BA 390- Marketing Midterm 1 OSU – Flashcards
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How is marketing defined in this class?
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FACILITATING EXCHANGE between a business and its customers.
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What are the five core customer and marketplace concepts discussed in your textbook that marketers must understand?
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1) production 2) product 3) selling 4) marketing 5) social marketing
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What are the differences between wants, needs, and demands?
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Needs: states of felt deprivation Wants: the form human needs take as they are shaped by culture and individual personality Demands: wants that are backed by buying power
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What is a Value Proposition?
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A set of benefits and values a brand promises to deliver to consumers to satisfy their needs.
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What are the five marketing management orientations? How do they differ from one another?
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Production- consumers will favor a product that is available and highly affordable. Product- consumers will favor the product that offers the most in quality, performance and innovative features. Selling- The idea that consumers will not buy enough of the firm's products unless the firm undertakes a large-scale selling and promotion effort. Marketing- organizational goals depend on knowing the needs and wants of the target markets and delivering desired satisfactions better than competitors do. Societal marketing- Is a firm that satisfies the immediate needs and wants of the target market doing what's best for its consumers in the long run?
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What is customer-perceived value and how does it relate to customer satisfaction?
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Customer-perceived value - the customer's evaluation of the difference between all the benefits and all the costs of a market offering relative to competitors. Customer satisfaction - the extent to which a product's perceived performance matches a buyer's expectations.
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Describe the major trends and forces that are changing the marketing landscape today?
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The changing economic environment. Growth of not-for-profit marketing (st jude, etc) Rapid globalization. (competition in other countries) Sustainable marketing/ call for social responsibility. Ethics, etc. SOCIALLY AND ENVIRONMENTALLY RESPONSIBLE.
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Marketing mix: four P's
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Product Price Promotion Place
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What is strategic planning and what are the four steps in strategic planning?
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The process of developing and maintaining a strategic fit between the organizations goals and capabilities and its changing marketing opportunities. Four steps: 1) defining the company mission 2) setting company objectives and goals 3) designing the business portfolio 4) planning marketing and other functional strategies
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What is an SBU?
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Strategic business units can be a company division, a product line within a division, or sometimes a single product of brand. MAKE UP THE COMPANY
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Describe the four product/market expansion strategies (also referred to as growth strategies) (i.e., market penetration, market development, product development, and diversification)? Provide examples of each.
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Market Penetration: an attempt to sell more of the current product to the current customer segment. EX: when U.S. turkey producers worked to reposition turkey as a good choice for everyday consumption, and not just a food for Thanksgiving. Market Development: to take the current product, and introduce it to new markets. EX: printers moving from the business to the home market Product Development: to offer new products to current customers. EX: Kellogg's Rice Krispies being sold as Rice Krispie Treats Diversification: to offer new products in new markets. EX: Yamaha provides an interesting example, as they market products that include motorcycles, watercraft, guitars, and pianos.
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What is customer-driven marketing strategy? Why is it important and what is involved in the process (i.e., market segmentation, market targeting, differentiation, and positioning).
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Customer-driven marketing strategy is a result of companies knowing they must be customer centered. Market Segmentation: dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors. Market Targeting: evaluating each market segment's attractiveness and selecting one or more segments to enter. Differentiation: actually differentiating the market offering to create superior customer value Positioning: arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers.
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What is the marketing mix? What are the 4 Ps and the 4 Cs?
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Marketing mix: The set of tactical marketing tools that the firm blends to produce the response it wants in the target market. 4 P's: Product: the goods and services that the company offers to the target market Price: amount customers must pay Place: company activities that make the product available Promotion: persuades customers to buy it 4 C's: Customer solution (product) Customer Cost (price) Convenience (place) Communication (promotion)
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What is a SWOT analysis? Why is it important?
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An overall evaluation of the company's strengths (S), weaknesses (W), opportunities (O), and threats (T). Helps limit negativity throughout the company.
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What is marketing ROI? How do companies measure marketing ROI?
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Return on marketing investment. The net return from a marketing investment divided by the costs of the marketing investment.
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What is the microenvironment and what are the 6 major actors within the microenvironment that affect a company's ability to serve its customers? Give examples of each.
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Microenvironment: the factors CLOSE to the company that affect its ability to serve its customers- the company, suppliers, marketing intermediaries, customer markets, competitors, and publics. 6 major actors: THE COMPANY: management, mission, objectives, strategies. SUPPLIERS: provide resources for company to produce goods. MARKETING INTERMEDIARIES: help company promote, sell, and distribute to its final buyers. COMPETITORS: position products against them PUBLICS: group that has interest or impact on an organizations ability to achieve its goals. (financial, media, govt, citizen-action, etc) CUSTOMERS: most important!!! in microenvironment
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What is the macroenvironment and what are the 6 major forces of the macroenvironment? Give examples of each macroenvironmental force.
