MKC1 Fudamental of Marketing and Business Communication – Flashcards
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What is the difference between strategic and tactical planning?
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-Strategic planning is the process of determining an organization's primary objectives and finding and implementing steps that will achieve the objectives. -Tactical planning is setting short-term actions that are needed to complete larger strategies.
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What is the difference between a business plan and a marketing plan?
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- Business plan is a detailed plan setting out the objectives of a business, the strategy and tactics planned to achieve them, and the expected profits, usually over a period of three to ten years. - Marketing plan is a strategic plan at the functional level that provides a firm's marketing group with direction. the strategy for implementing the components of marketing: creating, communicating, delivering, and exchanging value.
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What is the purpose of a marketing plan?
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It is a road map that improves the firm's understanding of its competitive situation. It helps the firm allocate resources and divvy up the tasks that employees need to do for the company to meet its objectives.
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What are the two elements of every marketing strategy?
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(1) Product Strategy (2) Market Strategy -market penetration strategy- Selling more of existing products and services to existing customers. -product development strategy- Creating new products or services for existing markets.
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How would you describe first-mover strategy?
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A Market innovator, not a follower- Corporate level strategy theorizing that being the first organization to offer a product in the marketplace will be the long-term market leader.
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What are the advantages and disadvantages of being a first mover?
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-Three benefits (advantages) of being first: technology leadership, control of resources, and buyer switching costs. -Disadvantages: Later entrants can overcome advantages, must heavily entice customers to try new type of product (high education expense), some first movers may become complacent with changing customer needs.
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How would you describe second-mover strategy?
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Corporate level strategy theorizing that closely observing the innovations of the first movers, and then improving on them can help an organization gain advantage in the marketplace.
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What are the advantages and disadvantages of being a second mover?
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-Advantages: Ability to observe competitors' successes and failures. Lower risk in product development and less controversy. Revising rather than creating and competitor surprise, and stealing market share rather than creating it. -Disadvantages: Persuading customers to "switch", communicating your value add.
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Name the different levels of strategic planning in an organization.
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corporate, business, and functional. The number of levels may vary. However, if a company has multiple planning levels, the plans must be consistent, and all must help achieve the overall goals of the corporation.
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Define the Strategic planning Process
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Evaluate External Environ / Evaluate Internal Environ Mission, Objectives, Value Prop & Strategy Formulation
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What is SWOT analysis?
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SWOT analysis-An acronym for strengths, weaknesses, (internal & controllable) opportunities,and threats (external & mostly uncontrollable), the SWOT analysis is a tool that frames the situational analysis. Determine competitive advantage.
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What is marketing?
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"The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large." (4 "p's = Product, Promotion, Place, Price)
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What are the 4 components of the marketing mix?
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The 4 P's - Product, Promotion, Place, Price a marketing plan is a mix of these four components.
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What is sales orientation?
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A philosophy that products must be pushed through selling and advertising in order for a firm to compete successfully.
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What is Market Orientation?
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A business approach or philosophy that focuses on identifying and meeting the stated or hidden needs or wants of customers.
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When should a company use marketing orientation (concept)?
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A time when there are many competing products and services available to customers.
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What is the difference between ethics and social responsibility?
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Ethics requires companies do no harm. Social Responsibility is the idea that companies should manage their businesses not just to earn profits but to advance the well-being of society.
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What is marketing myopia?
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Companies/industries defining themselves too narrowly, which renders them incapable of adapting to changing markets.
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How can companies avoid marketing myopia?
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redefined themselves beyond their original products
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Three examples of Marketing Myopia
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American Express - Credit Card Company Disneyland - Amusement Park BMW - Automobile
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Name the 4 elements of Relationship Marketing.
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1. Gather Customer Info - (Demographics,purchase & lifestyle characteristics) 2. Analyze Data-modify marketing mix to deliver diff msg to individual cust's 3. Monitor Interactions- satisfaction/dissatisfaction, calc cost/profits for new cust's 4. CRM (Cust Relationship Mgmt) - sophisticated technology for intimate knowledge of cust's & their preferences.
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Why is interactive marketing an important tool for marketers?
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Interactive marketing is interactive dialog w/ cust's. Allows companies to learn what cust's want and like, allows company to educate cust's on value and where to find products, allows companies to solve cust issues.
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What is the Consumer Product Safety Act?
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Est. 1972 to "assist consumers in evaluating the comparative safety of consumer products; to develop uniform safety standards for consumer products and to minimize conflicting state and local regulations; and to promote research and investigation into the causes and prevention of product related death, illnesses, and injuries." The act also established the Consumer Product Safety Commission (CPSC) to "protect the public against unreasonable risks associated with consumer products." The CPSC has authority to set mandatory standards, ban products, order recalls of unsafe products, and institute labeling requirements.
