Final answer:
The four major steps in designing a customer-driven marketing strategy are market segmentation, target marketing, differentiation, and positioning. These steps help companies understand and cater to their consumers effectively, differentiate their products, and choose the right price and quantity for their products.
Step-by-step explanation:
Steps in Designing a Customer-Driven Marketing Strategy
The four major steps in designing a customer-driven marketing strategy are:
Market segmentation: Dividing a market into distinct groups of buyers with different needs, characteristics, or behaviors.
Target marketing: Selecting one or more segments to enter and focusing on the customers in that segment.
Differentiation: Differentiating the firm’s market offering to create superior customer value.
Positioning: Arranging for a market offering to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers.
These steps form the foundation for a strong marketing strategy. Differentiated products are essential as they allow companies, especially those in monopolistic competition, to distinguish their offerings from those of competitors. The choice of price and quantity for a monopolistically competitive firm is often based on factors such as perceived product differentiation and expected response from competitors. Entry and exit in such markets are typically easy due to low barriers, affecting the efficiency and number of competitors within a market. Advertising plays a crucial role in monopolistic competition as it can influence demand, consumer perceptions, and differentiate products.