lesson planning guide - mr. wolschleger · • describe how marketers use more than one...

Chapter ObjectivesAfter studying this chapter, students will be able to• explain how segmentation helps a marketer determine a market to target.• list the four categories of segmentation variables for the consumer market.• explain each segmentation category and give one example.• describe how marketers use more than one segmentation variable.

Student Text OutlineIntroductory Text

I. Market SegmentationII. Geographic Variables A. Location B. Climate C. City SizeIII. Demographic Variables A. Age B. Gender C. Ethnicity D. Income E. Family SizeIV. Psychographic Variables A. Hobbies and Activities B. LifestyleV. Behavioral Variables A. Features Desired B. Usage Rate C. Brand LoyaltyVI. Combining VariablesVII. Market Segment Profi le

Terms

market segmentationgeographic segmentation

censusdemographic informationdemographic segmentationgenerationdisposable incomediscretionary incomepsychographic segmentation

behavioral segmentation

market segment profi le

Teaching ResourcesWB: Terms, Activity AMEH: Activity Buffet—Reading and VocabularyTR: Market Segmentation, Master 16-1 (transparency)

WB: Segmenting the Market by Generations, Activity C (math)

TR: Targeting a Market Segment, Master 16-2 (project)WB: Market Segments and Customers, Activity B

Review and AssessmentStudent TextReality Checks, pp. 194, 195, 196, 198, 200, 201Chapter Review, pp. 203–204

Review Concepts, Think Critically, Connect to Business, Explore Careers, Connect to the Internet

Teaching ResourcesWB: Terms, Activity ATR: Chapter 16 Test, Reproducible Test MasterMEH: Activity Buffet—Assessment, Content Review, and GamesEV: ExamView® Assessment Suite CD

193A

Lesson Planning GuideChapter 16Segmenting a Market

CH_16.indd Sec3:193CH_16.indd Sec3:193 7/2/2009 12:23:55 PM7/2/2009 12:23:55 PM

Business Administration and Marketing Performance Indicators

• Explain the concept of market and market identifi cation. (MP:003/CS)• Identify market segments. (MP:004/MN)

193B

DECAHave students contact National DECA for a breakdown of the market segments that DECA appeals to. DECA is not just for high school

members. After information has been obtained, ask for an oral report on the segments.

TM


Have students copy the list of terms and write a defi nition for each in their vocabulary notebooks. Give them a limit of 15 minutes. When the time is up, have volunteers read their defi nitions. Have the class vote on whether the defi nition is correct. Then have them use the book to check the defi nitions. Have them correct any incorrect defi nitions in their notebooks.

• WB: Chapter 16 Terms, Activity A. Use this activity to preview or review terms.

• For more vocabulary activities, see Activity Buffet—Vocabulary in the MEH.

• Have students read the objectives and predict what they will learn for each one. Then ask them to list the vocabulary terms that most likely go with each objective.

• For more prereading and reading activities, see Activity Buffet—Reading in the MEH.

Say, “Suppose that this class represents a larger market. How would you segment the class into smaller market segments?” Organize students into groups. Tell each group to decide on one characteristic that it can use to segment the class into smaller markets. One example of a characteristic is ethnic background, but students are not to use this one. When the groups have chosen their characteristic, have the groups report. If there is a duplicate, that group has to come up with another characteristic. Suggest hobbies, music, TV watching. Once each group has its characteristic, tell them that the characteristic used to segment a market is called a segmentation variable. Tell them to use their segmentation variable to make a list of market segments with descriptions of the segments.

Vocabulary Builder

Resources

Prereading Activities

Introductory Activity

16 Segmenting aSegmenting a MarketMarket

After studying this chapter, you will be able to

■ explain how segmentation helps a marketer determine a market to target.

■ list the four categories of segmentation variables for the consumer market.

■ explain each segmentation category and give one example.

■ describe how marketers use more than one segmentation variable.

Marketing Termsmarket segmentationsegmentation variablegeographic segmentationcensusdemographic informationdemographic segmentationgenerationdisposable incomediscretionary incomepsychographic segmentationbehavioral segmentation80/20 rulemarket segment profile

Think about the people you see in the local mall. How might these people be similar and different in their wants and needs for products? How can a marketer decide which group to target? Marketers have developed ways to analyze a large mass market and break it up into segments, 16-1. To segment a market means to divide a mass market into smaller markets with similar characteristics. Once the market is segmented, the marketer can then select one of the segments to be the target market.

