Marketing Grewal 4th Edition Solutions Manual

Marketing Grewal 4th Edition Solutions Manual
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Chapter 9 - Segmentation, Targeting, and Positioning
Chapter 9
Segmentation, Targeting, and Positioning
TOOLS FOR INSTRUCTORS
• Brief Chapter Outline

• Learning Objectives
• Chapter Overview (“Summing Up”)
• Extended Chapter Outline with Teaching Tips
o Topics, key terms, and boxed inserts referenced to PPT slide
• PowerPoint Slides with Teaching Notes
• Answers to End of Chapter Learning Aids
• Chapter Case Study
• Additional Teaching Tips
BRIEF CHAPTER OUTLINE
The Segmentation, Targeting, and Positioning Process

Summing Up
End of Chapter Learning Aids
Chapter Case Study: Coca-Cola
LEARNING OBJECTIVES
LO1. Outline the different methods of segmenting a market.

LO2. Describe how firms determine whether a segment is attractive and therefore worth
pursuing.
LO3. Articulate the difference among targeting strategies: undifferentiated,
differentiated, concentrated, or micromarketing.
LO4. Determine the value proposition.
LO5. Define positioning, and describe how firms do it.
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CHAPTER OVERVIEW (“SUMMING UP”)
Outline the different methods of segmenting a market.
There is really no one “best” method to segment a market. Firms choose from various
methods on the basis of the type of product/ service they offer and their goals for the
segmentation strategy. For instance, if the firm wants to identify its customers easily,
demographic or geographic segmentation likely will work best. But if it is trying to dig
deeper into why customers might buy its offering, then psychographic, geodemographic,
benefits, or behavioral segmentation (occasion and loyalty) work best. Typically, a
combination of several segmentation methods is most effective.
Describe how firms determine whether a segment is attractive and therefore worth
pursuing.
Marketers use several criteria to assess a segment’s attractiveness. First, the customer
should be identifiable—companies must know what types of people are in the market so
they can direct their efforts appropriately. Second, the market must be substantial enough
to be worth pursuing. If relatively few people appear in a segment, it is probably not cost-
effective to direct special marketing mix efforts toward them. Third, the market must be
reachable— the firm must be able to reach the segment through effective
communications and distribution. Fourth, the firm must be responsive to the needs of
customers in a segment. It must be able to deliver a product or service that the segment
will embrace. Finally, the segment must be profitable, both in the near term and over the
lifetime of the customer.
Articulate the differences among targeting strategies: undifferentiated, differentiated,

concentrated, or micromarketing.
Firms use a targeting strategy after they have identified its segments. An undifferentiated
strategy uses no targeting at all and works only for products or services that most
consumers consider to be commodities. The difference between a differentiated and a
concentrated strategy is that the differentiated approach targets multiple segments,
whereas the concentrated targets only one. Larger firms with multiple product/service
offerings generally use a differentiated strategy; smaller firms or those with a limited
product/service offering often use a concentrated strategy. Firms that employ a
micromarketing or one-to-one marketing strategy tailor their product/service offering to
each customer—that is, it is custom made. In the past, micromarketing was reserved
primarily for artisans, tailors, or other craftspeople who would make items exactly as the
customer wanted. Recently, however, larger manufacturers and retailers have begun
experimenting with custom-made merchandise as well. Service providers, in contrast, are
largely accustomed to customizing their offering.
Determine the value proposition.
A firm’s value proposition communicates the customer benefits to be received from a

