Textbook Notes (369,137)
Canada (162,407)
Commerce (1,696)
Chapter 8

Chapter 8 Textbook Notes.docx

3 Pages
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Department
Commerce
Course Code
COMMERCE 2MA3
Professor
Stephen Charko

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Chapter 8: Market Segmentation, Targeting, and Positioning Types of Markets… •Market: group of people with sufficient purchasing power, authority, and willingness to buy o Target Market: group of people to whom a firm decides to direct its marketing efforts and ultimately its goods and services •Products are either classified as: o Consumer Products: products nought by ultimate consumers for personal use o Business Products: goods and services purchased for use either directly or indirectly in the production of other goods and services for sale The Role of Market Segmentation… •Market Segmentation: division of the total market into smaller, relatively homogeneous groups o Four basic requirements for effective segmentation are: 1. The market must present measurable purchasing power and size 1. Marketers must find a way to promote effectively and to serve the market segment 1. Marketers must then identify segments that are sufficiently large to give them good profit potential 1. The firm must aim for segments that match its marketing capabilities o Segmentation of the Consumer Market: • Geographic Segmentation: division of an overall market into homogeneous groups based on their locations  Businesses must look at: • Population • Economic Variables • Population growth • Core Regions: region from which most major brands get 40 to 80 percent of their sales  Census Metropolitan Area (CMA): geographic area surrounding an urban core with a population of at least 100,000  Census Agglomeration: geographic area with a population over 10,000 • Demographic Segmentation (Socioeconomic Segmentation): division of an overall market into homogeneous groups based on variables such as: Gender   Age • School-Age Children • Tweens and Teens • Generation X: the group born between 1966 and 1981 • Baby Boomers: people born between the years of 1947 and 1965 • Seniors • The Cohort Effect: tendency of members of a generation to be influenced and bound together by events occurring during their key formative years-roughly 17 to 22 years of age • Video Game Generation: a group called by several names: Generation Y, the Millennial Generation, Generation Next, the 9/11 generation, and the Echo Boomers  Ethnic Group  Family Life Cycle Stages • Family Life Cycle: process of family formation and dissolution  Household Type • Vary by life cycle stage and presence or absence of children  Income and Expenditure Patterns • According to Engel, as household income increases: • A smaller percentage of expenditures go for food • The percen
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