BUSA300 midterm exam

What three attitude-change approaches are most common?

(1) Change beliefs about the extent to which a brand has certain attributes. (2) Change the perceived importance of these attributes. (3) Add new attributes to the product.

What are the three main types of organizational buyers?

(1) Industrial firms, which in some way reprocess a product or service they buy before selling it again to the next buyer; (2) resellers, which are wholesalers and retailers that buy physical products and resell them again without any reprocessing; and (3) government units, which are the federal, state, and local agencies that buy products and services for the constituents they serve.

What two challenges must marketers overcome when marketing to Hispanic consumers?

(1) The diversity of nationalities among this subculture that affect product preferences and (2) the language barrier that can lead to misinterpretation or mistranslation of commercial messages when translated into Spanish.

(non highlighted in study sheet) Marketers are concerned with which types of reference groups?

(1) associative groups—ones to which a person actually belongs, such as a brand community that consists of a specialized group of consumers with a structured set of relationships involving a particular brand; (2) aspiration groups—ones that people wish to be a member of or identified with; and (3) dissociative groups—ones that people wish to maintain a distance from because of differences in values or behaviors.

(not highlighted)In evaluating marketing actions, what are the two dimensions on which they should be evaluated?

(1) evaluate the decision itself, which involves monitoring the marketplace to determine if action is necessary in the future; and (2) evaluate the decision process used to determine (a) whether the marketing research and analysis used to develop the recommendations were effective or flawed in some way and (b) whether the process could be improved for similar situations in the future.

What are the four I's of services?

(1) intangibility, which means that they can't be held, touched, or seen; (2) inconsistency, which means that their quality varies with each person's capabilities and day-to-day job performance; (3) inseparability, which means that the consumer cannot (and does not) separate the deliverer of the service from the service itself; and (4) inventory, which means that inventory carrying costs are more subjective and are related to idle production capacity—when the service provider is available but there is no demand for the service.

What are the three kinds of sales forecasting techniques?

(1) judgments of the decision maker who acts on the results of a sales forecast; (2) surveys of knowledgeable groups, those who are likely to know something about future sales; and (3) statistical methods such as trend extrapolation, which involves extending a pattern observed in past data into the future.

In terms of market segments and products, what are the three market segmentation strategies?

(1) one product and multiple market segments; (2) multiple products and multiple market segments; and (3) "segments of one," or mass customization—the next step beyond build-to-order.

Identify factors that influence ethical and unethical marketing decisions.

(1) societal culture and norms, (2) business culture and industry practices, (3) corporate culture and expectations, and (4) personal moral philosophy and ethical behavior.

To serve both buyer and sellers, marketing seeks to what?

(1) to discover the needs and wants of prospective customers and (2) to satisfy them. These prospective customers include both individuals, buying for themselves and their households, and organizations, buying for their own use (such as manufacturers) or for resale (such as wholesalers and retailers)

What are the Four Factors required for marketing to occur?

(1) two or more parties (individuals or organizations) with unsatisfied needs; (2) a desire and ability on their part to have their needs satisfied; (3) a way for the parties to communicate; and (4) something to exchange.

Identify the major sociocultural influences on consumer behavior.

)))Sociocultural influences, which evolve from a consumer's formal and informal relationships with other people, also affect consumer behavior. These involve (1) Personal influence(Opinion leadership and word-of-mouth behavior are two major sources of personal influence), (2) Reference groups (are people to whom an individual looks as a basis for self-approval or as a source of personal standards), (3)Family influences(result from three sources: consumer socialization, passage through the family life cycle, and decision making within the family or household) , (4)culture, and subculture (a person's culture and subculture have been shown to influence product preferences and buying patterns)

What are the two primary forms of personal influence?

- (1) Opinion leadership—persons considered to be knowledgeable about or users of particular products and services and - (2) word of mouth—the influencing of people (friends, family, and colleagues) during conversations.

What is the difference between an organization's business and its goals?

- organization's business describes the clear, broad, underlying industry or market sector of an organization's offering. An - organization's goals (or objectives) are statements of an accomplishment of a task to be achieved, often by a specific time. Goals convert an organization's mission and business into long- and short-term performance targets to measure how well it is doing.

Recognize the various terms that pertain to products and services.

- product is a good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies consumers and is received in exchange for money or something else of value. -A good has tangible attributes that a consumer's five senses can perceive and intangible ones such as warranties; a laptop computer is an example. Goods also can be divided into nondurable goods, which are consumed in one or a few uses, and durable goods, which usually last over many uses. -Services are intangible activities or benefits that an organization provides to satisfy consumer needs in exchange for money or something else of value, such as an airline trip. -An idea is a thought that leads to a product or action, such as eating healthier foods.

Describe four generational cohorts.

-(1) Baby boomers, generation of 73 million among the U.S. population born between 1946 and 1964. These Americans are growing older and will all be 65 or older by 2030. -(2) Generation X includes the 50 million people born between 1965 and 1976. These well-educated Americans, also known as the baby-bust cohort because of declining birthrates during that time, are supportive of racial and ethnic diversity. -(3) Generation Y, or millennials, are the 75 million Americans among the U.S. population born between 1977 and 1994. The rising birthrate of this "echo-boom" cohort is the result of baby boomers having children. -(4) The post-millennial generation, which includes consumers born between 1995 and 2010, is referred to as Generation Z.

Explain the four market-product strategies in diversification analysis.

-(1) Market penetration, a strategy to increase sales of current products in current markets (no change in either the basic product line or markets reserved, but rather selling more of the product or selling the product at a higher price generates increased sales.). -(2) Market development, strategy to sell current products to new markets. -(2) Market development, strategy to sell current products to new markets. -(3) Product development, strategy of selling new products to current markets. -(4) Diversification, strategy of developing new products and selling them in new markets.(high risk strategy b.c firm has no prev. production or mrktng experience on which to draw in marketing a new product to a new market.)