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Macroenvironment: The larger societal forces that affect the microenvironment. Demographic: human populations (size, density, location, age, gender, race, etc) Economic: economic factors that affect consumer purchasing power and spending patterns Natural: involves the physical environment and natural resources that are needed as inputs. Technological: most dramatic force- antibiotics, robotic surgery, miniaturized electronics, smartphone, internet. Political: laws, government agencies, pressure groups that influence organizations Cultural forces: institutions and other forces that affect a society's VALUES, PERCEPTIONS, BELIEFS, BEHAVIOR.
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What are the major generational groups called? What are the significant differences between generational groups? Why do generational groups matter to marketers?
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GENERATION X: 49 million people born between 1965 and 1976 following the baby boom. Set in their ways, older, smarter. GENERATION Y: millennials - the 83 million children of the baby boomers born between 1977 and 2000. Tech-savvy, lots of millennials.
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What is marketing research and why is it important?
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Marketing research: The systematic design, collection, analysis, and reporting of data relevant to a specific marketing situation facing an organization. Management looks to marketing research to reduce uncertainty. This is an important point; market researchers do not make decisions, but rather provide information that helps managers make decisions.
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What is the difference between marketing intelligence and marketing research?
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Research: FORMAL and SPECIFIC studies- not always public information. Intelligence: publicly available info about consumers, competitors, and developments in marketing environment.
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What are the four steps in the marketing research process?
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1) defining the problem and research objectives 2) developing the research plan for collecting information 3) implementing the research plan- collecting and analyzing the data 4) interpreting and reporting the findings
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What is the difference between exploratory research, descriptive research, and causal research and what is the goal of each?
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Exploratory: research to gather PRELIMINARY information. Goal is to help define problems and suggest hypotheses. Descriptive: research to better DESCRIBE marketing problems, situations, or markets. Goal is to tell us about demographics and attitudes. Causal: research to test hypotheses about cause and effect relationships.
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Define each of the research approaches for gathering primary data.
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PRIMARY: Information collected for the specific purpose at hand. Observation: observing relevant people, actions and situations. Survey: asking people questions about their knowledge, attitudes, preferences, and buying behavior. Experiment: selecting matched groups of subjects, giving them different treatments, controlling related factors and checking for differences in responses.
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Why do researchers use 'samples'? What are the differences between probability and nonprobability samples?
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A sample is a segment of the population selected for marketing research to represent the population as a whole. Probability: each population member has a known chance of being included. SAMPLING ERROR CAN BE MEASURED. Nonprobability: when probability costs too much or takes too much time, researchers turn to this. SAMPLING ERROR CANNOT BE MEASURED.
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What is meant by the term "a research instrument"?
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Questionnaires (surveys, polls, questions) and mechanical devices (tv, satellites, technology).
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What ethical considerations do market researchers and managers need to be aware of?
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Intrusions on consumer privacy, misuse of research findings (surveys being abused).
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Secondary data
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information that has been collected previously and may even come from projects that one might think are unrelated to the existing research needs
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exploratory research
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qualitative
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causal/ descriptive research
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quantitative
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Can marketers predict buyer behavior (pay attention to the lecture notes on Canvas)?
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Yes. As consumer behavior disciplines have matured, research became increasingly sophisticated as scholars and practitioners worked to improve theory and models which sought to better explain purchase behavior. Seemingly, much of the research worked to refine models that could predict buyer behavior, which has largely been an elusive goal.
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Describe research in the field of consumer behavior (pay attention to the lecture notes on Canvas).
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The earliest research in consumer behavior focused almost exclusively on issues relating to consumer decision making. Now, we have a large body of published research and sophisticated research tools that can provide valuable information that can aid marketers to predict buyer behavior.
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What are the four major factors that influence consumer buyer behavior (see Figure 5.2)? Describe them in detail.
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CULTURAL: culture, subculture, social class. Most basic cause of a person's wants and behavior. SOCIAL: groups and social networks, family, roles and status. Relatively permanent and ordered divions whose members share similar values, interests, and behaviors. PERSONAL: age and life-cycle stage, occupation, economic situation, personality and self-concept. Personal characteristics. PSYCHOLOGICAL: motivation, perception, learning, beliefs and attitudes.
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What are the major American social classes and where do you see yourself (Figure 5.3)?
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Upper class (inherited wealth, high income through exceptional ability) Middle class (professionals, independent businesspersons, corporate managers) Working class: depend heavily on relatives for economic and emotional support Lower class: the working poor. Poorly paid for unskilled work.
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What is an opinion leader? How do marketers attempt to use opinion leaders to help promote products/brands?