product or service and thereby provides reasons for wanting to purchase it. It consists of
the attributes of a product or service that are desired by the target market, but not
available from competitors. Firms could attempt to offer attributes that are important to
its customers, whether or not they are offered by competitors. For attributes that are not
important to its customers, it should either educate its customers about the importance of
those attributes, deemphasize them, or not offer those product or service attributes.
Define positioning, and describe how firms do it.
Positioning is the “P” in the STP (segmentation, targeting, and positioning) process. It
refers to how customers think about a product, service, or brand in the market relative to
competitors’ offerings. Firms position their products and services according to several
criteria. Some focus on their offering’s value—customers get a lot for what the product or
service costs. Others determine the most important attributes for customers and position
their offering on the basis of those attribute symbols can also be used for positioning,
though few products or services are associated with symbols that are compelling enough
to drive people to buy. Finally, one of the most common positioning methods relies on
the favorable comparison of the firm’s offering with the products or services marketed by
competitors. When developing a positioning strategy and a perceptual map, firms go
through six steps. First, they determine consumers’ perceptions and evaluations of the
product or service in relation to competitors. Second, they identify the market’s ideal
points and market sizes for those products or services. Third, they identify competitors’
positions. Fourth, they determine consumer preferences. Fifth, they select the position.
Finally, they monitor the positioning strategy.
EXTENDED CHAPTER OUTLINE WITH TEACHING TIPS
I. THE SEGMENTATION, TARGETING, POSITIONING PROCESS (PPT slide

9-4)
A. Step 1: Establish Overall Strategy or Objectives (PPT slide 9-5)
B. Step 2: Describe Segments (PPT slide 9-6)
1. Geographic Segmentation (PPT slide 9-7)

2. Demographic Segmentation (PPT slide 9-8)
3. Psychographic Segmentation (PPT slide 9-10)
4. Geodemographic Segmentation (PPT slide 9-12)
5. Benefit Segmentation (PPT slide 9-14)
6. Behavioral Segmentation (PPT slide 9-15)
7. Using Multiple Segmentation Methods
Check Yourself: Several questions are offered for students to check their understanding
of core concepts. (PPT slide 9-16)
 What are the various segmentation methods?

Answer: Geographic, Demographic, Psychographic, Geodemographic, Benefits,
and Behavioral.
C. Step 3: Evaluate Segment Attractiveness (PPT slide 9-17)
1. Identifiable (PPT slide 9-18)

2. Substantial (PPT slide 9-19)
3. Reachable (PPT slide 9-20)
4. Responsive (PPT slide 9-21)
5. Profitable (PPT slide 9-22, 23)
D. Step 4: Select Target Market (PPT slide 9-24)
1. Undifferentiated Segmentation Strategy, or Mass Marketing (PPT slide 9-25)

2. Differentiated Segmentation Strategy (PPT slide 9-25)
3. Concentrated Segmentation Strategy (PPT slide 9-25)
4. Micromarketing (PPT slide 9-25)
E. Step 5: Develop Positioning Strategy (PPT slide 9-26, 27, 28)
1. Value
2. Salient Attributes
3. Symbol
4. Competition
5. Positioning (PPT slide 9-29)
F. Positioning Steps (PPT slide 9-30)
1. Determine consumers’ perceptions and evaluations in relation to competitors’.

2. Identify competitors’ positions
3. Determine consumer preferences.
4. Select the position.
5. Monitor the positioning strategy.
G. Perceptual Maps (PPT slide 9-31)
Check Yourself: Several questions are offered for students to check their understanding
of core concepts. (PPT slide 9-32)
 What is a perceptual map?

Answer: A perceptual map displays, in two or more dimensions, the position of
products or brands in the consumer’s mind.
 Identify the six positioning steps.

Answer: The six positioning steps are: Determine consumers’ perceptions and
evaluations of the product or service in relation to competitors’, identify
competitors’ positions, determine consumer preferences, select the position,
monitor the positioning strategy.
POWERPOINT SLIDES WITH TEACHING NOTES
Power Point Slide Teaching Notes

9-1: Segmentation, Targeting, And
Positioning
9-2: Learning Objectives These are the learning objectives for this
chapter.
9-3: Victoria’s Secret Firms constantly look to increase the markets

for their products by getting current consumers
to consume more, obtaining new consumers for
current products, offering new products to
current consumers, or entering an entirely new
market.
When the economy flagged and consumers cut

spending, Victoria’s Secret’s parent company,
Limited Brands Inc., turned its attention to
specific market segments to offset falling sales.
9-4: Segmentation, Targeting, Positioning Previous chapters addressed how to plan