What are the three types of buying situations or buy classes?

-(1) New buy—the organization is a first-time buyer of the product or service; -(2) straight rebuy—the organization reorders an existing product or service from a list of acceptable suppliers; and -(3) modified rebuy—an organization's buying center changes the product's specifications, price, delivery schedule, or supplier.

What are the three steps of the planning phase of the strategic marketing process?

-(1) Situation analysis, involves taking stock of where the firm or product has been recently, where it is now, and where it's headed in terms of the organization's marketing plans and the external forces and trends affecting it. To do this, an organization uses a SWOT analysis, an acronym that describes an organization's appraisal of (internal Strengths and Weaknesses) and its (external Opportunities and Threats.) -(2) Market-product focus and goal setting, which determine what products an organization will offer to which customers. This is often based on market segmentation—aggregating prospective buyers into groups or segments that have common needs and will respond similarly to a marketing action. -(3) Marketing program, which is where an organization develops the marketing mix elements and budget for each offering.

How does technology impact customer value?

-(1) The declining cost of technology allows consumers to assess the value of technology-based products on other dimensions, such as quality, service, and relationships. -(2) Technology provides value through the development of new products. -(3) Technology enables the collection of data used in the growing field of data analytics.

What are the four main types of consumer products?

-(1) convenience products—items that the consumer purchases frequently, conveniently, and with a minimum of shopping effort; -(2) shopping products—items for which the consumer compares several alternatives on criteria such as price, quality, or style; -(3) specialty products—items that the consumer makes a special effort to search out and buy; and -(4) unsought products—items that the consumer does not know about or knows about but does not initially want.

(not highlighted)What is the difference between the demographic and behavioral bases of market segmentation?

-Demographic segmentation is based on some objective physical (gender, race), measurable (age, income), or other classification attribute (birth era, occupation) of prospective customers. -Behavioral segmentation is based on some observable actions or attitudes by prospective customers—such as where they buy, what benefits they seek, how frequently they buy, and why they buy.

What is the difference between a consumer's disposable and discretionary income?

-Disposable income is the money a consumer has left after paying taxes to use for necessities such as food, housing, clothing, and transportation. -Discretionary income is the money that remains after paying for taxes/necessities and is usually spent on luxury items.

What is the difference between a for-profit and a nonprofit organization?

-For-profit: a privately owned organization that serves its customers to earn a profit so that it can survive. -Nonprofit: is a nongovernmental organization that serves its customers but does not have profit as an organizational goal. Instead, its goals may be operational efficiency or client satisfaction

Distinguish among industrial, reseller, and government organizational markets.

-Industrial firms in some way reprocess a product or service they buy before selling it to the next buyer. -Resellers (wholesalers and retailers) buy physical products and resell them again without any reprocessing. -Government agencies at the federal, state, and local levels buy goods and services for the constituents they serve. The North American Industry Classification System (NAICS) provides common industry definitions for Canada, Mexico, and the United States, which facilitates the measurement of economic activity for these three organizational markets.

(Not highlighted) How are marketing and product synergies different in a market-product grid?

-Marketing synergies run horizontally across a market-product grid. Each row represents an opportunity for efficiency in the marketing efforts to a market segment. -Product synergies run vertically down the market-product grid. Each column represents an opportunity for efficiency in research and development (R&D) and production. Marketing synergies often come at the expense of product synergies because a single customer segment will likely require a variety of products, each of which will have to be designed and manufactured. The company saves money on marketing but spends more on production. Conversely, if product synergies are emphasized, marketing will have to address the concerns of a wide variety of consumers, which costs more time and money.

Why are many companies developing multicultural marketing programs?

-Multicultural marketing programs consist of combinations of the marketing mix that reflect the unique attitudes, ancestry, communication preferences, and lifestyles of different races and ethnic groups. -Multicultural marketing programs are being developed in response to rapid changes in the racial and ethnic diversity of the United States. The growing size of the African American, Asian, and Hispanic populations has increased the economic impact of these groups on the marketplace.

What is the difference between a multidomestic marketing strategy and a global marketing strategy?

-Multinational firms- view the world as consisting of unique markets. As a result, they use a (multidomestic marketing strategy) because they have as many different product variations, brand names, and advertising programs as countries in which they do business. -Transnational firms- view the world as one market. As a result, they use a (global marketing strategy), which involves standardizing marketing activities when there are cultural similarities and adapting them when cultures differ.

Describe three approaches to developing a company's sales forecast.

-One approach to developing a sales forecast uses the subjective judgments of the decision maker, such as in direct or lost-horse forecasts. A direct forecast involves estimating the value to be forecast without any intervening steps. A lost-horse forecast starts with the last known value of the item being forecast and then lists the factors that could affect the forecast, assesses whether they have a positive or negative impact, and makes the final forecast. -Surveys of knowledgeable groups, a second method, involve obtaining information such as the intentions of potential buyers or estimates provided by the salesforce. -Statistical methods involving extending a pattern observed in past data into the future are a third approach. The best-known statistical method is linear trend extrapolation.

What is the difference between a panel and an experiment?

-Panel is a sample of consumers or stores from which researchers take a series of measurements. -Experiment involves obtaining data by manipulating factors under tightly controlled conditions to test cause and effect, such as changing a variable in a customer purchase decision (marketing drivers) and seeing what happens (increase/decrease in unit or dollar sales).

What is the difference between product positioning and product repositioning?

-Product positioning refers to the place a product occupies in consumers' minds based on important attributes relative to competitive products. -Product repositioning involves changing the place a product occupies in a consumer's mind relative to competitive products.