Market SegmentationThe process of dividing a large

market into smaller parts is called marketsegmentation. Each smaller part is called a


If students have done the introductory activity, now have each group describe its variable, then have the class organize itself into market segments based on that variable. Then have the class discuss what products might be marketed to each segment.

TR: Market Segmentation, Master 16-1 (transparency). This master shows Figure 4-9 (page 59). Use it to review the concept of market segmentation.

Organize students into groups. Have each group choose a product. If there is a duplicate, have the second group choose another product. Each group records the name of the market segment most likely to buy the product, then lists as many characteristics as possible for that market segment. Have groups share their product, market segment name, and segment characteristics.

(Student response. Teen male—video games; Teen female—clothes; Parent—toys and clothes for children; Wealthy adult—restaurant meal; Retired—food and medicine.)

Cooperative Learning

Resource


Reality Check Answer

Part 3 Marketplace Dynamics194

market segment. Each market segment is made of customers with similar wants and needs for a specifi c product. Market segmentation helps marketers fi nd an appropriate target market. Marketers often segment the market, study the segments, then choose one (or more) of the segments as their target market.

In the consumer market, marketers use characteristics of customers to segment the market. For example, a marketer might segment a market based on the age of the customers. A customer characteristic that is used to segment a market is called a segmentation variable. Age is a segmentation variable. Some other segmentation variables are income level (how much money the customer makes) and gender (whether the customer is male or female). The assumption is that based on these variables, the customers in the segment have similar wants and needs for products.

There are over 25 different variables that marketers commonly use to segment the consumer market. Marketers have organized these variables into four categories: (1) geographic, (2) demographic, (3) psychographic, and (4) behavioral. Business marketers also segment their markets. Segmentation of business markets will be discussed in Chapter 18.

Imagine that $100 are available to spend. How might a teenaged male spend the money? A teenaged female? A 30-year-old parent with two children? A wealthy 40-year-old? A retired person on a very small fi xed income?

✓✓ Reality CheckReality Check

16-1

Think about the people you see in the mall. How do their wants and needs differ? Marketers have developed ways to analyze a large mass market and break it up into segments.

Photo courtesy of The Mills Corp.


Post a large map of the United States at the front of the room. Have students come up to the map, close their eyes, and point to a place on the map. Have them record the name of the closest town or city. Have the student use Internet and library resources to write a report on the geography and weather in that city. Then have them list products or businesses that they think would be successful in that city and their reasons.

(Student response. Climate. Sports equipment. Downhill snow skis—need snow and mountains. Scuba gear—need deep water.)

Review the meaning of the terms market segmentation, segmentation variable, and geographic segmentation. Answer questions 1–3 under Review Concepts and questions 1–2 under Think Critically at the end of the chapter.


Activity

Review It Now

Chapter 16 Segmenting a Market 195

Geographic VariablesSegmenting a market based on where

customers live is called geographicsegmentation. Commonly used geographic variables include location, climate, and city size.

LocationCustomers’ needs for products often

vary based on where they live. Customers who live in the same country often need different products from those who live in a different country. For example, automobiles for Americans must have the steering wheel on the left. Automobiles for the British must have the steering wheel on the right. Therefore, a company that produces cars for the world market would segment the market by places that need the steering wheel on the left (America) and those that need the steering wheel on the right (England). (This would not be the only segmentation variable that a car manufacturer would consider in developing a car.)

ClimateClimate has a huge impact on what

customers need. Customers who live in climates where it never gets colder than 60ºF (15.5˚C) do not need warm coats. Customers who live where the average winter temperature is 20ºF (–6.7˚C) need warm coats. Therefore, a coat manufacturer might segment the market based on average winter temperatures, 16-2.

City SizeMany marketers have discovered that

market size varies with the size of the city. Some cities are too small to be profi table for certain businesses. For example, one restaurant chain will locate restaurants only in cities of 200,000 or more people. Smaller

cities do not provide enough customers for this particular business. Other businesses prefer to focus on the needs of a small city or town. Walmart is the classic example. When Walmart started, it located its stores in small towns.

Choose a geographic variable. Think of a product that can be segmented based on that variable. Name the product and the geographic variable. Then describe each market segment.


