Chapter 07 Test Bank
1. The process of dividing a larger market into smaller groups based on meaningfully shared characteristics is referred to as
A. mass marketing.
B. concept testing.
2. It has been Shelly’s dream to open a bakery, and while she has experience in making all types of baked goods, she always
gets rave reviews for her hand-decorated cupcakes. So, rather than open a bakery that offers a wide variety of baked goods,
Shelly has decided to open a specialty cupcake shop to cater to that market only. This is an example of
A. repositioning.
B. market fragmentation.
3. A defined in your text, market segmentation involves dividing a larger market into smaller market segments based on
4. Market segmentation refers to
5. Market segmentation produces relatively homogenous groups of consumers called
6. Market segments are
A. the two buying groups: those that have never purchased a firm’s product, and those that are potential repeat customers.
B. the different geographical areas in which a product must be marketed differently.
7. Read the following statements to select the choice that is not true of market segmentation.
A. Market segmentation helps firms design specific marketing strategies for the characteristics of specific segments.
8. To be effective, segmentation should create market segments that rate favorably on various criteria. Which of the following is
not one of the criteria outlined in your text?
A. substantial
B. actionable
9. When it comes to criteria for segmenting markets, it is important that the size and purchasing power of a market segment
should be clearly identified. In other words, it should be
A. differentiable.
B. actionable.
10. When a firm is reasonably certain that its marketing mix can inform consumers about the product, how it adds value to the
consumer, and ultimately how to purchase it, then the firm rates favorably on which market segment criteria?
11. An auto insurance company segmented its market by both gender and age, and designed different marketing campaigns to
appeal to both. In the end, both segments responded the same to the different marketing strategies, in part, because both
segments are required to have auto insurance. This firm failed to understand the criteria of market segments needing to be
A. accessible.
B. actionable.
12. Which market segment criteria refers to the fact that segments must be large enough for the firm to make a profit by serving
them?
D. actionable
E. accessible
13. What does the criteria accessible mean regarding market segments?
A. Marketers should develop strategies that can attract a market to its products.
B. Markets should be clearly identified with appropriate strategies developed for each.
14. Which of the following is not one of the broad segmentation bases outlined in your text that can be used to segment a
market?
D. geographic
E. psychographic
15. What are the two most commonly used demographic variables used by marketers?
A. age and income
B. education and family size
16. Demographic segmentation divides markets by
A. characteristics such as loyalty and price sensitivity.
B. geographic location.
17. One of the most important sources of demographic information for marketers, which of the following provides free
information on data such as how households are segmented by race, education, age, and occupation?
A. ACNielsen Company
B. the Social Security Administration
18. Clif Bar & Company, makers of energy and nutrition bars, expanded their product line to include Clif Kid Z Bars. These bars
are specifically designed to provide the right kind of nutrition for growing children. For this product, Clif Bar & Company is
segmenting the market based on
A. lifestyle.
B. customer convenience.
19. Marketers particularly target older Americans because
A. they tend to pay more attention to advertisements than other consumers.
B. they tend to be more educated than other consumers.
20. Which of the following is a demographic segmentation variable?
21. Quentin is a realtor selling high-end homes priced over $750,000. Before showing a property to prospective clients, Quentin
makes sure they are pre-qualified for a home loan commensurate with the price of the house. This pre-qualification is based
mainly on the client’s income, which is what type of segmentation variable?
A. psychographic
B. financial
22. American households that have between $100,000 and $250,000 in investable assets are one of the fastest growing
segments in the United States and are referred to as
A. the well-to-dos.
B. ultra-prosperous.
23. Contractors that advertise the ability to turn home attics or the space above a garage into living areas are most likely
targeting their market based on the demographic variable of
24. Segmentation based on where prospective consumers live, work, and spend their leisure time is referred to as
A. regional segmentation.
B. proximity segmentation.
25. Free-standing areas with a core urban population of at least 50,000 are what the U.S. Census Bureau calls
26. The fact that you see a Starbucks on practically every corner would indicate that Starbucks is most likely geographically
segmenting based on
27. According to the 2010 U.S. Census, which is the only southern state that lost seats in the House of Representatives due to
population shifts out of the state?
28. Psychographic segmentation refers to the science of segmenting markets based on
A. consumers’ opinions, interests and attitudes.
B. behavior and demographics.
29. When marketers segment based on psychographics, the market is divided into groups according to
A. a consumer’s income and interest in the product.
B. family size and marital status.
30. A psychographic segmentation variable that divides people into groups based on their opinion and the interests and activities
they pursue is called
31. Stores like Cabela’s, REI, and Bass Pro Shops that cater to outdoor enthusiasts’ most likely use what type of segmentation
strategy?