Process marketing strategy; this chapter focuses on how
firms use that strategy to identify the target
markets they will serve.
9-5: Step 1: Establish Overall Strategy or Remind students that any strategy must be
Objectives consistent with the firm’s mission statement and
be based on the current assessments from
SWOT analyses
9-6: Step 2: Describe Segments Group activity: Divide the class into groups.
Have them choose either a manufacturer or

national retailer.
Have them describe their segmentation strategy

and then evaluate whether or not it is the best
segmentation strategy for that firm.
9-7: Geographic Segmentation Geographic information software (GIS) aids in

such segmentation.
Many firms use regional brands of popular

products.
When Dunkin’ Donuts introduced soup to its

menu, it included New England Clam Chowder
which appealed to northeastern consumers, but
franchisees in Texas objected to this choice.
Understanding regional preferences can define a

company’s success — or failure.
Ask students: How can firms successfully

change a regional brand into a national brand?
This will tie to the previous chapter on global

marketing – should they adapt to local tastes?
9-8: Demographic Segmentation This web link is to the U.S. Census Bureau.
They provide one of the most important

marketing research tools: Census data, which
offer a rich, free source of information about
various consumers that, suggests segmentation
possibilities.
On the Census Bureau Website, walk students

through the information available about the zip
code in which your university is located.
9-9: Google’s Project Glass Ask students What segments are Google
targeting with this ad?
Ask students Should Google make their

Glasses compatible with the iPhone as well as
Android phones? Why or why not?
YouTube link:
http://www.youtube.com/watch?v=9c6W4CCU
9M4
9-10: Psychographic Segmentation Not just businesses segment their customers;

segmentation also helps organizations that
counsel drug addicts or other at-risk groups.
Recall the discussion during the last presidential

election about “hockey moms”—middle-class,
educated, married women concerned about
various threats to their children.
Group Activity: Divide students into groups.
Have each choose a product/service they like.
Have them describe users of that product/service

in terms of psychographics.
9-11: VALS Framework Click on the VALS hyperlink and take the
survey as a class.
Group activity: Students complete the VALS

survey individually, and then bring their
completed survey to class.
Ask students: Why might you fall into similar

categories? Who fell into different categories?
For example, few business students likely

belong to the Believers category, but art majors
very well may.
9-12: 9-12 Geodemographic Segmentation Click on the Claritas link and conduct the “You
Are Where You Live” exercise with the zip
codes of the students’ hometowns.
Ask students: Describe your neighborhood.
How accurately does the site depict your

hometown?
9-13: State Farm Not Insuring Mississippi Ask students when geographic segmentation is
not legal or ethical.
You can play this video about State Farm

refusing to insure Mississippi.
Note: Please make sure that the video file is

located in the same folder as the PowerPoint
slides.
9-14: Benefit Segmentation Group activity: Have students identify products

that provide each type of benefit.
How else might these products be segmented?
This activity provides a good opportunity to

remind students that products exist in multiple
segments, just as consumers do.
Different motives lead different consumers to

purchase the same product.
9-15: Behavioral Segmentation Firms encourage loyalty in various ways, such

as airline mileage or hotel point reward
programs.
Ask students: Are you a loyal buyer of any

single product, to the extent that you refuse to
purchase a substitute?
Students may refer to soft drinks, but true brand

loyalty is extremely rare.
9-16: Check Yourself 1. Geographic, Demographic, Psychographic,

Geodemographic, Benefits, and Behavioral.
9-17: Step 3: Evaluate Segment Marketers first must determine whether the
Attractiveness segment is worth pursuing, using several
descriptive criteria:
Is the segment identifiable, substantial,

reachable, responsive, and profitable?
9-18: Identifiable Ask students: When would these women all be

in the same segment?
When would they be in different segments?
These women would appear in the same

segment if the segmentation variable were
gender but in individual segments based on race
or lifestyle.
They also may be in different geographic or

income segments, for example.
9-19: Substantial Just because a firm can find a market does not
necessarily mean it represents a good market.
But size in terms of number of people is not the

only consideration; despite its small size, the
market for the original Hummer was incredibly
profitable, and therefore was substantial
9-20: Reachable The Internet has enabled more people to be

reached more easily, but various areas around
the world simply cannot be served because they
aren’t accessible to marketing messages or
because there isn’t adequate distribution.
Ask students: What types of media influence