16-2

Marketers of certain products, such as coats, segment the market based on climate.


How does age affect a person’s needs and wants for clothing? Give some examples. (Student response. Babies need small, soft clothing and diapers. Toddlers need sturdy clothing. Adults who work need business clothing.)

(Student response. Books. 0–3, books that are more like toys; 3–5, picture books; 6–9, easy reading books; 9–12, junior books, subjects of interest to this age group with an appropriate reading level; 12–17, young adult books, subjects of interest to this age group with an appropriate reading level; 17 and up, adult books.)

Students learn many different ways; consequently, some students like to use the Internet to research information and are more profi cient. Have these students take an active role in this chapter. Ask for volunteers to look up the census information for your state and the nation. Ask them to report what they fi nd. You might also want to use these students as a resource to help other students improve their profi ciency on the Internet.


Critical Thinking

Meeting Special Needs


Demographic VariablesMost nations want to know basic

information about their citizens, such as how many people are in each age group. As a result, most nations count the number of people in their countries. A census is a count of the people in a country made by the government on a regular basis. The United States takes a census every ten years. The government agency that performs the census is the U.S. Census Bureau (www.census.gov).

A census collects demographic information. Demographic informationconsists of statistics (numbers) that describe the characteristics of a population of people. For example, the Census Bureau will ask the age of each person; it will then compile a graph that shows how many people in the country are in each age group.

The categories that this information is divided into are called demographic variables.Segmenting a market based on demographic variables is called demographicsegmentation. Demographic variables commonly used by marketers include age, gender, ethnicity, income, and family size.

AgeAge is a commonly used segmentation

variable because people at different ages have different needs and wants, 16-3. For example, babies require special food, so a number of companies specialize in producing baby food. Clothing is another area where age affects wants and needs.

An important variable related to age is generation. A generation is a group of people born during a particular period of history. The period of history that a group of people grew up in has a major effect on their attitudes, wants, and needs. Figure 16-4 lists recent generations. One of the most famous generations is the Baby Boomers. These people were born between 1946 and 1964, in the years after World War II. The Baby

Boomers were infl uenced by television in the 1950s, the countercultural Woodstock music festival in the 1960s, the Vietnam War in the 1970s, and the materialism of the 1980s. Marketers like to target this generation because it is large, distinct, and wealthy.

Name a product whose market is segmented by age. Describe the different market segments and describe how the product differs for each age segment.


16-3

People of different ages have different wants and needs. Markets are often segmented based on age.


http://www.census.gov

The World War II generation grew up during the Depression. How do you think it affected their spending and buying habits? Suggest that students talk with older family members and friends who either grew up during this period or had parents who did. (Some are careful with their money, others spend lavishly to make up for what they did not have in their youth.)

WB: Segmenting the Market by Generations, Activity C (math). Students use the information from text Figure 16-4 to create a bar graph and a circle graph, then compare the two graphs.

List other stores that cater specifi cally to women or men. (Student response. Women’s clothing stores, men’s clothing stores, barbershops, bath and beauty shops.)

Organize students into groups. Have each group choose an ethnic group. Students might consult the list in Figure 14-2, page 170. Make sure each group chooses a different ethnic group. Have students plan a store that sells goods for that ethnic group. Students can use Internet and library resources to fi nd out what goods their group wants and buys. Groups should present a list of the products their store will carry, with photos if possible, in poster form or in presentation software.

Critical Thinking

Resource

Critical Thinking



GenderMen and women differ in their wants

and needs for many products. Marketers use these differences to develop products that meet the specifi c needs of men or the specifi c needs of women. For example, the Lady Footlocker stores provide running shoes and other athletic equipment that meet the specifi c needs of women.

EthnicityThe United States is composed of people

from a variety of ethnic backgrounds. The need for jeans does not vary based on a person’s ethnic background. However, needs for other products may vary with ethnic heritage. For example, a person of Chinese heritage may want specifi c Chinese cooking ingredients, such as dried squid and yellow bean paste. In addition, many people enjoy products related to the ethnic heritage of other people. For example, people from many ethnic backgrounds enjoy cooking and eating Chinese food. Many marketers have found success by segmenting the market based on ethnicity. They then

develop products to meet the needs of a specifi c ethnic group and the wants of people interested in that ethnic group.

