Principles of Marketing, 17e, Global Edition (Kotler/Armstrong)
Chapter 7 Customer Value-Driven Marketing Strategy: Creating Value for Target
Customers
1) Companies know they cannot appeal to all buyers in the marketplace, or at least not in the
same way. Reasons for this include all of the following EXCEPT ________.
A) buyers are too numerous
B) companies vary widely in their abilities to serve different market segments
C) buyers are varied in their needs and buying practices
D) companies need more information to offer the right products to the right customers
E) buyers are widely scattered
2) ________ consists of evaluating each market segment’s attractiveness and selecting one or
more segments to enter.
A) Positioning
B) Mass customization
C) Market targeting
D) Market segmentation
E) Differentiation
3) ________ 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
4) ________ 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
5) When marketers at Fair & Leigh Inc. selected the Millennials, a demographic group that
includes many 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
6) ________ 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) Targeting
C) Segmentation
D) Differentiation
E) Positioning
7) Mass marketing involves identifying market segments, selecting one or more of them, and
developing products and marketing programs tailored to each.
8) The customer-driven marketing strategy involves four steps: market segmentation, market
targeting, positioning, and differentiation.
9) With technology advances making it simple to contact many customers at once, companies
have moved toward mass marketing over target marketing.
10) What is differentiation?
11) Explain the four major steps in designing a customer-driven marketing strategy.
12) Which of the following is NOT one of the major variables used in segmenting consumer
markets?
A) demographic
B) behavioral
C) ethical
D) geographic
E) psychographic
13) ________ 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
14) 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
15) ________ 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
16) 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
17) ________ segmentation divides buyers into different segments based on social class,
lifestyle, or personality characteristics.
A) Benefit
B) Occasion
C) Geographic
D) Demographic
E) Psychographic
18) A company selling child-care products ran a television ad depicting women as being
primarily responsible for childcare. 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
19) Which of the following variables are the most popular for marketers to use in segmenting
customer groups?
A) ethical
B) psychographic
C) demographic
D) behavioral
E) geographic
20) ________ can be a poor predictor of a person’s health, work or family status, needs, or
buying power.
A) Occupation
B) Education
C) Ethnicity
D) Religion
E) Age
21) ________ segmentation has long been used in clothing, cosmetics, toiletries, and
magazines.
A) Behavioral
B) Gender
C) Benefit
D) Occasion
E) Geographic
22) Gilron Holidays runs a premium membership club that caters to customers whose annual
salary exceeds $100,000. Members of this club are offered seasonal discounts at select luxury
hotels in select cities worldwide. Gilron Holidays most likely follows a(n) ________
segmentation approach.
A) gender
B) benefit
C) occasion
D) income
E) geographic
23) ________ segmentation divides buyers into different segments based on lifestyle or
personality characteristics.
A) Benefit
B) Occasion
C) Geographic
D) Demographic
E) Psychographic
24) 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
25) ________ 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
26) ________ 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
27) 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
28) Tropicana promotes drinking orange juice at any time of day as a cool, refreshing drink.
The market segmentation approach Tropicana is using is ________.
A) occasion segmentation
B) benefit segmentation
C) age and life-cycle segmentation
D) gender segmentation
E) behavioral segmentation
29) ________ 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
30) Calypso Motors recently rolled out its Proteus hatchback. 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
31) 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
32) 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
33) 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
34) 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
35) 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
36) 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.
37) 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.
38) Which of the following is NOT a benefit of using multivariable segmentation systems?
A) help companies identify key customer segments
B) help companies reach key customer segments more efficiently
C) help companies more accurately price their products to appeal to key customer segments
D) help companies better understand key customer segments
E) help companies tailor market offering to the needs of the key customer segments
39) 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
40) Business marketers use geographic, demographic, benefit, user status, usage rate, and
loyalty status to segment their markets. They also use ________, customer operating
characteristics, purchasing approaches, and situational factors.
A) weather patterns
B) psychographics
C) ethical traits
D) budgets and financial status
E) personal characteristics
41) ________ segmentation assumes that nations close to one another will have many common
traits and behaviors.
A) Geographic
B) Occasion
C) Psychographic
D) Benefit
E) Demographic
42) 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
43) Pacific Fisheries divides its customers into different regional units, such as Asia, Australia,
and the Americas. This is an example of ________ segmentation.
A) demographic
B) psychographic
C) geographic
D) occasion
E) benefit
44) 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) sociocultural factors
45) Anchor Tractors focuses on selling its farm equipment in North America and Europe. It has
not yet considered expanding into the Middle East. Which factor is likely most important in this
decision regarding expansion?
A) geographic
B) political
C) demographic
D) personality
E) cultural
46) 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
47) Using ________ segmentation, marketers form segments of consumers who have similar
needs and buying behaviors even though they are located in different countries.
A) psychographic
B) demographic
C) occasion
D) benefit
E) intermarket
48) Orion Inc. markets luxury watches. 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
49) 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 market segmentation is evident here?
A) income segmentation
B) psychographic segmentation
C) gender segmentation
D) intermarket segmentation
E) occasion segmentation
50) An American cola-manufacturing company that primarily targets rebellious and
adventurous people most likely uses ________ segmentation.
A) occasion
B) geographic
C) income
D) benefit
E) psychographic
51) An Irish company that manufactures umbrellas and ponchos primarily targeting consumers
during the winter months is using ________ segmentation.
A) psychographic
B) income
C) geographic
D) occasion
E) benefit
52) 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 ________ segmentation.
A) intermarket
B) loyalty
C) life-cycle
D) income
E) psychographic
53) Papillon, a popular retailer of chic women’s clothing, segments its market according to
consumer lifestyles. Papillon most likely uses ________ segmentation for segmenting its
market.
A) geographic
B) psychographic
C) benefit
D) age and life-cycle
E) occasion
54) 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
55) Business information services such as Experian Marketing Services and Nielsen help
marketers to ________.
A) save significant amounts of money on shipping products
B) spend more time identifying potential customers
C) learn more specific details from consumers about their products
D) segment people and locations into marketable groups of like-minded consumers
E) expand their product offerings to interested clients and provide high-quality service to them
56) When the size, purchasing power, and profile of a market segment can be calculated, the
market is ________.
A) measurable
B) profitable
C) substantial
D) actionable
E) competitive
57) A market segment that is large enough or profitable enough to serve is ________.
A) measurable
B) accessible
C) substantial
D) profitable
E) differentiable
58) When an effective program can be designed for attracting and serving a particular segment,
the segment is best described as ________.
A) accessible
B) measurable
C) competitive
D) actionable
E) differentiable
59) ________ segments are conceptually distinguishable and respond differently to different
marketing mix elements and programs.
A) Complex
B) Measurable
C) Competitive
D) Differentiable
E) Homogeneous
60) Market segments that can be effectively reached and served are ________.
A) measurable
B) accessible
C) substantial
D) actionable
E) profitable
61) Different soft drinks target different personalities. This is an example of ________
segmentation.
A) psychographic
B) demographic
C) occasion
D) life-cycle
E) benefits