The Price Segmentation Model Divides Customers into Four Broad Categories

question 56

Multiple Choice

The price segmentation model divides customers into four broad categories based on the customer's "perceived pain" of paying a high price and the "perceived value" of product differentiation.A customer who is in a "Value Segment" is best characterized by which of the following?

• A)This customer wants the lowest price and will not make trade-offs for value-added product benefits.Getting the lowest price is the priority.
• B)This customer wants both the lowest price possible and the largest combination of value-added product benefits.This person "wants it all" and will search for the best combination.
• C)This customer is less concerned with price and wants to have a high level of product differentiation.
• D)This customer is not overly concerned with price or value-added product benefits, but is mainly concerned with minimizing product search and evaluation.
• E)This customer is highly brand loyal, perceiving value in his/her favorite brand, and will pay any price for that favored brand.

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Definitions:

Generalize

The process of forming general concepts by abstracting common properties of instances.

Experimental Group

In an experiment, the group receiving the treatment under study.

Control Group

In an experiment, a group of people, similar to those in the experimental group, who do not receive the treatment under study.

Cause and Effect

A relationship where one event (the cause) makes another event happen (the effect).