IncomeIncome level has a major infl uence

on what people buy, therefore marketers often segment the market based on income level. Income level and buying patterns are also related to social class, as described in Chapter 14.

People with similar income levels often buy similar types of products. People in the lower income groups tend to spend a larger percentage of their incomes on necessities, such as food, clothing, and shelter. People with higher incomes tend to spend relatively more on recreation, education, and luxuries.

There are two categories of income that marketers are interested in: disposable and discretionary. Disposable income is the income a person has available to spend (dispose of) after taxes have been taken out. Usually, the fi rst things that disposable income is spent on are the necessities of life—food, clothing, shelter, and transportation. Discretionary income is the income left after taxes and after the necessities of life

Years Born

1995 – present

1977 – 1994

1965 – 1976

1946 – 1964

1933 – 1945

Before 1933

Total

Size in 2000(millions)

23

73

48

78

30

29

281

Generation Name

Generation Z (also called Post-Millennials)

Generation Y (also called Millennials)

Generation X

Baby Boomers

Swing Generation

World War II Generation

Generations

U.S. Population(%)

8

26

17

28

11

10

100

16-4

The U.S. consumer market is often segmented by generations.


(Student response. Income. Housing. Low income—rentals, motor homes; lower middle class—small houses and condos; upper middle class—larger houses; upper class—very large and luxurious houses and condos.)

Review the meaning of the terms census, demographic information, demographic segmentation, generation, disposable income, and discretionary income. Answer questions 4–6 under Review Concepts and questions 3–5 under Think Critically at the end of the chapter.

Teenagers as a group do not have high incomes. Yet they seem to have a great deal of discretionary income. Why? (Teens usually do not have to pay food, shelter, and basic clothing costs. These costs are usually covered by their parents or guardians. That leaves students with a large part of their income to spend however they want.)


Review It Now

Critical Thinking


have been paid for. Discretionary income is the money a person can spend at his or her discretion, that is, however he or she wants. Discretionary income is often spent on entertainment, vacations, restaurant meals, and similar products, 16-5.

Some marketers decide they want to focus on luxury items. In order to be able to afford various luxury items, one must have a fairly high income. The U.S. Census Bureau collects information on income levels based on geographic location. Marketing research can determine which areas of the country have the highest average incomes. The marketers of luxury items can then target advertising campaigns to those areas.

Family SizeMarketers have discovered that a

household consisting of one person has quite different needs and wants from a household consisting of one or two parents and one or more children. As a result, marketers often segment the market based on family size. For example, many convenience food manufacturers have developed single-serving packaging to meet the needs of single-person households.

Choose a demographic variable. Think of a product that can be segmented based on that vari able. Name the product and the demographic variable. Describe each market segment.


Psychographic Variables

Customers have psychological and emotional characteristics that affect their needs and wants for products. Segmenting a market based on psychological characteristics of customers is called psychographicsegmentation. Aspects that are considered in psychographic segmentation are hobbies, social activities, lifestyle, interests, and attitudes. Psychographic information about target markets is very useful when planning promotion. If you show the target market in the ad, people see themselves and can relate better to the promotional message.

Hobbies and ActivitiesPeople who participate in the same

activities or have the same hobbies tend to have similar buying patterns. Examples of hobbies include photography, quilting, and stamp collecting. Examples of activities include all types of sports, visiting museums, and attending operas.

LifestyleLifestyle and values are often diffi cult to

measure and defi ne. In order to group people in this way, marketing researchers administer surveys that ask participants to agree or disagree with a variety of statements called AIO statements. AIO stands for activities, interests, and opinions. A marketing research company well known for its psychographic

16-5

Discretionary income is the money you have left after necessities and taxes are paid. People use discretionary income to buy luxuries, such as restaurant meals and vacations.


Have students read the examples of hobbies and activities in the text on page 198. Have half the class list as many hobbies as they can. Have the other half list as many activities as they can. Assign at least one hobby or activity to each student. Have the students use Internet or library resources to fi nd the name and an example of a magazine that serves people who are involved in their hobby or activity. Have students make a poster on the hobby or activity and the magazine. Have students present them. Ask, “Why would marketers want to know about these magazines?” (So they can advertise products targeted to the readers of the magazines.)

