An Introduction to Marketing – Flashcards
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Toys "R" Us is the name of a major retailer that sells toys and other kids products. What type of name is Toys "R" Us?
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Descriptive
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The tagline for Disneyland is "The Happiest Place on Earth." What type of tagline is this?
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Superlative
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Under the Elaboration Likelihood Model, a firm should only use central routing in their marketing messaging if customers have:
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The motivation to elaborate and the ability to elaborate.
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If a company has used a celebrity endorsement in an "imperative mode," what message is the celebrity conveying?
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"You should use this product."
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Jane goes to buy a laptop. There are 53 available models in the world. Jane has heard of 12 of these models, of which she is considering buying 4 models. In this example, what is the number 12 referred to as?
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Evoked set
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For customer satisfaction, should a company be more concerned with actual performance or perceived performance?
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Perceived performance
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Jonah Berger's STEPPS framework helps us understand which messages catch on and get shared. Which of the following is NOT one of the factors in the STEPPS framework?
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Popularity
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the marketing mix
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Place, Price, Promotion, Product
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When Steve Jobs updated his company name from Apple Computer to Apple in 2007, which part of the brand positioning was he changing?
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Frame of reference
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They were born between 1977 and and 1997. They appreciate free content, access to wireless internet, and customization. They account for 30% of the population.
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Generation Y cohor
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PRIZM is a segmentation scheme that defines the country based on what type of clusters?
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Geographic
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In a buyer's market, the buyer has the power and the market is ______-focused.
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Customer
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Cracks in the product-centric approach
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Retail saturation Globalization Deregulation Smart customers
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Aa strategy that aligns a company's development/delivery of its products/services around the current and future needs of a select set of customers in order to maximize their long-term financial value to the firm.
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definition of customer centricity
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The best way to pick a salesperson of the month?
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The change in total customer lifetime value for that month
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In a product-centric company, sales bias is on the side of the ____________ in a transaction.
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Seller
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Instead of "cost per acquisition" (CPA), firms would be better off measuring "___________ per acquisition."
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Value
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Customer lifetime value should be _________ the amount you would want to spend to acquire a customer.
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Greater than
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An annual churn rate of 55% means that:
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You have lost 55% of your customers during that year.
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If your attrition rate is 20%, then your typical customer lifetime is
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5 years
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Common explanations for low attrition rates
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High switching costs Customer inertia Customer loyalty
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Sometimes at McDonald's your cashier will ask you, "Do you want fries with that?" What is this an example of?
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Cross-selling
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An example of up-selling?
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A car salesperson asking if a customer wants to get a "sport package" for a car she is buying.
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customer heterogeneity
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Recognizing that some customers are more profitable than others since all customers are not inherently equal.
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Persuade customer to want what the firm has
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Production Orientation
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Persuade firm to offer what the customer wants
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Marketing Orientation
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Manage customer's entire experience with the firm
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Experience Orientation
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Prioritize building a relationship based on trust and discipline
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Trust Orientation
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Customer Value Differentiation Segmentation, Targeting and Positioning
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3 Principles of Marketing
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Product Place Promotion Price
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4 P's of Marketing
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Know our markets Customers have the final say Commit to being first in the markets we serve Deliver total quality to guarantee customer satisfaction
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Market Driven Principles
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Segmentation Targeting Positioning
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Positioning Process
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Identify variables that allow one to segment the market
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Segmentation
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Evaluate the attractiveness of each segment and choose a target segment
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Targeting
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Identify positioning concepts for each target segment, select the best, and communicate it.
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Positioning
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The process of dividing a market into subsets, where any subset may conceivably be selected as a marketing target to be reached with a distinct marketing mix.
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Market Segment
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Charactersitics of the Customer Benefits Sought Systematic, Product-Related Behaviours
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Segmentation Methods
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Purchasing behaviour
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Systematic, Product_Related Behaviours
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Regional zip clustering
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Geographic Segmentation
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Deistinct marketing strategies created for similar types of neighborhoods stretched across the nation. eg: PRIZM
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Zip Clustering
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Develop measures of segment attractiveness Select among attractive segments based on business capabilities.
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Market Targeting
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A proprietary trademark for a specific product or service
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What is a brand - Formally
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A contract from the company to its customers; A promise of specific benefits, quality, and value. A relationship.
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What is a brand - Conceptually
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Defines the value proposition of product to the target market
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Positioning Statement
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All 4 elements of the marketing mix
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When to use a Positioning Statement
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Focus on a few key benefits Must be defensible
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Rules of Positioning Statements
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Desirable to customer Can be delivered - Feasible, Communicability and sustainable
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POD Criteria
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Set of abstract concepts or phrases that characterize the five to ten most important dimensions of the mental map of a brand.
