Intro to Business Chapter 11& 12
A group of activities designed to expedite transactions by creating distribution pricing and promoting goods services and ideas. It is a systematic approach to satisfying consumers.
The act of giving up one thing (money, credit, labor, goods) in return for something else (goods, services, or ideas)
Function of marketing
Marketing for the zone complex set of activities that must be performed to accomplish objectives and generate exchanges. Includes buying, selling, transporting, sorting, grading, financing, marketing research, and risk-taking
Everyone who shops for products (consumers, stores, businesses, governments) decides whether and what to buy. A marketer must understand buyers’ needs and desires to determine what products to make available
This change process is expedited through selling. Markers usually view selling as a persuasive activity that is accomplished through promotion (advertising, personal selling, sales promotions, publicity, and packaging).
Transporting is the process of moving products from sellers to the buyers. Marketers for this on transportation costs and services.
Like transporting, storing is part of the physical distribution of products and includes warehousing goods. The warehouse holds some products for a lengthy period to create time utility. The tiny utility has to do with being able to satisfy demand in a timely manner. This especially pertains to seasonal good such as orange juice.
Grading refers to standardizing products by dividing them into subgroups displaying and labeling them so that consumers clearly understand their nature and quality
For many products, especially large items such as automobiles, refrigerators, and new homes, the marketer arranges his credit to expedite the purchase
Through research, marketers ascertained the need for new goods and services. By gathering information regularly, marketers can detect new trends and change in consumer taste
Risk is the chance of loss associated with marketing decisions. Developing a new product creates a chance of loss if consumers do not like it enough to buy it. Spending money to hire a sale force or to conduct marketing research also involves risk. The implications of risk is that most marketing decisions result in either success or failure.
A customer’s subjective assessment of benefits relative to cost and determining the worth of a product. The tax and the service charge included in the price of the television is a monetary cost associated with purchasing a television.
The idea that an organization should try to satisfy customers needs to coordinated activities that also allowed to achieve its own goals
And approach requiring organizations to gather information about customers needs, share that information throughout the firm, and use that information to help build long-term relationships with customers
A plan of action for developing, pricing, distributing, and promoting products that meet the needs of specific customers
A group of people who have a need, purchasing power, and the desire and authority to spend money on goods, services, and ideas
A specific group of consumers on his needs and wants a company focuses its marketing efforts
Turtle market approach
And approach whereby a firm tries to peel to everyone and assumes that all buyers have some morning
Strategy whereby a firm divides the total market into groups of people who have relatively similar product needs
A collection of individuals, groups, or organizations who share one or more characteristics and thus had a relatively some more product needs and desires
Market segmentation approach whereby a company develops one marketing strategy for single market segment
Market segmentation approach whereby the market Ames is efforts at two or more segments, developing a marketing strategy for each. The marketer aims its marketing efforts at two or more segments, developing a marketing strategy for each. Many firms use a multisegment approach that includes different advertising messages for different segments.
The four marketing activities (product, price, promotion, and distribution) that the firm can control to achieve specific goals with the dynamic marketing environment
Value placed on an object exchange between a buyer and a seller
Marketing products available to customers in the quantities design. Also referred to as Place.
Persuasive form of communication attempts to expedite a marketing is changed by enforcing individuals, groups and organizations to set goods, services an idea
A systematic objective process of getting information about potential customers to guide marketing decision
Marketing information is observed, recorded, or collected directly from respondents
Information that is compiled inside or outside an organization for some purpose other than changing the current situation
The decision process and action of people who purchase and use products
The process by which a person selects, organizes, and interprets information received from his or her senses
Inner drive that directs a person’s behavior towards goals
Changes in a person’s behavior based on information and experiences
Knowledge and positive or negative feeling about something
The organization of an individual’s distinguishing character traits, attitudes, or have it
A set of expectations for individuals based on some position they occupy
Groups with him buyers identify and whose values or attitudes they adopt. Include families, professional groups, civic organizations, and other groups with whom buyers identify and whose values or attitudes they adopt.
A ranking of people into higher or lower positions of respect
The integrated, excepted pattern of human behavior, including thoughts, speech, beliefs, actions, and artifacts
Psychological Variables of Buying Behavior
Perception, Motivation, Learning, Attitude, Personality
Social Variables of Buying Behavior
Social Roles, Reference Groups, Social Classes, Culture
Determining what customers want first then producing it
Family size is an example of the demographic segmentation of markets. Demographic segmentation includes age, sex, race, ethnicity, income, education, occupation, family size, religion, social class. These characteristics are often closely related to customers’ product needs and purchasing behavior, and they can be readily measured.