Explain how marketing uses secondary and primary data.

-Secondary data have already been recorded prior to the start of the project and consist of two parts: (a) internal secondary data, which originate from within the organization, such as sales reports and customer comments; and (b) external secondary data, which are created by other organizations, such as the U.S. Census Bureau (which provides data on the country's population, manufacturers, retailers, and so on) or business and trade publications (which provide data on industry trends, market size, etc.). -Primary data are collected specifically for the project and are obtained by either observing or questioning people.

Explain the distinction between standardization and customization when companies craft worldwide marketing programs.

-Standardization means that all elements of the marketing program are the same across countries and cultures. -Customization means that one or more elements of the marketing program are adapted to meet the needs or preferences of consumers in a particular country or culture. Global marketers apply a simple rule when crafting worldwide marketing programs: Standardize marketing programs whenever possible and customize them wherever necessary.

Identify the five steps involved in segmenting and targeting markets.

-Step 1: group potential buyers into segments. Buyers within a segment should have similar characteristics to each other and respond similarly to marketing actions like a new product or a lower price. -Step 2: putting related products to be sold into meaningful groups. - In step 3, organizations develop a market-product grid with estimated sizes of markets in each of the market-product cells of the resulting table. -Step 4: selecting the target market segments on which the organization should focus. -Finally, step 5 involves taking marketing mix actions(often in the form of a marketing program)to reach the target market segments.

What is the difference between ultimate consumers and organizational buyers?

-Ultimate consumers are the people who use the products and services purchased for a household. -Organizational buyers are those manufacturers, wholesalers, retailers, and government agencies that buy products and services for their own use or for resale.

How does licensing differ from a joint venture?

-Under licensing, a company offers the right to a trademark, patent, trade secret, or other similarly valued item of intellectual property in return for a fee or royalty. -In a joint venture, a foreign company and a local firm invest together to create a local business to produce some product or service. The two companies share ownership, control, and profits of the new entity.

What is the difference between a product line and a product mix?

-product line is a group of product or service items that are closely related because they satisfy a class of needs, are used together, are sold to the same customer group, are distributed through the same outlets, or fall within a given price range. The -product mix consists of all the product lines offered by an organization.

The ___________ Act forbids actual monopolies, whereas the _________ Act forbids actions that are likely to lessen competition.

1.Sherman Antitrust 2. Clayton

Identify the environmental forces that shape global marketing efforts.

3 major env.forces shape global mktng effort: -First, there are cultural forces, including values, customs, cultural symbols, and language. -Economic forces also shape global marketing efforts. These include a country's stage of economic development and economic infrastructure, consumer income and purchasing power, and currency exchange rates. -Finally, political-regulatory forces in a country or region of the world create a favorable or unfavorable climate for global marketing efforts.

Name and describe the alternative approaches companies use to enter global markets.

4 alternat. approaches for entering global markets:(exporting, licensing, joint venture, direct investment.) -Exporting involves producing products in one country and selling them in another country. -Under licensing, a company offers the right to a trademark, patent, trade secret, or similarly valued item of intellectual property in return for a royalty or fee. -In a joint venture, a foreign company and a local firm invest together to create a local business. -Direct investment entails a domestic firm actually investing in and owning a foreign subsidiary or division.

Recognize the bases used to segment consumer and organizational (business) markets.

4 bases used to segment consumer markets are: -geographic, -demographic, -psychographic, and -behavioral. Organizational markets use the same bases except for the psychographic one.

Identify the major developments that have influenced world trade and global marketing.

5 major developments: -(1) there has been a gradual increase of economic protectionism by individual countries, leading to tariffs and quotas. -(2) economic integration and free trade among nations, reflected in the European Union and the North American Free Trade Agreement, is being challenged. -(3) there exists global competition among global companies for global consumers, resulting in firms adopting global marketing strategies and promoting global brands. -(4) a networked global marketspace has emerged using Internet technology as a tool for exchanging products, services, and information on a global scale. -(5) economic espionage has grown among countries and companies because technical know-how and trade secrets separate global industry leaders from followers.

Describe the stages in the consumer purchase decision process.

5 stages: -(1) problem recognition, is perceiving a difference between a person's ideal and actual situation big enough to trigger a decision. -(2) information search, involves remembering previous purchase experiences (internal search) and external search behavior such as seeking information from other sources. -(3) alternative evaluation, Alternative evaluation clarifies the problem for the consumer by (a) suggesting the evaluative criteria to use for the purchase, (b) yielding brand names that might meet the criteria, and (c) developing consumer value perceptions. -(4) purchase decision, involves the choice of an alternative, including from whom to buy and when to buy. (5) postpurchase behavior. involves the comparison of the chosen alternative with a consumer's expectations, which leads to satisfaction or dissatisfaction and subsequent purchase behavior. Marketing practitioners study the consumer purchase process by identifying consumer touchpoints and consumer journey maps.

Describe the key characteristics of organizational buying that make it different from consumer buying.

7 key characteristics, Includes -demand characteristics, -the size of the order or purchase, the number of -potential buyers, -buying objectives, -buying criteria, -buyer-seller relationships and supply partnerships, -and multiple buying influences within organizations. The organizational buying process itself is more formalized, more individuals are involved, supplier capability is more important, and the postpurchase evaluation behavior often includes performance of the supplier and the item purchased.

Describe the nature and scope of world trade from a global perspective.

A global perspective on world trade views exports and imports as complementary economic flows: A country's imports affect its exports and exports affects its imports. Trade flows reflect interdependencies among industries, countries, and regions.

Describe the factors contributing to the success or failure of a new product or service.

