Marketing Management 11th Edition Peter Test Bank 1

Chapter 05 - Market Segmentation
Marketing Management 11th Edition Peter Test Bank
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Chapter 05
Market Segmentation
Multiple Choice Questions
1. The process of dividing a market into groups of similar consumers and selecting the most
appropriate group(s) for the firm to serve is called _____.
a. test marketing
b. mass marketing
c. market segmentation
d. marketing communication
Answer: c
Topic: Introduction
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Easy
Explanation: Market segmentation is the process of dividing a market into groups of similar
customers and selecting the most appropriate group(s) for the firm to serve. A primary reason
for studying consumer and organizational buyer behavior is to provide bases for effective
segmentation, and a large portion of marketing research is concerned with segmentation.
2. The logic of market segmentation is based on the idea that _____ can seldom meet the
needs and wants of all consumers.
a. marketers and sales people
b. marketing communication
c. integrated marketing systems
d. a single product item
Answer: d
Topic: Introduction
5-1
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Blooms: Remember
AACSB: Analytic
Explanation: The logic of market segmentation is quite simple and is based on the idea that a
single product item can seldom meet the needs and wants of all consumers. Typically,
consumers vary as to their needs, wants, and preferences for products and services, and
successful marketers adapt their marketing programs to fulfill these preference patterns.
3. Which of the following statements is true about a firm’s decision to “mass market” a
product?
a. This decision considers a market segmentation analysis to be an optional requirement.
b. This decision should be reached only after a market segmentation analysis has been
conducted.
c. This decision requires that a company selects a target market first.
d. This decision can be reached only after the firm develops the marketing mix.
Answer: b
5-2
Topic: Introduction
Blooms: Remember
AACSB: Analytic
Explanation: Even if the final decision of a firm is to “mass market” and not segment at all,
this decision should be reached only after a market segmentation analysis has been conducted.
Thus, market segmentation analysis is a cornerstone of sound marketing planning and
decision making.
4. Which of the following is the primary reason for studying consumer and organizational
buyer behavior?
a. To study employees and their relationship with the organization
b. To study the effectiveness of an organization’s marketing department
c. To provide bases for effective market segmentation
d. To determine an organization’s distinctive competencies
Answer: c
Topic: Introduction
Blooms: Remember
AACSB: Analytic
Level of Difficulty: Medium
Explanation: A primary reason for studying consumer and organizational buyer behavior is to
provide bases for effective segmentation, and a large portion of marketing research is
concerned with segmentation. From a marketing management point of view, selection of the
appropriate target market is paramount to developing successful marketing programs.
5. Which of the following constitutes a viable market segment?

a. A particular group of consumers who have varying needs and wants from the offerings of
the firm
b. A particular group of consumers of a single item who can be served profitably by a firm
c. A group of products and services that can be mass marketed profitably by a firm
d. A large geographic area where consumer of all the different social classes live and shop
Answer: b
Topic: Introduction
Blooms: Understand
AACSB: Analytic
Explanation: If a particular group can be served profitably by a firm, it is a viable market
segment. In other words, the firm should develop a marketing mix to serve the group or
market segment.
5-3
6. Which of the following statements about market segmentation is true?

a. According to the model of market segmentation analysis, the process usually begins with
deciding the segmentation strategy to be used.
b. Market segmentation analysis precedes the determination of consumer needs and wants.
c. The logic of market segmentation is that a single product item can seldom meet the needs
and wants of all consumers.
d. According to the model of market segmentation analysis, the process begins with designing
the marketing mix strategy.
Answer: c
Topic: Introduction
Blooms: Remember
AACSB: Analytic
Explanation: The logic of market segmentation is based on the idea that a single product item
can seldom meet the needs and wants of all consumers. Typically, consumers vary as to their
needs, wants, and preferences for products and services, and successful marketers adapt their
marketing programs to fulfill these preference patterns.
7. The group or market segment that a company selects to focus on is called the _____.
a. differentiated market
b. customer profile
c. target market
d. business group
Answer: c
Topic: Introduction
Blooms: Remember
AACSB: Analytic
Explanation: The group or market segment that a company selects to focus on is called a
target market.
8. Which of the following is the first step of the market segmentation process?
a. Determining the consumer needs and wants
b. Dividing the markets on relevant dimensions
c. Delineating the firm’s current situation
d. Designing the marketing mix strategy
Answer: c
Topic: Delineate the Firm’s Current Situation
Blooms: Remember
AACSB: Analytic
Explanation: A firm must do a complete situational analysis when embarking on a new or
modified marketing program. At the marketing planning level, such an analysis aids in
determining objectives, opportunities, and constraints to be considered when selecting target
markets and developing marketing mixes.
5-4
9. When embarking on a new or modified marketing program, a company should conduct

