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: Market
segmentation is when a market gets divided up into segments that are
meaningful, identifiable and similar.
(Lamb, Hair & McDaniel, 2014).
Market segmentation helps companies to be able to focus their resources
better and make it easier to define marketing objectives (Lamb, Hair &
McDaniel, 2014).
The market segments have to meet four criteria to be successful: substantiality, identifiability and
measurability, accessibility and responsiveness (Lamb, Hair & McDaniel,
2014). Substantiality means that the
market segment created must be big enough for it to make sense to create a
special marketing mix for that particular segment (Lamb, Hair & McDaniel,
2014). Identifiability and measurability
means that it is easy to identify
certain characteristics of the segment and easy to collect and use data
describing the segment and different demographic aspects about it (Lamb, Hair
& McDaniel, 2014). Accessibility
means that the segment that is created should be made up of people who are easy
to make contact with (Lamb, Hair & McDaniel, 2014). Lastly, responsiveness means that separate
marketing mixes should not be created if each segment would respond to one
marketing mix the same (Lamb, Hair & McDaniel, 2014).
Mullin describes the target customer as college-aged females
and young mothers who are interested in the organic aspect of the tea. Numi figured out that their customer was
college-aged females and young mothers by demonstrating sampling to survey
their customer base in a way. Once
people tasted the tea they were more apt to give their true opinions and allowed
Numi to get honest feedback and collect data on who their target customer
is. This allowed them to break down the
market into segments where they could better focus their resources and gain
clear objectives.
ANSWER: Numi’s
principle marketing plan is to target the college-aged females and young
mothers who value the organic aspect of the tea. To target this segment, they involve
themselves in a lot of community events that give back, like breast cancer
fundraisers and things of that sort, that the young mothers and college-aged
females are likely to attend. Numi also
incorporates taste testing into their market strategy to get their customers to
truly try their product, having confidence that once they do, they will really
like it.
Numi likes to partner with restaurants as well that sell
food that is along the lines of their organic tea. They think that if someone asks for a cup of
tea there and they have a large variety and really like it, they will inquire
about the brand and also look into where they can buy more.
Numi is a very high quality tea so their prices are higher
than the average tea. They are an organic
product which makes it more expensive to begin with and also have a variety of
flavors that suit most people’s tastes.
They are becoming the world’s largest brand for organic tea, so they
will not be reducing their prices.
Numi was surprised by how many larger retailers wanted to
partner with them and carry their product as well. They thought because their product was more
expensive than what people are used to paying for tea, that they would not be
accepted at larger retailers like Costco and such, but they found that there is
a huge demand for their product and people really like seeing it on the
shelves.
a. Geographic segmentation
b. Demographic segmentation
c. Ethnic segmentation
d. Psychographic segmentation
ANSWER: Describing
the typical customer as female, college-educated tea lover is using
psychographic segmentation.
Psychographic segmentation is when the market is segmented by using the
whole picture rather than just one aspect or characteristic. Psychographic segmentation incorporates
personality, motives, lifestyle and geodemographics into the segmentation
(Lamb, Hair & McDaniel, 2014). The
personality is the “eco-mom” personality of a female who is concerned about the
environment and like to use organic products.
The motive is also the fact that the female is motivated to do better
for the economy as well as for herself and use eco-friendly products. The lifestyle is a college-educated woman who
is knowledgeable of the product as well as other aspects of the company such as
charitable community involvement.
a. Geographic segmentation
b. Demographic segmentation
c. Benefit segmentation
d. Usage-rate segmentation
ANSWER: Benefit
segmentation is segmenting the market using the benefit the consumer expects to
get out of the product (Lamb, Hair & McDaniel, 2014). Numi segmented their customer base into the
group of people who are looking for the benefit of an organic product which is
that the product is good for the environment and good for the consumer’s
health. Consumers of Numi also want tea
that is of better quality than most teas out there so they are willing to pay a
higher price for it. Numi consumers also
want the tea that they buy to be fair-trade meaning that it is reasonably
priced and the benefits are of equal value to the consumer.
