question

Marketing Strategy formation

answer

overall long-term goals, customer selection and value creation

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Marketing Planning

answer

formation of shorter-term plans to pursue long-term goals outlined during Marketing Strategy Formation stage

question

Programming, allocation, and budgeting

answer

short-term strategy to distribute resources effectively in pursuit of marketing strategy/marketing plan

question

Implementation

answer

executing tactics in pursuit of strategy developed over the prior three steps

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Monitoring and auditing

answer

evaluating the results of marketing tactics

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Analysis and Research

answer

gathering all necessary data needed to redesign marketing strategies or tactics

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Steps of forming a Marketing Strategy

answer

Marketing planning, programming, allocation and budgeting, implementation, monitoring and auditing, and analysis and research, all steps interact and rely on other steps

question

Marketing Strategy formation process

answer

the process of forming and executing a marketing strategy involves analyzing the market, making decisions on your aspiration and actions/tactics, and evaluating the results

question

5Cs analysis

answer

gathering of relevant information that is used in all future marketing decisions, need to continuously update their understanding of the 5Cs, always start with customer

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Customer analysis

answer

Determine who our customers or potential customers are, evaluate all potentially relevant aspects of consumer behavior in the market

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Decision-Making Unit

answer

who actually makes the decision, can be anything from a single customer to a huge group of complicated relationships, need to create value for the decision-making unit

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Types of Decision-making units

answer

initiators, gatekeepers, deciders, influencers, purchasers, users; one person can be more than one type

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Initiators

answer

begin the search for new products

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Gatekeepers

answer

experts that control access to information

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Decider

answer

actually make the purchasing choice

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Influencers

answer

serve to influence and modify the process by which deciders make decisions

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Purchasers

answer

purchase the product

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Users

answer

consume the product

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Company analysis

answer

the core competency of the company

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Core competency

answer

significantly contributes to the creation of customer value, difficult for competitors to imitate, from company's perspective

question

Collaborator analysis

answer

analyze the incentives, strategies, and goals of all potential collaborators which can be any company that helps the firm operate

question

Competitor analysis

answer

assessing the threat posed by competitors

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Competitors and collaborators

answer

can often be the same company, sometimes direct competitors can be forced by an outside force to collaborate

question

Context Analysis

answer

the firm can't control all factors that impact sales like culture, legal issues, regulations, social norms, etc.

question

The 5Cs

answer

Customer, Company, Collaborators, Competitors, Context

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Aspiration

answer

decision about the firm's general goals given analysis of the market, STP

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STP

answer

Segmentation, Targeting, and Positioning

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Segmentation

answer

divide the market into groups for which value is more homogeneous

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Targeting

answer

choose the segment of segments to serve, market in which the firm can generate the most profits, based on either providing additional value and on the size of the potential segment

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Positioning

answer

place the product/brand/firm to serve the targeted segment

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Positioning Statement

answer

specify the target customer as defined by segmentation, the wants of that customer, the product type and category from the customer's perspective, and the key benefit to be provided to the target customer

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Marketing Mix 4Ps

answer

Price, Product, Promotion, Place,

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Marketing Mix

answer

deciding on marketing actions, important that each tactic pursues strategic goals and is based on analysis and aspirational goals, have to consider tactics from a unified perspective

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Outcomes of marketing strategy

answer

depends on goals, usually in form of profit or improving customer lifetime value

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Customer Value

answer

basis of all marketing strategies, purpose of firm is to provide and collect value from customer

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Value Proposition

answer

foundation of any good business, total set of benefits offered to customers, viewed very expansively, from customer's perspective, don't need to be entirely unique, should tie into core competency

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Types of customer value

answer

social, functional, experiential, and economic

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Functional Value

answer

Value provided by the actual functioning of the product, can be a bundle of different attributes

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Conjoint Analysis

answer

marketing research technique meant to find the importance of an attribute by making customers tradeoff between attributes

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Thresholds

answer

attribute needs to reach a threshold level, often apply when functioning requires a basic level or performance

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Economic Value

answer

Ability to provide a benefit for a lower cost than alternatives, need to provide some other benefit (usually fuctional), secondary form of value

