4.1 Choose magazine ads for five different consumer products. For each ad, write a description of your
perception of the demographic characteristics of the targeted market.
Students will choose a variety of ads but should clearly understand demographics and psychographics.
4.2 Investigate how Delta Airlines (www.delta.com) uses its Web site to cater to its market segments.
Delta uses usage-rate and benefit segmentation in its Web site. The market segments that are obvious in Delta’s
4.3 Is it possible to identify a single market for two distinctly different products? For example, how substantial
is the market comprised of consumers who use Apple and who drive Volkswagens? Can you think of other
product combinations that would interest a single market? (Do not use products that are complementary,
like a bike and a bike helmet. Think of products, like the iPod and the car, that are very different.) Complete
the following sentences and describe the market for each set of products you pair together.
Consumers of:
Propel fitness water could also be a target market for ______________.
Proactiv Solution skin care products could also be a target market for ______________.
Alienware computers could also be a target market for ______________.
Specialty luggage tags could also be a target market for _______________.
5.1 Choose five ads from business publications such as the Wall Street Journal, Fortune, or BusinessWeek. For
each ad, write a description of how you think the company has segmented the business market.
Students’ answers should contain the bases on which segmentation was done: the bases for segmenting business
6.1 Write a letter to the president of your bank suggesting ideas for increasing profits and enhancing customer
service by improving segmentation and targeting strategies.
The students’ answers should describe two or more variables that should be used to segment the market, explain
7.1 Form a team with two or three other students. Create an idea for a new product. Describe the segment (or
segments) you are going to target with the product and explain why you chose the targeting strategy you did.
Students should clearly describe a market segment as a subgroup of people or organizations sharing one or more
Chapter 8 ♦ Segmenting and Targeting Markets 8-13
7.2 Go to the Web sites of JCPenney, www.jcpenney.com, and Target, www.target.com. Compare the
presentation of women’s fashions at the Web sites. What are the major differences? Which site is more
designer focused, and which is more brand focused? Which company’s approach do you think will appeal
more to the “Holy Grail” target market of 25– to 35-year-old women?
8.1 You are the marketing manager for a specialty retailer that sells customized handbags. Write a memo to
your boss describing how the company could benefit from one–to-one marketing.
Students’ answers will vary. Possible ideas include sending client’s a birthday postcard designed like the latest
9.1 Choose a product category (e.g. pickup trucks) and identify at least three different brands and their
respective positioning strategies. How is each position communicated to the target audience?
Supplemental Exercise: Group Work
Review and Applications
Review and Application questions 1.1, 4.3, and 7.1 lend themselves well to group work. For those activities, divide the
APPLICATION EXERCISE
Purpose: This exercise quickly shows students the powers and limitations of using demographics to describe customers,
and clarifies the process of segmentation and positioning.
Setting It Up: Form groups of 5-8 persons and instruct students to follow the directions on page 300 of their books.
Discuss the perpetual maps that students created for the products that were chosen.
This exercise was inspired by the following Great Idea in Teaching Marketing:
Kim McKeage
University of Maine
STUDENTS PRACTICE MAKING MARKET/PRODUCT GRIDS ON THEMSELVES
8-14 Chapter 8 ♦ Segmenting and Targeting Markets
• Quality Sensitivity
On the day when we do this exercise, students form groups of 5-8 persons. The group is instructed to pick a product
category. I recommend the following categories to them as items they might be familiar with:
• Automobiles (cars, trucks, SUVs, etc.)
• Athletic Shoes
Students then have to describe which market segments are represented in their group according to the segmentation
scheme(s) they choose to use. They must also develop a market/product grid to describe how to target different products
(within their chosen category) toward the different market segments represented within their group. The product
positions can be for existing products or imagined products (especially if no existing product fits a position they want).
ETHICS EXERCISE
1. Is marketing tobacco products to younger consumers unethical?
Marketing tobacco products to younger consumers is unethical insofar as they are more susceptible to being
2. Many are beginning to argue that fast–food companies, such as McDonald’s and Burger King, are
knowingly marketing unhealthy food to consumers. Is it unethical for fast-food companies to market
kids’ meals to children?