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A person within a reference group who, because of special skills, knowledge, personality, or other characteristics, exerts social influence on others. WHEN THEY TALK, consumers listen.
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What does Maslow's Hierarchy of Needs have to do with marketing?
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Human NEEDS are arranged in a hierarchy. Marketers can target people's psychological needs.
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What are the major types of buying decision behavior?
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Complex buying behavior: they are highly involved with a purchase and perceive significant differences among brands. Buyer will pass through a learning process and will make a thoughtful choice. Variety-seeking buying behavior: low consumer involvement, significant perceived brand differences. Dissonance-reducing buying behavior: in situations characterized by high involvement but few perceived differences among brands. Habitual buying behavior: low consumer involvement, few significant perceived brand differences.
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What are the stages in the buyer decision process?
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1) need recognition 2) information search 3) evaluation of alternatives 4) purchase decision 5) postpurchase behavior
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What is a 'new product' and how do consumers decide whether or not to 'adopt' the new product? What are the five adopter groups and the characteristics of each?
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A good, service, or idea that is perceived by customers as new. 1) Awareness: consumer becomes aware of new product but lacks information about it. 2) Interest: consumer seeks information about product 3) Evaluation: consumer considers whether trying the new product makes sense 4) Trial: consumer tries product on small scale 5) Adoption: consumer decides to make full and regular use of the new product.
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How are business markets different from consumer markets? Compare factors such as dollars involved, number of items sold, number of buyers, structure and demand, types of buyers, the buyer decision process.
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B2B market is considerably larger than the consumer market. It would be a safe assumption that the B2B buyer would take a more careful and structured approach to the purchase decision than a typical consumer. B2B = business to business marketing.
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What are the major types of buying situations?
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1) Straight rebuy: the buyer reorders something without any modifications. Usually handled on a routine basis by the purchasing department. "In" suppliers try to maintain service/ product quality. "Out" suppliers try to exploit dissatisfaction. 2) Modified rebuy: the buyer wants to modify product specifications, prices, terms or suppliers. "In" suppliers may become nervous and put their best foot forward. "Out" suppliers use modified rebuy situation to make a better offer and gain new business. 3) New task: company buying a product or service for the first time. 4) Systems selling: buying a packaged solution to a problem from a single seller, thus avoiding all the separate decisions involved in a complex buying situation.
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Who are the participants in the business buying process?
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Users: members of organization who will use the product or service. Users initiate the buying proposal. Influencers: often help define specifications and provide information for evaluating alternatives. EX: technical personnel. Buyers: formal authority to select the supplier and arrange terms of purchase. Deciders: have power to select or approve the final suppliers. In routine buying, buyers are often the deciders/approvers. Gatekeepers: control the flow of information to others. EX: agents often have the authority to prevent salespersons from seeing users or deciders.
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What are the major influences on business buyer behavior?
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Environmenal: the economy, supply conditions, technology, politics/regulation, competition, culture and customs Organizational: objectives, strategies, structure, systems, procedures Interpersonal: influence, expertise, authority, dynamics Individual: age/education, job position, motives, personality, preferences, buying style
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How are the buying practices of institutional and governmental markets different from business buyers?
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Institutional: Schools, hospitals, nursing homes, prisons, and other institutions that provide goods and services to people in their care. (ex. hospital food) Government: Governmental units—federal, state, and local—that purchase or rent goods and services for carrying out the main functions of government. Military, defense, schools, etc. Government organizations typically require suppliers to submit bids, and normally they award the contract to the lowest bidder.
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What are the four major steps in designing a customer-driven marketing strategy? (Create value for targeted customers)
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Market Segmentation: dividing a market into smaller segments of buyers with distinct needs, characteristics, or behaviors that might require separate marketing strategies or mixes. Market targeting: evaluating each market segment's attractiveness and selecting one or more segments to enter. Differentiation: differentiating the 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.
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How does market segmentation differ from market targeting?
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Market segmentation segments the market and divides it into profiles. Targeting evaluates each segment after it is divided and decides which market segments to enter.
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Describe the four major sets of segmentation variables for consumer markets.
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1) Geographic segmentation: dividing a market into different geographical units, such as nations, states, regions, counties, or even neighborhoods. (swimsuits in macys in florida, local chocolate in Michigan) 2) Demographic: age, life-cycle stage, gender, income, occupation, education, religion, ethnicity, generation (jello for kids "wiggle" vs adults "10 calorie guilt free indulgence" 3) Psychographic: social class, lifestyle, personality 4) Behavioral: occasions, benefits, user status, usage rate, loyalty status
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What are the requirements for effective segmentation?
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Measurable Accessible Substantial (large/ profitable enough to serve) Differentiable (distinguishable) Actionable
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What three factors do marketers look at when evaluating market segments? What is meant by "segment structural attractiveness?"