A new product or service often fails for these marketing reasons: -(1) insignificant points of difference, -(2) incomplete market and product protocol before product development starts, -(3) a failure to satisfy customer needs on critical factors, -(4) bad timing, -(5) no economical access to buyers, -(6) poor product quality, -(7) poor execution of the marketing mix, -and(8) too little market attractiveness.

What is business portfolio analysis?

A technique that managers use to quantify performance measures and growth targets to analyze their firms' strategic business units (SBUs) as though they were a collection of separate investments. The purpose of this tool is to determine which SBU or offering generates cash and which one requires cash to fund the organization's growth opportunities.

(not highlighted) What is a test market, and what are the three kinds?

A test market involves offering a product for sale on a limited basis in a defined area for a specific time period. Three kinds: -(1) standard test market: In a standard test market, a city (or cities) is selected that is viewed as being demographically representative of the markets targeted for the new product. Standard test markets must have both cable TV systems that can deliver different ads to different homes and retailers with checkout counter scanners to measure sales results., -(2) controlled test market: In a controlled test market, the firm contracts the entire test program to an outside service, which pays retailers for shelf space to guarantee a specified percentage of the test product's potential distribution volume. -and (3) simulated test market: In a simulated (or laboratory) test market (STM), the firm attempts to replicate a full-scale test market by creating a fictitious storefront in a shopping mall and exposing prospective customers to the product (or concept) and ads from both it and its competitors to see if they will buy.

What are the two key characteristics of the marketing concept?

An organization should (1) strive to satisfy the needs of consumers while also (2) trying to achieve the organization's goals.

What are points of difference and why are they important?

Are those characteristics of a product that make it superior to competitive substitutes. They are important factors in the success or failure of a new product.

Explain how buying centers and buying situations influence organizational purchasing.

Buying center consists of a group of individuals who share common goals, risks, and knowledge important to a purchase decision. A buyer or purchasing manager is almost always a member of a buying center. However, other individuals may affect organizational purchasing due to unique roles in a purchase decision. 5 roles a person may play in a buying center (users, influencers, buyers, deciders, and gatekeepers). The specific buying situation will influence the number of people and the different roles played in a buying center. For a routine reorder of an item— straight rebuy situation—a purchasing manager or buyer will typically act alone in making a purchasing decision. When an organization is a first-time purchaser of a product or service— new buy situation—a buying center is enlarged and all five roles in a buying center often emerge. A modified rebuy situation lies between these two extremes. Figure 5-4 offers additional insights into how buying centers and buying situations influence organizational purchasing.

Identify the ways in which consumer and business products and services can be classified.

Classified by type of user, the major distinctions are consumer products, which are products purchased by the ultimate consumer, and business products, which are products that assist an organization in providing other products for resale. -Consumer products can be classified further based on the effort involved in the purchase decision process, marketing mix attributes used in the purchase, and the frequency of purchase: (a) convenience products are items that consumers purchase frequently and with a minimum of shopping effort; (b) shopping products are items for which consumers compare several alternatives on selected criteria; (c) specialty products are items that consumers make special efforts to seek out and buy; and (d) unsought products are items that consumers either do not know about or do not initially want. -Business products can be broken down into (a) components, which are items that become part of the final product, such as raw materials or parts, and (b) support products, which are items used to assist in producing other goods and services and include installations, accessory equipment, supplies, and industrial services. -Services can be classified in terms of whether they are delivered by (a) people or equipment, (b) business firms or nonprofit organizations, or (c) government agencies. -Firms can offer a range of products, which involve decisions regarding the product item, product line, and product mix.

(not highlighted)Commercialization, the most expensive stage for most new products, is the last stage of the new-product development process. It involves positioning and launching a new product in full-scale production and sales. What is the commercialization of a new product?

Commercialization, the most expensive stage for most new products, is the last stage of the new-product development process. It involves positioning and launching a new product in full-scale production and sales.

Explain the purposes of each step of the new-product development process.

Consists of 7 stages a firm uses to develop salable products or services: (1) New-product strategy development involves defining the role for the new product within the firm's overall objectives. (2) Idea generation involves developing a pool of concepts from consumers, employees, basic R&D, and competitors to serve as candidates for new products. (3) Screening and evaluation involves evaluating new-product ideas to eliminate those that are not feasible from a technical or consumer perspective. (4) Business analysis involves defining the features of the new product, developing the marketing strategy and marketing program to introduce it, and making a financial forecast. (5) Development involves not only producing a prototype product but also testing it in the lab and with consumers to see that it meets the standards set for it. (6) Market testing involves exposing actual products to prospective consumers under realistic purchasing conditions to see if they will buy the product. (7) Commercialization involves positioning and launching a product in full-scale production and sales with a specific marketing program.

What are constraints, as they apply to developing a research plan?

Constraints in a decision are the restrictions placed on potential solutions to a problem, such as time and money. These set the parameters for the research plan—due dates, budget, and so on.

Distinguish among three variations of the consumer purchase decision process: extended, limited, and routine problem solving.

Consumers don't always engage in five-stage purchase decision process. They skip or minimize one or more stages depending on the level of involvement—the personal, social, and economic significance of the purchase. -For high-involvement purchase occasions, each of the five stages is used and considerable time and effort are devoted to the search for external information and the identification and evaluation of alternatives. -With limited problem solving, consumers typically seek some information or rely on a friend to help them evaluate alternatives. -For low-involvement purchase occasions, consumers engage in routine problem solving. They recognize a problem, make a decision, and spend little effort seeking external information and evaluating alternatives.

(not highlighted) How does the development stage of the new-product development process involve testing the product inside and outside the firm?