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Sherman Antitrust Act
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Est. 1890 was the first action taken by the federal government to place limits on business monopolies and cartels and to prevent restraints on trade, such as price fixing
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Clayton Act
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Est 1914. Increased the scope of the Sherman Antitrust Act. It was meant to supplement, include (1) a prohibition on anticompetitive price discrimination; (2) a prohibition against certain tying and exclusive dealing practices; (3) an expanded power of private parties to sue and obtain treble (triple) damages; (4) a labor exemption that permitted union organizing; and (5) a prohibition against anticompetitive mergers.
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Robinson-Patman Act
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Est 1936. Amendment to the Clayton Act of 1914. It prohibits sales that discriminate in price on the sale of goods to equally-situated distributors when the effect of such sales is to reduce competition.
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Federal Trade Commission Act
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Est 1914. The act established the Federal Trade Commission (FTC) (primary purpose to protect consumers) to challenge any "unfair methods of competition ... , and unfair or deceptive acts or practices in or affecting commerce." To ensure the smooth operation of our free market system, the FTC enforces federal consumer protection laws that prevent fraud, deception and unfair business practices, such as telemarketing fraud, Internet scams or price-fixing schemes. The Commission also enforces federal antitrust laws that prohibit anticompetitive mergers and other business practices that restrict competition and harm consumers.
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The Wheeler-Lea Act
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Est. 1938. AKA-Advertising Act. Amendment to the Fed Trade Comm Act. This Act attempts to tackle the evils of false and misleading advertisement.. The FTC is given the power to check false advertising of any foods, drugs, medical devices, and cosmetics.
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Federal Food and Drug Act
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Est 1906. For preventing the manufacture, sale, or transportation of adulterated or misbranded or poisonous or deleterious foods, drugs, medicines, and liquors, and for regulating traffic therein, and for other purposes.
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North American Free Trade Agreement (NAFTA)
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Est. 1994 - It is designed to remove tariff barriers between the U.S., Canada and Mexico. Includes two important side agreements on environmental and labor issues that extend into cooperative efforts to reconcile policies, and procedures for dispute resolution between the member states.
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What is the personal value equation?
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Value = Benefits received − [Price + Hassle]
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The focus of a value proposition is ________.
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what customers want
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What serves as an effective guide for developing a company's strategies for a particular target market?
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the value proposition
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What is market segmentation?
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The process of breaking down all consumers into groups of potential buyers with similar characteristics.
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What is target market?
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The select groups of people you sell to.
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Different buyer characteristics used to segment markets.
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Behavioral, demographic, geographic, psychographic.
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What are different ways to demographically segment customers?
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Segment by tangible personal characteristics. Age, generation, Income, Gender, Family life cycle, Ethnicity, Family size, Occupation, Education, Nationality, Religion, Social class
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Describe psychographics?
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Customer activities, interests, opinions, values, attitudes, lifestyles
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How would you describe product-related (behavioral) segmentation?
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It divides people and organization into groups according to how they behave with or act toward products. (1) Benefits sought from the product (2) How often the product is used (usage rate) (3) Usage situation (daily use, holiday use, etc.) (4) Buyer's status and loyalty to product (nonuser, potential user, first-time users, regular user)
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Identify criteria for market segmentation.
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(a) Measurable purchasing power and size: The market should be sizeable enough to be profitable given your operating cost. (b) Good profit potential: The market should be growing and not saturated with competitors. (c) Able to serve the market segment: Either the market is already accessible or you can find a way to reach it. (d) Match with marketing capabilities: You might have a great idea to market home electronics to a large number of smaller market segments, but this can be prohibitively expensive. (e) Ability and resources to compete. (f) Consistent with firm's mission.
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Global Market targets.
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China, Russia, India, and Brazil because of their fast-growing middle classes.
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What is market positioning?
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Tailoring your product so that it stands out from the competition and people want to buy it.
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What is a perceptual map?
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A two-dimensional graph that visually shows where your product stands, or should stand, relative to your competitors, based on criteria important to buyers. The criteria can involve any number of characteristics—price, quality, level of customer service associated with the product, and so on. To avoid head-to-head competition with your competitors, you want to position your product somewhere on the map where your competitors aren't clustered.
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Identify common types of positioning strategies:
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(1) attribute or benefit- This is the most frequently used positioning strategy. (2) use or application- how the product will be used (3) User: (4) product or service class (5) Competitor (6) price or quality Bottom-line know what your customers want!
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Name the 2 steps to take when determining strategic opportunities.
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(1) Analyze recent past for developing trends (2) Predict the future based on emerging trends
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In preparing a business case gather demographics and pyschographic data to get a clear picture of target market. Translate data into what two crucial descriptions.
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(1) Purchase patterns description (2) Buying sensitivities description
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PRIZM combines which two bases of marketing segmentation to generate its categories of customers?
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demographics and geography
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What is consumer insight?
