company resources
C) segment structural attractiveness
D) core competencies of competitors
E) company objectives
47) A segment is less attractive if ________.
A) it is difficult for new entrants to enter
B) it is substantial
C) it is actionable
D) it already contains many strong and aggressive competitors
E) it contains weak suppliers
48) A(n) ________ consists of a set of buyers who share common needs or characteristics that
the company decides to serve.
A) marketing channel
B) citizen-action group
C) distribution channel
D) target market
E) customer franchise
49) ________ refers to a market-coverage strategy in which a firm decides to ignore market
segment differences and go after the whole market with one offer.
A) individual marketing
B) local marketing
C) niche marketing
D) undifferentiated marketing
E) segmented marketing
50) Sanguine Services is a small company that uses a marketing strategy in which its limited
resources are employed to target a large share of two small market segments. Sanguine most
likely uses which of the following marketing strategies?
A) individual marketing
B) one-to-one marketing
C) mass marketing
D) concentrated marketing
E) trigger-based marketing
51) A market-coverage strategy in which a firm decides to target several market segments and
designs separate offers for each is known as ________.
A) mass marketing
B) differentiated marketing
C) concentrated marketing
D) individual marketing
E) cross-marketing
52) Which of the following is a disadvantage of using a differentiated marketing strategy?
A) generates far lower sales compared to an undifferentiated marketing strategy
B) customer loyalty is negatively impacted and difficult to obtain
C) the costs of doing business increase
D) quality control problems increase
E) product safety decreases
53) With a(n) ________ marketing strategy, a firm goes after a large share of one or a few
smaller niches.
A) individual
B) mass
C) concentrated
D) differentiated
E) local
54) Which of the following is true about the concentrated marketing strategy?
A) Companies that rely on a few segments for all of their business will suffer if a segment turns
sour.
B) Concentrated marketing is not profitable for most firms.
C) Niche marketing involves few risks for most firms.
D) Concentrated marketing involves going after a small share of a large market.
E) The Internet has limited the use and benefits of niche marketing.
55) ________ is the practice of tailoring products and marketing programs to suit the tastes of
specific individuals and locations.
A) Mass marketing
B) Trigger-based marketing
C) Differentiated marketing
D) Concentrated marketing
E) Micromarketing
56) ________ tailors brands and promotions to the needs and wants of regional customer groups,
such as cities, neighborhoods, and even specific stores.
A) Undifferentiated marketing
B) Differentiated marketing
C) Niche marketing
D) Local marketing
E) Individual marketing
57) Which of the following is a drawback of local marketing?
A) Local marketing increases manufacturing costs by reducing the economies of scale.
B) Local marketing requires specialization that is difficult to identify.
C) Local marketing is not profitable for most small firms.
D) Local marketing cannot accommodate the needs of modern buyers who are technology savvy.
E) Local marketing almost always results in brand dilution.
58) Andrew Levitt runs a retail store in Norristown. Andrew’s store stocks cold weather products
as Norristown mostly has sub-zero temperatures. Which of the following is evident here?
A) local marketing
B) concentrated marketing
C) segmented marketing
D) mass marketing
E) direct marketing
59) A public relations firm tailors its advertising and promotional services according to the needs
and preferences of specific customers. This exemplifies ________.
A) trigger-based marketing
B) mass marketing
C) segmented marketing
D) individual marketing
E) concentrated marketing
60) When a company customizes its merchandise store by store to meet shopper needs, it is
practicing ________.
A) niche marketing
B) mass marketing
C) local marketing
D) segmented marketing
E) trigger-based marketing