the way they shop?
The answer may lead to an interesting

discussion about how difficult it is to reach
Generation Y customers either because they
don’t participate in traditional media such as
newspapers or because they are skeptical about
being influenced by commercial messages.
9-21: Responsive Group activity: Nike is very successful at

selling sports related goods. Would consumers
accept personal care products from Nike? Why
or why not? Develop a list of potential products
for Nike.
Ask students: Are any of the following

acceptable: cologne, deodorant, toothpaste, or
hair gel. Why or why not? What about Nike
towels, sheets, or pajamas?
What differences can you identify between these

two types of product categories? Students are
likely to say they will not understand the value
proposition and the company’s expertise. Yet
other students might say that they will believe in
personal care product because Nike offers
superior products.
9-22: Profitable A hot segment today may not last long enough
to make it worth investment.
Many firms are investigating when and how

much to invest in the Millennial/GenY
generational cohort.
Firms in financial services and housing

understand that it provides a new potential
market, but the debt levels this segment carries
makes it difficult to target effectively.
9-23: Profitable Segments Children under 15 represent a very profitable

market segment as this example illustrates.
9-24: Step 4: Selecting a Target Market Hallmark looks at geographic segmentation

when building new stores.
They also use benefit segmentation for their

online cards.
In general, a company matches their

competencies with the attractiveness of target
markets.
9-25: Segmentation Strategy Ask students: What is an example of a mass

market product? Answer: There are very few
mass market products.
Even commodity goods such as flour are now

differentiated.
Ask students: What are examples of products

that use differentiated, concentrated, and
micromarketing segmentation strategies?
Differentiated = Coca Cola

Concentrated = Helena Rubenstein or Clinique
Microtargeting = Financial Services Providers
9-26: Step 5: Identify and Develop Positioning strategies generally focus on either
Positioning Strategy how the product or service affects the consumer
or how it is better than competitors’ products
and services.
When positioning against competitors, the

objective is to play up how the brand being
marketed provides the desired benefits better
than do those of competitors.
Firms thus position their products and services

according to value, salient attributes, and
symbols, and against competition.
9-27: Circles for a Successful Value Ask students – how is this positioning? They
Proposition should say salient attributes and competition.
9-28: Circles for a Successful Value Ask students – how is this positioning? They
Proposition should say salient attributes and competition.
9-29: Positioning Ask students – how is this positioning? They

should say salient attributes and competition.
Interesting here that the competition is its own

product – that is the joke of the ads.
9-30: Positioning Steps This slide provides the steps necessary to

develop the positioning map on the next slide.
Switch back and forth on these two slides to

explain the positioning map.
9-31: Perceptual Maps This perceptual map was created by the process
on the previous page.
It was for Gatorade which was seeking a

positioning of healthy and sweet taste.
9-32: Check Yourself 1.A perceptual map displays, in two or more

dimensions, the position of products or brands
in the consumer’s mind.
2.Determine consumers’ perceptions and
evaluations of the product or service in
relation to competitors’, identify competitors’
positions, determine consumer preferences,
select the position, monitor the positioning
strategy.
ANSWERS TO END OF CHAPTER LEARNING AIDS
Marketing Applications
1. What segmentation methods would you suggest for a small entrepreneur starting her
own business selling gourmet chocolates? Justify why you would recommend those
methods.
Students must think about the different benefits and trade-offs of the segmentation
methods. Descriptions of the different segments help firms better understand the
customer profiles in each segment. With this information, marketers can distinguish
customer similarities within a segment and dissimilarities across segments. The
entrepreneur might consider segmentation variables such as geography, income, life-
style, and convenience in her development of her target markets.
2. You have been asked to identify various segments in the market and then a potential
targeting strategy. Describe the segments for a pet supply store, and then justify the
best targeting strategy to use.
Students should be able to explain what each segmentation strategy is and its application.
With an undifferentiated segmentation strategy, the pet supply store would consider
everyone a potential user of the product. This is probably not the best segmentation
method for this type of store considering some people do not have pets.
A differentiated segmentation strategy uses several market segments to obtain a bigger

