Pride; Marketing Core Concepts and Applications
Chapter 5 - Target markets: segmentation and evaluation


1.
Which of the following is not a requirement for a market?
A.
Ability to purchase
B.
Measurable relationship between supply and demand
C.
Need for a product
D.
Authority to buy
E.
Willingness to purchase


2.
The two major categories of markets are
A.
business and reseller.
B.
consumer and producer.
C.
consumer and business.
D.
consumer and government.
E.
consumer and reseller.


3.
An undifferentiated targeting strategy can be effective when
A.
many individuals have similar needs and are satisfied by several marketing mixes.
B.
many individuals have diverse product needs but are satisfied by a single marketing mix.
C.
used only in the consumer market.
D.
many individuals have diverse product needs that can be satisfied by a single marketing mix.
E.
many individuals have similar product needs that can be satisfied by a single marketing mix.


4.
Markets made up of individuals with diverse product needs are called
A.
homogeneous markets.
B.
heterogeneous markets.
C.
differentiated markets.
D.
segmented markets.
E.
geodemographic markets.


5.
One major difference between an undifferentiated targeting strategy and a differentiated targeting strategy is the
A.
number of product modifications.
B.
number of marketing mixes required.
C.
relative size of the marketing mix.
D.
number of prices used.
E.
homogeneity of the target group.


6.
A company with limited resources can compete with much larger organisations by
A.
concentrating its efforts on a single segment.
B.
using a differentiated targeting strategy.
C.
using a geographical segmentation variable.
D.
using multivariable segmentation.
E.
concentrating its efforts on the total population.


7.
Consequences that may be associated with the differentiated targeting strategy are
A.
an increase in sales and a decrease in total marketing costs.
B.
the use of excess production capacity and a decrease in total marketing costs.
C.
an increase in sales and the use of excess production capacity.
D.
a decrease in production costs and a decrease in total marketing costs.
E.
an increase in sales and a decrease in total production costs.


8.
Companies in the car industry generally use which of the following marketing strategies?
A.
Product differentiation
B.
Undifferentiated
C.
Differentiated
D.
Concentrated
E.
Mass marketing


9.
Which of the following is not a necessary condition for effective segmentation?
A.
Consumers' needs must be homogeneous.
B.
The segments must be divisible.
C.
The estimated sales potential of the segments must be measurable.
D.
At least one segment must provide enough profit to support a special marketing mix.
E.
The segments must be accessible.


10.
The segmentation variables that are measured most easily are
A.
product benefits.
B.
demographic characteristics of buyers.
C.
buyer behaviour.
D.
buyer motives.
E.
buyer personality.


11.
The number of potential customers within a unit of land area is referred to as the
A.
target market.
B.
market objective.
C.
market density.
D.
market segment.
E.
total market.


12.
Gunns Timber provides timber to various manufacturers in Tasmania and Victoria. Gunns Timber would most probably segment markets based on which one of the following variables?
A.
Demographics
B.
Psychographics
C.
Type of organisation
D.
Branch loyalty
E.
Population


13.
The segmentation variable that would most probably be used to segment magazines such as Cosmopolitan, Girlfriend and Vogue is
A.
geographic location.
B.
religion.
C.
age.
D.
rate of usage.
E.
personality.


14.
Geographic segmentation variables include
A.
climate, citizenship and terrain.
B.
city size, lifestyle and climate.
C.
population density, social class and urban/rural values.
D.
urban/rural values, motives and lifestyle.
E.
terrain, city size and climate.


15.
The three psychographic dimensions most commonly used in market segmentation are
A.
personality, perception and learning.
B.
personality, perception and behaviour.
C.
motives, attitudes and lifestyles.
D.
attitudes, personality and perception.
E.
personality, motives and lifestyles.


16.
Through a program called Club Rewards, Diners Club International, the entertainment credit card, allows cardholders to purchase merchandise and trips using points earned based on dollar-volume charges per month. This program is based on which of the following variables?
A.
Lifestyle
B.
Demographic
C.
Behavioural
D.
Psychographic
E.
Benefit


17.
By offering Colgate for Kids (attractive taste for children), Regular Colgate for cavity control and Tartar Control Colgate toothpastes, Colgate-Palmolive is segmenting the market based on
A.
benefits.
B.
psychographics.
C.
lifestyle.
D.
demographics.
E.
behaviourals.


