Monday, May 2, 2016

Numi Organic Tea

Antecedents of Target Marketing

1.  In the first part of the video, Jen Mullin, the Vice President of Marketing for Numi Organic Tea, clearly describes their typical customer. Using the information on segmentation you learned from reading Chapter 8 in Lamb, et al. (2014), discuss who the customer is and how the Numi marketing team figured that out?

ANSWER: Numi Organic Tea clearly describes a customer that is a female college student that drinks tea.  She loves organic and is predominately a green tea drinker.  She purchases at least 2 to 3 boxes a month. In this description, you can say that Numi Organic Tea uses Demographic segmentation.  “Some common bases of Demographic segmentation are age, gender, income and family lifestyle” ( Lamb et al., 2014).  Numi searches for a particular woman and she is in college.  Through research and the studying of demographics, it helps the Numi marketing team figure out whom to target.  Demographic information is widely available and often related to consumers buying and consuming behavior (Lamb et al.,2014).  This allows the team to be aware of whom is purchasing what and how often.  Also, the information allows them to target the areas or place that these particular consumers buy.  For instance, if demographic information tells me that a woman in her late 20’s that attends school buys tea often, then I know that a target area could be a college campus.  Research can go a long way.  You study and learn your consumers so that you can better serve them and become successful. Without research you have no direction and wouldn’t know which way to go or what the consumer wants.  You have to know schedules, what consumers like and dislike.  Age matters because different age groups prefer different things.  Age also plays a role in income, knowing whether or not the consumer will have enough funds to purchase your product.  All this information is helpful.

2. What is Numi's principle marketing plan? In what way does Numi's marketing team use what they know about their target demographic to implement their marketing plan?

ANSWER:  Numi’s marketing plan consists of targeting their consumers in places or areas that they know their consumers will be.  Numi uses samples believing that the actually taste of the tea will sell the product.  They have samplings in places like the grocery store, colleges and spas.  They know that a young woman has to go grocery shopping and being able to sample a tea while shopping may lead the sampler to buy the product.  “Lifestyles segmentation divides people into groups according to the way they spend their time, the importance of the things around them, their beliefs and socioeconomic characteristics such as income and education” (Lamb et al.,2014).   A lot of the time, even if the product has not been heard of, consumers still are curious, wanting to try the product.  Spas are basically being places of relaxation and this organic tea represents a sense of relaxation.  Their targeted consumer wants new and organic.  They join in a greater cause such as the cancer walk and send out free samples of tea to those consumers that are interested in the same causes.  I agree with the saying if you treat me good, you will get that in return.  Building a relationship with your consumers let the consumer know that you actually care about their wants and interests and not just in it for the money.  Numi team donate for free but also pay for some sampling, as well.  So, there are many ways that Numi’s marketing team use what they know about their target demographic to implement their marketing plan.

Defend Your Answer Challenge: Highlight your multiple choice answer in yellow. Write a 100 (or more) word discussion in defense of your answer to the multiple choice and true/false questions using research from your textbook to help substantiate your understanding of segmentation, target marketing, and positioning. Apply APA style referencing in your writing.  

3) Jen Mullin, the vice president of Marketing for Numi Organic Tea, describes their typical customer as a female, college-educated tea lover, possibly an “eco-mom.” What type of market segmentation has she used to identify this customer group?

a. Geographic segmentation
b. Demographic segmentation
c. Ethnic segmentation
d. Psychographic segmentation     

ANSWER:  Jen Mullin defiantly uses Demographic segmentation.  She is considering gender, age and lifestyle.  She has studied this target and has learned the consumers buying and consuming habits.  Demographics include a wide range of information in detail that is very helpful to Numi’s marketing team.  Just the woman’s age can tell Numi’s team many things such as a considerable income for this woman, or if she may have kids or not and many other things.  This woman’s lifestyle is important and knowing if she has a child or not could be very helpful, as well.  Normally woman that has had children are struggling with weight loss and often tea can be good for many especially if they are substituted soda with tea.

4) Another way Numi Organic Tea identifies potential customers is through what they want from the product; they are looking for organic, fair-trade, premium quality tea, according to the video. What type of market segmentation is used to identify customers in this way?

a. Geographic segmentation
b. Demographic segmentation
c. Benefit segmentation
d. Usage-rate segmentation

ANSWER: “Benefit segmentation is different because it groups potential customers on their needs and wants rather than other characteristics such as age or gender” (Lamb et al.,2014).  Benefit segmentation is about caring about your customers.  For example, the tea could be divided in to Benefit segments such as Soothing & Relaxation, Sliming tea, Energy Tea and more.  You have to be unique as well as the consumers can all be different and have different wants and needs.  If the consumer is feeling great about their purchase, then they will come back.  Customer satisfaction is a key to having regular customers.  Numi’s marketing team go an extra mile and it works.

