Problem 1. Read the example below of a company that has used market segmentation and answer the questions that follow: A group of investors have identified a small segment of society that is displeased with the high cost of college education and is willing to forego all social and sporting extracurricular activities in order to get an inexpensive, quality education in four years. In response to this, they are starting a for-profit college to be called Haven University The university investors will advertise nationally. Their target audience is individuals between 22 and 40 years of age, who have either not started earning a college degree or who did not finish one they began in the last ten years. The investors want to attract students who are currently working at a job with which they are dissatisfied. Haven University will only offer three degree programs, which cannot be modified to suit individual student needs. Research has shown these are the degrees this market segment repeatedly seeks. Students can earn their degrees over the Internet and only have to attend a one-week seminar on campus twice a year.
• Write two paragraphs on the marketing strategy, the university investors are using to identify their target market.
• What in your opinion would be the basis for segmenting consumer markets in the above case?
Read the example and answer the questions that follow: Roy Lindale has retired and moved to the Gulf Coast. He wants to open a wholesale nursery that sells seedlings, potted plants, and shrubbery to retailers and distributors. Due to climatic conditions in the area, there are already five wholesale nurseries within a 100-mile radius of the location Lindale has selected for his nursery. He has been advised that he needs to use a customer survey to determine how his five potential competitors were perceived on five attributes. The following chart shows the results of the analysis. (10=best; 1=worst):
Competitors A B C D E
Attributes
Product quality 9 10 7 7 6
Product variety 9 5 6 7 10
Price 8 9 5 7 9
Botanical knowledge 10 8 7 7 8
Service 9 8 6 7 7
• Who in your opinion is the overall strongest and weakest competitor? Justify your opinion by citing their various attributes. What is your inference about competitor B in the light of the given attributes?