bus 130 intro to marketing final
consumer promotions
sales promotion tools used to boost short-term customer buying and engagement or enhance long-term customer relationships
business promotions
sales promotion tools used to generate business leads, stimulate purchases, reward customers, and motivate salespeople
7 (8) C's of a good website
•Should be: •Easy to use •Professional looking •Physically attractive •Useful •Interactive •Linked to other related sites •Promotional
Comparative Advertising
•Some persuasive advertising becomes comparative advertising or attack advertising
Multiple Segmentation Bases
•The Nielsen PRIZM system -Based on demographic factors -Classifies U.S. households into 66 demographically and behaviorally distinct segments
modes of transportation
•Trucks •Railroads •Water carriers •Pipelines •Air carriers •Internet •Intermodal transportation: (piggyback, fishyback, trainship, airtruck)
line stretching
Lengthening the product line beyond the current range •Downward, to cater to lower-end segments •Upward, to add prestige to existing products
disintermediation
Occurs when product and service producers cut out intermediaries and go directly to final buyers, or when radically new types of channel intermediaries displace traditional ones.
co-branding
Occurs when two established brand names of different companies are used on the same product
Price packs (or cents-off deals)
Offer consumers savings off the regular price of a product
good-value pricing
Offering the right combination of quality and good service at a fair price
Samples
Offers of a trial amount of a product
Why is marketing information important?
Online sources give marketers abundant data about consumer behavior
social marketing
Social marketing: The use of commercial marketing concepts and tools in programs designed to influence individuals' behavior to improve their well-being and that of society
brand
a name, term, symbol, design, or combination thereof that identifies a seller's products and differentiates them from competitors' products
five major promotion tools
advertising, sales promotion, personal selling, public relations, direct marketing
cognitive dissonance
after making a purchase, buyers often doubt whether they made the right decision.
marketing channel design decisions that marketers need to make
analyzing consumer needs, setting channel objectives, identifying major alternatives, evaluating them
capital items
long lasting goods that facilitate developing and for managing the finished product
two dimensions of the Boston Consulting Group's (BCG) growth-share matrix?
market share and market growth
marketing research
Systematic design, collection, analysis, and reporting of data relevant to a specific marketing situation facing an organization.
method/instrument that can be used to analyze a current business portfolio? (the growth-share matrix)
The Boston Growth-Share Matrix Approach
Event marketing
creating a brand-marketing event or serving as a sole or participating sponsor of events created by others
Value and satisfaction
customers form expectations about the customer __________________ and ___________________ that various market offerings will deliver
methods to set the advertising budget
*Affordable method: Setting promotion budget at the level management thinks the company can afford *Percentage-of-sales method: Setting promotion budget at a certain percentage of current or forecasted sales or as a percentage of the unit sales price *Competitive-parity method: Setting the promotion budget to match competitors' outlays *Objective-and-task method: developing the promotion budget by defining specific objectives, determining the tasks that must be performed to achieve these objectives, estimating the costs of performing these tasks
channel management decisions that need to be made
*Selecting channel members *Managing and motivating channel members-partner relationship management *Evaluating channel members
Stores- diff types
*Specialty stores: A retail store that carries a narrow product line with a deep assortment within that line (e.g., apparel stores, sporting-goods stores, florists) *Department stores: A retail store that carries a wide variety of product lines, each operated as a separate department managed by specialist buyers or merchandisers *Supermarkets: A large, low-cost, low-margin, high-volume, self-service store that carries a wide variety of grocery and household products *Convenience store: A small store, located near a residential area, that is open long hours seven days a week and carries a limited line of high-turnover convenience goods *Superstore: A store much larger than a regular supermarket that offers a large assortment of routinely purchased food products, non-food items, and services *Category killer: A giant specialty store that carries a very deep assortment of a particular line *Discount Stores: Sell standard merchandise at lower prices and margins, in return for higher volume *Off-Price Retailers: Buy merchandise at less-than-regular wholesale prices sells at less than retail *types: factory outlet, warehouse club *Factory outlet: an off-price retailing operation that is owned and operated by a manufacturer and normally carries the manufacturer's surplus, discontinued, or irregular goods *Warehouse club: an off-price retailer that sells a limited selection of brand name grocery items, appliances, clothing, and other goods at deep discounts to members who pay annual membership fees
Baby Boomers
- 78 million people born between 1946 and 1964 -Wealthiest generation in history -Recession hit baby boomers hard, eating into savings and retirement prospects -Represent strong targets for financial services
Generation X
-49 million born from 1965 to 1976 -Most educated generation to date -Less materialistic than other groups -Skeptical of marketing -Careful spenders
Millennials
-83 million, born between 1977 and 2000 -$733 billion in purchasing power -Ethnically diverse -Fluent with digital technology -Personalization and product customization are key to marketing success
social responsible behavior
-Actively seek out ways to protect the long‐run interests of consumers and the environment -Develop policies and other responses to address social responsibility issues
Customer Lifetime value, share of customer, customer equity
-Customer Lifetime value: The value of the entire stream of purchases that the customer would make over a lifetime of patronage -Share of customer: The portion of the customer's purchasing that a company gets in its product categories -Customer equity: sum of all customer lifetime values for a firm
Labels/labeling
-Identify the product -Describe the product -Promote the brand
Crowdsourcing
-Invites customers, employees, independent scientists and researchers, and even the public at large, into the new-product innovation process
Advertising appeals should have what characteristics (meaningful, believable, distinctive)?
-Meaningful: Pointing out benefits that make the product more desirable or interesting to consumers -Believable: Consumers must believe that the product or service will deliver the promised benefits -Distinctive: Should tell how the product is better than competing brands
recent trends and developments in wholesaling
-Need for greater efficiency -Demands for lower prices -Sorting out suppliers who are not adding value based on cost and quality -Blurring distinction between large retailers and wholesalers -Increased use of technology to contain costs and boost productivity
What marketing offers exist?
-Not limited to physical products -Include entities such as persons, places , organizations, information, and ideas
role of the sales force?
-Serve as a critical link between a company and its customers -Coordinate marketing and sales
service marketing -3 types
-external marketing: traditional marketing via the 4 P's -internal marketing: Orienting and motivating customer-contact employees and the supporting service people to work as a team to provide customer satisfaction -interactive marketing: Training service employees in the fine art of interacting with customers to satisfy their needs
reverse logistics
-from customers back to suppliers/company/resellers -The area of logistics that involves bringing goods back to the manufacturer because of defects or for recycling materials.