Marketing fast food to children is becoming an increasingly hot debate, as time–pressed parents are relying on
3. What does the AMA Statement of Ethics have to say about marketing unhealthy or harmful products to
consumers, particularly children and young adults? Go to the AMA Web site at
Chapter 8 ♦ Segmenting and Targeting Markets 8-15
The first rule mentioned in the AMA Code of Ethics is this: The marketer must not knowingly do harm.
Additionally, the code states that in the area of product development, the marketer must disclose all substantial
risks associated with product or service usage. In the past, however, even providing specific operating
instructions or instructions for use and clearly marking the product with warning labels has not been enough to
MARKETING PLAN EXERCISE
Once you’ve completed the marketing plan exercise for each chapter in Part 2 of this textbook, you can complete the Part
2 Marketing Planning Worksheet on your companion Web site at www.cengage.com/marketing/lamb. Complete the
exercises on page 287 to continue the marketing plan you began in Chapter 2.
CASE STUDY
Coke Zero: Do Real Men Drink Diet Coke?
1. Describe the specific type of consumer that the Coca-Cola Company is targeting with each of the following
products: Diet Coke, Coke Zero, Diet Coke Plus, Coca-Cola Blak, and Full Throttle Blue Demon. What types
of demographic segmentation is each product’s marketing most likely to include?
The Coca-Cola Company segments markets for its products on the basis of demographic information related to
2. Some industry analysts think soft-drink companies should develop products that will bring new customers
into the market rather than just creating variants on the old. They warn that products like Coke Zero will
8-16 Chapter 8 ♦ Segmenting and Targeting Markets
cannibalize lost market share from other soft drink categories instead of increasing the number of consumers
overall. Which Coca-Cola products are most likely to lose customers to Coke Zero?
Coke Zero is most likely to affect sales of Coke and Diet Coke with intra-brand switching. Times have been tough
3. Why do you think that the hidden-camera videos used to promote Coke Zero were an effective way to reach
its target market? Do you think a similar strategy with a viral marketing campaign on the Internet would
appeal to the target market for Diet Coke Plus?
Student answers will vary, but it is unlikely that the target market for Diet Coke Plus (women who want to lose
4. Do you think Diet Coke could have been repositioned to change consumers’ perceptions of it enough to be
considered a drink equally appealing to men? Why or why not?
Student answers will vary, but Diet Coke’s brand image is so well known that it would have been difficult to
LESSON PLAN FOR VIDEO
Company Clips ReadyMade—Focus and Segmentation
ReadyMade markets itself as a magazine catering to GenNest, the group of consumers ages 25 to 35 who are just settling
down after college. This group of young couples is buying its first houses and taking on domestic and decorating roles
for the first time. They are interested in being stylish, while at the same time maintaining their own unique personalities.
But ReadyMade appeals to a wide variety of readers than just GenNest. The magazine has subscribers in all age groups,
from teens looking to spruce up their rooms to retirees looking for projects to enliven their homes. This diversity offers a
unique challenge to ReadyMade as it tries to promote itself to advertisers who need to know what sort of people will be
reached through advertisements appearing in the publication.
Solutions for Viewing Activities (also for the Company Clips questions in the textbook):
1. How does ReadyMade communicate the demographics of its reader base to advertisers who want to see
specific statistics that do not easily represent ReadyMade’s target market?
2. What sort of segmentation does ReadyMade use when it markets to businesses and investors?
ReadyMade uses each of the bases, or variables, used to segment consumer markets: geography, demographics,
Chapter 8 ♦ Segmenting and Targeting Markets 8-17
3. What ideas do you have that would help ReadyMade reach out to new subscribers without alienating its
loyal base?
Supplemental Exercise: Video
Company Clips
Pre-Class Prep for You:
• Preview the Company Clips video segment for Chapter 8. This exercise reviews concepts for LO1, LO2, LO3, LO4,
and LO5.
