TEST YOURSELF

Chapter 4: The Market Segmentation Process

Essay Questions

1. One of the keys factors involved with successfully matching product offerings with the needs of particular market segments is the “differentiability of products.” Select a product or service that you are familiar with, list the key brands, and list as many points of differentiation as you can think of for each brand. Are the products in this category as well differentiated as you initially thought? If not, what would you do to improve the differentiability of your favourite brand?

2. Based on what the text has taught you about segmentation strategies, which one would you use if you were starting up your own small business and why?

3. Assume that you are the marketing manager for a brewery and have completed the first stage of the market segmentation decision process; i.e, you have segmented the beer market on the basis of usage rate (high, medium, low, and very low–no consumption over a month). Complete the second stage of the process by profiling the market segments. Fill in the chart below based on your existing knowledge of the beer market. Use whatever descriptors you think are relevant.
   
   Beer Market Segmentation Based on Usage Rate

   	High	Medium	Low	Very Low–No
   Consumer Profiles

   
   
4. Repeat the above process using age as the basis for segmentation. Again, use whatever consumer profile descriptors you think are relevant. Are your segment profiles notably different than they were when you looked at the market based on usage rate? If they are, how are they different and why? If they are not, why not?

   Beer Market Segmentation Based on Age

   	15–29	30–39	40–49	50+
   Consumer Profiles

    

5. Based on the above two charts, evaluate the attractiveness of each of these eight segments against the five traits of uniqueness, responsiveness, actionability, stability, and profitability. Is there a segment that you found to be the most attractive based on this analysis? Is this segment currently being served by the existing products in the market or have you uncovered an under-served market segment?

6. Use target market decision analysis to evaluate the product mix of your favourite beer. What modifications or improvements do you recommend to the product line-up based on this analysis?
   

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