segmenting international markets
-geographic location -economic factors (income levels or level of economic development) -political and legal factors (type of government, receptivity to foreign firms, monetary regulations, and bureaucracy) -cultural factors (languages, religions, values, customs)
public policy issues in pricing
-price-fixing: an agreement between two or more firms on the price they will charge for a product/ the maintaining of prices at a certain level by agreement between competing sellers. -predatory pricing: the pricing of goods or services at such a low level that other suppliers cannot compete and are forced to leave the market. -retail price maintenance: practice whereby a manufacturer and its distributors agree that the distributors will sell the manufacturer's product at certain prices -discriminatory pricing: a selling strategy that charges customers different prices for the same product or service based on what the seller thinks they can get the customer to agree to -deceptive pricing: any pricing scheme that is likely to mislead consumers and affect consumers' behavior or decisions about the product or services offered for sale
product and service attributes
-product quality: The characteristics of a product or service that bear on its ability to satisfy stated or implied customer needs -product features: Differentiate the company's product from competitors' products -Product style and design
sales force structures that exist (territorial, product, customer/market)? -types
-territorial: Assigns each salesperson to an exclusive geographic territory in which that salesperson sells the company's full line -product: Salespeople specialize in selling only a portion of the company's products or lines -customer/market: Salespeople specialize in selling only to certain customers or industries
retailers- types
-the amount of service they offer -the breadth and depth of product lines -the relative prices charged -how they are organized Self-service retailers: Serve customers who are willing to perform their own locate-compare-select process Limited-service retailers: Provide more sales assistance as they carry shopping goods about which details are needed Full-service retailers: Usually carry more specialty goods for which customers need or want assistance or advice Service retailer: A retailer whose product line is actually a service; examples include hotels, airlines, banks, colleges, and many others
considerations in setting price
1. Customer value-based pricing 2. Cost-based pricing 3. Competition-based pricing
steps in the strategic planning process
1. Defining the company mission 2. Setting company objectives and goals 3. Designing the business portfolio 4. Planning marketing and other functional strategies
Major Steps in Sales Force Management (SFM)
1. Designing sales force strategy and structure2. Recruiting and selecting salespeople3. Training salespeople4. Compensating salespeople5. Supervising salespeople6. Evaluating salespeople
consumer buyer decision process business buyer decision process
1. Need recognition 2. Information search 3. Evaluation of alternatives 4. Purchase decision 5. Post-purchase behavior problem recognition, general need description, product specification, supplier search, proposal solicitation, supplier selection, order-routine specification, performance review Key differences exist between business and consumer buying situations: •Business buyers usually face more complex buying decisions •The business buying process tends to be more formalized •Buyers and sellers are much more dependent on each other in business markets
different steps in the selling process
1. Prospecting and qualifying: prospecting- Identifying qualified potential customers/ qualifying: identifying good ones and screening out poor ones 2. Preapproach: Learning as much as possible about a prospective customer before making a sales call 3. Approach: meeting the customer for the first time-presentation and demonstration: Presentation: Telling the value story to the buyer, showing how the company's offer solves the customer's problems 4. Handling objections: Seeking out, clarifying, and overcoming any customer objections to buying 5. Closing: Asking the customer for an order 6. Follow-up: Following up after the sale to ensure customer satisfaction and repeat business
price adjustment strategies
1.Discount and allowance pricing 2.Segmented pricing 3.Psychological pricing 4.Promotional pricing 5.Geographical pricing 6.Dynamic pricing 7.International pricing
steps in the marketing process?
1. Understand the marketplace and customer needs and wants 2. Design a customer-driven marketing strategy 3. Construct an integrated marketing program that delivers superior value 4. Build profitable relationships and create customer delight 5. Capture value from customers to create profits and customer equity
major logistics functions
1. Warehousing 2. Inventory Management 3. Transportation 4. Logistics Information Management
four major brand strategy decisions
1. brand positioning: attributes, benefits, beliefs and values 2. brand name selection: selection, protection 3. brand sponsorship: manufacturer's brand, private brand, licensing, co-branding 4. brand development: line extensions, brand extensions, multibrands, new brands
Five core customer and marketplace concepts
1. needs, wants, and demands 2. market offerings (products, services, and experiences) 3. value and satisfaction 4. exchanges and relationships 5. markets
factors to consider when choosing a differentiation and positioning strategy?
1.) Identifying a set of differentiating competitive advantages on which to build a position 2.) Choosing the right competitive advantages (e.g., Unique Selling Proposition) 3.) Selecting an overall positioning strategy
Marketing Information System (MIS)? benefits?
A MIS consists of people and procedures dedicated to assessing information needs, developing the needed information, and helping decision makers to use the information to generate and validate actionable customer and market insights -benefits: •A good MIS balances the information users would like against what they need and what is feasible to offer. •Information is not worth itself; its value comes from its use.
criteria to select proper brand names
A brand name should: •Suggest the product's benefits and qualities •Be easy to pronounce, recognize, and remember •Be distinctive •Be extendable •Translate easily into foreign languages •Be capable of registration and legal protection
vertical marketing system (VMS)
A channel structure in which producers, wholesalers, and retailers act as a unified system. One channel member owns the others, has contracts with them, or has so much power that they all cooperate -types of VMS: Corporate VMS: A vertical marketing system that combines successive stages of production and distribution under single ownership—channel leadership is established through common ownership Contractual VMS: A vertical marketing system in which independent firms at different levels of production and distribution join together through contracts Administered VMS: A vertical marketing system that coordinates successive stages of production and distribution through the size and power of one of the parties
Franchising
A contractual association between a manufacturer, wholesaler, or service organization (a franchisor) and independent businesspeople (franchisees) who buy the right to own and operate one or more units in the franchise system
franchising organization/system
A contractual vertical marketing system in which a channel member, called a franchisor, links several stages in the production-distribution process
five categories marketers can create differentiation on
A firm can create differentiation on: •Product •Services •Channels •People •Image
distribution center
A large, highly automated warehouse designed to receive goods from various plants and suppliers, take orders, fill them efficiently, and deliver goods to customers as quickly as possible
channel level
A layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer
What is the difference between a market-oriented versus a product-oriented mission statement?
A market orientated company is one that organizes its activities, products and services around the wants and needs of its customers. By contrast, a product-orientated firm has its primary focus on its product and on the skills, knowledge and systems that support that product.
Branding
A name, term, sign, symbol, or design, or a combination of these, that identifies the products or services of one seller or group of sellers and differentiates them from those of competitors -Customers attach meanings to brands and develop brand relationships
value delivery network
A network composed of the company, suppliers, distributors, and, ultimately, customers who "partner" with each other to improve the performance of the entire system in delivering customer value.
consumer products
A product bought by final consumers for personal consumption •Classified by how consumers buy them 1.Convenience products 2.Shopping products 3.Specialty products 4.Unsought products
target market
A set of buyers sharing common needs or characteristics that the company decides to serve
multichannel distribution system
A single firm sets up two or more marketing channels to reach one or more customer segments -Each new channel expands sales and marketing coverage -Helps tailor its products and services to specific needs of diverse customer segments -Hard to control; can generate conflicts
discounts
A straight reduction in price on purchases made during a stated period of time or in larger quantities •Forms: -Cash discount -Quantity discount -Functional discount -Seasonal discount
strategic business unit (SBU)
A unit of the company that has a separate mission and objectives and that can be planned independently from other company businesses.
value chain
A value chain is a business model that describes the full range of activities needed to create a product or service.
objectives advertising can have
Advertising objective: A specific communication task to be accomplished with a specific target audience during a specific period of time -Informative advertising -Persuasive advertising -Reminder advertising
line filling
Adding more items within the present range of the line •Reaching for extra profits •Satisfying dealers •Using excess capacity •Keeping out competitors
Dynamic Pricing
Adjusting prices continually to meet the characteristics and needs of individual customers and situations -Especially prevalent online
advertainment
Aims to make ads themselves so entertaining that people want to watch them
wholesaling/ wholesaler
All activities involved in selling goods and services to those buying for resale or business use An individual or organization that sells products that are bought for resale, for making other products, or for general business operations.
retailing/ retailer?
All activities involved in selling goods or services directly to final consumers for their personal or nonbusiness use A dealer who sells to consumers.
business/buying center
All the individuals and units that participate in the business buying-decision process •The buying center is not a fixed or formally identified unit •It is a set of buying roles assumed by different people for different purchases
price
Amount of money charged for a product or service Sum of the values that customers exchange for the benefits of having or using the product or service
competitive advantage
An advantage over competitors gained by offering greater customer value, either by having lower prices or providing more benefits that justify higher prices
sales force management (SFM)
Analyzing, planning, implementing, and controlling sales force activities
product
Anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need Tangible goods, services, events, persons, organizations, places, ideas, or a mixture of these
value-added pricing
Attaching value-added features and services to differentiate a company's offers while charging higher prices
Consumer Buyer Decision Process for NEW Products (i.e., Stages in the Adoption Process)?
Awareness: Consumer becomes aware of the new product, but lacks information about it Interest: Consumer seeks information about new product Evaluation: Consumer considers whether trying the new product makes sense Trial: Consumer tries new product on a small scale to improve his or her estimate of its value Adoption: Consumer decides to make full and regular use of the new product
advantages and disadvantages that exist for selling on the Internet
Benefits •Conserves salespeople's valuable time, saves travel dollars, and gives them a new vehicle for selling and servicing accounts •Gives customers more control over the sales process Drawbacks •Expensive •Intimidates low-tech salespeople or clients
generational groups we distinguish and how are they different from each other?