a. Family life cycle
b. 80/20 principle
c. Undifferentiated targeting
strategy
d. Concentrated targeting strategy
ANSWER: Family life cycle segmentation is a series of
family stages that incorporate a combination of age, the presence or absence of
children and the marital status of individuals (Lamb, Hair & McDaniel,
2014). It is really important or Numi to
pay particular attention to the family life cycle segmentation because as
things change in people’s lives, their tastes and outlook on products may
change as well. For instance, if someone
was buying the tea as a college student from their college café and then they
graduate, get married, and have children, they might not have money to buy
premium quality tea anymore and may have to settle for regular commodity
tea.
a. Age
b. Income
c. Ethnicity
d. Gender
ANSWER: The CEO of Numi was very shocked to find out
that the customers Numi was targeting at the high-end spas and fine restaurants
were also shopping at Costco. They
realized that the consumer who would be going to high-end spas and fine
restaurants shopped at Costco to save on packaging costs to buy groceries in
bulk rather than paying for packaging to buy less of the product. There was no real income difference in the
customer because they were the same customer, just visiting very different
places. This makes it easy for Numi to
not have to create another plan for another segment of customers.
a. Perceptual mapping
b. One-to-one marketing
c. Product differentiation
d. Market segmentation
ANSWER: Product differentiation is what a company
uses to differentiate their product from the product of their competitors
(Lamb, Hair & McDaniel, 2014).
Product differentiation can either be a real difference in two products
or a perceived difference in two products (Lamb, Hair & McDaniel,
2014). Numi’s product differentiation is
a real difference in their product when comparing it with other commodity
teas. Their tea is organic and of
premium quality because they use whole leaves.
Their raw ingredients are really expensive so their price is higher than
their competitors, but not when you compare it to the quality of tea the
consumer gets.
a. Undifferentiated targeting
b. Concentrated targeting
c. Multisegment targeting
d. Niche targeting
ANSWER: Numi found out that they had more than one
target market. Numi’s target market are
eco-moms, college students and family travelers. They target consumers who are at high-end
spas as well as fine dining restaurants.
Their customers who are all there are also shopping at places like
Costco, which gives them the benefit of mass selling their product without much
effort to. Multisegment targeting is
when a company develops different marketing mixes for different segments (Lamb,
Hair & McDaniel, 2014). I think it
would be irrelevant for Numi to incorporate multisegment targeting because,
although they have more than one segment, there would not be a different
reaction to marketing to any of the segments because they overlap and all go to
the same places.
a. True
b. False
ANSWER:
Optimizers are companies who carefully
choose products because they solicit bids and study all proposals and consider
a large number of companies before making their decision (Lamb, Hair &
McDaniel, 2014). Mullin knows that
companies who seek Numi tea to go into gift baskets are optimizers because most
of the time the gift baskets are consistent of all high quality products that
are also organic and have the same quality that Numi tea does. The promotional giveaways help Numi to market
their product while it is beside other high quality and well-respected brands
and products.
a. True
b. False
ANSWER:
Perceptual mapping is a way to graph
the location, brands or groups of products that customers are thinking about
(Lamb, Hair & McDaniel, 2014). The
channel conflict that exists for Numi is that they are marketing their tea at
high-end spas and fine dining restaurants.
They are also selling their product at places like Costco and
Target. When the spas and restaurants
find out that Numi’s tea is at “lower-end” stores like Costco and Target, there
can sometimes be a conflict because they want high-end products that make their
customers feel special. Creating a
perceptual map can help Numi to visually see where their product is being sold
and what other products may be at the same location or may be bought by the
same consumers.
References
Lamb, C. W., Hair, J. F., & McDaniel, C.
(2012). MKTG5. Mason, OH:
South-Western, Cengage.
