a method of market segmentation that clusters people in zip code areas and smaller neighborhood units based on lifestyle and demographic information
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Market Segmentation
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the process of dividing a total market into groups with relatively similar product needs to design a marketing mix that matches those needs
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Segmentation Variables
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Characteristics of individuals, groups, or organizations used to divide a market into segments
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Market Potential
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the total amount of a product that customers will purchase within a specified period at a specific level of industrywide marketing activity
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Expert Forecasting Survey
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sales forecasts prepared by experts outside the firm, such as economists, management consultants, advertising executives, or college professors
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Concentrated Targeting Strategy
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a market segmentation strategy in which an organization targets a single market segment using one marketing mix
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Company Sales Potential
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the maximum percentage of market potential that an individual firm within an industry can expect to obtain for a specific product
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Undifferentiated Targeting Strategy
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a strategy in which an organization designs a single marketing mix and directs it at the entire market for a particular product
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Cycle Analysis
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an analysis of sales figures for a three-to-five year period to ascertain whether sales fluctuate in a consistent, periodic manner
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Homogeneous Market
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a market in which a large proportion of customers have similar needs for a product
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Differentiated Targeting Strategy
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a strategy in which an organization targets two or more segments by developing a marketing mix for each segment
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Business Market
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individuals, organizations, or groups that purchase a specific kind of product for resale, direct use in producing other products, or use in general daily operations
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Geographic Variables
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- Region
- Urban, Suburban, Rural
- City Size
- County Size
- State Size
- Market Density
- Climate
- Terrain
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Micromarketing
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an approach to market segmentation in which organizations focus precise marketing efforts on very small geographic markets
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Market Segment
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individuals, groups, or organizations sharing one or more similar characteristics that cause them to have similar product needs
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Market Test
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making a product available to buyers in one or more test areas and measuring purchases and consumer responses to marketing efforts
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Psychographic Variables
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- Personality Attributes
- Motives
- Lifestyles
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Breakdown Approach
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measuring company sales potential based on a general economic forecast for a specific period and the market potential derived from it
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Delphi Technique
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a procedure in which experts create initial forecasts, submit them to the company for averaging, and then refine the forecasts
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Sales Forecast
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the amount a product a company expects to sell during a specific period at a specified level of marketing activities
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Market Density
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the number of potential customers within a unit of land area
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Buildup Approach
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measuring company sales potential by estimating how much of a product a potential buyer in a specific geographic area will purchase in a given period, multiplying the estimate by the number of potential buyers, and adding the totals of all the geographic areas considered.
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Seasonal Analysis
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An analysis of daily, weekly, or monthly sales figures to evaluate the degree to which seasonal factors influence sales
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Customer Forecasting Survey
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a survey of customer regarding the types and quantities of products they intend to buy during a specific period
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Benefit Segmentation
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the division of a market according to benefits that consumers want from the product
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Regression Analysis
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a method of predicting sales based on finding a relationship between past sales and one or more independent variables, such as population or income
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Consumer Market
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purchasers and household members who intend to consume or benefit from the purchased products and do not buy products to make profits.
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Heterogeneous Market
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a market made up of individuals or organizations with diverse needs for products in a specific product class
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Demographic Variables
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- Age
- Gender
- Race
- Ethnicity
- Income
- Education
- Occupation
- Family Size
- Family Life Cycle
- Religion
- Social Class
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Time Series Analysis
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a forecasting method that uses historical sales data to discover patterns in the firm's sales over time and generally involves trend, cycle, seasonal, and random factory analyses
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Sales Force Forecasting Survey
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a survey of a firm's sales force regarding anticipated sales in their territories for a specified period
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Trend Analysis
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an analysis that focuses on aggregate sales data over a period of many years to determine general trends in annual sales
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Behavioristic Variables
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- Volume Usage
- End Use
- Benefit Expectations
- Brand Loyalty
- Price Sensitivity
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Random Factor Analysis
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an analysis attempting to attribute erratic sales variations to random, nonrecurrent events
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Executive Judgement
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a sales forecasting method based on the intuition of one or more executives