18.
The total amount of a product for all companies in an industry that customers will purchase within a specified time period at a specific level of industrywide marketing activity is known as
A.
sales potential.
B.
market potential.
C.
consumer buying potential.
D.
a sales forecast.
E.
marketability.


19.
The maximum percentage of market potential that an individual company can expect to obtain for a specific product is known as
A.
company sales potential.
B.
market potential.
C.
a sales forecast.
D.
the profitability margin.
E.
a sales breakdown schedule.


20.
Through a customer survey, the forecaster gains information about consumers'
A.
past purchases.
B.
actual purchases.
C.
intended purchases.
D.
buying power.
E.
minimum purchases.


21.
A major justification for a company surveying its own salespeople is that they are
A.
least biased.
B.
least likely to be overly pessimistic.
C.
able to devote more time to the study.
D.
the best at setting reasonable quotas.
E.
closer to customers on a daily basis.


22.
The sales forecasting method that relies specifically on historical sales data is
A.
market tests.
B.
executive judgement.
C.
expert surveys.
D.
times series analysis.
E.
forecasts of sales personnel.


23.
A disadvantage of using expert surveys is that the experts
A.
seldom have the required experience.
B.
often lack necessary information.
C.
are not expedient.
D.
may not be motivated.
E.
are too expensive.


24.
Through a market test, the forecaster gains information about consumers'
A.
past purchases.
B.
actual purchases.
C.
intended purchases.
D.
estimated purchases.
E.
minimal purchases.


25.
Which of the following is the first step in the breakdown approach to determining sales estimates?
A.
Developing a general forecast of demand
B.
Developing a general economic forecast for a specific time period
C.
Estimating market sales potential
D.
Estimating company sales potential
E.
Developing a sales forecast


26.
The amount of a product that a company actually expects to sell during a specific time period at a specified level of marketing activity is called the
A.
market density.
B.
market potential.
C.
sales forecast.
D.
sales potential.
E.
market opportunity.


27.
Suppose that Kathleen Day is a marketer for Nestlé. To create a company sales forecast, she questioned customers and sales personnel. Kathleen was using which sales forecasting technique?
A.
Surveys
B.
Executive judgement
C.
Time series analysis
D.
Market tests
E.
Correlation methods


28.
If a marketer for Coca-Cola measured purchases and consumer responses to price, promotion and distribution of its new product, Raspberry Coke, it would be using which sales forecasting technique?
A.
Surveys
B.
Executive judgement
C.
Time series analysis
D.
Market tests
E.
Regression analysis


29.
A sales forecasting procedure in which experts create initial forecasts, submit them to the company for averaging and then refine the forecasts is known as
A.
time series analysis.
B.
regression analysis.
C.
trend analysis.
D.
salesforce forecasting survey.
E.
the Delphi technique.


30.
Market segment profiles help marketers
A.
select one or more segmentation variables.
B.
determine the degree to which an organisation's possible products can fit potential customers' product needs.
C.
forecast sales within various segments.
D.
facilitate the use of an undifferentiated targeting strategy.
E.
select which targeting strategy to utilise.


31.
What is the relationship between geodemographic segmentation and micromarketing?
A.
Micromarketing is usually required in order to perform geodemographic segmentation.
B.
Geodemographic segmentation allows marketers to engage in micromarketing.
C.
Geodemographic segmentation typically results in marketing to customers in a large geographic area, whereas micromarketing focuses on small geographic units sometimes as small as neighbourhoods.
D.
Geodemographic segmentation and micromarketing are essentially the same.
E.
There is no relationship between these two terms.


32.
Which one of the following product categories is most likely to be segmented based on family life cycle?
A.
Dictionaries
B.
Jewellery
C.
Cosmetics
D.
Cars
E.
Beer


33.
When evaluating relevant market segments, the major factors to be considered are
A.
competition, estimated sales and product feasibility.
B.
estimated sales, costs and product quality.
C.
competition, costs and estimated sales.
D.
competition, costs and level of advertising.
E.
availability of promotional resources, costs and sales estimates.


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