Development is the stage of the new-product process that turns the idea on paper into a prototype—a demonstrable, producible product that can be efficiently manufactured. Internally, laboratory tests are done to see if the product achieves the physical, quality, and safety standards set for it. Externally, market testing is done to expose actual products to prospective consumers under realistic purchase conditions to see if they will buy.

What are e-marketplaces?

E-marketplaces are online trading communities that bring together buyers and supplier organizations to make possible the real-time exchange of information, money, products, and services

(not highlighted) What factor is estimated or measured for each of the cells in a market-product grid?

Each cell in the grid shows the estimated market size of a given product sold to a specific market segment.

Distinguish between marketing mix factors and environmental forces.

Four elements in a marketing program designed to satisfy customer needs are product, price, promotion, and place. These elements are called the marketing mix, the four Ps, or the marketer's controllable variables. The marketing mix also provides a clear customer value proposition—a cluster of benefits that an offering satisfies. Environmental forces, also called uncontrollable variables, are largely beyond the organization's control. These include social, economic, technological, competitive, and regulatory forces.

Discuss the forms of competition that exist in a market.

Four forms of competition: pure competition, monopolistic competition, oligopoly, and monopoly. Key components of competition include the likelihood of new competitors, the power of buyers and sellers, & the presence of competitors and possible substitutes. -While large companies are often examples of marketplace competitors, there are 28.8 million small businesses in U.S, which have significant impact on the economy.

Explain the significance of "newness" in new products and services as it relates to the degree of consumer learning involved.

From the important perspective of the consumer, "newness" is often seen as the degree of learning that a consumer must engage in to use the product. With a continuous innovation, no new behaviors must be learned. With a dynamically continuous innovation, only minor behavioral changes are needed. With a discontinuous innovation, consumers must learn entirely new consumption patterns.

The process of segmenting and targeting markets is a bridge between which two marketing activities?

Identifying market needs, and executing the marketing program

Describe the four components of the implementation phase of the strategic marketing process.

Implementation phase of the strategic marketing process carries out the marketing plan that emerges from the planning phase. It has four key components: -(a) obtaining resources; - (b) designing the marketing organization to perform product management, marketing research, sales, and advertising and promotion activities; - (c) developing schedules to identify tasks that need to be done, the time that is allocated to each one, the people responsible for each task, and the deadlines for each task—often with an action item list and Gantt chart; and - (d) executing the marketing strategies, which are the means by which marketing goals are to be achieved, and their associated marketing tactics, which are the detailed day-to-day marketing actions for each element of the marketing mix that contribute to overall success of a firm's marketing strategies. These are the marketing program actions a firm takes to achieve the goals set forth in its marketing plan.

(Not highlighted) How do internal and external screening and evaluation approaches differ?

In internal screening, company employees evaluate the technical feasibility of new-product ideas to determine whether they meet the objectives defined in the new-product strategy development stage. For services, employees are assessed to determine whether they have the commitment and skills to meet customer expectations and sustain customer loyalty. In external screening, evaluation consists of preliminary concept testing of the new-product idea (not the actual product itself) using written descriptions, sketches, mockups, or promotional literature with consumers.

What is sustainable development?

Involves conducting business in such a way that protects the natural environment while making economic progress. Green marketing is an ecological example of such an initiative.

What is the implementation phase of the strategic marketing process?

It carries out the marketing plan that emerges from the planning phase and consists of (1) obtaining resources; (2) designing the marketing organization; (3) defining precise tasks, responsibilities, and deadlines; and (4) executing the marketing program designed in the planning phase.

What is meant by moral idealism?

Its a personal moral philosophy that considers certain individual rights or duties as universal, regardless of the outcome; it is the philosophy embodied in the Consumer Bill of Rights and favored by consumer interest groups.

Define marketing and identify the diverse factors that influence marketing actions.

Its an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and stakeholders. This definition relates to two primary goals of marketing: (a) discovering the needs of prospective customers and (b) satisfying them. Achieving these two goals also involves the four marketing mix factors largely controlled by the organization and the five environmental forces that are generally outside its control.

Discuss how an organization assesses where it is now and where it seeks to be.

Managers of a organization ask 2 key ?'s to set strategic direction. First question "where are we now?" requires an organization to (a) assess its core competencies to understand how its special capabilities provide a competitive advantage; (b) identify its customers and how they receive genuine value and have a satisfying experience; and (c) analyze its competitors from a global perspective to determine distinctions among them. The second question, "Where do we want to go?" requires an organization to set a specific direction and allocate resources to move it in that direction. Business portfolio and diversification analysis help an organization do this. -Managers use business portfolio analysis to assess the organization's strategic business units (SBUs), product lines, or individual products as though they were a collection of separate investments (cash cows, stars, question marks, and dogs) to determine the amount of cash each should receive. -Diversification analysis is a technique that helps a firm search for growth opportunities from among four strategies: market penetration (selling more of current products to current markets); market development (selling current products to new markets); product development (selling new products to current markets); and diversification (selling new products to new markets)

What are the main sources of new-product ideas?

Many firms obtain ideas externally using open innovation, in which an organization finds and executes creative new-product ideas by developing strategic relationships with outside individuals and organizations. Some of these sources include -employee and co-worker suggestions; -customer and supplier suggestions (either directly, through the firm's salesforce or purchasing department or through crowdsourcing—soliciting ideas via the Internet from large numbers of people); -R&D laboratories (both internal to the firm and professional innovation firms such as IDEO); -competitive products (analyzing their points of difference that lead to a competitive advantage for them); - and smaller, nontraditional technology firms, university technology transfer centers that partner with business firms to commercialize faculty inventions, and lone inventors or entrepreneurs.

Explain what market segmentation is and when to use it.

Market segmentation involves aggregating prospective buyers into groups that (a) have common needs and (b) will respond similarly to a marketing action. Organizations go to the expense of segmenting their markets when it increases their sales, profits, and ability to serve customers better.