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Poverty Trap

answer

often costs money upfront to save money, difficult to obtain this capital

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Value is Heterogeneous

answer

customers vary, often substantially, in their value for a product, might pay for itself for one person, but not another, have to consider the distribution and not just the average when determining customer value for your product

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Experiential value

answer

difficult to quantify, often emotionally driven, includes branding and design

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Branding

answer

signals of quality, status, image, consistency, signals of placement, and often a signal to others

question

Brand Equity

answer

amount of value of a brand to the firm, often recorded at the firm level

question

Design

answer

aesthetically pleasing, can be delivered directly, also can work with social value (conversation pieces)

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Customer Service

answer

Great customer service can deliver value even in the face of terrible experiences

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front-line employees

answer

those immediately responsible for a quality experience are often the lowest paid, least experienced, and least trained

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Automation of service

answer

many younger people prefer technology to interactions with people

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Emotional benefits

answer

makes you feel like a better person, think that you are supporting your area, University, etc.

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Social Value

answer

gain value as others buy a product or observe you purchasing a product, seek confirmation that we are right and that product is high quality

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Platform markets

answer

two-sided markets, market becomes more valuable as the other set of customers adopt, indirect network effects, increasingly important in the entertainment industry

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Social Capital

answer

can enhance reputation through online communication, also gain social capital through the purchase and display of certain products

question

Social relationships

answer

can become closer to others through online or offline communication, simply improving social relationships can be a form of value, facebook and twitter

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Educating customers of value

answer

value is often not readily apparent to customers, requires substantial education through promotion and other marketing tactics

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Benefits of Segmentation

answer

provide more value, few firms can serve entire market and provide sufficient value compared to more niche firm, higher prices, lower costs with promotion and distribution expenses

question

Segmentation benefits to company

answer

identification of unfulfilled needs, better product design, more targeted promotions, increased customer satisfaction

question

Segmentation Benefits to the customer

answer

convenience and time savings, tailored products and services, relevant offers, personalized experience

question

characteristics of a good segment

answer

identifiable, substantial

question

Identifiable segment

answer

need to be able to identify the differences between groups, technology helps to increase personal data and more segmented media

question

Substantial segment

answer

can vary by product by fixed cost, profit margin, or volume per purchaser

question

Stable segment

answer

segment must remain for a long enough period, look at product lifecycle

question

Accessible segments

answer

have to be able to reach the intended segment, better if they can be reached without reaching many people not in the segment

question

Actionable segments

answer

need to be able to target the segment and position the product for segmentation to be worth it

question

Common segmentation variables

answer

geographic, demographic, psychographic, behavioral, benefits sought

question

Different sizes of a target market

answer

mass marketing, large segments, niche marketing, one-to-one size

question

Mass marketing

answer

targeting all (or nearly all) potential customers

question

Segment Marketing

answer

relatively limited segmentation, might sell to a mass market in a few locations, divide the market into a very limited number of segments, often does not require market leadership to gain profitability

question

Niche Marketing

answer

identifying and serving one or more small segments, often requires becoming a leader in the segment, divides very large categories into a very small market with a specific specialization

question

One-to-one marketing

answer

product is produced for one customer, mass customization- providing a set of option for a customer to create a unique product

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Steps of Target market selection

answer

5Cs analysis, determine which segment we can profitably serve, segment characteristics, competition, and company fit

question

Targeting over time

answer

start with mass production, mass marketing, standardized products, low customer involvement, and one-way broadcasted brand communications, then make technological innovations, and then more niche and one-to-one marketing, two-way media, and more customer involvement

question

Product

answer

the means by which firms directly provide value to customers, should be strategically determined, can be a product, service or combination

question

Product portfolio

answer

all products released by the firm, should be some strategic fit between products

question

Product Breadth

answer

number of product lines offered by the firm

question

History of product breadth

answer

post WWII there were a lot companies with large breadths with many division that were weakly related so that is one line failed, others were there to support the company, this fell out in the 1980s when a theory suggested that firms should be strategically focused on core competencies rather than developing financial strength