share of the market. The pet supply store might consider this strategy as it sells to
consumers who have dogs, cats, fish, reptiles, etc. Each customer with a different type of
pet might have different needs.
A concentrated segmentation strategy is used when an organization selects a single,

primary target market and focuses all its energy on providing a product to fit that
market’s needs. This might be an appropriate strategy for the pet supply store if the store
only sold to customers with one type of pet.
Micromarketing occurs when a firm tailors a product or service to suit an individual

customer’s wants or needs. This strategy would only work for the pet store if they were
custom making food, clothing, or supplies for pets.
3. How and why would a retailer use micromarketing?
Micromarketing occurs when a firm interacts on a one-on-one basis with many people to
create custom-made products or services. A firm could use micromarketing by
standardizing aspects of the products but leaving enough room for variability to tailor
the product to each customer’s needs. For example, a jeans manufacturer might pre-cut
fabric, then modify the pre-cut patterns to fit each customer who orders a pair of jeans.
Micromarketing increases customer satisfaction by specifically meeting the exact need or
want of the customer, which in turn increases the likelihood of customer loyalty and
repeat business.
4. You have been asked to evaluate the attractiveness of a group of identified potential
market segments. What criteria will you use to evaluate those segments? Why are
these appropriate criteria?
The third step in the segmentation process involves evaluating the attractiveness of
market segments. To undertake this evaluation, marketers first must determine whether
the segment is worth pursuing, using several descriptive criteria: is the segment
identifiable, substantial, reachable, responsive, and profitable.
If a firm can determine who appears in the market and thus design products or services
to meet their needs, the market segment is identifiable. If it can measure the size of the
segment and determine its worth, the market segment is substantial. If the firm can reach
the segment through persuasive communications and product distribution, it is reachable.
If customers in a market segment react positively to the firm’s offerings, the market
segment is considered responsive. Finally, if a market segment has sufficient size and the
potential for high adoption rates and repeat purchases with sufficient profit margins, it is
profitable. These criteria are appropriate because they apply to any market segment,
regardless of the product or service offered, and represent the key issues to address to
make the new product or service a lucrative opportunity.
5. A small-business owner is trying to evaluate the profitability of different segments.

What are the key factors you would recommend she consider? Over what period of
time would you recommend she evaluate?
At a different level than that in the previous question, students must suggest ways to
determine profitability.
The business owner should consider the following key factors: market growth (current
size, expected growth rate), market competitiveness (number of competitors, entry
barriers, product substitutes), and market access (ease of developing or accessing
distribution channels, brand familiarity). As far as the length of evaluation, it should be a
minimum of 12 months to ensure the owner knows what one year’s operations will entail.
6. Think about the various energy drinks that you and your friends drink (e.g., Coca-
Cola, Pepsi, 7-Up, Gatorade, and Powerade).How do those various brands position
themselves in the market?
Market positioning involves a process of defining the marketing mix variables so that
target customers have a clear, distinctive, desirable understanding of what the product
does or represents in comparison with competing products. Positioning strategies focus
on either how the product or service affects the consumer or how it is better than
competitors’ products or services. Companies position their products using values,
salient attributes, and symbols. Students should discuss which of these tools the different
energy drinks use to differentiate themselves from competitors. For example, 5-hour
energy might use salient attributes, while Red Bull might use symbols.
7. Put yourself in the position of an entrepreneur who is developing a new product to

introduce into the market. Briefly describe the product. Then, develop the
segmentation, targeting, and positioning strategy for marketing the new product. Be
sure to discuss (a) the overall strategy, (b) characteristics of the target market, (c) why
that target market is attractive, and (d) the positioning strategy. Provide justifications
for your decisions.
This exercise challenges students to proceed through the entire segmentation /targeting
/positioning process described in the chapter.
For example, the new product is a self-propelled, robotic lawn mower, similar to the
robotic vacuum cleaner that is on the market today.
• Overall strategy: Segment the market into those consumers who own homes with
lawns and those who do not. Segment those with lawns into geodemographic markets
to identify the segments most likely to see value in such a new product. Focus
marketing efforts—most likely, television advertising, Internet banner ads, and
newspaper inserts—specifically on those segments.
• Characteristics of the target market: The target market includes middle- to upper-
middle-class households with no children and at least 20 square feet of lawn to mow.
• Attractiveness: These households likely can afford the product, do not have children
to mow the lawn as a chore, and possess enough lawn space to justify the purchase
for the sake of ease and convenience. This segment is easy to identify and is
significantly different from other segments.
• Positioning strategy: The product positioning should use both value (under $200) and
salient (self-propelled, does not need supervision, senses the boundaries of the lawn
automatically, and saves energy because it stops when it finishes mowing) attributes.
8. Think of a specific company or organization that uses various types of promotional