Baby Boomers, Generation X, and Generation Y (or Millennials)
advantages/disadvantages of the BCG portfolio matrix?
Benefits of the BCG-Matrix: •The BCG-Matrix is helpful for managers to evaluate balance in the companies's current portfolio of Stars, Cash Cows, Question Marks and Dogs. •BCG-Matrix is applicable to large companies that seek volume and experience effects. •The model is simple and easy to understand. •It provides a base for management to decide and prepare for future actions. •If a company is able to use the experience curve to its advantage, it should be able to manufacture and sell new products at a price that is low enough to get early market share leadership. Once it becomes a star, it is destined to be profitable. Limitations of the BCG-Matrix: •It neglects the effects of synergies between business units. •High market share is not the only success factor. •Market growth is not the only indicator for attractiveness of a market. •Sometimes Dogs can earn even more cash as Cash Cows. •The problems of getting data on the market share and market growth. •There is no clear definition of what constitutes a "market". •A high market share does not necessarily lead to profitability all the time. •The model uses only two dimensions - market share and growth rate. This may tempt management to emphasize a particular product, or to divest prematurely. •A business with a low market share can be profitable too. •The model neglects small competitors that have fast growing market shares.
store brands
Brands created and owned by a reseller of a product or service
broadcasting
Broadcasting, by definition, is sharing a message broadly with a very wide audience. Implied in broadcasting is that the message is fit for mass consumption. -companies these days are doing less broadcasting and more narrowcasting
brokers and agents
Brokers: brings buyers and sellers together and assists negotiations. they don't take title to goods, and perform only few functions. Agents: represent buyers and sellers on a more permanent basis. they don't take title to goods, and perform only few functions.
business markets
Business Marketing refers to the sale of either products or services or both by one organization to other organizations that further resell the same or utilize to support their own system.
product bundle pricing
Combining several products and offering the bundle at a reduced price
locations retailers can locate in
Central business districts, Regional shopping centers, Community shopping centers, Strip malls (neighborhood shopping center), Power centers, Lifestyle centers
Coupons
Certificates that save buyers money when they purchase specified products
Introduction Stage Characteristics & Strategies
Characteristics Sales: Low Costs: High cost per customer Profits: Negative or low Customers: Innovators Competitors: Few Marketing objective: Create product awareness and trial Strategies •Product: Offer a basic product •Price: Use cost-plus pricing •Distribution: Build selective distribution •Advertising: Build product awareness among early adopters and dealers •Promotion: Use heavy promotion to entice product trial
Maturity Stage Characteristics & Strategies
Characteristics Sales: Peak sales Costs: Low cost per customer Profits: High profits Customers: Middle majority Competitors: Stable number beginning to decline Marketing objective: Maximize profits while defending market share LONGEST STAGE OF PLC Strategies •Product: Diversify brand and models •Price: Match or beat competitors •Distribution: Build more intensive distribution •Advertising: Stress brand differences and benefits •Promotion: Increase to encourage brand switching
Decline Stage Characteristics & Strategies
Characteristics •Sales: Declining sales •Costs: Low cost per customer •Profits: Declining profits •Customers: Laggards •Competition: Declining number •Marketing objective: Reduce expenditures and milk the brand Strategies •Product: Phase out weak items •Price: Cut price •Distribution: Go selective—phase out unprofitable outlets •Advertising: Reduce to level needed to retain hard-core loyals •Promotion: Reduce to minimal level
Growth Stage Characteristics & Strategies
Characteristics •Sales: Rapidly rising •Costs: Average cost per customer •Profits: Rising profits •Customers: Early adopters •Competitors: Growing number •Marketing objective: Maximize market share Strategies •Product: Offer product extensions, service, warranty •Price: Price to penetrate the market •Distribution: Build intensive distribution •Advertising: Build awareness and interest in the mass market •Promotion: Reduce to take advantage of heavy consumer demand
approach companies should take when it comes to managing new-product development?
Companies must take a holistic approach to new product development This requires: •Customer-centered new-product development •Team-based new-product development •Systematic new-product development
segmentation of business markets vs consumers markets?
Consumer and business markets use many of the same variables for segmentation
costs we distinguish- types
Fixed (overhead) Costs •Vary with production or sales level Variable Costs •Vary directly with the level of production Total Costs •Sum of the fixed and variable costs for any given level of production
Convenience Products
Consumer products that customers usually buy frequently, immediately, and with minimal comparison and buying effort -Low priced -Placed in many locations to make them readily available -e.g. Laundry detergent, candy, magazines, newspapers and fast food
Unsought Products
Consumer products that the consumer either does not know about or knows about but does not normally consider buying •Require a lot of advertising, personal selling, and other marketing efforts •New innovations are generally unsought till advertised •Known but unsought products and services are life insurance, blood donation, preplanned funeral services
Shopping products
Consumer products that the customer, in the process of selecting and purchasing, usually compare on such attributes as suitability, quality, price, and style •Less frequently purchased •Distributed through fewer outlets •Greater sales support •E.g. Furniture, clothing, used cars Consumer Products (continued)
Specialty products
Consumer products with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort •Different brands are not usually compared •E.g. Specific brands of cars, high-‐priced photographic equipment, designer clothes, and the services of medical or legal specialists
Sales contests
Contest for salespeople or dealers to motivate them to increase their sales performance over a given period
Media Timing Strategies
Continuity: Scheduling ads evenly within a given period Pulsing: Scheduling ads unevenly over a given time period
core beliefs and values
Core beliefs and values: •Passed on from parents to children •Reinforced by schools, churches, business, and government
three levels of a product?
Core customer value -What the consumer is really buying Actual product- Brand name, service features, design, packaging, and quality level Augmented product- Additional services and benefits such as delivery and credit, instructions, installation, warranty, and service
cost-based pricing vs. value-based pricing
Cost-based pricing °Setting prices based on the costs for producing, distributing, and selling the product plus a fair rate of return for effort and risk Value-based pricing °Setting price based on buyers' perceptions of value rather than on the seller's cost
Cost-based pricing --> 2 types
Cost-plus (markup) pricing •Adding a standard markup to the cost of the product Break-even (target return) pricing •Setting price to break even on the costs of making and marketing a product, or setting price to make a target return
New brands
Created for new product category, or when interest in existing brands decreases
customer empowerment
Customer empowerment is the process of providing customers with the tools and resources needed to be successful. This means giving them information to make well-informed decisions that put them one step closer to achieving their goals.
logistics system- goals
Deliver a targeted level of customer service at the least cost
Organizational climate
Describes the feeling that salespeople have about opportunities, value, and rewards for a good performance
four elements of a salesperson's compensation
Fixed amount, Variable amount, Expenses, Fringe benefits
Marketing Strategy Development
Designing an initial marketing strategy for a new product based on the product concept °Marketing Strategy Statement -Part 1 Describes the target market, planned value proposition, sales, market share, and profit goals -Part 2 Outlines the product's planned price, distribution, and marketing budget -Part 3 Describes the planned long-run sales and profit goals, marketing mix
Packaging
Designing and producing the container or wrapper for a product -Protects the product -Attracts customers and closes the sale
Product Development
Developing the product concept into a physical product to ensure that the product idea can be turned into a workable market offering •Prototypes are made •Consumer tests are conducted
product features
Differentiate the company's product from competitors' products
differentiation?
