Strategic Marketing Segmentation, Business and Finance homework help

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IMPORTANT NOTE: The questions must be address in its full context. These questions are an opportunity to go outside the box to demonstrate your analytical, integrative, problem- solving and critical thinking skills using the knowledge acquired in your readings. As a result, it is very important to pay close attention to the questions and be able to conduct your discussions in the context of your question.  – Please keep this in mind when you complete this assignment.

You must expand your ideas further. Analysis must be deep and very instructive.

ANSWER THE FOLLOWING QUESTIONS. Each question should be answered in at least 300 words. Quality of content and use of course and outside-of-course resources to support your position or analysis. The answers should not be in the form of essay, just straight to the point- Work must be original and cite your sources.

Please be sure to answer the question completely but specifically in well-written complete sentences. 

Use the attached lecture to help you answer these questions, and conduct your own research Lecture.docx

Chapter 3 - Strategic Marketing Segmentation

Competing in the single European market raises some interesting market segment questions. Discuss the segmentation issues regarding this multiple-country market.

Chapter 4 - Strategic Customer Management: Systems, Ethics, and Corporate Social Responsibility

Discuss the value of considering CRM at different organizational levels.


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Chapter 3 - Strategic Market Segmentation Decision makers face renewed dilemmas in making segmentation choices, driven by escalating market complexity and turbulence. Many traditional assumptions about markets are becoming obsolete. Clinging to inaccurate assumptions that markets are simple and stable is likely to critically undermine the ability of an organization to develop and implement effective marketdriven strategy. This unit, we will explore the role of market segmentation in marketing strategy, followed by a discussion of the variables used to identify segments. Next, we will explain the methods for forming segments, followed by a review of high-variety strategies. Finally, we will consider the issues and guidelines involved in selecting the segmentation strategy and its implementation. The purpose of this chapter is to familiarize the student with market segmentation. To get started, please read Chapter 3, Strategic Market Segmentation in order to understand the concepts that we will be discussing. Levels and Types of Market Segmentation Segmentation is an important tool in strategic marketing, which is linked to choosing market targets and positioning against alternatives to build competitive advantage. Importantly, segmentation may serve several purposes at levels which range from the strategic to operational. Many traditional views emphasize segmentation as an operational tool-for instance, to aim advertising effectively at different types of customers. However, segmentation models appropriate to developing advertising programs may be quite different to those used to develop marketing strategy. While advertising-oriented segmentation aims to identify targets that differ in their responses to a given message, strategic segmentation has the goal of identifying market segments that differ in their purchasing power, goals, aspirations and behavior, in ways relevant to identifying new product and value opportunities. It is useful to examine segmentation as operating at several decision-making levels in the way suggested by Exhibit 3.1 (page 74). Strategic segmentation links to the management vision and strategic intent of corporate strategy, and emphasizes product benefits that different types of buyers seek. Managerial segmentation is concerned with allocating resources around segment targets, including them in marketing plans, and aligning organizational processes around them. Operational segmentation issues are concerned with the marketing program changes needed to reach segment targets with advertising and promotions, and with distribution systems. Market-Driven Strategy and Segmentation Market segmentation needs to be considered early in the development of market-driven strategy. Segments are identified; customer value opportunities and new market spaces are explored in each segment, organizational capabilities are matched to promising segment opportunities, market target(s) are selected from the segment(s) of interest, and a positioning strategy is developed and implemented for each market target Exhibit 3.2 (page 74). Thus, market segmentation is the process of placing the buyers in a product-market into subgroups so that the members of each segment display similar responsiveness to a particular positioning strategy. Buyer similarities are indicated by the amount and frequency of purchase, loyalty to a particular brand, how the product is used, and other measures of responsiveness. Segmentation identifies customer groups within a product-market, each containing buyers with similar value requirements concerning specific product/brand attributes. Market targeting consists of evaluating and selecting one or more segments whose value requirements provide a good match with the organization's capabilities. Companies typically appeal to only a portion of the people or organizations in a product-market, regardless of how many segments are targeted. An important consideration in defining the market to be segmented is estimating the variation in buyer's needs and requirements at the different product-market levels and identifying the types of buyers included in the market. In contemporary markets, boundaries and definitions can change rapidly, underlining the strategic importance of market definition and selection, and the need for frequent reevaluation. Identifying Market Segments One or more variables may be used to divide the product-market into segments. Demographic and psychographic characteristics of buyers are of interest, since this information is available from the U.S. Census reports and many other sources including electronic databases. The characteristics of people fall into two major categories: (1) geographic and demographic, and (2) psychographic (lifestyle and personality). Demographics are often more useful to describe consumer segments after they have been formed rather than to identify them. Demographic variables describe buyers according to their age, income, education, occupation, and many other characteristics. Lifestyle variables indicate what people do, their interests, their opinions, and their buying behavior. Lifestyle characteristics extend beyond demographics and offer a more penetrating description of the consumer. Markets can be segmented based on how the product is used. As an illustration, Nikon, the Japanese camera company, offers a line of high performance sunglasses designed for activities and light conditions when skiing, driving, hiking, flying, shooting, and participating in water sports. For