Explain how marketing managers position products in the marketplace.

Marketing managers often locate competing products on two-dimensional perceptual maps to visualize the products in the minds of consumers. They then try to position new products or reposition existing products in this space to attain maximum sales and profits.

Explain why managers use marketing dashboards and marketing metrics.

Marketing managers use marketing dashboards to visually display essential information related to achieving a marketing objective. This information consists of key performance measures of a product category, such as sales or market share, known as marketing metrics, which are a measure of the quantitative value or trend of marketing actions or results. Today's marketers use data visualization to present marketing metrics graphically so they can spot deviations from plans and take corrective actions.

Discuss the uses of observations, questionnaires, panels, experiments, and newer data collection methods.

Marketing researchers -observe- people in various ways, such as electronically using Nielsen people meters to measure TV viewing behavior or personally using mystery shoppers or ethnographic techniques. A recent electronic innovation is neuromarketing—using brain scanning to record the responses of a consumer's brain to marketing stimuli like packages or TV ads. -Questionnaires- involve asking people questions (a) in person using interviews or focus groups or (b) via a questionnaire using a telephone, print, e-mail, Internet, or social media survey. A cross tabulation is often used with questionnaire data to analyze the relationships among two or more variables to lead to marketing actions. -Panels- involve a sample of consumers or stores that are repeatedly measured through time to see if their behaviors change. -Experiments-, such as test markets, involve measuring the effect of marketing variables such as price or advertising on sales. -Collecting data- from social networks like Facebook or Twitter is increasingly important because users can share their opinions about products and services with countless "friends" around the globe.

Explain how data analytics, data mining, and predictive modeling lead to marketing actions.

Marketing researchers have observed that today we live in an era of data deluge. Information technology enables this massive amount of marketing data to be stored, accessed, and processed. Transforming the data into useful information is accomplished through the use of -data analytics-, which uses specific queries or questions to guide the analysis. In contrast, -data mining- is the extraction of hidden information from the databases to find statistical relationships. -Predictive modeling- uses data mining and probability analysis to make marketing decisions and actions.

Describe the five-step marketing research approach that leads to marketing actions.

Mktng researchers engage in a five-step decision-making process to collect information that will improve marketing decisions. -The first step is (define the problem), which requires setting the research objectives and identifying possible marketing actions. -The second step is(develop the research plan), which involves specifying the constraints, identifying data needed for marketing decisions, and determining how to collect the data. -The third step is(collect the relevant information), which includes considering pertinent secondary data (both internal and external) and primary data (by observing and questioning consumers) as well as using information technology and data mining to trigger marketing actions. The fourth step is to develop findings from the marketing research data collected. This involves analyzing the data and presenting the findings of the research. The fifth and last step is to take marketing actions, which involves making and implementing the action recommendations and then evaluating the results.

(not highlighted) What is the new-product strategy development stage in the new-product development process?

New-product strategy development is the first stage of the new-product process that defines the role for a new product in terms of the firm's overall objectives. During this stage, the firm uses both a SWOT analysis and environmental scanning to assess its strengths and weaknesses relative to the trends it identifies as opportunities or threats. The outcome not only defines the vital "protocol" for each new-product idea but also identifies the strategic role it might serve in the firm's business portfolio.

(Not highlighted) What is the difference between observational data and questionnaire data?

Observational data are facts and figures obtained by watching, either mechanically or in person, how people actually behave. Questionnaire data are facts and figures obtained by asking people about their attitudes, awareness, intentions, and behaviors.

Explain the three steps of the planning phase of the strategic marketing process.

Organization uses strategic marketing process to allocate its marketing mix resources to reach its target markets and achieve a competitive advantage. This process is divided into three phases (planning, implementation, evaluation). The planning phase consists of -(a) a situation (SWOT) analysis, which involves taking stock of where the firm or product has been recently, where it is now, and where it is headed and focuses on the organization's internal factors (strengths and weaknesses) and the external forces and trends affecting it (opportunities and threats); -(b) a market-product focus through market segmentation (grouping buyers into segments with common needs and similar responses to marketing programs) and goal setting, which in part requires creating points of difference (characteristics of a product that make it superior to competitive substitutes); -(c) a marketing program that specifies the budget and actions (marketing strategies and tactics) for each marketing mix element.

Recognize the importance and nature of online buying in industrial, reseller, and government organizational markets.

Organizations dwarf consumers in terms of online transactions and purchase volume. Online buying in organizational markets is popular for three reasons. -(1)organizational buyers depend on timely supplier information that describes product availability, technical specifications, application uses, price, and delivery schedules. This information can be conveyed quickly via Internet technology. -(2) this technology substantially reduces buyer order processing costs. -(3) business marketers have found that Internet technology can reduce marketing costs, particularly sales and advertising expense, and broaden their customer base. Two developments in online buying have been the creation of e-marketplaces and online auctions. E-marketplaces provide a technology trading platform and a centralized market for buyer-seller transactions and make possible the real-time exchange of information, money, products, and services. These e-marketplaces can be independent trading communities, such as PlasticsNet, or private exchanges, such as the Global Healthcare Exchange. Online traditional and reverse auctions represent a second major development. With traditional auctions, the highest-priced bidder "wins." Conversely, the lowest-priced bidder "wins" with reverse auctions.

Develop a market-product grid to identify a target market and recommend resulting marketing actions.

Organizations use five key criteria to segment markets, whose groupings appear in the rows of the market-product grid. Groups of related products appear in the columns. After estimating the size of the market in each cell in the grid, they select the target market segments on which to focus. They then identify marketing mix actions—often in a marketing program—to reach the target market most efficiently.