Differentiation: Actually differentiating the market offering to create superior customer value
direct/indirect marketing channel
Direct: A marketing channel that has no intermediary levels -consumer example: producer --> consumer -business example: producer --> business customer Indirect: a marketing channel containing one or more intermediary levels -consumer example: producer --> wholesaler --> retailer --> consumer -business example: producer --> manufacturer's representatives of sales branch --> business distributor --> business customer
channel conflict -horizontal channel conflict -vertical channel conflict
Disagreements among marketing channel members on goals, roles, and rewards—who should do what and for what rewards -horizontal: occurs among firms at the same level of the channel (e.g., between different dealers of the same brand) -vertical: occurs between different levels of the same channel (e.g., between a brand and its franchisee)
satisfying customers is important why?
Disappointment ---Performance < Expectations Satisfaction---Performance = Expectations Delight---Performance > Expectations
Point-of-purchase (POP) promotions
Displays and demonstrations that take place at the point of sale
advertising standardization
Efforts to make marketing program elements uniform. However, targeting the same product everywhere is not usually feasible.
role that motivation plays in SFM?
Encourage salespeople to work hard and energetically toward sales force goals
Exchanges and relationships
Exchange is the act of obtaining a desired object from someone by offering something in return Marketing actions build and maintain exchange relationships with target audiences involving an idea, product, service, or other object Marketers build strong relationships by consistently delivering superior customer value
objectives a research project might have (exploratory, descriptive, causal)?
Exploratory research, Descriptive research, Causal research
exploratory, descriptive, and causal research?
Exploratory research: Gathering preliminary information that will help define the problem and suggest hypotheses Descriptive research: Generating information to better describe marketing problems, situations, or markets Causal research: Testing hypotheses about cause-and-effect relationships
brand extension
Extending an existing brand name to new product categories
direct marketing forms
Face-to-face selling, direct-mail marketing, catalog marketing, telemarketing, direct-response marketing, Kiosk marketing, new digital technologies, online marketing
licensing
For a fee, companies use names and symbols created by other companies
intermarket segmentation
Forming segments of consumers who have similar needs and buying behavior even though they are located in different countries
blog vs forum
Forum posts can be presented in chronological order of posting to the forum, or chronologically within a thread, which makes it easier to follow a conversation. Author posts, reader comments. A blog post is usually one person's opinion, followed optionally by comments.
Contests, sweepstakes, and games
Give consumers the chance to win something
Exclusive distribution
Giving a limited number of dealers the exclusive right to distribute the company's products in their territories
Premiums
Goods offered either free or at low cost as an incentive to buy a product
Conventions and trade shows
Help vendors find new sales leads, contact customers, introduce new products, etc.
time-and-duty analysis
Helps show salespersons the time the salesperson spends selling, traveling, waiting, taking breaks, and doing administrative chores in hopes of determining ways they could be more productive/efficient.
consumer markets
In consumer markets, products are sold to consumers either for their own use or use by their family members.
salesperson
Individual representing a company to customers by performing one or more of the following activities •Prospecting, Communicating, Selling, Servicing, Information gathering, Relationship building
innovation management system?
Innovation management systems can help companies collect, review, evaluate, and manage new-product ideas •They help create an innovation-oriented company culture •They yield a larger number of new-product ideas
adopter categories based on time of adoption
Innovators: These individuals adopt new technology or ideas simply because they are new. Innovators tend to take risks more readily and are the most venturesome. Early adopters: This group tends to create opinions, which propel trends. They are not unlike innovators in how quickly they take on new technologies and ideas but are more concerned about their reputation as being ahead of the curve. Early majority: If an idea or other innovation enters this group, it tends to be widely adopted before long. This group makes decisions based on utility and practical benefits over coolness. Late majority: The late majority shares some traits with the early majority but is more cautious before committing, needing more hand-holding as they adopt. Laggards: This group is slow to adapt to new ideas or technology. They tend to adopt only when they are forced to or because everyone else has already.
major cultural views
Institutions and other forces that affect society's basic values, perceptions, preferences, and behaviors
How can marketers make services more tangible?
Intangibility requires marketers to make promises to customers and the customer is forced to place a degree of trust in these promises -To cope with intangibility, service providers come up with tangible cues such as well groomed professional appearing customer contact employees and clean facilities ex. professionalism and cleanliness of an airline pilot's uniform
place marketing
Involves activities undertaken to create, maintain, or change attitudes or behavior toward particular places
Geographical Pricing
Is used for customers in different parts of the country or the world FOB-origin pricing Uniform-delivered pricing Zone pricing Basing-point pricing Freight-absorption pricing
Promotional Pricing
Is when prices are temporarily priced below list price or cost to increase demand Discounts (loss leaders) Special-event pricing Cash rebates Low-interest financing Longer warranties Free maintenance
salespeople can be evaluated by
Management gets information about its salespeople from: •Sales reports •Call reports •Expense reports •Monitoring the sales and profit performance data in the salesperson's territory •Personal observation, customer surveys, and talks with other salespeople
customer relationship management (CRM)
Managing detailed information about individual customers and carefully managing customer touch points to maximize customer loyalty. •Helps firms offer better customer service •Helps identify high-value customers •Enhances the firm's ability to cross-sell products and develop offers tailored to customers
experience
Market offerings often include both tangible goods and intangible services •Pure tangible good •Pure service
new-product pricing strategies we distinguish
Market-skimming pricing & Market-penetration pricing
brand positioning
Marketers can position brands clearly in customers' minds at any of three levels •Product attributes •Product benefits •Beliefs and values Positioning: Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers
factors marketers should keep into account when developing a sales promotion program?
Marketers must: •Determine the size of the incentive •Set conditions for participation •Determine how to promote and distribute the promo1on program itself •Set the length of promotion •Evaluate the promotion
marketing environment is made up of (micro-and macro-environments)?
Marketing environment is made up of a microenvironment and a macroenvironment
socially responsible target marketing
Marketing generates concern when targeting: •Vulnerable, minority or disadvantaged populations •Children and teens Controversy arises when an attempt is made to profit at the expense of these segments Critics worry that marketers directly or indirectly target young girls with provocative products, promoting a premature focus on sex and appearance
price elasticity of demand
Measure of the sensitivity of demand to changes in price -inelastic & elastic demand
Media Types vs Media Vehicles
Media Types: media that effectively and efficiently present the message to customers -Consider each medium's impact, effectiveness, and cost Media Vehicles: specific media within each general media type
characteristics of a good mission statement?
Mission statements should be market-oriented (not product-oriented), and defined in terms of customer needs.
advertising adaptation
Modifying elements of the marketing program to accommodate specific customer requirements in individual foreign markets. Can be as straightforward as translating labels, instructions, or books into foreign languages or as complex as complete product modification which can provide a marketer with an important advantage. Ex) McDonald's in certain areas of the world like India substitutes its burgers with lamb or chicken because of the culture shunning of beef
Do consumers or businesses always go through all of the decision-making stages (not only in high involvement or non-routine purchases)?
NO THEY DON'T
controlled test markets
New products and tactics are tested among controlled panels of shoppers and stores
Customer-Centered New-Product Development
New-product development that focuses on finding new ways to solve customer problems and create more customer-satisfying experiences
Frequency
Number of times the average person in the target market is exposed to the message
reach
Percentage of people in the target market who are exposed to an ad campaign during a given period of time
perceptional map/ positioning map?
Perceptual maps visually plot how various brands stand in relation to one another. Maps can be based on important product attributes (attribute rating method), or Maps can be based on the overall similarity and dissimilarity between products (overall similarity method). Perceptual maps help managers do the following: -Customer needs not met by you -competitor weaknesses -how to improve a product
person marketing
Person marketing consists of activities undertaken to create, maintain, or change attitudes or behavior toward particular people -Organizations use well-known personalities to help sell their products or causes
Personal selling
Personal presentation by the firm's sales force for the purpose of making sales and building customer relationships
personal selling
Personal presentations by the firm's sales force for the purpose of making sales and building customer relationships
Big Idea
Point of focus for communicating the message strategy. Can be risky because they are different and untested. An idea is a new or unexpected combination of thoughts. Also known as creative concept.
positioning
Positioning: Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers
Cash refunds (or rebates)
Price reduction occurs after purchase to the manufacturer, which then refunds part of the purchase price
Reference pricing
Prices that buyers carry in their minds and refer to when they look at a given product
Psychological Pricing
Pricing that considers the psychology of prices, not simply the economics; the price says something about the product
target costing
Pricing that starts with an ideal selling price and then targets costs that will ensure that the price is met
sources of existing data
Primary or secondary
probability vs. non-probability sample
Probability sample: Each population member has a known chance of being included in the sample Nonprobability sample: Sampling error cannot be measured
national brands
Products are marketed under the manufacturer's own name
Industrial products
Products bought by individuals and organizations for further processing or for use in conducting a business -materials and parts -capital items -supplies and services
advantages and disadvantages of Online marketing research?