5) Because Numi Organic Tea has identified more than one target market, for example, “eco-moms,” college students, and family travelers, they should be particularly aware of the ____________________, which helps explain how consumption patterns differ at different stages determined by a combination of age, marital status, and the presence or absence of children.

a. Family life cycle
b. 80/20 principle
c. Undifferentiated targeting strategy
d. Concentrated targeting strategy

ANSWER:  The family life cycle can include many areas.  It can inform you if a woman is single, in college or with child.  It will help target their needs and wants and even what they can afford.  It will help to narrow down how they go about their day.  You can figure out when and how often they spend.  The smallest detail can lead to a whole lot of other questions being answered.  Tea could fit into these consumer’s lifestyles for many different reasons, as everyone is different.  Numi is a premium quality organic tea which can be appealing to a tea lover who seeks quality and can afford it. 

6) The demographic variable that Numi Tea marketers were examining when they recognized that people who had discovered their product at a high-end spa or fine restaurant often shopped for groceries at Costco was _________________________.

a. Age
b. Income
c. Ethnicity
d. Gender

ANSWER:  Instead of tea just being demanded from consumers such as a female college student or eco-mom, the tea is moving up in the market.  It’s now being demanded in high-end spa or fine restaurants which could mean more income.  People that have money to waste would not worry about how much they are spending especially if it’s on a high premium organic product.  The more money you got, the more you can spend on things that you like. Numi’s tea is expanded to different and even mass markets.  Different and mass markets produce more income.  They have achieved their targeted market and more.

7) Numi Tea uses premium ingredients to create a premium tea at an affordable price, according to Jen Mullin. This is a form of ______________________ that the company uses to distinguish their products from those of competitors.

a.  Perceptual mapping
b.  One-to-one marketing
c.  Product differentiation
d.  Market segmentation

ANSWER: “Product differentiation is a positioning strategy that many firms use to distinguish their products from the competitors” (Lamb et al.,2014). In the marketing industry you have to be unique or different in your own way.  You pretty much have to find out what works best for your product.  Although there are other teas that are produced, they are nothing like Numi Tea.  Numi Tea uses premium ingredients to create a premium tea at an affordable price plus they use organic leaves.  There is not another tea that uses the exact ingredients with a combination of organic leaves such as Numi Tea.  Numi Tea has its own product differentiation from others.

8) Which of the following is the least likely targeting strategy that Numi Tea would select to market their products?

a. Undifferentiated targeting
b. Concentrated targeting
c. Multisegment targeting
d. Niche targeting

ANSWER: “Concentrated targeting is a strategy used to select one segment of a market for targeting” (Lamb et al.,2014) which it is clear that Numi Tea targets more than one segment of a market.  Also, the more successful Numi Tea becomes the more their market expands.  This expansion has now opened up major possibilities in the high-end and mass markets.  Numi’s uniqueness has left a great after taste in the mouths of their consumers producing more income and success for Numi’s Tea.  Knowing the right moves to make can be rewarding but making the wrong moves could be costly and concentrated targeting would be not only be the least likely target strategy but the wrong one for Numi to select.

9) When Jen Mullin explains that her company seeks to include their product in gift bags and other promotional giveaways by companies and other organizations, she is recognizing the need to change customers’ perceptions through sampling.

a. True
b. False

ANSWER: I would say that this statement is true because gifts often intrigues the interest of consumers.  I know if I received a gift bag with free samples of Numi Tea and I liked it, it may influence me to buy some.  Promotional giveaways by other companies and organizations shows that Numi Tea is connected to the community and other causes.  Jen Mullin also states that the transition takes place with their tea when the consumer tastes it.  So, gift bags and promotional giveaways are great ways for sampling.  Leaving consumers with a taste of a good thing will bring them back for more.  Yes, perceptions can be changed through sampling.

10) To graphically map the “channel conflict” between marketing Numi Tea to premium spas, hotels, and restaurants and selling the same brand at mass market stores such as Target, the company could employ perceptual mapping.

a. True
b. False

ANSWER:  Perceptual mapping is a means of displaying or graphing, in two or more dimensions, the location of products, brands or groups of products in customer’s minds” (lamb et al.,2014).  They product in the colleges can produce income that differ from the product placed in grocery stores or mass markets such as Target.  As long as Numi can keep everything in order and in control then all channels can be successful.  They may have to sell in bulk at Costco’s and make less nether the less, it is still profit.  Channels may get cross but it can be worked out.

Lamb, C. W., Hair, J. F., & McDaniel, C. (2012). MKTG5. Mason, OH: South-Western, Cengage.

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