more information on Nikon, click on Nikon (Links to an external site.) http://www.nikondigital.com/index.page (Links to an external site.) Buyers’ Needs, Tastes and Preferences Needs, tastes and preferences that are specific to products and brands can be used as segmentation bases and segment descriptions. Marketing research shows that needs and tastes motivate people to act. Understanding how buyers satisfy their needs provides guidelines for marketing actions. Buyers’ attitudes toward brands are important because experience and research findings indicate that attitudes influence behavior. Perception is defined as "the process by which an individual selects, organizes, and interprets information inputs to create a meaningful picture of the world. Since buying decisions vary in importance and complexity, it is useful to classify them to better understand their characteristics, the products to which they apply, and the marketing strategy implications of each type of purchase behavior. Buyer decisions can be classified according to the extent to which the buyer is involved in the decision. Forming Market Segments An important question is deciding if it is worthwhile to segment a product-market. Determining differences in the responsiveness of the buyers in the product-market to positioning strategies is a key segment identification requirement. It must be possible to identify the customer groups that exhibit response differences and sometimes finding the correct groups may be difficult. Segmentation must be financially attractive in terms of revenues generated and costs incurred. Segments must show adequate stability over time so that the firm's marketing efforts will have enough time to produce favorable results. Segments are formed by: (A) grouping customers using descriptive characteristics and then comparing response differences across the groups, or (B) forming groups based on response differences and determining if the groups can be identified based on differences in their characteristics. By identifying customer groups using descriptive characteristics and comparing them to a measure of customer responsiveness to a marketing mix such as product usage rate, potential segments can be identified. The alternative to selecting customer groups based on descriptive characteristics is to identify groups of buyers by using response differences to form the segments. Chapter 4 - Strategic Customer Management: Systems, Ethics, and Corporate Social Responsibility In this chapter we examine that building effective customer relationships is widely recognized by executives as a high priority business initiative. A study of 960 international executives rated customer relationship management (CRM) and strategic planning highest among 10 priority strategic initiatives for improving organizational performance. So, it is important to learn about the pivotal role of customer relationship management by developing CRM strategies such as value creation process and the CRM and strategic marketing concepts. What is the CRM? CRM is a cross-functional core business process concerned with achieving improved shareholder value through the development of effective relationships with key customers and customer segments. Customer Relationship Management recognizes that customers vary in their economic value to the company; and differ in their expectations toward the firm. Other characteristic is the customer lifetime value. It is also very important to state that the customer lifetime value (CVL) calculates past profit produced by the customer for the firm-the sum of all the margins of all the products purchased over time, less the cost of reaching that customer. Sources: Sridhar N. Ramaswani, Mukesh Bhargava, and Rajendra Srivastava, “Market based Assets and Capabilities, Business Process, and Financial Performance.” MSI Working Paper Series, N0. 04-001, 2004 Developing a CRM Strategy CRM can be viewed from company-wide, customer-facing, and functional levels. Each level has important but different implications for strategic marketing. All three perspectives are important, although the company-wide or strategic level provides the most complete view of CRM. The functional perspective considers the processes that are needed to fulfill required marketing functions. The customer-facing level offers a single view of the customer across all of the organization’s access channels to the customer. This level of CRM is concerned with coordinating information across all contact channels on a continuing basis. The company-wide level provides a strategic focus for CRM. It considers the implications of knowledge about customers and their preferences across the entire company. The intent is to guide the interactions between the organization and its customers in seeking to maximize the lifetime value of customers for the firm. Importantly, the strategic perspective acknowledges that (1) customers vary in their economic value to the company and (2) customers differ in their expectations toward the firm. The strategic use of CRM resources reflects the shift in focus by marketing executives to the customer who delivers long-term profits, that is, an emphasis on customer retention rather than acquisition. As CRM evolves and offers executives deeper insights into their customer base, the new information may challenge strategic assumptions in important ways. Just because a group of customers were profitable in the past, this may not always be true in the future. The following are steps in developing a CRM strategy: • • • • Gain enterprise commitment Build a CRM Project Team Business Needs Analysis Define the CRM Strategy Source: V. Kuman and Werner J. Reinartz, Customer Relationship Management (John Wiley and Sons, Inc.) 2006, 39 Value Creation Process Payne and Frow define the value creation process in CRM as (1) the value the customer receives; and (2) the value the organization receives. Successfully managing the value exchange between the customer and the firm is essential in achieving effective CRM. Continue to read about value creation process on page 113. Source: Payne and Frow, “A Strategic Framework for Customer Relationship Management, 170172 Ethics and Social Responsibility in Strategic Marketing Interest and concerns about ethics and social responsibility are rising rapidly. Large numbers of business organizations throughout the world are directing attention and efforts to these important concerns. In part, the issues are driven by the belief that businesses should behave in an ethical way, because it is the right thing to do, and that they should deliver social benefits as well as meeting their business goals. However, it is also the case that perceptions of a seller’s ethical standing and social contribution can have a direct impact on its attractiveness to customers and their willingness to buy. Ethics and social responsibility questions are increasingly significant to the creation of effective customer relationships, in part because of the impact on corporate reputation; continue your readings from pages 118-127.
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