A comprehensive exam is part of many DECA competitive events: Individual Series Events, Management Team Decision Making Events, Advertising Campaign Event, Technical Sales Event, and DECA Quiz Bowl. Obtain sample tests from DECA. These tests are composed of 100 multiple-choice questions. Give students 25 to 50 of the questions. Grade the tests and give the students feedback on their results. Go over those questions that pertain to material you have already covered. Suggest that students look up the correct answers for any questions that they miss.

Activity


research and data is SRI Consulting Business Intelligence (SRIC-BI). Their survey is called the VALS™ Survey. Here are some sample statements from a VALS Survey:■ I follow the latest trends and fashions.■ I would rather make something than

buy it.■ I consider myself an intellectual.

VALS divides U.S. adult consumers into eight VALS market segments based on the results of this survey, 16-6. These segments are based on consumer psychology that affects buying behavior. These segments are organized on a grid. The variable from top to bottom is level of resources: high to low. The variable from left to right is personal

VALS™ Lifestyle Segments

INNOVATORS

ACHIEVERS

STRIVERS MAKERSBELIEVERS

EXPERIENCERSTHINKERS

SURVIVORS

High ResourcesHigh Innovation

Low ResourcesLow Innovation

VALS™ Framework

Primary Motivation

Ideals Achievement Self-Expression

16-6

The VALS™ Survey divides U.S. adults into eight segments.

© 2002 by SRI Consulting Business Intelligence. All rights reserved. Reprinted with permission.



motivation: ideals, achievement, and self-expression. For example, one group is called Achievers. This group is concerned about status, has a fair amount of income, tends to buy premium products, and watches an average amount of TV. Another group is called Survivors. This group is concerned about safety, has relatively little income, tends to be loyal to brands, and watches a more-than-average amount of TV. Marketers would use the information about these groups to choose a target market. They would then use the information to customize the marketing mix to meet the unique needs of the market they targeted. A product for the Achievers would have a different marketing mix from a product for Survivors.

Choose a psychographic variable. Think of a product that can be segmented based on that variable. Name the product and the psychographic variable. Describe each market segment.


Behavioral VariablesCustomers differ in the way they use

products. Segmenting a market based on the way customers use a product or behave toward a product is called behavioralsegmentation. Common behavioral variables include features desired, usage rate, and brand loyalty.

Features DesiredCustomers vary in the features they

want from a product. For example, the mass market for home personal computers is huge. However, one type of computer will not meet the needs of all computer users. Some computer users want a basic computer for word processing and e-mail only. Other computer users want a computer with a few more features so that they can play games

and surf the Net. Other computer users want advanced features so that they can edit video and have three-dimensional graphics. As a result, home computer manufacturers often segment their market based on the features that the customer wants, 16-7.

Usage RateAs amazing as it might seem, research

shows that for many businesses, 80 percent of the sales come from 20 percent of the customers. This observation is called the 80/20 rule: the majority of a business’s profi ts come from a small number of customers.

16-7

Computer manufacturers may segment the market based on the features that customers want. Some customers want a basic computer. Others want advanced features.

(Student response. Hobbies. Magazines. Magazine for each hobby, such as model airplanes, quilting, photography, knitting, stamp collecting.)

How could a marketer use information about customers’ usage rates? (So they could spend limited advertising dollars on promotion to the heaviest users, that is, the users most likely to buy.)

Are there certain products for which you will only buy a certain brand? What are those products and why are you loyal to that brand? (Student response. I only buy Q-Tip brand cotton swabs because the other brands are not as good. They don’t have as much padding or they shred.)


Critical Thinking

Critical Thinking



For this reason, marketers often segment the market based on how often the customer uses or buys the product (usage rate). Usage rate categories include heavy, moderate, light, and nonuser.

Brand LoyaltyCustomers vary in how loyal they are

to a particular brand. The value of brand loyalty is related to the 80/20 rule. Loyal customers often are the source of most of a company’s sales. As a result, marketers often segment the market based on degree of loyalty. For example, airlines have developed frequent fl ier programs to reward airline customers who use the airline frequently. The frequent fl ier programs also encourage customers to use one airline for all their travel needs.

Choose a behavioral variable. Think of a product that can be segmented based on that variable. Name the product and the behavioral variable. Describe each market segment.


Combining VariablesOften, marketers fi nd it useful to target a

market based on two or more segmentation variables. A common combination is geographic location with a demographic variable, such as income. Marketers of luxury products can get the zip codes of people with the highest income levels.