Pros •Speed and low costs •Lowest cost per respondent of all contact methods; offers excellent sample control •Good flexibility and response rate due to interactivity Cons •Difficulty in controlling sample
advantages and disadvantages of Focus groups
Pros: -synergism-snowballing-stimulation-spontaneity-security-scientific scrutiny-speed Cons: -misrepresentation -moderator bias and researcher bias -participants may hide emotional side -social pressure
advantages and disadvantages of Telephone Interviewing?
Pros: •Gathers information fast, high response rate •Allows greater flexibility than mail surveys •Strong sample control Cons: •Higher costs than mail questionnaires •Interviewer may bias results •Limited quantity of data can be collected
advantages and disadvantages of Personal Interviewing?
Pros: •Highly flexible method that can gather a great deal of data from a respondent •Good control of sample, speed of data collection, and response rate Cons: •High cost per respondent •Subject to interviewer bias
advantages and disadvantages of Mail Questionnaires?
Pros: •Large amounts of information at a relatively low cost per respondent •Enables more honest responses than interviews •Absence of interviewer bias •Cons: •Inflexible, low response rate •Researcher has little control over sample
product placement
Putting products into TV shows and movies where they will be seen
allowances
Reduction from the list price for buyer actions such as trade-ins or promotional and sales support •Forms: -Trade-in allowances: Price reductions given for turning in an old item when buying a new one -Promotional allowances: Payments or price reductions that reward dealers for participating in advertising and sales support programs
product characteristics that influence the rate of adoption
Relative advantage: Is the innovation superior to existing products? Compatibility: Does the innovation fit the values and experience of the target market? Complexity: Is the innovation difficult to understand or use? Divisibility: Can the innovation be used on a limited basis? Communicability: Can results be easily observed or described to others?
simulated test markets
Researchers measure consumer responses to in laboratory stores or simulated online shopping environments
marketing decisions retailers have to make (1. Retail strategy; 2. marketing mix decisions)?
Retail strategy -retail segmentation and targeting -store differentiation and positioning Retail marketing mix -product and service assortment -retail prices -promotion -distribution (location)
positive incentive
Rewards of benefits for doing or not doing something
sampling plan
Sampling requires three decisions: •Who is to be studied (sampling unit) •How many people should be included (sample size) •How should the people in the sample be chosen (sampling procedure)
secondary beliefs and values
Secondary beliefs and values •More open to change than core beliefs
What is segmentation, targeting, differentiation, and positioning?
Segmentation: Dividing the market into segments of customers Target marketing: Selecting one or more segments to cultivate/target Differentiation: Actually differentiating the market offering to create superior customer value Positioning: Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers
segmented pricing
Selling a product or service at two or more prices, where the difference in prices is not based on differences in costs •Forms: -Customer-segment pricing -Product-form pricing -Location-based pricing -Time-based pricing
service differentiation, service quality, and service productivity?
Service differentiation-can differentiate service delivery by having more able and reliable customer -contact people can differentiate offer by including innovative features that set companies offer apart from competitors offer-can differentiate image through symbols and branding Managing service quality-service quality is harder to define than product quality example: harder to agree on quality of haircut than on quality of hairdryers-best measure of quality: customer retention service quality will always vary-good service recovery can turn angry customers into loyal one Managing Service Productivity-train current employees better or hire new ones who work harder or more skillfully to increase productivity-can increase quantity by giving up quality harness power of technology-careful not to take service out of the service
reduce the costs of test marketing by
Simulated test markets & Controlled test markets
marketing (or distribution) channel
Set of interdependent organizations that help make a product or service available for use or consumption by the consumer or business users *Marketing channel decisions: •Affect other marketing decisions, such as pricing or product design •Can lead to competitive advantage
by-product pricing
Setting a price for by-products to make the main product's price more competitive
competition-based pricing
Setting prices based on competitors' strategies, prices, costs, and market offerings
product line pricing
Setting the price steps between various products in a product line based on cost differences between the products, customer evaluations of different features, and competitors' prices
Sales contests
Short-term incentive programs to accomplish specific objectives
Sales promotion
Short-term incentives to encourage the purchase or sale of a product or service
sales promotion
Short-term incentives to encourage the purchase or sale of a product or service
demand curve
Shows the number of units the market will buy in a given time period, at different prices that might be charged
products that enter the decline stage can cycle back to the growth stage
Sometimes companies can improve a product by implementing changes to the product, such as new ingredients or new services. If the changes are accepted by customers, it can lead to a product moving out of the decline stage and back into the introduction stage.
Sales quotas
Standard that states the amount a salesperson should sell and how sales should be divided among the company's products
benefits and drawbacks of both international advertising decisions (standardization/adaptation)
Standardization: Benefits •Lower advertising costs •Greater global advertising coordination •More consistent worldwide image Drawbacks Ignores the fact that country markets differ greatly in cultures, demographics, and economic conditions
Intensive distribution
Stocking the product in as many outlets as possible
Business Buying Situations (straight rebuy; modified rebuy; new buy/new task) -types
Straight rebuy: Buyer routinely reorders something without any modifications Modified rebuy: Buyer wants to modify product specifications, prices, terms, or suppliers New task: Buyer purchases a product or service for the first time Systems (solution) selling: Becoming more common among companies
types of compensation plans exist for compensating salespeople
Straight salary, Straight commission, Salary plus bonus, Salary plus commission
components of the growth share matrix (e.g., stars, cash cows, question marks, dogs)?
Strategies for categories of the BCG Matrix •Stars need heavy investments to finance their rapid growth •Cash cows need less investment to hold their market share •Question marks require a lot of cash to hold their share, let alone increase it •Dogs do not promise to be large sources of cash
The PLC concept also can be applied to what are known as styles, fashions, and fads
Style-A basic and distinctive mode of expression Fashion-A currently accepted or popular style in a given field Fad-A temporary period of unusually high sales driven by consumer enthusiasm and immediate product or brand popularity
actors the microenvironment is made up of (company, suppliers, intermediaries, competitors, publics, customers)?
The actors close to the company that affect its ability to serve its customers—the 1.) company, 2.) suppliers, 3.) marketing intermediaries, 4.) customer markets, 5.) competitors, and 6.) publics
execution style -types
The approach, style, tone, words, and format used for executing an advertising message -types: slice of life, lifestyle, fantasy, mood or image, musical, personality symbol, technical expertise, scientific evidence, testimonial evidence or endorsement
Black Box of the buyer behavior model (the stimulus-response model of buyer behavior)?
The black box model of consumer behavior identifies the stimuli responsible for buyer behavior. -buyer's black box =buyers characteristics/ the environment (marketing stimuli like product, price, place, promotion and other like economic, technological, social, cultural) --> buyer's black box (buyer's characteristics & buyer's decision process) --> buyer responses (buying attitudes and preferences, purchase behavior- what the buyer buys, when, where, and how much, and brand and company relationship behavior)
product quality
The characteristics of a product or service that bear on its ability to satisfy stated or implied customer needs
In what does superior customer value result? (customer perceived value)
The customer's evaluation of the difference between all of the benefits and all of the costs of a marketing offer relative to those of competing offers
new-product development?