a(n)_____ first.
a. a priori segmentation analysis
b. mixed contingency analysis
c. complete situational analysis
d. vendor analysis
Answer: c
Blooms: Remember
AACSB: Analytic
Explanation: A firm must do a complete situational analysis when embarking on a new or
modified marketing program.
10. MicroBionics manufactures digital hearing aids, which unlike analog hearing aids, can be
programmed to mask out external noise. The company has determined that its competitive
advantage lies in its product, while its weakness is the associated manufacturing costs. Target
market opportunities exist within the maturing baby boomer segment. One challenge that the
company faces lies in the existence of a competing and well-established brand called
BelTone. In terms of the market segmentation process, MicroBionics has completed which of
the following steps?
a. Development of the product positioning strategy
b. Delineation of the firm's current position
c. Division of the market on relevant segmentation variables
d. Design of the marketing mix strategy
Answer: b
Blooms: Apply
AACSB: Reflective Thinking
Level of Difficulty: Hard
Explanation: The first step in the market segmentation process is to delineate the firm's
current situation. A firm must do a complete situational analysis when embarking on a new or
modified marketing program. At the marketing planning level, such an analysis aids in
determining objectives, opportunities and constraints to be considered when selecting target
markets and developing marketing mixes.
5-5
11. The second step in the market segmentation process involves determining the_____.
a. relevant dimensions for market segmentation
b. product positioning strategy to be used
c. consumer needs and wants
d. marketing mix strategy
Answer: c
Topic: Determine Consumer Needs and Wants
Blooms: Remember
AACSB: Analytic
Explanation: second step in the market segmentation process involves determining the
consumer needs and wants. Successful marketing strategies depend on discovering and
satisfying consumer needs and wants. In most situations, the industry in which the firm
operates specifies the boundaries of a firm’s need satisfaction activities.
12. In the market segmentation step involving the study of consumer needs and wants, it is
advisable for a company to _____.
a. forego undiscovered needs even if it possesses adequate venture capital to uncover them
b. transcend the barriers that the industry places upon its range of need satisfaction activities
c. use this step for generation for theoretical strategies, rather than operational concepts
d. modify or enhance offerings with relevant changes in technology for practical benefit
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: New technology often brings about an investigation of consumer needs and
wants for new or modified products and services. In these situations, the firm is seeking the
group of consumers whose needs could best be satisfied by the new or modified product.
13. Which of the following often brings about an investigation of consumer needs and wants
for new or modified products and services?
a. Organizational objectives
b. Organizational portfolio
c. New technology
d. Production orientation
Answer: c
Blooms: Remember
AACSB: Analytic
Explanation: As a practical matter, new technology often brings about an investigation of
consumer needs and wants for new or modified products and services. In these situations, the
firm is seeking the group of consumers whose needs could best be satisfied by the new or
modified product.
5-6
14. Consumer attitudes, preferences, and benefits sought that are determined through
marketing research:
a. are commonly used as operational concepts for segmentation purposes.
b. are directly translated into theoretical concepts about target market markets.
c. need not always be aligned with the organization's overall strategic objectives.
d. are unaffected by external factors like development of new technology or nature of the
industry.
Answer: a
Blooms: Remember
AACSB: Analytic
Explanation: At a strategic level, consumer needs and wants usually are translated into more
operational concepts. For instance, consumer attitudes, preferences, and benefits sought,
which are determined through marketing research, are commonly used for segmentation.
15. In which of the following stages of the market segmentation process would a firm need to
decide whether to use a post hoc or a priori approach to segmenting a market?
a. Determining customer needs and wants
b. Delineating the firm’s current situation
c. Dividing markets on relevant dimensions
d. Deciding a segmentation strategy
Answer: c
Topic: Divide Market on Relevant Dimensions
Blooms: Remember
AACSB: Analytic
Explanation: Dividing markets on relevant dimensions is often considered to be the whole of
market segmentation (i.e., consumers are grouped on the basis of one or more similarities and
treated as a homogeneous segment of a heterogeneous total market). An a priori or post hoc
approach to segmentation may be used.
16. Which of the following statements about market segmentation is true?

a. Market segmentation is the process of dividing an organization’s products into different
product classes according to their features for sale through a mass marketing mechanism.
b. The decision to mass market a product does not require any market segmentation analysis.
c. The first step in market segmentation is to develop an appropriate product positioning
strategy.
d. During market segmentation, consumers are grouped on the basis of one or more
similarities and treated as a homogeneous segment of a heterogeneous total market.
Answer: d
Topic: Divide Markets on Relevant Dimensions
Blooms: Understand
AACSB: Analytic
5-7
Explanation: From a marketing management point of view, selection of the appropriate target
market is paramount to developing successful marketing programs. During market
segmentation, consumers are grouped on the basis of one or more similarities and treated as a
homogeneous segment of a heterogeneous total market.
17. Identify the approach in which the marketing manager has decided on the appropriate
basis for segmentation in advance of conducting a research study on a market.
a. A priori segmentation approach
b. Post hoc segmentation approach
c. Empirical approach
d. Psychographic approach
Answer: a
Topic: Divide Markets on Relevant Demands
Blooms: Remember
AACSB: Analytic
Explanation: An a priori segmentation approach is one in which the marketing manager has
decided on the appropriate basis for segmentation in advance of doing any research on a
market.
18. In the case of segmentation for entirely new products, which of the following approaches
for determining key market dimensions would you recommend?
a. An a priori approach
b. A post hoc approach
c. An empirical approach
d. A cross-functional approach
Answer: b
Blooms: Remember
AACSB: Analytic
Explanation: Post hoc segmentation is an approach in which people are grouped into segments
on the basis of research findings. In the case of segmentation for entirely new products, a post
hoc approach may be useful for determining key market dimensions.
5-8
19. A new variant of tea that is higher in antioxidant content is being targeted at consumers
who are health conscious and seek organic food products by retailing them in stores that sell
organic food products only. This is an example of the _____ segmentation approach.
a. a priori
b. a posteriori
c. post hoc
d. de facto
Answer: a
Blooms: Apply
market. Segmentation research is then conducted to determine the size of each of these groups
and their demographic or psychographic profiles.
20. _____ refers to a market segmentation approach in which people are grouped into
segments on the basis of research findings, and then, the size of each of these groups and
demographic and psychographic profiles are determined.
a. Post hoc segmentation
b. Empirical segmentation
c. Benefit segmentation
d. Psychographic segmentation
Answer: a
Blooms: Remember
AACSB: Analytic
on the basis of research findings. The size of each of these groups and their demographic and
psychographic profiles are then determined.
21. A company is entering the deodorant market. Its marketing manager decides that the
market should be divided on the basis of whether the consumers are nonusers, light users, or
heavy users of deodorants. Which of the following approaches to segmentation is the
company using?
a. A priori segmentation
b. Empirical segmentation
c. Post hoc segmentation
d. A posteriori segmentation
Answer: a
Blooms: Apply
5-9