Key to Developing a Marketing Strategy
Maintaining a marketing mix that creates long-term relationships with customers
Product Development Process
Idea Generation –> New Idea Screening –> Business Analysis –> Product Development –> Test Marketing –> Commercialization
New ideas can come from marketing research, engineers and outside sources such as advertising agencies and management consultants. Ideas sometimes come from customers too.
New Idea Screening
In this phase, a marketing manager should look at the organization’s resources and objectives and assess the firm’s ability to produce and market the product. Important aspects to consider at this stage are consumer desires, the competition, technological changes, social trends, and political, economic and environmental considerations.
A basic assessment of product’s compatibility in the marketplace and its potential profitability.
Often expensive and few product ideas make it to this stage. Various elements of the marketing mix must be developed for testing. Copyrights, tentative advertising copy, packaging, labeling and descriptions of a target market are integrated to develop an overall marketing strategy.
A trial mini-launch of a product in limited areas that represent the potential market.
The full introduction of a complete marketing strategy and the launch of the product for commercial success.
Products intended for household or family use
Products that are used directly or indirectly in the operation of manufacturing processes of businesses
A group of closely related products that are treated as a unit because of similar marketing strategy
All the products offered by an organization
Product Life Cycle
Four stages – Introduction, Growth, Maturity, and Decline
Consumer awareness and acceptance of the product are limited, sales are zero and profits are negative
Sales increase rapidly and profits peak, then start to decline. One reason profits start to decline during the growth stage is the new companies enter the market, driving prices down and increasing marketing expenses.
Sales continue to grow but then they hit a curve peak and start to decline while profits continue to decline.
Sales continue to fall rapidly. Profits also decline and may even become losses as prices ar cut and necessary marketing expenditures are made. As profits drop firms may eliminate certain models or items.
The process of naming and identifying products
A brand that is registered with the US Patent and Trademark Office and is thus legally protected from use by any other firm
Initiated and owned by the manufacturer to identify products from the point of production to the point of purchase
Private Distributor Brands
Brands which may cost less than manufacturer brands, that are owned and controlled by a wholesaler or retailer.
Products with no brand name that often come in simple packages and carry only their generic name
The external container that holds and describes the product
The presentation of important information on a package
The degree to which a good, service, or idea meets the demands and requirements of customers
Charging the highest possible price that buyers who want the product will pay
A low price designed to help a product enter the market and gain market share rapidly
Encouraging purchased based on emotional rather than rational responses to the price
A type of psychological pricing in which a lower priced item is compared to a more expensive brand in hopes that the consumer will use the higher price as a comparison price.
Temporary price reductions, often employed to boost sales
A group of organizations that moves products from their producer to customers; also called a channel of distribution
Intermediaries who buy products from manufacturers (or other intermediaries) and sell them to consumers for home and household use rather than for resale or for use in producing other products
Intermediaries who buy from producers or from other wholesalers and sell to retailers
A form of market coverage whereby a product is made available in as many outlets as possible.
A form of market coverage whereby only a small number of all available outlets are used to expose products. Uses only a small number of all available outlets to sell products
The awarding by a manufacturer to an intermediary of the sole right to sell a product in a defined geographic territory.
All the activities necessary to move products from producers to customers-inventory control, transportation, warehousing, and materials handling.
The shipment of products to buyers.
The design and operation of facilities to receive, store, and ship products.
The physical handling and movement of products in warehousing and transportation
Integrated Marketing Communications
Coordinating the promotion mix elements and synchronizing promotion as a unified effort
A paid form of nonpersonal communication transmitted through a mass medium, such as television commercials or magazine advertisements
Designing a series of advertisements and placing them in various media to reach a particular target market.
Direct, two-way communication with buyers and potential buyers.
6 Step Process:
6 Step Process:
Nonpersonal communication transmitted through the mass media but not paid for directly by the firm
Direct inducements offering added value or some other incentive for buyers to enter into an exchange.
An attempt to motivate intermediaries to push the product down to their customers
The use of promotion to create consumer demand for a product so that consumers exert pressure on marketing channel members to make it available.
The use of promotion to create an maintain an image of a product in buyers’ minds