Why do marketers use perceptual maps in product positioning decisions?

Perceptual maps are a means of displaying in two dimensions the location of products or brands in the minds of consumers. Marketers use perceptual maps to see how consumers perceive competing products or brands as well as their own product or brand. Then they can develop marketing actions to move their product or brand to the ideal position.

What are some criteria used to decide which segments to choose for targets?

Possible criteria include market size, expected growth, competitive position, cost of reaching the segment, and compatibility with the organization's objectives and resources.

Identify the major psychological influences on consumer behavior.

Psychology helps to understand why/how consumers behave as they do. In particular, psychological concepts such as motivation and personality; perception; learning; values, beliefs, and attitudes; and lifestyle are useful for interpreting buying processes. -Motivation: the energizing force that stimulates behavior to satisfy a need. -Personality: a person's consistent behaviors or responses to recurring situations. -Perception: the process by which an individual selects, organizes, and interprets information to create a meaningful picture of the world. -Much consumer behavior is learned: Learning refers to those behaviors that result from (a) repeated experience and (b) reasoning(brand loyalty results from learning). -Values, beliefs, and attitudes are also learned and influence how consumers evaluate products, services, and brands. A more general concept is lifestyle. -Lifestyle: also called psychographics, combines psychology and demographics and focuses on how people spend their time and resources, what they consider important in their environment, and what they think of themselves and the world around them.

Explain how regulatory forces ensure competition and protect producers and consumers.

Regulation exists to protect companies/consumers. - Legislation that ensures a competitive marketplace(the Sherman Antitrust Act and the Clayton Act.) - Companies can protect their competitive position with patent and copyright laws. Consumers are protected by laws that address each of the four elements of the marketing mix. Laws such as the Lanham Act, which provides for the registration of trademarks, benefit both companies and consumers. Self-regulation through organizations such as the Better Business Bureau provides an alternative to federal and state regulation.

(not highlighted) What is the difference between secondary and primary data?

Secondary data are facts and figures that have already been recorded prior to the project at hand, whereas primary data are facts and figures that are newly collected for the project.

Describe social forces such as demographics and culture.

Social forces of the environment include the demographic characteristics and the culture of the population. -3 key demographic characteristics include a population profile, a description of generational cohorts (baby boomers, Generation X, Generation Y, and Generation Z), and the racial and ethnic diversity of the population. - Culture incorporates the set of values, ideas, and attitudes that is learned/shared among members of a group. Notable cultural changes include the trend toward fewer differences in male and female roles and attitudes, and the growing importance of values such as sustainability on consumer preferences.

What is meant by social responsibility?

Social responsibility means that organizations are part of a larger society and are accountable to that society for their actions. It comprises three concepts: -(1) profit responsibility—maximizing profits for the organization's owners or shareholders; - (2) stakeholder responsibility—focusing on the obligations of the organization to those who can affect the achievement of its objectives; and -(3) societal responsibility—focusing on the obligations of the organization to the preservation of the ecological environment and to the general public.

Describe the different concepts of social responsibility.

Social responsibility means that organizations are part of a larger society and are accountable to that society for their actions. There are three concepts of social responsibility: profit responsibility, stakeholder responsibility, and societal responsibility.

Describe how technological changes can affect marketing

Technological innovations can replace existing products/services. -Changes in technology can impact customer value by reducing the cost of products, improving the quality of products, and providing new products that were not previously feasible. -Artificial intelligence, the Internet of Things, wearable technology, and data analytics are transforming how companies do business.

What rights are included in the Consumer Bill of Rights?

The Consumer Bill of Rights (1962) codified the ethics of exchange between buyers and sellers. These are the rights to (safety, to be informed, to choose, and to be heard).

Explain how organizations build strong customer relationships and customer value through marketing.

The essence of successful marketing is to provide sufficient value to gain loyal, long-term customers. -Customer value is the unique combination of benefits received by targeted buyers that usually includes quality, price, convenience, on-time delivery, and both before-sale and after-sale service. Marketers do this by using one of three value strategies: best price, best product, or best service.

Discuss how managers identify and act on deviations from plans.

The evaluation phase of the strategic marketing process seeks to keep the marketing program moving in the direction that was established in the marketing plan. This requires the marketing manager to compare the results from the marketing program with the marketing plan's goals to -(a) identify deviations or "planning gaps" and -(b) take corrective actions to exploit positive deviations or correct negative ones.

Explain how marketing discovers and satisfies consumer needs.

The first objective in marketing is discovering the needs and wants of consumers who are prospective buyers and customers. -A need occurs when a person feels deprived of basic necessities such as food, clothing, and shelter. -A want is a need that is shaped by a person's knowledge, culture, and personality. Effective marketing can clearly shape a person's wants and tries to influence what he or she buys. The second objective in marketing is satisfying the needs of targeted consumers. Because an organization obviously can't satisfy all consumer needs, it must concentrate its efforts on certain needs of a specific group of potential consumers or target market—one or more specific groups of potential consumers toward which an organization directs its marketing program. It then selects its target market segment(s), which is a relatively homogeneous group of prospective buyers that (1) have common needs and (2) will respond similarly to a marketing action. Finally, the organization develops a set of marketing actions in the form of a unique marketing program to reach them.

What is the five-step marketing research approach?

The five-step marketing research approach provides a systematic checklist for making marketing decisions and actions. The five steps are: (1) define the problem; (2) develop the research plan; (3) collect relevant information (data); (4) develop findings; and (5) take marketing actions.

What are examples of a functional level in an organization?

The functional level in an organization is where groups of specialists from the marketing, finance, manufacturing/operations, accounting, information systems, research and development, and/or human resources departments focus on a specific strategic direction to create value for the organization.