The development of original products, product improvements, product modifications, and new brands through the firm's own product development efforts
Brand equity
The differential effect that knowing the brand name has on customer response to the product or its marketing
integrated logistics management
The logistics concept that emphasizes teamwork, both inside the company and among all the marketing channel organizations, to maximize the performance of the entire distribution system. •Requires: -Cross-functional teamwork inside the company -Building logistics partnerships -Outsourcing to third-party logistics providers
advertising strategy
The plan by which the company accomplishes its advertising objectives. It consists of two major elements: creating advertising messages (message decisions) and selecting advertising media (media decisions).
factors affecting international pricing
The price that a company should charge in a specific country depends on economic conditions, laws and regulations, competitive situations, etc.
Wholesaling vs Retailing
The primary difference between wholesale and retail is that the former is a business-to-business model and the latter a business-to-consumer model. In a wholesale model, you don't sell products directly to consumers. ... In a retailing model, you obtain products from a distributor and sell products directly to consumers
Strategic Planning
The process of developing and maintaining a strategic fit between the organization's goals and capabilities and its changing marketing opportunities
mass customization
The production of personalized goods or services to meet individual consumers' diverse needs at near mass production prices.
product mix -4 product mix decisions
The set of all product lines and items that a particular seller offers for sale -4 product mix decisions length: the number of items within a product line. width: the number of different product lines the company carries. depth: the number of versions offered of each product in the line. consistency: how closely related various lines are in end use.
Marketing Mix; the 4 P's?
The set of tactical marketing tools—product, price, place, and promotion—that the firm blends to produce the response it wants in the target market
Macroenvironment- Demographic forces
The study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics -The changing age structure of the U.S. population is a significant demographic trend
channel members (e.g., distributors) add value? how? -key functions
The use of intermediaries results from their greater efficiency in making goods available to target markets •Channel members can offer -Contacts and experience -Specialization -Scale of operation Key Functions Performed by Channel Members -transaction completion: information, promotion, contact, matching, negotiation -transaction fulfillment: physical distribution, financing, risk taking
Selective distribution
The use of more than one but fewer than all of the intermediaries who are willing to carry the company's products
Concept Development and Testing
To develop a new product into alternative product concepts, find out how attractive each concept is to customers, and choose the best one °Testing new-product concepts with a group of target consumers to find out if the concepts have strong consumer appeal -Using a description, picture or model of the product -Asking consumers about their reactions
horizontal marketing system
Two or more companies at one level join together to follow a new marketing opportunity
Corporate Chains
Two or more outlets that are commonly owned and controlled
intermediaries we distinguish
Types of intermediaries •Resellers: distribution channel firms that help the company find customers or make sales to them-Includes wholesalers and retailers •Physical distribution firms: help the company stock and move goods from their points of origin to their destinations •Marketing services agencies: the marketing research firms, advertising agencies, media firms, and marketing consulting firms that help the company target and promote its products to the right market •Financial intermediaries: include banks, credit companies, insurance companies, and other businesses that help finance transactions or insure against the risks associated with the buying and selling of goods
markets that exist? -types
Types of markets: pure competition, monopolistic competition, oligopolistic competition, pure monopoly
publics we distinguish
Types of publics •Financial publics: group influences company's ability to obtain funds 1.Major financial publics: banks, investment analysts, and stockholders •Media publics: group carries news, features, editorial opinions, and other content 1.Includes: TV stations, newspapers, magazines, and blogs and other social media •Government publics: marketers must often consult the company's lawyers on issues of public safety, truth in advertising, and other matters •Citizen-action publics: made up of consumer organizations, environmental groups, minority groups, and others 1.public relations department can help company stay in touch with consumer and citizen groups •Local publics: group includes neighborhood residents and community organizations •General public: company needs to be concerned about the general public's attitude toward its products and activities •Internal publics: includes workers, managers, volunteers, and the board of directors
unique selling proposition (or, USP)
Unique selling proposition is a statement that describe how your product or company is different (and hopefully better than) the competition. (considered to be good selling points) The best USP takes a unique quality and explain how that quality will benefit your customers, all in a few memorable words. Many companies use USP as their slogans, so they can put them in front of as many prospective customers as possible
Advertising specialties (or promotional products)
Useful articles imprinted with an advertiser's name, logo, or message
consumer-generated ad messages
User-generated advertising efforts can produce new ideas and fresh perspectives on the brand----> Boost consumer involvement and with the brand
Integrated Marketing Communications (IMC)
Using IMC, the company carefully integrates and coordinates its many communication channels to deliver a clear, consistent, and compelling message about the organization and its products. •Recognize all points where the customer may encounter the company's brands
shopper marketing
Using point-of-sale promotions and advertising to extend brand equity to "the last mile" and encourage favorable in-store purchase decisions
team selling?
Using teams of people from sales, marketing, engineering, finance, technical support, and even upper management to service large, complex accounts
advertising media -steps in selecting advertising media
Vehicles through which advertising messages are delivered to their intended audiences •Determining reach, frequency, and impact goals. •Choosing among major media types (e.g., TV, magazines). •Selecting specific media vehicles (e.g., Newsweek or Sports Illustrated for magazines). •Choosing media timing (continuity vs. pulsing).
marketing decisions wholesalers have to make (1. Wholesale strategy; 2. Marketing mix decisions)
Wholesale strategy -wholesale segmentation and targeting -differentiation and service positioning Wholesale marketing mix -product and service assortment -wholesale prices -promotion -distribution (location)
difference between reactive and proactive firms in terms of their response to the marketing environment?
With proactive marketing, the company uses its collected data to plan organized marketing campaigns far in advance, whereas with reactive marketing, the company responds to consumer actions and trends as they happen.
conventional distribution channel
a channel consisting of one or more independent producers, wholesalers, and retailers, each a separate business seeking to maximize its own profits, perhaps even at the expense of profits for the system as a whole
derived demand
a demand for a commodity, service, etc. which is a consequence of the demand for something else.
fighter brands
a fighter brand is a lower-priced offering launched by a company to take on, and ideally take out, specific competitors that are attempting to under-price them ex: General Motors' (GM) "Saturn," United Airlines' "Ted," and Kodak's "Funtime" film range are all high-profile fighter brands that failed
Ethnographic research
a form of observational research that involves sending trained observers to watch and interact with consumers in their "natural environments"
product line
a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges
advertising agency
a marketing services firm that assists companies in planning, preparing, implementing, and evaluating all or portions of their advertising programs
everyday low pricing (EDLP)
a pricing strategy promising consumers a low price without the need to wait for sale price events or comparison shopping
Business Analysis
a review of the sales, costs, and profit projections for a new product to find out whether these factors satisfy the company's objectives
transaction-oriented selling
a sales strategy that is focused solely on making a quick sale or transaction with no emphasis on learning the actual pain of a customer and how their product can solve that pain
partner relationships management
a set of software and strategies that companies use to enable smooth business relationships with those they partner with on marketing and those that sell their products
mission statement
a statement of the organization's purpose - what it wants to accomplish in the larger environment
two ways a company can obtain new products
acquisition & new-product development effort
Product/Market Expansion Grid
also called the Ansoff Matrix, is a tool used to develop business growth strategies by examining the relationship between new and existing products, new and existing markets, and the risk associated with each possible relationship.
service
an activity, benefit, or satisfaction offered for sale that is essentially intangible and does not result in the ownership of anything
Customer database
an organized collection of comprehensive data about individual customers or prospects, including geographic, demographic, psychographic, and behavioral data -Databases are important as they are places where direct marketers take customer responses and store them in a database. The creation of databases enable direct marketers to target their best prospects and best customer, build customer relationships and maintain long-term customer loyalty.