material to market its offerings. The Web, magazine ads, newspaper ads, catalogs,
newspaper inserts, direct mail pieces, and flyers might all be sources for a variety of
promotional materials. Locate two or three promotional pieces for the company and
use them as a basis to analyze the segments being targeted. Describe the methods
used for segmenting the market reflected in these materials, and describe
characteristics of the target market according to the materials. Be sure to include a
copy of all the materials used in the analysis.
This exercise takes the examination of segmentation, targeting, and positioning one step
further to the actual implementation of the entire process of marketing materials.
A company like Pillsbury uses a variety of promotional materials to sell its products.
Three common types are newspaper coupon inserts, magazine advertisements, and its
Web site. According to these materials, the basic segmentation strategy Pillsbury uses
focuses on salient attributes; all the material tends to highlight product attributes (flavor,
quick baking time, convenient to make, enough for a family of four). As far as the target
market, it appears to be predominately cost-conscious women with children who have
limited time and budgets to make home-cooked meals for their family and are looking for
easy recipes and convenience.
9. You have been hired recently by a large bank in its credit card marketing division.
The bank has relationships with a large number of colleges and prints a wide variety
of credit cards featuring college logos, images, and the like. You have been asked to
oversee the implementation of a new program targeting the freshman class at the
schools with which the bank has a relationship. The bank has already purchased the
names and home addresses of the incoming freshman class. You have been told that
no credit checks will be required for these cards as long as the student is over 18
years of age. The bank plans a first day of school marketing blitz that includes free
hats, t-shirts, and book promotions, as well as free pizza, if the students simply fill out
an application. Do you think it is a good idea to target this program to these new
students?
What ethical issues might arise from the situation outlined, and to what degree do these
issues violate students’ own ethical standards? Using the ethical decision-making
framework discussed in Chapter Three, students should evaluate their opinion of the
practice of marketing credit cards to college freshmen and thus determine an appropriate
course of action.
In applying the ethical decision-making framework:
• “Have you thought broadly of any ethical issues associated with the decision to be
made?” I have thought broadly about the ethical issues and have concerns about
targeting a market segment of young consumers who lack jobs and are just learning
how to manage their own finances. Such targeting could breed a population of
students who run up credit card bills to the point that it affects their ability to buy a
car or house a few years down the line.
• “Have you involved as many possible people who might have a right to offer input
into or have actual involvement in making this decision and action plan?” At this
point, the students have no say in whether such marketing efforts should be on
campus, parents have had no chance to give input to a process that probably is
occurring without their knowledge, and the school administration has not been
consulted about whether this target population is appropriate.
• “Does this decision respect the rights and dignity of the stakeholders?” College
freshmen likely have little understanding of the potential pitfalls involved with
running up credit card debt they cannot pay for, and the parents of these students
might be the ones most adversely affected if they have to bail out their child,
incurring costs of which they were not even aware.
• “Does this decision produce the most good and the least harm to the relevant
stakeholders?” The college freshmen would be making important credit decisions
without full knowledge of the potential consequences, and their credit ratings could
be affected for life, ruining their chances of obtaining credit in the future for car and
home purchases.
• “Does this decision uphold relevant conventional moral rules?” It likely violates the
community’s standard for what is appropriate, because it targets young adults with
credit cards that they cannot afford.
• “Can you live with this decision alternative?” If the decision is to forgo such
marketing to college freshmen, then yes, I could live with that.
Quiz Yourself
1. NASCAR redirected its marketing efforts when a survey indicated that almost fifty
percent of race fans were female. This is an example of ______________
segmentation.
A. geographic
B. psychographic
C. demographic
D. benefits
E. behavioral
Gender is an example of a demographic variable. Demographic variables are easily