Market segmentation involves aggregating prospective buyers into groups that have two key characteristics. What are they?

The groups should (1) have common needs and (2) respond similarly to a marketing action.

(not highlighted) What marketing metric might you use in a marketing dashboard to discover which states have weak sales?

The marketing metric—annual percentage change in unit volume by state—will help identify those states that are underperforming.

Why can an "insignificant point of difference" lead to new-product failure?

The new product must have superior characteristics that deliver unique benefits to the user; compared to competitors, its benefits must be sufficient enough to motivate a change in consumption behavior. Without these points of difference, the product will probably fail.

(not highlighted) What is the trade feedback effect?

The phenomenon in which one country's imports affect the exports of other countries and vice versa, thus stimulating trade among countries.

How do the goals set for a marketing program in the planning phase relate to the evaluation phase of the strategic marketing process?

The planning phase goals or objectives are used as the benchmarks with which the actual performance results are compared in the evaluation phase to identify deviations from the written marketing plans and to act on those deviations—exploiting positive ones and correcting negative ones.

Explain the purpose of environmental scanning.

The process of continually acquiring info. on events occurring outside the organization to identify and interpret potential trends.

Identify the reason for conducting marketing research.

To be successful, products must meet the wants and needs of potential customers. So marketing research reduces risk by providing the vital information to help marketing managers understand those wants and needs and translate them into marketing actions.

Describe three kinds of organizations and the three levels of strategy in them.

To give organizations direction and focus, they continuously assess their core values, mission, organizational culture, business, and goals. Today's organizations specify their foundation, set a direction, and formulate strategies—the "why," "what," and "how" factors, respectively. - Core values are the organization's fundamental, passionate, and enduring principles that guide its conduct over time. - Organization's mission is a statement of its function in society, often identifying its customers, markets, products, and technologies. - Organizational culture is a set of values, ideas, attitudes, and norms of behavior that is learned and shared among the members of an organization. To answer the question, "What business are we in?" an organization defines its "business"(the clear, broad, underlying industry category or market sector of its offering). - The organization's goals (or objectives) are statements of an accomplishment of a task to be achieved, often by a specific time. - Finally, organizational strategies vary by level in the organization and by product. The strategies are often described in a marketing plan.

Discuss how economic forces affect marketing.

Two aspects of economic forces include (a)macroeconomic conditions related to the marketplace and (b)microeconomic factors such as consumer income. -Indicators of marketplace conditions include GDP, unemployment, and price changes (inflation or deflation) -Consumer income has gross, disposable, and discretionary components. The state of the economy and changes in income can influence consumers' ability to buy products and services.

What country is the biggest as measured by world trade?

china

What is the term for postpurchase anxiety?

cognitive dissonance

The problem with the Toro Snow Pup was an example of selective _____________.

comprehension—consumers perceived the name to mean that Snow Pup was a toy that was too light to do any serious snow removal.

The brands a consumer considers buying out of the set of brands in a product class of which the consumer is aware are collectively called the _____________.

consideration set

What kind of innovation would an improved electric toothbrush be?

continuous innovation—no new learning is required by consumers

What mode of entry could a company follow if it has no previous experience in global marketing?

indirect exporting through intermediaries

In pure competition there are a ________ number of sellers.

large

Organizational buyers are ________.

manufacturers, wholesalers, retailers, service companies, not-for-profit organizations, and government agencies that buy products and services for their own use or for resale.

What is the difference between a marketing dashboard and a marketing metric?

marketing dashboard is the visual display of the essential information related to achieving a marketing objective. Each variable displayed in a marketing dashboard is a marketing metric, which is a measure of the quantitative value or trend of a marketing action or result.

What is the meaning of an organization's mission?

mission is a clear, concise, meaningful, inspirational, and long-term statement of the organization's function in society, often identifying its customers, markets, products, and technologies. It is often used interchangeably with vision.

What does lifestyle mean?

mode of living that is identified by how people spend their time and resources, what they consider important in their environment, and what they think of themselves and the world around them.

What is the first stage in the consumer purchase decision process?

problem recognition—perceiving a need

What are the four marketing mix elements that make up the organization's marketing program?

product, price, promotion, place

Cross-cultural analysis involves the study of _________.

similarities and differences among consumers in two or more nations or societies.

An organization can't satisfy the needs of all consumers, so it must focus on one or more subgroups, which are its __________

target markets

The North American Free Trade Agreement was designed to promote free trade among which countries?

the United States, Canada, and Mexico

How does the American Marketing Association define Marketing?

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.

What is protectionism?

the practice of shielding one or more industries within a country's economy from foreign competition through the use of tariffs or quotas.

What is marketing research?

the process of defining a marketing problem and opportunity, systematically collecting and analyzing information, and recommending actions to reduce the risk of and thereby improve marketing decisions.

What are environmental forces?

the uncontrollable forces that affect a marketing decision. They consist of social, economic, technological, competitive, and regulatory forces.

In general, which type of online auction creates upward pressure on bid prices and which type creates downward pressure on bid prices?

traditional auction; reverse auction

Economic espionage includes what kinds of activities?

trespassing, theft, fraud, misrepresentation, wiretapping, searching of competitors' trash, and violations of written and implicit employment agreements with noncompete clauses.

The Federal Trade Commission (FTC) monitors _____________.

unfair business practices

Describe four unique elements of services.

—the four I's—are (1) intangibility: tendency of services to be a performance that cannot be held or touched, rather than an object. -inconsistency: is a characteristic of services because they depend on people to deliver them, and people vary in their capabilities and in their day-to-day performance, -inseparability: refers to the difficulty of separating the deliverer of the services (hairstylist) from the service itself (hair salon). -and inventory: refers to the need to have service production capability when there is service demand.