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Core Brand Values
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An articulation of the heart and soul of the brand
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Brand Mantra
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Communicate - define business, clarify what is unique Simplify - Memorable, short, vivid, and crisp Inspire - Have higher level meaning from employees and consumers
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Brand Mantra Considerations
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Describe the nature of the product or service or the type of experiences or benefits the brand provides.
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Brand Functions
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Further clarifies the nature of the product or service
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Descriptive Modifier
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How exactly does the brand provide benefits and in what way
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Emotional Modifier
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Used internally to guide decisions - what the brand should and should not be associated with.
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When to use Brand Mantras
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Consistency Superior Distinctive Alignment Relevant
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Characteristics of great brands
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multi staged/ multi channeledd
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Shopping Process is..
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Need Recognition eg: Need to replace broken item
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First Stage of Shopper Process
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Create a need
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How to get customers to Need Recognition
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Information Search
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Second stage of Shopper Process
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To create top of mind awareness so brand comes readily to mind and is included in the consideration set.
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Traditional Advertising
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All the products the customer can think of
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Evoked Set
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The Few products the customer take into consideration
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Consideration Set
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Decision Stage
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Third Stage of buying Process
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Purchase Stage
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Fourth Stage of buying Process
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a set price or a price range in consumers' minds that they refer to in evaluating a product's price
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Internal Reference Prices
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a price presented by a marketer for the consumer to use to compare with the current price
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External Reference Price
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Customer Satisfaction
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Fifth Stage Of Buying Process
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How well the product/service works compared to how the customer expects it to work
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Actual Performance
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The relationship between the consumer's expectations and the product's ________ determines whether the buyer is satisfied or dissatisfied with a purchase.
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Perceived Performance
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Marketing to consumers based on research of the entire process consumers go through when making a purchase
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Shopper Market
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using in-store promotions and advertising to extend brand equity to "the last mile" and encourage favorable in-store purchase decisions
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Shopper Marketing
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The process of developing an interpretation of a stimulus, or, in other words, deciding what a stimulus means
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Perception
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Constructive, People construct interpretations on the fly.
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Perception is ________
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Brand Name Logo Symbol Character Packaging Slogan
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Brand Elements
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Memorable - easily remembered Meaningful - Discriptive, persuasive Appealing - Fun, interesting, Aestheticlly good Protectable - legal Adaptable - flexible, updateable Transferable - within catagories, geographically
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Brand Element Choice Criteria
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Can be tailored to positioning strategy Can remove ambiquity Can generate it's own equity / emotion Can reingorce the name of a symbol
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Slogans/ Taglines
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Short Differentiated from competitin Unique Easy to Say and Remember No negative connotations Protected and Trademarked Evokes an emotional Response
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Tagline Rules
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Two routes to Persuasion: Systamatic (central) and Superficial (peripheral), A model suggesting that attitude change can be driven by evaluation of the content of a persuasive message (central route) or by irrelevant persuasion cues (peripheral route)
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Elaboration Likelihood Model
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Rather than relying on a careful process of weighing and considering the strength of Products/services, the customer responds to simple, often irrelevant cues that suggests your product/service without gibing it much thought.
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Peripheral Route of Persuation
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relatively stable change by carefully scrutinizing facts, statistics, and other information
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Central Route of Persuation
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Classical conditioning Reciprocity: you owe me. Consistency: we've always done it that way Social Proof: every body's doing it Liking: love me, love my ideas Authority: just because I say so Scarcity: quick, before they're all gone
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Peripheral Cues:
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products treated as assets, firm tries to get max profit from each transaction
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Product centric
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A strategy that aligns a company's development/delivery of its products/services around the current and future needs of a select set of customers in order to maximize their long-term financial value to the firm.
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Customer Centricity
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Commoditization Smart Customers Retail Saturation Globalization Deregulation End to end solutions Customer Level tracking
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Crack in the Product Centric Approach
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Customer want _____________ which may require products/services from multiple vendors
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End to End Solutions
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A process of market competition through which unique products that command high prices and high margins gradually lose their ability to do so, thus becoming commodities.
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Commoditization
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The degree to which a trading area is over or understood, the amt of competetion.
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Retail Saturation
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Actions or processes that involve the entire world and result in making something worldwide in scope.
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Globalization
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The lifting of restrictions on business, industry, and professional activities for which government rules had been established and that bureaucracies had been created to administer.