measured, objective characteristics.
2. Within a perceptual map, a(n) _________________ represents where a particular

market segment's desired product would lie.
A. point of parity
B. strategic target
C. PRIZM cluster
D. ideal point
E. benefit centroid
An ideal point indicates where a particular market segment’s ideal product would lie on
a perceptual map.
Net Savvy
1. Go to the Nielsen Claritas’ website http://www.mybestsegments.com. Click on the

tab that says “ZIP Code Look-Up,” then enter your zip code to learn which segments
are the top five in your zip code. Follow the links for each of the five most common
PRIZM segments to obtain a segment description. Write up a summary of your
results. Discuss the extent to which you believe these are accurate descriptions of the
main segments of people who reside in your zip code.
By looking at their own zip codes, students can get a feel for how accurate Claritas is and
discover any areas in which Claritas has missed the mark.
Answers will vary. A sample answer may be: Generally, people who live in my zip code
tend to be highly educated, affluent, ethnically mixed, liberal, and technologically savvy.
This description is accurate for the area I live in on the whole, but a segment of the
population that PRIZM seems to have missed are the elderly, who are numerous in my
area.
2. Go to the VALS website

(http://www.strategicbusinessinsights.com/vals/presurvey.shtml), and click on the
link to complete the VALS survey. After you submit your responses, a screen will
display your primary and secondary VALS types. Click on the colored names of each
segment to get additional information about them, and print out your results. Assess
the extent to which these results reflect your lifestyle, and identify which
characteristics accurately reflect your interests and activities and which do not.
Responses will vary according to the results of each students’ VALS survey results. The
main dimensions of the VALS segmentation framework are consumer motivation and
consumer resources. Consumers are inspired by three motivations: (1) ideal, (2)
achievement, and (2) self-expression. Students should touch upon the basic framework of
the VALS survey in their response and address the validity of the survey.
Chapter Case Study: Coca-Cola
1. Which types of segmentation strategies does Coca-Cola use to categorize the cola
beverage market?
Coca-Cola uses a differentiated marketing strategy. It delivers a unique plan (and

subsequent marketing message) to its segments. This strategy is effective in the market
since each segment has its unique needs that are significantly different. Each is a
completely different market.
This chapter addresses segmentation strategy– undifferentiated, differentiated,

concentrated, and micromarketing. The student will learn critical thinking skills to
determine the best method of segmenting a market. Segment attractiveness is explored
and well as positioning
The four strategies of undifferentiated, differentiated, concentrated, and micromarketing

should be further explored with critical thinking exercises. Emphasize that it is the
approach to the marketing message in relation to its target market(s) NOT the type of
product it is. Students confuse this. Consequently providing additional exercises such as
having students research advertisement campaigns on the Web, then determining if it’s a
differentiated, undifferentiated, concentrated, or micromarketing segmentation strategy
will help them to better understand that the strategy is based on the target market
characteristics not the product.
2. Are these types effective in this market? Provide support for your answer.
Student’s answers may vary. Coca-Cola has enjoyed tremendous success with its
segmentation strategy. However, some critics and shareholders worry that Coke-Zero
may cannibalize the Diet Coke market. Ask students to evaluate whether or not they
believe this to be true. Coca-Cola clearly would not benefit from an undifferentiated
strategy, nor could it manage a micro-marketing strategy. For Coca-Cola’s continued
success, a differentiated marketing strategy is the most strategically viable.
ADDITIONAL TEACHING TIPS
This chapter addresses segmentation strategy– undifferentiated, differentiated,