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1) Segment size and growth 2) Segment structural attractiveness (cant contain too many aggressive competitors or be too easy for new entrants to come in. Also, substitute products may limit prices and products earned.) 3) Company objectives and resources
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Describe the four primary market targeting strategies. What are examples of companies using each of these strategies?
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1) Undifferentiated marketing (mass marketing): a strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer. Most modern marketers have strong doubts about this! 2) Differentiated (Segmented) marketing: a firm decides to target several market segments and designs separate offers for each. P&G detergent is an example, 6 different laundry detergents that all compete with each other. 3) Concentrated (niche) marketing: a firm goes after a large share of one or a few segments or niches. Ex: whole foods has less stores than HUGE Kroger, yet smaller, more upscale retailers have grown faster than rivals. 4) Micromarketing: tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments. EX: places in manhattan making sandwiches and quick lunches for the office workers and commuters.
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Why are some marketing efforts criticized as being potentially harmful? Which segments are considered the most vulnerable? How does the advertising industry's self-regulatory agency address these issues?
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Depending on competitors, certain types of marketing can be harmful. Undifferentiated marketing is the most vulnerable. Not necessarily WHO, but HOW and WHAT. Marketing, especially towards children, can be harmful. Sexualization, "heathly" happy meals, etc. SOCIALLY RESPONSIBLE MARKETING.
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How do companies differentiate and position their products? What are the possible value propositions as described in your textbook (figure 7.4)?
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1) Identifying a set of differentiating competitive advantages on which to build a position 2) Choosing the right competitive advantages 3) Selecting an overall positioning strategy. More for more, more for the same, more for less, less for less. PRICE vs BENEFITS. More for more ALWAYS WINS. Less for more always loses. Then, develop a positioning statement.
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Describe the three levels of products and services (figure 8.1).
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1) Core customer value. "What is the customer really buying?" not just a computer, but entertainment, self-expression, productivity, connectivity. 2) Actual product- brand name, features, quality level, packaging, design, features. 3) Augmented product- delivery and credit, product support, warranty, after-sale service.
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Define the four types of consumer products and the marketing considerations of each. Provide an example of each.
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Convenience product: consumer products and services that customers usually buy frequently, immediately, and with minimal comparison/ effort. Usually low priced. Shopping products: a consumer product that the customer, in the process of selecting and purchasing, usually compares on such attributes as suitability, quality, price and style. MUCH TIME SPENT on gathering info, compatisons. Ex: furniture, clothing, used cars, hotels/airlines, etc. Specialty products: product with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort. Ex: gourmet food, a Lamborghini, chanel, etc. Unsought product: a consumer product that the consumer either doesn't know about or doesn't consider buying. Ex: life insurance, funeral services, blood donations, etc.
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What is a product? What decisions do marketers need to make about individual products/services?
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Product: anything that can be offered to a market for attention, acquisition, use or consumption that may satisfy a WANT or NEED. Products and services need to bring value to customers/ builds customer relationships. End goal is money.
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What is a product line? What decisions do marketers need to make about product lines?
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A product line is a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges. Decisions- PRODUCT LINE LENGTH (# of items), also understanding how each product contributes to the line's performance.
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What is a product mix? What decisions do marketers need to make about the product mix?
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Product mix: the set of all product lines and items that a particular seller offers for sale. ex: campbells soup has healthy, baked, simple meals. Each line has several sublines. Decisions: depth (number of versions offered for each product), consistency (how closely related items are), width (number of lines in the mix). Companies may have to weed out lines that don't work to regain their focus.
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What are the four characteristics that affect the marketing of services? How does service marketing differ from traditional product marketing?
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Intangibility: services cannot be seen, tasted, felt, heard or smelled before they are bought. Inseparability: services are produces and consumed at the same time and cannot be separated from their providers. Variability: the quality of services may vary greatly depending on who provides them and when, where and how they are provided. ex: Marriott employees, one may be great and another may be awful, but they're both employees of the same company. Perishability: services cannot be stored for later sale or use. Ex: doctors charge for missed appointments. Differs because services cannot be touched!
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What is the service profit chain?
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The chain that links service firm profits with employee and customer satisfaction. internal service quality, satisfied and productive employees, greater service value, satisfied and loyal customers, healthy service profits and growth. Happy team members result in happy customers. Happy customers do more business for you and become advocates for your enterprise.
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What is a brand and how do marketers build strong brands?
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Brands are more than just names and symbols- they are a key element in the company's relationship with customers. Ways to build strong brands: Brand equity is the measure of a brand's ability to capture consumer preference and loyalty. Positioning: attributes, benefits, beliefs and values Brand name selection: selection and protection Brand sponsorship: private brand, licensing, co-branding Development: line extensions, brand extensions, multibrands, new brands.