Advertising
any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor
Do these public policy pricing issues occur within channel levels or across channel levels?
both within channel: price fixing & predatory pricing across channel: price discrimination, retail price maintenance, deceptive pricing
Public Relations
building good relations with the company's various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events
segmenting business markets
business marketers can also use operating characteristics, purchasing approaches, situational factors, personal characteristics
factors marketers need to consider when deciding on a target market strategy?
company resources, market variability, product's life cycle stage, competitor's marketing strategies
competition and other external factors affecting pricing?
competitors strategies and prices marketing strategy, objectives, and mix nature of the market and demand
sales force automation system
computerized, digitized sales force operations that let salespeople work more effectively anytime, anywhere
organization marketing
consists of activities undertaken to create, maintain, or change the attitudes and behavior of target consumers toward an organization -Business firms sponsor public relations or corporate image marketing campaigns to market themselves and polish their images -IBM's Smarter Planet campaign markets IBM as a company that helps improve the world's IQ
consumer buyer behavior versus business buyer behavior
consumer buyer behavior- The buying behavior of individuals and households who buy goods and services for personal consumption business buyer behavior- Business buyer behavior refers to the buying behavior of the organizations that buy goods and services for use in production of other products and services that are sold, rented, or supplied to others.
customer markets- 5 types
consumer, business, reseller, government, international
sub-categories that each segmentation variable has?
demographic segmentation -age and life cycle -gender -income psychographic segmentation -social class -lifestyle -personality behavioral segmentation -occasion -benefit sought -user status -usage rate -loyalty status to segment markets
major forces in a company's macro-environment (demographic, economic, natural, technological, political, cultural)
demographic, economic, natural, technological, political, cultural
environmental sustainability
developing strategies and practices that create a world economy that the planet can support indefinitely
Direct marketing
direct connections with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships •Message is directed to a specific person •Message is immediate and customized •Allows a dialogue between the marketing team and the consumer
forms of online ads
display ads, Search-related ads (or contextual advertising), content sponsorships, viral marketing,
prototypes
early sample or model built to test a concept or process or to act as a thing to be replicated or learned from.
line extension
extending an existing brand name to new forms, colors, sizes, ingredients, or flavors within a product category
customer insights?
fresh understandings of customers and the marketplace derived from marketing information that become the basis for creating customer value and relationships
Survey research
gathering primary data by asking people questions about their knowledge, attitudes, preferences, and buying behavior
Observational research
gathering primary data by observing relevant people, actions, and situations
Experimental research
gathering primary data by selecting matched groups of subjects, giving them different treatments, controlling related factors, and checking for differences in group responses
segmentation variables that can be used to segment markets?
geographic segmentation demographic segmentation psychographic segmentation behavioral segmentation
materials and parts
goods that enter the manufacturer and product completely
competitor price changes- when and why should firms respond
has competitor cut price? no: hold current price, continue to monitor competitor's price yes: reduce price, raise perceived value, improve quality and increase price, launch low price "fighter brand"
major stages in new-product development?
idea generation, idea screening, concept development and testing, marketing strategy development, business analysis, product development, test marketing, commercialization
inbound/outbound logistics
inbound: from suppliers to company outbound: from company to resellers/customers
intermediaries
independent firms which assist in the flow of goods and services from producers to end-users; they include agents, wholesalers and retailers; marketing services agencies; physical distribution companies; and financial institutions. Also referred to as Middlemen
merchant wholesalers
independently owned wholesale business that takes title to the merchandise it handles
inelastic demand vs. elastic demand
inelastic: Demand hardly changes with a small change in price elastic: Demand changes greatly with a small change in price
Primary data
information collected for the specific purpose at hand
Secondary Data
information that already exists somewhere, having been collected for another purpose
four service characteristics
intangibility: services can not be seen, tasted, felt, heard or smelled before purchase inseparability: services cannot be separated from their providers variability: quality of services depends on who provides them and when, where, and how perishability: services cannot be stored for later sale or use
customer satisfaction
is a function of consumer expectations and perceived product performance
store atmosphere
is important as a unique store experience -can move customers to buy
problems associated with the poor selection of salespeople
lower sales, costly turnover, less productivity, disrupted customer relationships
methods to contact people?
mail questionnaires, telephone interviewing, personal interviewing, focus groups, online marketing research
branded entertainment
making the brand an inseparable part of some other form of entertainment -Most common form is product placements
What is marketing?
managing profitable customer relationships -a process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return.
supply chain management
managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers, and final consumers
cause-related marketing
many companies are now linking themselves to worthwhile causes
idea marketing
marketing activities that seek to gain market share for a concept, philosophy, belief, or issue by using elements of the marketing mix to create or change a target market's attitude or behavior
Multibrands
marketing many different brands in a given product category
five requirements for effective segmentation?
measurable, accessible, substantial, differentiable, actionable
wholesalers -types
merchant wholesalers, brokers and agents, and manufacturer's sales branches and offices
sequential product development
method of product design and development in which each stage of the process leads to the next without overlap.
possible value propositions for marketers?
more for more more for the same more for less the same for less less for much less -two meaningful dimensions such value propositions can be based on: Benefits & Price
brand sponsorship
national brands, store brands, licensing, co-branding
major PR tools?
news, special events, written materials, audiovisual materials, corporate identity materials, public service activities
price ceiling
no demand above this price
price floor
no profits below this price
major advertising decisions
objectives setting, budget decisions, message decisions, media decisions, advertising evaluation
specific approaches for gathering primary data
observation, ethnographic research, survey, experiment
outside/field versus the inside sales force
outside/field sales force: salespeople who travel to call on customers in the field inside sales force: salespeople who conduct business from their offices via telephone, the Internet, or visits from prospective buyers
different components of Maslow's Hierarchy of Needs
physiological, safety, social, esteem, self-actualization
marketing logistics/physical distribution
planning, implementing, and controlling the physical flow of materials, final goods, and related information from points of origin to points of consumption to meet customer requirements at a profit
public relations (PR) department? functions
press relations or press agency, product publicity, public affairs, lobbying, investor relations, development
price changes that firms can make
price cuts- reasons: •Excess capacity •Falling demand in face of strong competitive price or a weakened economy •Attempt to dominate market through lower costs price increases- reasons: Can greatly improve profits and may be initiated due to: •Cost inflation •Overdemand
high-low pricing
pricing strategy adopted by companies, usually small and medium-sized retail firms, where a firm initially charges a high price for a product and later, when it has become less desirable, sells it at a discount or through clearance sales.
five (5) individual product decisions?
product attributes branding packaging labeling product support services
product mix pricing strategies
product line pricing, optional product pricing, captive product pricing, by-product pricing, product bundle pricing
Sales meetings
provide social occasions, breaks from the routine, chances to meet and talk with "company brass," and opportunities to air feelings and identify with a larger group
value selling
requires: •Listening to customers •Understanding their needs •Carefully coordinating the whole company's efforts to create lasting relationships based on customer value
trade promotions -trade promotion tools
sales promotion tools used to persuade resellers to carry a brand, give it shelf space, and promote it in advertising and push it to consumers •Contests •Premiums •Displays •Discounts/Price-off/Off-invoice/Off-list •Allowances •Free goods •Push money •Specialty advertising items
Consumer Promotion Tools
samples, coupons, rebates, price packs, premiums, advertising specialties, point-of-purchase promotions, contests, sweepstakes, games, and event marketing
Idea Screening
screening new-product ideas to spot good ideas and drop poor ones as soon as possible
Captive product pricing
setting a price for products that must be used along with a main product, such as blades for a razor and games for a video-game console
cost-based pricing
setting prices based on the costs of producing, distributing, and selling the product plus a fair rate of return for effort and risk
narrowcasting
sharing a message with a narrower group -companies these days are doing less broadcasting and more narrowcasting
Supplies and services
short lasting goods and services that facilitate developing and/or managing the finished product
call plan
shows which customers and prospects to call on and which activities to carry out
local marketing
tailoring brands and marketing to the needs and wants of local customer segments - cities, neighborhoods, and even specific stores
individual marketing
tailoring products and marketing programs to the needs and preferences of individual customers often referred to as one-to-one marketing, mass customization, and markets-of-one marketing).