concentrated, and micromarketing. The student will learn critical thinking skills to
determine the best method of segmenting a market. Segment attractiveness is explored
and well as positioning
One of the most difficult concepts for students to understand is that of product
positioning. Instructors should emphasize that product position is based primarily on
competing brands in the marketplace and the consumer’s perception of the brand. The
perceptual map from the text (shown below) should be thoroughly reviewed with
students.
Students can learn this in a classroom setting where the instructor delegates one person in
the class to be the facilitator and then assigns the classroom with creating a class
perceptual map (food franchises can be used as an example). This can also take place in
groups with each group presenting their perceptual map to the class. Online Tip: This
exercise can be transferred to the online platform where groups are given the same tasks
then asked to post the groups’ results. An ensuing discussion board can then
compare/contrast the various perceptual maps.
The four strategies of undifferentiated, differentiated, concentrated, and

micromarketing should be further explored with critical thinking exercises. Emphasize
that it is the approach to the marketing message in relation to its target market(s) NOT
the type of product it is. Students confuse this. Consequently providing additional
exercises such as having students research advertisement campaigns on the Web, then
determining if it’s a differentiated, undifferentiated, concentrated, or micromarketing
segmentation strategy will help them to better understand that the strategy is based on the
target market characteristics not the product.
Remember to review the Newsletter for Instructors and its accompanied PowerPoint
presentation, which integrates examples and discussion from the newsletter. Each
newsletter contains over ten article abstracts on hot topics, plus a selection of current
commercials and videos for you to use with your class. The newsletter also includes a
guide that explains where the articles, commercials, and videos best fit in your Marketing
course.
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Chapter 9 - Segmentation, Targeting, and Positioning

TOOLS FOR INSTRUCTORS

• Brief Chapter Outline

BRIEF CHAPTER OUTLINE

The Segmentation, Targeting, and Positioning Process

LO1. Outline the different methods of segmenting a market.

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CHAPTER OVERVIEW (“SUMMING UP”)

Outline the different methods of segmenting a market.

Articulate the differences among targeting strategies: undifferentiated, differentiated,

Determine the value proposition.

A firm’s value proposition communicates the customer benefits to be received from a

Define positioning, and describe how firms do it.

EXTENDED CHAPTER OUTLINE WITH TEACHING TIPS

I. THE SEGMENTATION, TARGETING, POSITIONING PROCESS (PPT slide

A. Step 1: Establish Overall Strategy or Objectives (PPT slide 9-5)

B. Step 2: Describe Segments (PPT slide 9-6)

1. Geographic Segmentation (PPT slide 9-7)

 What are the various segmentation methods?

C. Step 3: Evaluate Segment Attractiveness (PPT slide 9-17)

1. Identifiable (PPT slide 9-18)

D. Step 4: Select Target Market (PPT slide 9-24)

1. Undifferentiated Segmentation Strategy, or Mass Marketing (PPT slide 9-25)

E. Step 5: Develop Positioning Strategy (PPT slide 9-26, 27, 28)

1. Determine consumers’ perceptions and evaluations in relation to competitors’.

G. Perceptual Maps (PPT slide 9-31)

 What is a perceptual map?

 Identify the six positioning steps.

POWERPOINT SLIDES WITH TEACHING NOTES

Power Point Slide Teaching Notes

9-3: Victoria’s Secret Firms constantly look to increase the markets

When the economy flagged and consumers cut

9-4: Segmentation, Targeting, Positioning Previous chapters addressed how to plan

Have them choose either a manufacturer or

Have them describe their segmentation strategy

9-7: Geographic Segmentation Geographic information software (GIS) aids in

Many firms use regional brands of popular

When Dunkin’ Donuts introduced soup to its

Understanding regional preferences can define a

Ask students: How can firms successfully

This will tie to the previous chapter on global

They provide one of the most important

On the Census Bureau Website, walk students

Ask students Should Google make their

9-10: Psychographic Segmentation Not just businesses segment their customers;

Recall the discussion during the last presidential

Group Activity: Divide students into groups.

Have each choose a product/service they like.

Have them describe users of that product/service

Group activity: Students complete the VALS

Ask students: Why might you fall into similar

For example, few business students likely

Ask students: Describe your neighborhood.

How accurately does the site depict your

You can play this video about State Farm

Note: Please make sure that the video file is

9-14: Benefit Segmentation Group activity: Have students identify products

How else might these products be segmented?

This activity provides a good opportunity to

Different motives lead different consumers to

9-15: Behavioral Segmentation Firms encourage loyalty in various ways, such