Part 1. True or False.

Write TRUE if the statement is correct. Write FALSE if the statement is not correct.

1. One of the reasons why the company segment, target, and position its business is because the buyers are too numerous, too widely scattered and too varied in their needs.

2. Segmentation helps the company create value for the customer.

3. Businesses selling commodity products is using market segmentation to divide the market.

4. Products like Rolex watch, BMW car and iPhone are under mass marketing.

5. Demographic segmentation includes income, occupation, and gender to segment the market.

6. Psychographic segmentation includes social class, lifestyle and personality.

7. Firms scattering their marketing effort uses the "shotgun" approach.

8. Firms focusing on the buyers who have greater interest in the values they create best is practicing "rifle" approach.

9. Mass marketing is about selling one or more products to multiple groups.

10.Segment marketing is about offering one products to one group.

11.Product differentiation includes symbols and characters.

12.Channel differentiation includes channel's coverage, expertise, and performance.

13.Service differentiation includes delivery, Installation Repair Services, Customer Training Services.

14.Image differentiation includes design, style and features.

15.Toyota's initiative to introduce Lexus line to compete with Mercedes is an example of More for More Value Proposition.

16.Meeting consumers' minor performance or quality requirements at a much lower price is under the positioning of Less-for-much-less positioning.

17.Markets cannot be segmented into nonusers, ex-users, potential users, first-time users, and regular users of a product.

18.Market segmentation reveals the firm's market segment opportunities.

19.Macromarketing is the practice of tailoring products and marketing programs to suit the tastes of specific individuals and locations.

20.If most buyers have the same tastes, buy the same amounts, and react the same way to marketing efforts, undifferentiated marketing is appropriate.

Case Analysis : DYNAMO Inc.

Mr. Jerry Cruz, owner and general manager of DYNAMO (a brand well-known for its Male Sportswear) call in his company's brand manager to discuss his latest business idea. Jose Santos, the Brand Manager, was hired from a multinational company engaged in the manufacture and promotion of jeans.

Mr. Cruz told Jose of his plan of launching a new line of bathing suits. He, Mr. Cruz, instructed Jose to plan the specifics. According to the owner manager, so far the Brand is successful in different product lines such as men's sports shirts, sports jackets, T-shirts and jeans. Many successful years of catering the male market, so it is time to diversify and try to cater the heavy buyers, the female market since the female market if fussy and more predictable.

Mr. Santos told Mr. Cruz, "Don't you think we'd be going out of character?" asked Jose.

"No, I don't think so. We'll still be in the sportswear business, although we're adding the new female dimension." Answered Mr. Cruz.

"Do we go for mass marketing or do we go top-of-the line?" asked Mr. Santos

"That I'm not sure, Jose. But I don't care if we spend two million, or even ten million pesos on it within the year. But I do want to make sure that we succeed and be dominant in this new market", said Me. Cruz.

"What about the seasonality of the new product?", asked Jose.

"Our manufacturing facilities could be producing throughout the year and we'd be building up our inventory to sell during the summer season. No problem."

"But there may be fashion trends abroad in bathing suits, and we could be caught with the wrong kind of inventory when we launch in the summertime," said Jose.

"Look, you are the Marketing expert. I am giving you six months to plan this thing." Answered Mr. Cruz.

Questions: 30pts

1. Would you suggest the addition of a new product for DYNAMO? What are the advantages and disadvantages in lengthening the company's current product lines?

2. What recommendations would you make to Mr. Jose Santos, the Brand Manager?

Case Analysis : Baun's Confectionery Inc.

Mr. Eddie Sotelo, advertising manager of Baun's Confectionery Inc. (BCI) was hopping mad when he told his friend, Albert Rofino, the production manager of BCI that he will resign for blaming him (Mr. Sotelo) of the lower sales of BCI brand which he handles, the Mint-Glow candies.

"It is true they are blaming you for the lower sales of our Mint-Glow candies", said Mr. Rofino. "But, on the other hand, they surely will realize that you are not entirely to blame. The market has become more competitive. More brands are there fighting it out. Our sales and distribution network is not all that hot. To top it all, the whole economy's in pretty bad shape. Many companies are laying off their workers. I myself was asked to reduce production level by 50%. That means I have to lay off people, too!"

"So why blame it all on me?" wailed Sotelo. Mr. Sotelo told Mr. Rofino that BCI cut the advertising budget from Php 1M to Php 0.5M; the company wants to expand sales and distribution of Mint-Glow from Visayas to Mindanao, and Metro Manila to the rest of Luzon; and to top it all the company wants to launch another brand!

Questions: 30pts

1. Should the management push through with the launching of a new brand to boost sales?

2. What recommendations would you give BIC's Management concerning marketing of the product, particularly advertising and sales promotion.