market. Segmentation research is then conducted to determine the size of each of the groups
and their demographic or psychographic profiles.
22. An entrepreneur has developed a self-service soda-bottling machine. Customers can fill
their own plastic soda bottles with 18 regular and diet flavors by placing empty bottles under
a nozzle, depositing coin and punching a series of buttons. The machine dispenses the
requested soda and a bar-coded dietary information sticker, which the customer places on the
bottle. The entrepreneur must now determine where to locate the machines by studying the
market and then grouping outlets on the basis of her research findings. This is an example of
the _____ segmentation approach.
a. psychographic segmentation
b. a priori segmentation
c. mass market segmentation
d. post hoc segmentation
Answer: d
Blooms: Apply
on the basis of research findings. In the case of segmentation for entirely new products, a post
hoc approach may be useful for determining key market dimensions.
23. Chewies has been a favorite candy for many Southerners for years. The caramel, peanut,
marshmallow and chocolate confectionaries are distributed through retail outlets in the South-
Eastern regions of America. Its manufacturers recently started selling the candy through
certain mail-order catalogs. Through previous research and experience, the marketing
managers were able to use the _____ segmentation approach to gather information that would
help determine the appropriate target groups for the mail-order catalogs for Chewies.
a. a priori
b. a posteriori
c. post hoc
d. mass market
Answer: a
Blooms: Apply
Explanation: If through previous research and experience a marketing manager has
successfully isolated a number of key market dimensions, then a priori approach based on
them may provide more useful information.
5-10
24. World Explorer Cruises advertises that it sells "Cruises for your heart, mind and soul.
Even better, it comes in a pint-sized budget!" What segmentation is the cruise line using?
a. Demographic segmentation
b. Mass market segmentation
c. Geographic segmentation
d. Benefit segmentation
Answer: d
Blooms: Apply
Explanation: The most market-oriented approach to segmentation is on the basis of what
benefits the potential consumer is seeking. Benefit segmentation is such an approach that
seeks to identify consumer needs and wants and to satisfy them by providing products and
services with the desired benefits.
25. What are the two commonly used approaches for segmenting markets?
a. Benefit segmentation and psychographic segmentation
b. Advertising segmentation and financial segmentation
c. Nonprofit segmentation and profit segmentation
d. Mass marketing segmentation and geodemographic segmentation
Answer: a
Blooms: Remember
AACSB: Analytic
Explanation: Two commonly used approaches for segmenting markets include benefit
segmentation and psychographic segmentation.
26. What does psychographic segmentation focus on?

a. Organizational strengths
b. Quantitative research
c. Test marketing
d. Consumer lifestyles
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: Psychographic segmentation focuses on consumer lifestyles. Lifestyles are
measured by asking consumers about their activities (work, hobbies, vacations), interests
(family, job, community), and opinions (about social issues, politics, business).
5-11
27. Benefit segmentation is clearly a _____.

a. technology-oriented approach
b. production-oriented approach
c. market-oriented approach
d. mass marketing approach
Answer: c
Blooms: Remember
AACSB: Analytic
Explanation: Benefit segmentation is clearly a market-oriented approach that seeks to identify
consumer needs and wants and to satisfy them by providing products and services with the
desired benefits. The most market-oriented approach to segmentation is on the basis of what
benefits the potential consumer is seeking.
28. “The Greedy Hand” is a book on the U.S. income tax system. Its publisher has targeted
the book at people who hold Libertarian political beliefs and who listen to conservative radio
talk shows. The publisher has used _____ segmentation in this scenario.
a. mass market
b. post hoc
c. psychographic
d. geodemographic
Answer: c
Blooms: Apply
Explanation: Psychographic segmentation focuses on consumer lifestyles. Among other
things, lifestyles are measured by asking consumers about their activities and opinions (about
social issues, politics and business).
29. Which of the following statements about psychographic segmentation is true?