32. The VALS framework classifies adults into eight psychographic groups: Innovators, Thinkers, Believers, Achievers, Strivers,
Experiencers, Makers, and
33. According to the VALS framework, why different consumer groups exhibit different behaviors or why different consumer
groups exhibit the same behaviors for different reasons is based on
A. lifestyle and income.
B. motivation and desire.
34. Behavioral segmentation divides consumers according to
35. Which of the following is a behavioral segmentation variable?
36. The 80/20 rule is a theory that suggests that
A. 80 percent of a firm’s profits is generated from 20 percent of its product line.
B. 20 percent of the total demand for products comes from 80 percent of the target market.
37. According to your text, the segmentation base that is often the most difficult to use is
A. geographic segmentation.
B. demographic segmentation.
38. Business-to-business firms generally segment their markets according to what three variables?
A. profit potential, price sensitivity, and demand
E. demographic, geographic, and psychographic
39. What type of business-to-business segmentation allows B2B marketers to segment based on purchasing patterns, supplier
requirements, and technological orientation?
A. psychographic
B. demographic
40. Read the following statements to select which one is accurate regarding the use of social media in market segmentation.
41. Which of the following is not characteristic of gathering the information needed to engage in international market
segmentation?
42. Firms typically segment international markets using three general bases: global, regional, and
43. As it pertains to international segmentation, global segmentation refers to identifying
A. products that will have a global appeal.
B. products that can be marketed in the same way across the globe.
44. Which international segmentation base usually results in market segments made up of young people, those that have more
money to spend, or those with access to the Internet?
45. As it pertains to international segmentation, unique segmentation is used when
A. a firm can identify a group of consumers with common needs and wants that spans the entire globe.
B. the similarity in needs and wants only extends across the region or several countries.
46. When a company evaluates each market segment to determine which segment or segments present the most attractive
opportunity to maximize sales, it is engaged in
47. Carson has opened up a new sports bar/restaurant in town. He has determined that his market segments are (1) students
from the nearby college campus, (2) families with small children, and (3) young adult males. Carson now has to determine which
of these segments will provide him with the best opportunity to maximize sales. The process of doing this is referred to as
A. marketing.
B. positioning.
48. The group of customers toward which an organization has decided to direct its marketing efforts is called its
49. After Carson opened up his new sports bar/restaurant, he determined that students from the nearby college campus will
provide him with the best opportunity to maximize sales, so he is concentrating his marketing efforts on this group which will be
his
A. marketing segment.
B. target sector.
50. According to your text, when selecting a target market, firms should consider three important factors: growth potential, level
of competition, and
A. cultural factors.
B. economic conditions.
51. What can be said of the level of competition when selecting a target market?
A. The more intense the competition within a segment, the more attractive it is to marketers.
B. The more competitors there are within a segment, the less of a chance there is for price wars.
52. What factor of the targeting process is at work when a marketer ensures that the target market is appropriate for what the
organization is and wants to be as defined in its mission statement?
53. According to your text, what tool provides an excellent framework to determine if a firm will be successful targeting a specific
segment?
A. a segmentation analysis
B. Maslow’s hierarchy of needs
54. Which of the following represents the three basic strategies for targeting markets?
55. Undifferentiated targeting is a strategy that
56. The potential savings in developing and marketing the product is the major advantage of
D. a specialized marketing strategy.
E. a differentiated targeting strategy.
57. What type of targeting strategy works with uniform products for which the firm can develop a single marketing mix that
satisfies the needs of all customers?
A. a concentrated marketing strategy
B. a geographic targeting strategy
58. Firms that market the same product to multiple regions with different preferences may need to tweak the product to ensure
that it meets a need unique to each segment. This represents what type of targeting strategy?
59. Rico’s firm manufactures homemade salsa. His product is sold around the country, but he adds extra jalapenos to his
product sold in Texas, New Mexico, and Arizona because those customers prefer the extra heat and spice. Rico also markets
the product differently based on the region of the country where it is sold. This represents what type of targeting strategy?
A. undifferentiated
B. niche
60. A firm marketing its product in the United States and abroad may have to tweak the product for its international customers
and as such may have to market it differently. What type of targeting strategy would work best for this situation?
A. undifferentiated