question

Product line depth

answer

number of products in one product line, may compete with multiple offerings per product line, usually higher or lower quality/price offerings

question

Customer Heterogeneity

answer

high amounts of customer heterogeneity push you towards expanded product lines

question

How to effectively target and position each segment

answer

identify segment, reach the segment, and position the product to serve that market

question

Product line decisions and competition

answer

go head-to-head with new competitors, preempt potential entrants into your product-level, change customer perceptions of the product-level, could grow the entire category

question

Cannibalization

answer

added a new product but then taking sales from an existing product

question

Cluttered product lines

answer

lines with many products and limited differentiation, a lot of cannibalization

question

Brand Equity and product lines

answer

moving down the product line often hurts brand equity, customers association our brand with lower quality/cost products, and moving up in the product line can cause the brand name to become less clear and can be difficult when the brand is associated with a lower quality product

question

Collaborator impact on product line expansion

answer

could raise costs for collaborators, additional shelf space, need to develop support for new product, some extensions occur for improved collaborator relationships, exclusive products with certain retailers

question

Additional fixed costs with product line expansion

answer

R&D, manufacturing costs, advertising, etc., high fixed costs will serve as a disincentive to product line depth extensions

question

Product design

answer

design product to deliver value to customers, products should be considered from the perspective of the overall offering

question

Levels of product value delivery

answer

generic -> Expected -> augmented -> potential

question

Types of new products

answer

incremental changes to existing products, existing product line expansion, new product to the firm, new-to-world product

question

Products as bundles

answer

viewing a product as a set of attributes, create the product that best delivers value to targeted customers

question

Product lifecycles

answer

strategically important to consider where in the product's lifecylce a product currently is and the nature of the product lifecycle, sales of products change overtime, durable products change less

question

Product Lifecyle Stages

answer

Introduction, growth, maturity, decline

question

Introduction stage

answer

early adopters, technology seeking-customers (value from trying new tech), get social value from owning it first

question

Growth Stage

answer

technology-friendly but technology is a means to an end, often preceded by a "chasm" or a "saddle" in sales

question

Maturity

answer

Need a well-proven value proposition, some disincentive to adopt

question

Decline

answer

customers that switch as a last resort for older products, high disutility for technology

question

Hierarchy of effects

answer

unaware -> awareness -> knowledge -> liking -> preference -> conviction -> purchase

question

Cognitive steps of hierarchy of effects

answer

unaware, aware, and knowledge

question

Affective steps of hierarchy of effects

answer

liking and conviction

question

Behavior step of hierarchy of effects

answer

purchase

question

Customer funnel

answer

awareness, consideration, conversion, loyalty, advocacy

question

Category need

answer

convince customers that they need to purchase in the category, product provides value

question

Brand awareness

answer

buyer's ability to recognize the brand within a category

question

Brand attitude

answer

effectiveness, and what does the brand say about me?

question

Determining brand attitude

answer

better attitude from direct communication of information and signaling quality by being able to advertise, more ads leads to higher perceived quality

question

Purchase intention/facilitation

answer

provide incentive to overcome final hurdle to purchase; price promotions, free trials, direct appeals

question

Loyalty and advocacy

answer

service provided by sales staff, providing information on better solutions for customer problems

question

Media planning

answer

be established to meet strategic goals, looking for return on investment, need to first decide what the goal of the communications should be, use promotional mix to help provide value

question

Advertising

answer

non-personal messages passed through some form of media

question

Pros of advertising

answer

message control, ability to target customers, audience data, and relatively rich content possibilities

question

Cons of advertising

answer

expensive, non-personal, message clutter, and personal knowledge is heavily activated

question

Sales promotion

answer

typically short-term promotions to encourage purchases or channel adoption, often meant to encourage trial by new customers or improve relations with collaborators, can serve to price segment

question

Pros of sales promotion

answer

improve sales immediately, encourage first-time trial, lower risk to new adopters, improve relationships with collaborators

question

Cons of sales promotion

answer

can hurt the brand, customers and intermediaries begin to expect lower prices, can significantly harm short-term profitabilitiy