a. Psychographic segmentation is a form of benefit segmentation.
b. Psychographic segmentation typically follows the a priori model of segmentation.
c. Psychographic segmentation focuses exclusively on the benefits sought by the consumer.
d. Psychographic segmentation focuses on consumer lifestyles, activities, and interests.
Answer: d
Blooms: Understand
AACSB: Analytic
Explanation: Psychographic segmentation focuses on consumer lifestyles. Lifestyles are
measured by asking consumers about their activities (work, hobbies, vacations), interests
(family, job, community), and opinions (about social issues, politics, business).
5-12
30. Vet Meds is the pharmaceutical branch of a large medical research centre for animals. Vet
Meds often conducts surveys at veterinary hospitals and private clinics for animals to identify
potential areas for improvisation and growth. The company noted that many domestic pet-
owners reported finding it extremely difficult to give their dogs oral medications owing to the
bitter taste of the medicines, which remained even when the medicines were mixed with food.
In response to this finding, Vet Meds released oral medicines for dogs which came in various
meat flavors. Vet Meds used which of the following segmentation approaches to satisfy
consumer needs?
a. Benefit segmentation
b. Psychographic segmentation
c. A priori segmentation
d. Social segmentation
Answer: a
Blooms: Apply
Explanation: Benefit segmentation is clearly a market-oriented approach to segmentation that
seeks to identify consumer needs and wants and to satisfy them by providing products and
services with the desired benefits.
31. Which of the following is the most market-oriented approach to segmentation?

a. Segmentation based on social class
b. Segmentation based on different customer lifestyles and purchasing habits
c. Segmentation based on geographic area
d. Segmentation based on the benefits that potential customers are seeking
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: The most market-oriented approach to segmentation is on the basis of what
benefits the potential consumer is seeking. Thus, consideration and research of sought
benefits are a strongly recommended approach in the marketing literature.
32. Which of the approaches to market segmentation is highly consistent with the approach to
marketing suggested by the marketing concept?
a. Geodemographic segmentation
d. Social segmentation
Answer: c
Blooms: Remember
AACSB: Analytic
5-13

Explanation: Benefit segmentation is clearly a market-oriented approach that seeks to identify
consumer needs and wants and to satisfy them by providing products and services with the
desired benefits. It is clearly very consistent with the approach to marketing suggested by the
marketing concept.
33. How are consumer lifestyles measured during psychographic segmentation?

a. Consumers are asked about their health and known medical conditions
b. Consumers are asked about their activities, interests, and opinions
c. Consumers are asked to rate products in terms of the benefits they offer
d. Consumers are asked to list the types of product features that they want
Answer: b
Blooms: Remember
AACSB: Analytic
Explanation: Whereas benefit segmentation focuses on the benefits sought by the consumer,
psychographic segmentation focuses on consumer lifestyles. Lifestyles are measured by
asking consumers about their activities (work, hobbies, vacations), interests (family, job,
community), and opinions (about social issues, politics, business).
34. Altron Herbals is trying to market a new sunscreen lotion. In order to find out which
segment of the market they should target, they have prepared a questionnaire that asks
potential consumers about lifestyles, especially their activities, interests, and opinions. Based
on their answers, the consumers are grouped into separate categories. Which of the following
market segmentation approaches has Altron used in this scenario?
a. A priori segmentation
c. Social segmentation
d. Geographic segmentation
Answer: b
Blooms: Apply
Explanation: Psychographic segmentation focuses on consumer lifestyles as the basis for
segmentation. Consumers are asked a variety of questions about their lifestyles (commonly,
their activities, interests, and opinions) and then grouped on the basis of the similarity of their
responses.
5-14
35. What does “VALS” stand for?

a. Values and Linkages
b. Values and Lifestyles
c. Values and Liabilities
d. Values and Leverage
Answer: b
Blooms: Remember
AACSB: Analytic
Explanation: The best-known psychographic segmentation is called VALS™ which stands for
“values and lifestyles.” Originally developed in the 1970s, it has been redone several times to
enhance its ability to explain changing lifestyles and predict consumer behavior.
36. The best-known psychographic segmentation called _____,was originally developed in