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An understanding of consumers that results when both quantitative and qualitative info are gathered about them.
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What is microtargeting?
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The process of gathering multiple sources of data available on people, everything from their tax and phone records to the catalogs they receive, so as to market to them. (It has ethical implications)
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What is Marketing research?
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The process of collecting, analyzing, and reporting marketing information that can be used to answer questions or solve problems so as to improve a company's bottom line. Done on an as-needed or project basis, not on an ongoing basis. What a company has to resort to if it can't answer a question by using market intelligence, internal company data, or analytical software.
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What is "Market" research
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The process of researching a specific market to determine its size and trends. (Narrower activity)
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Define marketing information system (MIS).
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A system, either paper or electronic, used to manage information a firm's marketing professionals and managers need to make good decisions.
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What is clickstream data?
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Data collected from Web sites showing the Web pages visitors clicked on and the order of their clicks.
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What is primary data?
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Data collected using hands-on tools such as interviews or surveys to answer a question for a specific research project.
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What is secondary data?
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Data already collected by your firm or another organization for purposes other than the marketing research project at hand.
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Where can secondary research sources be found?
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Census Data, web sites, publications, trade associations, syndicated research and Market aggregators.
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Describe and give examples of the three primary research methods.
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1) Observation = traffic controls, Nielsen TV ratings, Taping shopping habits, 2)surveys= Focus group interview, telephone survey, online survey , 3)controlled experiments= test market
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Define Data Mining.
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The process of accessing different databases to get the right data to the right places for decision-making in marketing.
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Concerning primary data versus secondary data in the marketing research process what should one think about.
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One should always look at the availability of secondary data before gathering primary data
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What are the types of Research Design?
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1. Exploratory research design 2. Descriptive research design 3. Causal research design (experiments)
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What is ethnography?
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A type of study whereby marketing researchers interview, observe, and often videotape people while they work, live, shop, and play
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What is projectve technique?
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An exploratory research technique used to reveal information research respondents might not reveal by being asked directly.
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What is descriptive research design?
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A study that involves gathering hard numbers, often via surveys, to describe or measure a phenomenon so as to answer the questions of who, what, where, when, and how.
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Define consumer behavior.
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The reasons why—personal, situational, psychological, and social—people shop for products, buy and use them, and then dispose of them.
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Define postpurchase dissonance.
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A situation in which consumers rethink their decisions after purchasing products and wonder if they made the best decision.
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Name the stages of Consumer Purchasing Process.
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(1) Need Recognition, (2) Search for Product Info (3) Product Evaluation (4) Product Choice & Purchase, (5) Post purchase use & evaluation of product, (6) Disposal of product.
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Maslow's Hierarchy of Needs
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(Bottom Up - Pyramid) Physiological, safety Needs, Social Needs, Esteem Needs, Self Actualization.
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Sequence of stages in the B2B buying process.
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need recognition, description and quantity of purchase need, search for suppliers, request for proposals sought, establishment of an order routine, and post-purchase evaluation conducted and feedback provided to vendor.
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Which type of e-commerce Web site helps the seller get the highest price for its product?
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a sell-side Web-based auction
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What is another name for a sell-side Web-based auction?
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a forward auction
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What are the top 5 countries that have a penchant for bribery?
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1. Russia 2. China 3. Mexico 4. India 5. Italy
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In b2b, what is fluctuating demand in b2b?
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Demand that fluctuates sharply in response to a change in consumer demand.
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In b2b, what is derived demand?
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Demand that springs from, or is derived from, a secondary source other than the primary buyer of the product.
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What are producers?
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Companies that purchase goods and services that they transform into other products.
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What are resellers?
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Companies that sell goods and services produced by other firms without materially changing them.
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A group of related offerings is called a what?
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product line
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What is a name, picture, design, symbol, or combination of those items used by a seller to identify its offerings and to differentiate them from competitors' offerings?
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The brand
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Name the 4 general consumer offerings categories.
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1. Convenience offerings: Low-priced, frequently purchased products and services that require little shopping effort. 2. Shopping offerings: An offering for which the consumer will make an effort to compare various firms' offerings and select a brand. 3. Specialty offerings: An offering that is highly differentiated from other offerings and is designed to satisfy a similar need or want. 4. Unsought offerings: An offering consumers don't typically shop for until it is needed. Examples include funeral and towing services.
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Product Development Strategies
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1. Market Penetration: increase sales of current products in existing mkts. 2. Mkt Development: expand sales of current products in new mkts. Est new distribution channels or promote new uses of product. 3. Product Development; introduce new product in established mkt. 4. Product Diversification: (most risky) new product in new mkts.
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Product development process.
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1. generate ideas, 2. evaluate ideas, 3. conduct feasibility research, 4. develop product, 5. test product, 6. sell product.
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What are the two popular portfolio planning approaches?
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BCG model and the GE approach.