question

Personal selling

answer

one-to-one or one-to-many communication

question

Pros of personal selling

answer

direct and immediate contact allows for modification and personalization, high understanding of nuances of customer needs

question

Cons of personal selling

answer

very high cost per customer, potential for inconsistent, messages, often requires building sales-customer relationship

question

Publicity

answer

nonpaid media-oriented content designed to place the firm or its offering in a more positive light

question

Pros of Publicity

answer

very low (often no) cost, high credibility, high word-of-mouth potential, low persuasion knowledge activation

question

Cons of Publicity

answer

low message control and personalization, lower ability to target specific customers then paid promotion

question

Public/Investor Relations

answer

development of goodwill with investors or other (non-media) influentials, not typically intended for customers directly, spillover effects

question

Pros of Public/Investor Relations

answer

low cost, impact could potentially be substantial, a positive statement from one influential source can cause major impacts

question

Cons of Public/Investor Relations

answer

often does not directly tie into sales, sometimes difficult to assess or control

question

Direct Marketing

answer

Customized communication designed to directly sell to customers, can occur through a variety of channels, often called "database marketing" due to the use of customer data in targeting message recipients

question

Pros of Direct Marketing

answer

can be easily combined with other promotional methods, allows for many customized segments

question

Cons of Direct Marketing

answer

some methods are not highly thought of by customers, can be expensive to collect and maintain sufficient data

question

Events and Sponsorship

answer

supporting causes, sports teams, events, charities, etc. that customers support, often includes associated advertising

question

Pros of events and sponsorship

answer

great for awareness, can improve company image, shows customers that you share the same values

question

Cons of events and sponshorship

answer

expensive, risk due to lack of control, shallow messaging

question

Product Placements/Branded Entertainment

answer

Placing a product in some other form of entertainment

question

Pros of product placements

answer

low cost per impression by paid promotion standards, lower persuasion knowledge activation, lower regulations than advertising

question

Cons of product placements

answer

limited exposure time, customers may not notice the message, limited control over the message

question

Point of Purchase/Packaging

answer

In-store media (including media found on packaging)

question

Pros of point of purchase/packaging

answer

very salient at the time of purchase, often appreciated by collaborators

question

cons of point of purchase/packaging

answer

customers can tend to pay less attention (filter out) persistent point-of-purchase advertising or attention-grabbing packaging

question

Word of mouth

answer

advice from customers or other influentials to other (potential) customers

question

Pros of word of mouth

answer

credibility developed from existing trust, spread information between customers is typically (although not always) no cost

question

Cons of word of mouth

answer

can be difficult to identify influentials, limited control, negative word of mouth can be exceptionally harmful

question

Push marketing

answer

demand comes from intermediaries to the manufacturer who makes the product, gives them to the intermediaries and then to the end users

question

Pull marketing

answer

demand comes from the manufacturers to the end users who want the product and ask for it from the intermediaries who get it from the manufacturers

question

Impact of internet on marketing

answer

not really additional element of promotional mix, new outlet for each of the other elements

question

Factors that influence the promotion mix

answer

product factors, demand and supply factors, customer factors, budget factors, marketing mix

question

Product factors that influence promotion mix

answer

some products lend themselves to certain forms of promotion, different products and different positions in the product or customer lifecycle result in varying effectiveness

question

Demand and Supply factors that influence promotion mix

answer

some demand is exceptionally elastic or inelastic, different promotions needed for each, competition often changes both the amount and type of promotion that is needed

question

Customer factors that influence promotion mix

answer

concentration of customers, how well customers can be segmented and targeted, how customers behave and who they are

question

Budget Factors that influence promotion mix

answer

financial resources available, seasonality

question

Marketing mix factors that influence promotion mix

answer

promotion needs to align with other marketing mix factors

question

Traditional way to measure promotion effects

answer

sales response models, advertising occurs and then a change in sales, either static or dynamic

question

Modern promotion environment

answer

many different forms of promotion, each have unique effects from unaware to purchase through many different forms of promotions

question

Types of attribution models

answer

last channel gets credit, first channel gets credit, all channels get equal credit, or all channels get partial credit

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