the 1970s.
a. AIO
b. VALS
c. ZIP
d. PRIZM
Answer: b
Blooms: Remember
AACSB: Analytic
Explanation: The best-known psychographic segmentation is called VALS™ which stands for
“values and lifestyles.” Originally developed in the 1970s, it has been redone several times to
enhance its ability to explain changing lifestyles and predict consumer behavior.
37. The _____ of the VALS™ framework segments people based on the degree to which they
are innovative and have requisite resources.
a. horizontal dimension
b. social groups
c. vertical dimension
d. primary motivation dimension
Answer: c
Blooms: Remember
AACSB: Analytic
Explanation: The vertical dimension of the VALS™ framework segments people based on the
degree to which they are innovative and have resources.
5-15
38. Thinkers, according to the VALS™ model, are motivated primarily by _____.
a. self-expression
b. ideals
c. achievement
d. image
Answer: b
Blooms: Remember
AACSB: Analytic
Explanation: Consumers driven by knowledge and principles are motivated primarily by
ideals. These consumers include the thinkers and believers groups.
39. According to the VALS™ framework, the _____ are consumers who are change leaders
and are most receptive to new ideas and technologies.
a. innovators
b. survivors
c. thinkers
d. believers
Answer: a
Blooms: Remember
AACSB: Analytic
Refer to: Fig. 5.4
Explanation: According to the VALS™ framework, innovators are change leaders and are the
most receptive to new ideas and technologies. They are very active consumers, and their
purchases reflect cultivated tastes for upscale, niche products and services.
40. According to the VALS™ framework, consumers who are classified as _____ are
predictable and they choose familiar products and established brands.
a. strivers
b. makers
c. believers
d. survivors
Answer: c
Blooms: Remember
AACSB: Analytic
Refer to: Fig. 5.4
Explanation: According to the VALS™ framework, consumers who are classified as makers
are predictable; they choose familiar products and established brands.
5-16
41. According to the VALS™ framework, consumers who are driven by a goal of
demonstrating success to their peers and are motivated primarily by achievement can be best
classified as _____.
a. strivers
b. makers
c. believers
d. survivors
Answer: a
Blooms: Remember
AACSB: Analytic
Explanation: Consumers who are driven by a goal of demonstrating success to their peers and
are motivated primarily by achievement are categorized as strivers and achievers.
42. What does the horizontal dimension of the VALS™ framework represent?
a. Secondary needs
b. Resources
c. Consumer needs
d. Primary motivation
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: According to VALS™, the main dimensions of the segmentation framework are
primary motivation (the horizontal dimension) and resources (the vertical dimension).
43. According to the VALS™ framework, consumers driven by knowledge and principles are
motivated primarily by _____.
a. ideals
b. achievement
c. self-expression
d. success
Answer: a
Blooms: Remember
AACSB: Analytic
Explanation: According to the VALS™ framework, consumers driven by knowledge and
principles are motivated primarily by ideals. These consumers include the thinkers and
believers groups.
5-17
44. Johnson & Coleman has created a new line of premium quality writing desks. The desks
are being marketed to consumers who value knowledge and principles. According to the
VALS™, which of the following psychographic groups would the writing desk appeal to the
most?
a. Achievers
b. Strivers
c. Experiencers
d. Thinkers
Answer: d
Blooms: Apply
Refer to: Fog. 5.4
Explanation: The VALS™ framework has eight psychographic groups arranged in a rectangle
based on two dimensions. Thinkers are conservative, practical consumers; they look for
durability, functionality, and value in the products they buy.
45. Dawson & Peters’ new line of leather boots are marketed as the hottest fashion trend of
the season. The company put up posters on billboards that featured several celebrities wearing
the boots. The concept of the television ads was how wearing the boots could make you the
envy of all those around you. According to the VALS™ framework, which of the following
psychographic groups was Dawson & Peters targeting?
a. Survivors
b. Strivers
c. Thinkers
d. Makers
Answer: b
Blooms: Apply
Explanation: Consumers who are driven by a goal of demonstrating success to their peers and
are motivated primarily by achievement are categorized as strivers and achievers.
46. Bill is a carpenter who loves his job. Even when he is not working, he spends his time
designing and building furniture and bookshelves for his own home. While not thrifty, Bill
does not care much for material possessions and considers his job to be an act of self-
expression, rather than a mere occupation. According to the VALS™ framework, which of
the following psychographic groups does Bill belong to?
a. Strivers
b. Achievers
c. Makers
d. Survivors
Answer: c
5-18

Blooms: Apply
Explanation: Consumers driven by a desire for social or physical activity, variety, and risk
taking are motivated primarily by self-expression. These consumers include both the
experiencers and makers.
47. According to the VALS™ framework, consumers categorized as experiences and makers
are motivated primarily by _____.
a. ideals
b. achievement
c. role models
d. self-expression
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: According to the VALS™ framework, consumers driven by a desire for social
or physical activity, variety, and risk taking are motivated primarily by self-expression. These
consumers include both the experiencers and makers.
48. The 2002 promotional campaign for a line of cruises by Celebration emphasized the
various activities, such as hang gliding, mountaineering, hiking, and scuba diving that people
taking any of the Celebration cruises could participate in. The cruise line was trying to dispel
the misconception that cruises are boring and meant only for older and more conservative
people. Which of the following categories of consumers, according to the VALS™
framework, would Celebration’s advertisements appeal to the most?
a. Survivors
b. Believers
c. Experiencers
d. Thinkers
Answer: c
Blooms: Apply
Explanation: According to the VALS™ framework, consumers driven by a desire for social
or physical activity, variety, and risk taking are motivated primarily by self-expression. These
consumers include both the experiencers and makers.
5-19
49. According to the VALS™ framework, consumers driven by a desire for social or physical
activity, variety, and risk taking are motivated primarily by _____.
a. ideals
b. achievements
c. self-expression
d. self-motivation
Answer: c
Blooms: Remember
AACSB: Analytic
Explanation: Consumers driven by a desire for social or physical activity, variety and risk
taking are motivated primarily by self-expression.
50. According to the VALS™ framework, which of the following psychographic groups may
be motivated by any of the three motivations of achievement, self-expression, and ideals?
a. Innovators
b. Survivor
c. Achiever
d. Striver
Answer: a
Blooms: Remember
AACSB: Analytic
Explanation: The VALS™ framework has eight psychographic groups arranged in a rectangle
based on two dimensions. Innovators have such high resources and they may express any of
the three motivations.
51. According to VALS™, _____ are the type of consumers that have few resources, are
more concerned with safety and security, and do not show a very strong primary motivation.
a. achievers
b. strivers
c. makers
d. survivors
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: Survivors have few resources with which to cope, live complacently and within
their means without a strong primary motivation.
5-20
52. _____ refers to an approach that identifies specific households in a market by focusing on
local neighborhood geography (such as zip codes) to create classifications of actual,
addressable, mappable neighborhoods where consumers live and shop.
a. Psychographic segmentation
b. Social segmentation
d. Geodemographic segmentation
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: Geodemographic segmentation refers to an approach that identifies specific
households in a market by focusing on local neighborhood geography (such as zip codes) to
create classifications of actual, addressable, mappable neighborhoods where consumers live
and shop.
53. Which of the following describes the function of geodemographic segmentation?

