Question

Question 3: 10 marks: The CEO of your company has come up through the ranks of production and operations management. You greet him in the lift one morning and he comments that the company profits are down, therefore he expects to see an improvement in sales this month. He says that you, as head of marketing, must get everyone out there to convince the customers to buy the company’s products. His comments concern you because you know that Marketing isn’t only about selling. You decide to request a meeting in which you will briefly explain to the CEO. “What exactly is Marketing and how does it benefit the company?”Limit your answer to a definition of marketing, a description of customer needs, wants and demands, and a brief commentary on what is meant by ‘customer value and satisfaction’.

Question2: 10 marks: Name, provide definition and discuss four major sets of variables that might be used in segmenting consumer markets. Provide an example for each variable

Answer 1

Demographic Variables

It is important to consider demographic characteristics because these help in closely determining the needs and purchasing pattern of consumers, and can be readily measured.

Demographic variables include:

• Age

• Gender

• Race and Ethnicity

• People’s Income and Occupation

• Family life cycle includes marital status and the presence and age of children

• Education

Demographic variables are used for segmenting markets for products such as cuisine, music, books, clothing, and beverages; and for services such as banking and insurance.

Geographic Variables

Geographic variables include:

• Climate

• Terrain

• City size

• Population density

• Urban/rural areas

Geographic variables are used for segmenting markets for products such as heaters and air-conditioners, food, clothing, building material, gardening tools, and recreational products.

Psychographic Variables

Psychographic variables include:

• Personality Attribute

• Lifestyles

• Motives

Psychographic variables are used for segmenting markets for products such as fashion, food, entertainment, technology, education, etc.

Behavioristic Variables

Behavioristic variables include:

• Volume Usage

• Benefit Expectations

• End Use

• Brand Loyalty

• Price Sensitivity

Behavioristic variables are used for segmenting markets for products such as heaters and air-conditioners, food, clothing, building material, gardening tools, and recreational products.

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