Figure 16-8 provides an overview of the segmentation categories and variables. There are many other variables that do not appear in this fi gure. Many of the statistics used in market segmentation can be found on the Web site of the U.S. Census Bureau (www.census.gov).

Think of a product that has a large market. Think of two or more segmentation variables for that market. Name the product. Then list the segmentation variables and the market segments based on them.


Market Segment Profi le

Once marketers have divided a market into segments, they must choose the segment or segments to target. To help them make this decision, they often develop a market segment profi le for each segment. A marketsegment profile is a detailed description of the typical consumer in a market segment. This profi le will include geographic location, demographics, psychographics, and behavior relevant to the product.

The segment profi les can then be used when the segments are chosen. In order to plan a marketing mix that meets the target market’s needs, the marketer needs to know as much as possible about the customers in the market. The marketer should be able to “see” the typical customer in his or her mind.

(Student response. Athletic shoes. Gender and sport. Women’s shoes for running, tennis, basketball, etc.; Men’s shoes for running, tennis, basketball, etc.)

Organize students into groups. Ask, “Which market segment has your place of work targeted? If you do not work, think of the market segment targeted by a store or product that is familiar to you.” Have each student write a market segment profi le. Have the group members critique each other’s profi les. Have students share their profi les with the class.

Review the meaning of the terms psychographic segmentation, behavioral segmentation, 80/20 rule, and market segment profi le. Answer questions 7–10 under Review Concepts and question 6 under Think Critically at the end of the chapter.

(Student response. Usage rate. Cell phone service. Infrequent users for emergencies only—least expensive service package; occasional users— more minutes at a higher cost; heavy users—highest package of minutes at a lower per minute cost; heavy and international users—special package that allows international calls.)


WorkplaceConnection

Review It Now





Category

Geographic

Demographic

Psychographic

Behavioral

Variable

Location

Climate

City Size

Age

Generation

Gender

Ethnicity

Income

Family Size

Hobbies

Sports

VALS™

Features Desired

Usage Rate

Brand Loyalty

Some Variables Used To Segment the Consumer Market

Examples

• Domestic/foreign• Local/regional/national

• Warm/cold• Humid/dry

• Under 200,000 population• Over 200,000 population

• Senior/adult/teen/child/infant

• Baby Boomer/Generation X/Generation Y

• Male/female

• European American/African American/Hispanic American/Asian American/Arab American

• Mexican/Cuban/Puerto Rican/South American• Japanese/Chinese/Vietnamese/Thai/Filipino

• Under $100,000 annual• Over $100,000 annual

• One person/two people/three or more people• Children/no children

• Photography/quilting/stamp collecting

• Basketball/bicycling/skiing/swimming

• Innovator/thinker/believer/achiever/striver/experiencer/maker/survivor

• Basic features/one or two special features/advanced features

• Heavy/moderate/light/nonuser

• Totally loyal/mostly loyal/not loyal

16-8

These are some of the segmentation variables that marketers use to segment a market.

WB: Market Segments and Customers, Activity B. Students read descriptions of customers, then fi ll out a chart that organizes their characteristics into these categories: geographic, demographic, psychographic, and behavioral.

TR: Targeting a Market Segment, Master 16-2 (project). Students are given brief market segment profi les, then gather ads for products aimed at that segment.

Organize students into groups. Say, “As a teenager, you are in the demographic market segment based on age. If you were marketing to teens, what other segmentation variables could you use to further segment your market? Choose a product that is aimed at teens, such as video games or camera phones. List at least one other variable you would use to further segment the teen market for this product.” (Student response. Video games—gender; boys tend to buy video games more than girls. Camera phones—family income; teens in wealthier families are more likely to buy camera phones.)

Resource


Resource


Chapter 16 ReviewChapter 16 Review

203

Remember This

■ Market segmentation is a process that helps marketers fi nd an appropriate target market.

■ Consumer markets are often segmented based on the following four categories of variables: (1) geographic, (2) demographic, (3) psychographic, and (4) behavioral.

■ Marketers often use more than one segmentation variable to segment a market.