a. It stresses the belief that the benefits people are seeking in consuming a given product are
the basic reasons for the existence of true market segments
b. It identifies the specific households in a market, by focusing on local neighborhood
geography and creates classifications of neighborhoods where people live and shop.
c. It determines the type of lifestyles that consumers have by asking them about their
activities, interests and opinions.
d. It identifies the consumers’ primary motivations and whether they are driven by ideals,
achievement, and/or self-expression.
Answer: b
Blooms: Remember
AACSB: Analytic
Explanation: Geodemographic segmentation identifies specific households in a market by
focusing on local neighborhood geography (such as zip codes) to create classifications of
actual, addressable, mappable neighborhoods where people live and shop.
5-21
54. The Hector & Gable Corporation conducted a research study that found that vacuum
brick-packs of coffee sell much better in the urban uptown than coffee that is canned. As a
result, Hector & Gable repackaged their Danver brand of coffee for the urban uptown and
developed an advertising campaign to market them to the region. Sales of Danver coffee in
this region were found to have increased by 32 percent. In this example, Hector & Gable used
_____ segmentation to market its coffee.
a. mass marketing
b. psychographic
c. person/situation
d. geodemographic
Answer: d
Blooms: Apply
actual, addressable, mappable neighborhoods where people live and shop.
55. Let's say you wanted to build a bowling alley in Canada. Market research shows that
western Canadians enjoy bowling and similar pastimes significantly more than those in
eastern Canada. By locating your alley in the western province of Alberta, you would have
used a _____ segmentation strategy.
a. post hoc
b. mass market
c. psychographic
d. geodemographic
Answer: d
Blooms: Apply
actual, addressable, mappable neighborhoods where consumers live and shop.
56. Which of the following observations about geodemographic segmentation is true?

a. It identifies specific individuals or households within a market.
b. It creates classifications of actual, addressable, mappable neighborhoods where consumers
live and shop.
c. It is primarily based on the assumption that consumers in a particular neighborhood vary in
many respects and lack similar consumption patterns.
d. It identifies consumer needs and wants in new markets and for new products as existing
markets are saturated.
Answer: b
5-22

Blooms: Understand
AACSB: Analytic
actual, addressable, mappable neighborhoods where consumers live and shop.
57. What is the function of the Nielsen PRIZM?

a. It is a system that provides studies enabling clients to understand and improve the position
of their technology, brands, products, media, or channels.
b. It is a form of psychographic segmentation that classifies consumers according to their
lifestyles and predicted behavior.
c. It is a form of geodemographic segmentation that classifies every U.S. neighborhood into
one of 14 groups.
d. It is a type of mass marketing strategy based on the benefits that consumers want from the
products they purchase.
Answer: c
Blooms: Remember
AACSB: Analytic
Explanation: One geodemographic system, is called Nielsen PRIZM, which stands for
consumers “Potential Ranking Index of ZIP Markets.” The system classifies every U.S.
neighborhood into one of 14 groups.
58. What assumption is the Nielsen PRIZM system based on?