Pre-Class Prep for Students:
• Have students take notes on the following terms and concepts: market segment, market segmentation; segmentation
Video Review Exercise Activity
• Warm-up
o Begin class with a review of the criteria for successful segmentation. Ask students to brainstorm, from
what they’ve seen in the previous video segments, what they already know about ReadyMade’s
segmentation scheme.
• In-Class Preview
o On the board, copy the top-level details of the map of consumer market segments. Do not fill in the entire
map. Review the five bases with the class, if needed.
• Follow-up
o Online project: Write on the board “GEN NEST: who are they?” and “What do they want?”
Supplemental Exercise: Class Activity
Bank Marketing
Give students the following statistics about the identity of U.S. bank depositors.
Age Group Percent of Households Percent of Deposits
15–24 6 Less than 1
Ask students who they think the banks should be targeting and why? Who should the banks be targeting for the future?
What can the banks do to appeal to their chosen market or markets? How do the segments differ in their needs for
services?
Have your class brainstorm ideas of services to offer.
Possible services include:
✓ Free checking accounts
✓ Safety-deposit boxes
Can the students think of other services to offer? Banks have selected and bundled these services into packages to appeal
to certain market segments. How would the class bundle these services for the different segments?
GREAT IDEAS FOR TEACHING CHAPTER 8
James S. Cleveland, Sage College of Albany
DISCUSSION BOARD TOPICS TO ENCOURAGE PARTICIPATION
Discussion board questions provided to students to encourage them to engage in thinking and writing about the content
of the Principles of Marketing course usually take the form of a provocative statement to which students are asked to
respond. An example of this would be: All PR is good PR.
Discussion topics such as this one are abstract and often require that the instructor provide an initial reply to show
students what is expected of them in their own replies. For students with limited work experience, this approach may be
quite appropriate. For adult students with extensive experience as employees and consumers, however, the abstract
nature of such topics can be frustrating.
Chapter 8 ♦ Segmenting and Targeting Markets 8-19
2. Second, there is a reference to text pages the student should review before proceeding. Since the goal of the
Series A
1. Marketers use segmentation bases, or variables, which are characteristics of individuals, groups, or
organizations, to divide a total market into segments.
Series B
1. The development of any marketing mix depends on positioning, a process that influences potential customers’
overall perception of a brand, product line, or organization in general. Position is the place a product, brand, or
Barbara Coleman, Augusta College
UNITY IN DIVERSITY
Whenever I teach a unit on multiculturalism, I begin with the following exercise. Sometimes it uncovers interesting
differences based on gender or ethnicity, but just as often it identifies common values and life-style characteristics.
Note your race, ethnic group or country of origin: __________
_____Male
_____Female
What is your favorite:
television program
What do you see yourself doing 5 years from now?
8-20 Chapter 8 ♦ Segmenting and Targeting Markets
Marcel L. Berard, Community College of Rhode Island
MARKETING STARTS WITH STP: SEGMENTING, TARGETING AND POSITIONING
This project should be started at the beginning of the semester so as to provide students immediately with a target date
for oral and written completion. It is highly recommended that this project start early and finish toward the end of the
semester utilizing a team approach. Team members should not exceed five students to each group — two, three, or four
are preferred. A professor may want to choose and assign students in particular groups — or students may choose
members. Also, professors might provide class or library-research time to complete the project, although most work will
be completed out-of-class. A final note to the professor, contingent on semester duration, the required marketing strategy
project outline can be lengthened or shortened with no loss of importance to the marketing plan.
Students’ Product Instructions and Outline
(Students must choose only one topic below!!!)
Note to Students: Conduct a “Brainstorming” session in which your group chooses a topic from those listed above. In
your session, you should answer all statements and questions in all three sections of the Marketing Strategy Project
outline below. Good Luck !!!
Marketing Strategy Project Outline
Section #1. Segmenting your Product-Market
a. Current Product Identification and Information
Ex. Name, location, size logo, symbols, insignias, models, etc.
Section #2. Targeting your Product-Market.
a. Primary Target-Market — main consuming group
. Secondary Target-Market —additional sales potential
Section #3. Positioning your Product-Market.
a. What is special about this product.
Chapter 8 ♦ Segmenting and Targeting Markets 8-21