Review Concepts

1. What do you call the process of dividing a large market into smaller parts?

2. What do you call a customer characteristic that is used to segment the market?

3. List three commonly used geographic variables.

4. List fi ve commonly used demographic variables.

5. Why do marketers use generation to segment a market?

6. Why might a marketer segment the market based on family size? Give an example.

7. List fi ve commonly used psychographic variables.

8. Why might a marketer segment the market based on hobbies? Give an example.

9. List three commonly used behavioral variables.

10. How might a marketer segment a market based on features desired?

Think Critically

1. Why do marketers segment a market? 2. Name three products for which

geographic segmentation would help determine the appropriate target market.

3. Which generation are you in? Your parents? Grandparents?

4. Why are marketers still interested in marketing to the Baby Boomers?

5. How might a marketer use income information from the U.S. Census Bureau to segment a market?

6. Suppose a marketer was trying to reach you as the typical consumer for the market segment he or she wanted to target. Write a brief market segment profi le of a segment that would include you. Include at least one of each of the four segmentation variables that would describe you.

Connect to Business

1. Visit a grocery store. Study the shelves where the cereal is displayed. How is the cereal market segmented? Write a description of at least three segments in the cereal market. Describe each market segment and the type of cereal that segment prefers. Use the segmentation variables in your description.

2. Find an ad in a newspaper or magazine. Based on the ad, describe the market segment that this ad targets. Use the segmentation variables in your description.

1. Market segmentation.2. Segmentation variable.3. Location, climate, city size.4. Age, gender, ethnicity, income level, and family size.5. People born in the same generation often have similar attitudes, wants, and needs.6. Example may vary. Families of different sizes have different needs for certain kinds of products. A large family might want a larger package size of food than a one-person household.

7. Hobbies, social activities, lifestyle, interests, attitudes.8. Example may vary. People who like the same hobbies might have the same wants and needs for products. People who are into photography need photographic equipment.9. Features desired, usage rate, brand loyalty.10. Answers may vary. For computers, the market segments might be those who want a basic computer with no extra features, those who want a few extra features, and those who want an advanced computer with many extra features.

Review Concepts Answers


204

Chapter 16 ReviewChapter 16 Review

3. Use library resources to fi nd the most recent issue of the magazine AmericanDemographics. First, determine the target market for this magazine. Then make a list of the topics covered. Choose one article. Summarize the article and explain how the information in that article might impact marketing and business.

Explore Careers

1. A demographer studies changes in populations of people. Use library resources or the Internet to learn what a demographer does. Then visit the Web site of the Population Association of America (www.popassoc.org). Click on the link “Jobs.” Browse through the job listings. Choose a job that appeals to you. What are the qualifi cations for the job? What does a person in the job do? Would you like this job? Explain why or why not.

2. Use library resources or go to the Web site of a college or university. List the courses taken by students who major in the social sciences. Then fi nd the article on “Social Scientists” in the OccupationalOutlook Handbook, available in libraries or online at www.bls.gov/OCO/. Make a list of the different types of social scientists. For each type, describe the kinds of work

they could do for business. Do any of these careers appeal to you? Explain why or why not.

Connect to the Internet

1. Visit the Web site of the U.S. Census Bureau (www.census.gov). First, fi nd the slogan for the U.S. Census Bureau. Why do you think the Census Bureau chose this slogan? Describe the information that you can fi nd on this site. How might marketers use this information?

2. Visit the Web site of the company that developed the VALS™ Survey, SRIC-BI (www.sric-bi.com). Click on the link for the VALS Survey, and take the survey. What is your VALS™ type? How does this compare with the way you look at yourself?

3. Visit the Web site of Claritas, a marketing research company that specializes in market segmentation (www.claritas.com).Click on the link, “About Us.” Then click on the link, “Free Resources.” Click on “You Are Where You Live.” Enter your zip code, and list the segments that describe your neighbor hood. Look up the descriptions of each segment. How do these segment descriptions compare with the way you think of your neighborhood?

MEH: Activity Buffet—Content Review, Games, and Vocabulary. Use activities from these buffet categories to review chapter content and vocabulary.

Select from various assessment options: Chapter 16 Test, Reproducible Test Master in the TR; Activity Buffet—Assessment in the MEH; and the ExamView® Assessment Suite CD.

Imagine that you are representative of a market segment. Write the market segment profi le for your segment.

Resources Review

Resources Assessment

Journal Writing


http://www.popassoc.org

http://www.bls.gov/OCO/


http://www.sric-bi.com

http://www.claritas.com

lesson planning guide - mr. wolschleger · • describe how marketers use more than one...

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