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Deregulation
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The individual customer is the unit of analysis Kno who their customers are and what they buy Aim to determine marketing communication based on past purchases Constantly determine (and leverage) individual customer value
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Elements of Direct Marketing
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To Maximize Shareholder value
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In a customer centric world the goal of the firm is....
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Distinguish profitable customers from the less profitable ones
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Customer Heterogeneity
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future Profitability of the customer rather than past profits
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Customer Lifetime Value
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Acquisition, Retention and Development
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3 points of Customer Centric World
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Does NOT suggest that non focal customers should be ignored. It is important to have a healthy proportion of such customers to add a high degree of stability and robustness to the overall customer base.
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What customer Centricity does NOT suggest...
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The more that a firm tightens it's central focus on a select group of customers, the more it needs its non-focal customers to stabilize the mix.
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Paradox of customer centricity
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Efforts to increase the profitability of current customers
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Customer Development
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the method of selling the customer additional related products tied to one name
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Cross- Selling
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increasing the value of the sale
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Up-selling
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Requires assessment of the 5 constraints
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The 3 C's of marketing
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customers competitors company collaborators context
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The 5 constraints are:
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Product, Price, Promotion, Place
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What are the 4 P's
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Segmentation, Targeting & Positioning Provides the link between 5c's and 4 p's
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What is STP
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Deliver exceptional value Address a large market Be easy to explain and describe Doesn't cost much to test
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4 Things your product should have
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Info and services are much more widely available.
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Democritization in access
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Companies that make expensive products more affordable, but still good quality
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Value chain disruption
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joining together as a group to use a specific product more efficiently
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Collaborative Consumption
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matching a need to a service/product when needed
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Matching of supply and demand
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success = product x marketing product = product or service satisfaction (0-10) marketing = customer/brand fit (stp) and 3p's (0-10)
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Marketing math 101
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Go on a website to search anything from home
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The web Reduces Search friction by...
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We can now go online to get items we can't get locally, or where to go in a city
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The web Reduces Geographic Friction by...
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..at least 50-60 sites devoted to local content
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Research shows that for every million people in a city there are.....
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more likely you are to buy from an online store
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The further you live from offline store the...
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Potentially lower prices/search costs Transact with others efficiently Get better info about local amenities Improved customer convenience
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Benefits delivered by online world
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90% of products eg:groceries
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How much is still sold offline
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Delivery time Uncertain of fit, feel, quality Cost of returns
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Barriers to online sale
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True for popular products false for niche products
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If a physical store opened locally it would reduce online sales - true or false
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based on the idea that firms can make money by selling small amounts of items that only a few people want (e.g., targeting small volume segments), provided that they sell enough different items.
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Long Tail concept
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The long tail exists because the economics and distribution have changed
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Supply side explanation
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The long tail is itself endogenous, as there are more ways for us to discover variety.
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Demand side explanation
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No, As most products account for very little but collectively count for a lot
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Does the 80-20 rule apply to long tail?
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The things available locally are dictated by whatever local sellers provide
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Tyranny of locality
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Geni co-efficient formula
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G = A/(A+B)
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Understand the equality/inequality of incomes within a country Or to understand quality/inequality of product sales from a particular seller
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Geni co-efficient is used to...
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long tail sales distribution
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Internet channel is more like...
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more like 80/20 distribution
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catalogue channel is more like
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Hits get disproportionate share of light users
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Law of natural monopoly
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Unfamiliar things are less well liked
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Law of Double Jeopardy
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Sales info since starting Typical data Research question - how, what, why
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Data required when researching a company
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Customer id Transaction value zip code geo-demographic "real world" data
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Typical data
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Customer acceptance of online retail depends on offline shipping costs
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Principle 1 of 5 principle about how online/offline interact
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sales evolution is structured and predictable
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Principle 2 of 5 principle about how online/offline interact
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Migrating from "good" to "great" requires expansion of niche locations
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Principle 3 of 5 principle about how online/offline interact
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Isolated prospects are worth Pursuing - The preference minority in an area
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Principle 4 of 5 principle about how online/offline interact
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Social contagion
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---------- from communication and observation affects online demand evolution (principle 2)
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internet retailers
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______ can alter the cost-benefit trade off shoppers by making things "closer" and more accessable (principle 1)
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spacial structure
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_------- follows a pattern of proximity and similarity (spatial "long tail") (principle 3)
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geographic social/demographic
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Two ways to think of distance
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people who live far apart from each other still may be similar in other ways
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Social/demographic distance
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When a few prefer something different to the majority
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Preference minority