a. Consumer lifestyles remain constant throughout different geodemographic segments of
consumers, making geodemographic segmentation less effective.
b. Consumers in particular neighborhoods are similar in many respects and the best prospects
are those who actually use a product or other consumers like them.
c. Implementation and control of the marketing plan requires segmentation based on
psychographic lines.
d. Achievement-oriented targets need to be made in order to increase sales of an organization.
Answer: b
Blooms: Remember
AACSB: Analytic
Explanation: The Nielsen PRIZM system is based on the assumptions that consumers in
particular neighborhoods are similar in many respects and that the best prospects are those
who actually use a product or other consumers like them.
5-23
59. The Nielsen PRIZM system includes maps of different areas that:
a. rank neighborhoods on their potential to purchase specific products or services.
b. group consumers in particular countries that are similar in many respects.
c. help implement and control the strategic plan of that area.
d. are used for providing slotting allowances to retailers.
Answer: a
Blooms: Remember
AACSB: Analytic
Explanation: The PRIZM system includes maps of different areas that rank neighborhoods on
their potential to purchase specific products and services. The PRIZM segmentation is
available on major marketing databases from leading providers.
60. Which of the following steps would a company undertake after it has determined the basic
segments of the market that could potentially be satisfied with its product?
a. Developing the product positioning plan
b. Deciding the segmentation strategy
c. Designing the marketing mix strategy
d. Determining the product mix
Answer: a
Topic: Develop Product Positioning
Blooms: Remember
AACSB: Analytic
Explanation: Once the firm has a good idea of the basic segments of the market that could
potentially be satisfied with its product, the next step is concerned with positioning the
product favorably in the minds of customers relative to competitive products.
61. Identify the step in the market segmentation process that involves focusing on a product’s
superiority to competitive products based on one or more attributes.
a. Determining the consumer needs and wants
b. Deciding the segmentation strategy
c. Designing the marketing mix strategy
d. Developing the product positioning plan
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: After dividing markets in relevant dimensions the product must be positioned
favorably in the minds of customers relative to competitive products. Products can be
positioned by focusing on their superiority to competitive products based on one or more
attributes.
5-24
62. EasyClean vacuum cleaners used the slogan: "Anything else is a compromise." The
manufacturer of EasyClean vacuum cleaners uses positioning:
a. based on superiority to competitive products.
b. in terms of use or application.
c. in terms of particular types of product users.
d. relative to a product class.
Answer: a
Blooms: Apply
Explanation: Product positioning involves positioning the product favorably in the minds of
customers relative to competitive products. Products can be positioned by focusing on their
63. The ad for Concordia kitchen cabinets states, “For an exceptional look in cabinetry that
you won’t find anywhere else, buy Concordia cabinets.” This is an example of positioning:
b. in terms of superior product users.
c. based on being a cost-leader in the market.
d. relative to a product class.
Answer: a
Blooms: Apply
customers relative to competitive products. Products can be positioned by focusing on their
64. HealthPro cereal ads show the cereal being used as a topping on yogurt, served hot as an
alternative to oatmeal, and as a snack food when topped with honey. HealthPro is using a
positioning strategy based on:
a. superiority to competitive products.
b. the product’s superiority over a particular competing brand.
c. particular types of product users.
d. use or application.
Answer: d
Blooms: Apply
customers relative to competitive products. Products can be positioned by use or application.
5-25
65. Clear Spring is a brand of bottled that is marketed as a much better product than Cool
Blue, which is a competing brand of bottled water. The Clear Spring brand of bottled water is
positioned:
a. by use or application.
b. in terms of particular types of product users.
c. relative to a product class.
d. directly against a particular competitor.
Answer: d
Blooms: Apply
customers relative to competitive products. Products can be positioned directly against
particular competitors.
66. Danko, Inc. has manufactured a new line of wristwatches that can withstand extreme
conditions, such as below freezing temperatures. The watches are also waterproof and heat-
resistant. The company is marketing these watches specifically to adventurers and extreme
sports enthusiasts, such as mountain climbers and scuba divers. Danko positioned their line of
wristwatches:
a. in terms of particular types of product users.
b. in terms of superiority to competing products.
c. relative to a particular product class.
d. directly against a particular competitor.
Answer: a
Blooms: Apply
Explanation: The development of product positioning involves positioning the product
favorably in the minds of customers relative to competitive products. Products can be
positioned in terms of particular types of product users.
5-26
67. An advertisement for First Union Bank describes the bank as not only providing all
banking services a consumer could ever want, but also offering brokerage house services.
Instead of just competing against banks, First Union increased its versatility by positioning its
services:
b. in terms of particular types of service users.
c. relative to a class of products or services.
d. in terms of its position as a cost leader.
Answer: c
Blooms: Apply
customers relative to competitive products. Products can be positioned relative to a product
class.
68. While churches are still places for traditional religious ceremonies and training, some
churches are trying to reach new segments of the population by offering music-based services,
youth-led services, and televised services. Churches are using positioning:
b. in terms of superior product users.
c. relative to the position of their competitors.
d. by use or application.
Answer: d
Blooms: Apply
customers relative to competitive products. Products can be positioned by use or application.
5-27
69. Imagine that you work for K-Swiss athletic shoes manufacturers. You want to know how
consumers perceive K-Swiss shoes when compared to all other athletic shoes currently in the
market. A survey is developed and administered and it indicates that the important attributes
consumers looked for in athletic shoes included price, durability, fit, and support. By using a
_____, you could determine how K-Swiss ranks against other brands like Nike and Adidas.
a. perceptual map
b. product mix
c. positioning map
d. competitive chart
Answer: c
Blooms: Apply
Explanation: One way to investigate how to position a product is by using a positioning map,
which is a visual depiction of customer perceptions of competitive products, brands or
models. It is constructed by surveying customers about various product attributes and
developing dimensions and a graph indicating the relative position of competitors.
70. Which of the following statements is true with regard to a positioning map?
a. It is a mathematical estimate of the rate at which new products will have to be developed to
maintain control over the market share.
b. It is a written document outlining the marketing research study that was undertaken before
the launch of a new product.
c. It is a type of documentation used by the U.S. Department of Commerce to create a
geodemographic model of the nation.
d. It is a visual description of customers' perceptions of competitive products, brands, or
models.
Answer: d
Blooms: Remember
AACSB: Analytic
5-28
71. A positioning map is:

a. constructed by surveying customers about various product attributes and developing
dimensions and a graph indicating the relative position of competitors.
b. used solely with benefit segmentation and includes an assessment of lifestyle choices based
on activities, interests, and opinions.
c. implemented when marketers want to differentiate between the Young Digerati,
Cosmopolitans, and American dreams.
d. an indication of the number of experiencers and strivers within a geographic area based on
PRIZM analysis.
Answer: a
Blooms: Remember
AACSB: Analytic
72. Why is it inadvisable for a follower to attempt to directly position their product against the
industry leader?
a. Competing with market leaders can be costly and not often successful
b. A follower’s product already dominates in sales and in the minds of customers
c. Followers find it difficult to select segmentation strategies
d. A follower can never compete with the industry leader in terms of product quality
Answer: a
Blooms: Understand
AACSB: Analytic
Explanation: Some experts argue that different positioning strategies should be used
depending on whether the firm is a market leader or follower, and that followers usually
should not attempt to position directly against the industry leader. A smaller or less desirable
target market may have to be selected since competing with market leaders is costly and not
often successful.
73. In which of the following situations is it appropriate for a firm to become a mass
marketer?
a. The market is large and consists of several segments that are almost equal in size.
b. Heavy users make up such a large proportion of the sales volume that they are the only
relevant target.
c. The largest segment is composed of light users, and hence, targeting them would yield the
highest profits for the firm.
d. Potential consumers constitute such a small group that they don’t form a meaningful
segment.
5-29
Answer: b
Topic: Decide Segmentation Strategy
Blooms: Remember
AACSB: Analytic
Explanation: Under certain situations, it is appropriate for the firm to become a mass
marketer. One such situation is when heavy users make up such a large proportion of the sales
volume that they are the only relevant target.
74. In which of the following stages does a firm decide not to enter the market after
conducting a suitable analysis of the viability of the market?
a. Developing product positioning
b. Dividing the market on relevant dimensions
c. Determining consumer needs and wants
d. Deciding the segmentation strategy
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: When deciding which segmentation strategy to use, four basic alternatives are
available to the firm. During this step the firm may decide not to enter the market.
75. Gable Brothers, Inc. is trying to find viable market for its new brand fountain pen. After
conducting a psychographic segmentation, it found that the segment of potential consumers is
so small that the volume in sales would not be profitable for the company. Therefore, top
management has decided to not release the product into the market. Which of the following
stages of the market segmentation process is the company currently in?
a. Deciding market segmentation strategy
b. Delineating the firm’s current situation
d. Determining consumer needs and wants
Answer: a
Blooms: Apply
Explanation: When deciding which segmentation strategy to use a, four basic alternatives are
available to the firm. During this step the firm may decide not to enter the market.
5-30
76. Three important criteria on which to base a segmentation strategy decision are that a
viable segment must be:
a. continual, presentable, and restricted.
b. measurable, meaningful, and marketable.
c. political, cultural, and assured.
d. prestigious, non-deceptive, and demographic.
Answer: b
Blooms: Remember
AACSB: Analytic
Explanation: A firm must have some criteria on which to base its segmentation strategy
decisions. Three important criteria on which to base segmentation strategy decisions are that a
viable segment must be measurable, meaningful, and marketable.
77. For a segment to be measurable, the firm must be able to measure its:
a. homogeneous preferences.
b. size and characteristics.
c. postpurchase satisfaction.
d. potential for test marketing.
Answer: b
Blooms: Remember
AACSB: Analytic
Explanation: Three important criteria on which to base segmentation strategy decisions are
that a viable segment must be measurable, meaningful, and marketable. For a segment to be
selected, the firm must be capable of measuring its size and characteristics.
78. A meaningful segment is one that:

a. is large enough to offer long-run profits for the firm.
b. has a well-defined geodemographic profile.
c. can be reached and served by direct marketers in an efficient manner.
d. is driven by the desire for instant gratification.
Answer: a
Blooms: Remember
AACSB: Analytic
Explanation: Three important criteria on which to base segmentation strategy decisions are
that a viable segment must be measurable, meaningful, and marketable. A meaningful
segment is one that is large enough to have sufficient sales and growth potential to offer long-
run profits for the firm.
5-31
79. What is a marketable segment?

a. A firm that is large enough to have some sales and growth potential and involves no
competitors
b. A segment that includes innovators in high proportion along with containing few survivors
c. A firm that has good customer-relationship and employs at least one form of quality
assurance
d. A segment that can be reached and served by the firm in an efficient manner.
Answer: d
Blooms: Remember
AACSB: Analytic
Explanation: A marketable segment is one that can be reached and served by the firm in an
efficient manner.
80. Which of the following is the last stage of the market segmentation process?
a. Delineating the firm’s current situation
b. Deciding the marketing mix strategy
d. Developing product positioning
Answer: b
Topic: Design Marketing Mix Strategy
Blooms: Remember
AACSB: Analytic
Explanation: To complete its marketing plan the firm must finalize the marketing mix or
mixes to be used for each segment. Selection of the target market and designing the marketing
mix go hand in hand.
5-32

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Chapter 05 - Market Segmentation

Marketing Management 11th Edition Peter Test Bank

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Multiple Choice Questions

5. Which of the following constitutes a viable market segment?

6. Which of the following statements about market segmentation is true?

9. When embarking on a new or modified marketing program, a company should conduct

16. Which of the following statements about market segmentation is true?

AACSB: Reflective Thinking

26. What does psychographic segmentation focus on?

27. Benefit segmentation is clearly a _____.

29. Which of the following statements about psychographic segmentation is true?

31. Which of the following is the most market-oriented approach to segmentation?

Level of Difficulty: Easy

33. How are consumer lifestyles measured during psychographic segmentation?

35. What does “VALS” stand for?

36. The best-known psychographic segmentation called _____,was originally developed in

Topic: Divide Markets on Relevant Dimensions

53. Which of the following describes the function of geodemographic segmentation?

56. Which of the following observations about geodemographic segmentation is true?

Topic: Divide Markets on Relevant Demands

57. What is the function of the Nielsen PRIZM?

58. What assumption is the Nielsen PRIZM system based on?

71. A positioning map is:

78. A meaningful segment is one that:

79. What is a marketable segment?

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