Micromarketing (local or individual marketing)
tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments; it includes local marketing and individual marketing
What is the marketing environment and why is it important to study?
the actors and forces outside marketing that affect marketing management's ability to build and maintain successful relationships with target customers -Studying the marketing environment allows marketers to take advantage of opportunities and combat threats
service-profit chain? 5 links
the chain that links service firm profits with employee and customer satisfaction 5 links -customer loyalty, customer satisfaction, employee loyalty, employee satisfaction and productivity.
business portfolio
the collection of businesses and products that make up the company
product life cycle (PLC)? + stages
the course of a product's sales and profits over its lifetime stages: Introduction, Growth, Maturity, Decline
product adaptation
the firm adapts the product to the local markets
supply chain -upstream/downstream
the group of firms that make and deliver a given set of goods and services Upstream Supply Chain- Firms that supply the raw materials, components, parts, and other elements necessary to create a product or service Downstream Supply Chain- Marketing channel partners that link the firm to the customer
market flexibility in setting price varies depending on...
the nature of the market
return on advertising investment
the net return on advertising investment divided by the costs of the advertising investment Advertisers should regularly evaluate the: -Communication effects -Sales and profit effects
success of individual channel members depends on
the overall channel's success •The channel will be most effective when: •Each member is assigned tasks it can do best •All members cooperate to attain overall channel goals
experiential retailing
the practice of creating an immersive retail environment where customers can try out a "lifestyle" rather than just seeing products on a shelf -is growing in popularity
optional product pricing
the pricing of optional or accessory products along with a main product
portfolio analysis
the process by which management evaluates the products and businesses that make up the company -Purpose of portfolio analysis •To direct resources toward more profitable businesses while phasing out or dropping weaker ones
market segmentation
the process of dividing a total market into homogeneous subgroups, or segments, consisting of people or organizations with relatively similar product needs -Dividing a market into smaller segments of buyers with distinct needs, characteristics, or behaviors that might require separate marketing strategies or mixes
market targeting/target marketing
the process of evaluating each market segment's attractiveness and selecting one or more segments to enter -In evaluating different market segments, a firm must look at: •Segment size and growth •Segment structural attractiveness •Company objectives and resources
product standardization
the process of maintaining uniformity and consistency among the different iterations of a particular good or service that are available in different markets
Media impact
the qualitative value of a message exposure through a given medium
promotion mix
the specific blend of promotion tools that the company uses to persuasively communicate customer value and build customer relationships
What market target/target market strategies exist?
undifferentiated mass marketing, differentiated segmented marketing, concentrated niche marketing, micromarketing (local or individual marketing)
Voluntary Chains
wholesale-sponsored groups of independent retailers that engage in group buying and common merchandising
manufacturer's sales branches and offices
wholesaling by sellers/buyers themselves rather than through independent wholesalers
Systematic New-Product Development
°The new-product development process should be holistic and systematic °Innovation management systems can help companies collect, review, evaluate, and manage new-product ideas -They help create an innovation-oriented company culture -They yield a larger number of new-product ideas
undifferentiated mass marketing
•A firm decides to ignore market segment differences and go after the whole market with one offer •Focuses on what is common in the needs of consumers •Designs a product that will appeal to the largest number of buyers
differentiated marketing
•A firm decides to target several market segments and designs separate offers for each
concentrated marketing
•A firm goes after a large share of one or a few segments or niches •Can fine-tune its products, prices, and programs to the needs of carefully defined segments
What trend triggered the development of click-and-brick marketers?
•Almost all traditional companies have set up their own online sales and communication presence. •Many click-and-mortar firms are having more online success than their click-only competitors.
Product Support Services
•An important part of the customer's overall brand experience •Firms must survey customers to assess the value of current services and obtain ideas for new ones
idea generation
•Analyze customer questions and complaints to find new products that better solve consumer problems -Invite customers to share suggestions and ideas •Internal sources-The traditional R&D process-Intrapreneurs within the company •External sources-Distributors and suppliers-Competitors and their products-Trade magazines and shows-Customers •Crowdsourcing-Invites customers, employees, independent scientists and researchers, and even the public at large, into the new-product innovation process
ethical issues that play a role in online-marketing
•Annoys customers •Takes unfair advantage of impulsive buyers •Internet fraud -Phishing - Identity theft that uses deceptive emails and fraudulent Web sites to fool users into divulging their personal data •Online security •Access by vulnerable or unauthorized groups •Invades privacy •Ready availability of information leaves consumers open to abuse
sales promotion objectives
•Are used together with other promotion mix tools •Help reinforce product's position and build long-term customer relationships
two dimensions most standard portfolio analysis methods use to evaluate SBUs?
•Attractiveness of SBU's market or industry •Strength of SBU's position within that market or industry
persuasive advertising
•Becomes more important as competition increases •Objective is to build selective demand
four strategies a company can take for its SBUs?
•Build: increase investment of resources •Hold: maintain minimum investment to keep current position •Harvest: maximize current cash flow, regardless of long term impact •Divest: sell or liquidate
Business to Consumer (B to C) Marketing Business to business (B to B) online marketing Consumer to consumer (C to C) online marketing Consumer to business (C to B) online marketing
•Businesses selling goods and services online to final consumers •Businesses using online marketing to reach new business customers, serve current customers more effectively, and obtain buying efficiencies and better prices •Online exchanges of goods and information between final consumers •Online exchanges in which consumers search out sellers, learn about their offers, initiate purchases, and sometimes even drive transaction terms
major factors changing today's marketing communications
•Changing consumers •Changing marketing strategies •Sweeping advances in communications technology
pull strategies
•Company spends a lot of money on consumer advertising and promo1on to induce final consumers to buy the product, creating a demand vacuum that pulls the product through the channel
Direct marketing Benefits to Buyers Direct marketing Benefits to Sellers
•Convenient •Easy •Private •Immediate and interactive •Access to a wealth of: •Products •Comparative information about companies, products, and competitors •Building customer relationships •Offers sellers a low-cost, efficient, speedy alternative to reach markets •Online direct marketing results in lower costs, improved efficiencies, and speedier handling of channel and logistics functions •Offers greater flexibility •Gives access to buyers that cannot be reached through other channels
factors that influence the "why" of buying in both consumer and business buyer behavior (cultural, social, personal, and psychological factors)?
•Cultural: culture, subculture, social class •Social: reference groups, family, roles and status •Personal: age and life-cycle stage, occupation, economic situation, lifestyle, personality and self-concept •Psychological: motivation, perception, learning, beliefs and attitudes
Price vs. Value
•Cutting cost in tough economic times isn't always the answer -Companies should sell value, not price •Price reductions can: -Cut profits and initiate price wars -Cheapen perceptions of brand quality Marketers should strive to convince consumers that price is justified by value provided
corporate vs marketing website
•Designed to build customer goodwill, collect customer feedback, and supplement other sales channels rather than sell the company's products directly •Interacts with consumers to move them closer to a direct purchase or other marketing outcome
Click-only companies Click-and-mortar companies
•Dot-coms, which operate online only and have no brick-and-mortar market presence •Traditional brick-and-mortar companies that have added online marketing to their operations
international marketing channel design decisions that need to be made
•Each country has its own unique distribution system •Distribution systems can have many layers and a large number of intermediaries •Distribution systems in developing countries may be scattered or inefficient •Customs and government regulation can restrict distribution in global markets
sales force performance can be evaluated by
•Formal evaluation -Forces management to develop and communicate clear standards for judging performance -Provides salespeople with constructive feedback and motivates them to perform well •Company should measure its return on sales investment
value proposition
•How it will create differentiated value for targeted segments •What positions it wants to occupy in those segments The full positioning of a brand—the full mix of benefits on which it is positioned
reminder advertising
•Important for mature products •Helps to maintain customer relationships and keep consumers thinking about the product
sources of marketing information (internal databases, competitive marketing intelligence, and marketing research)?
•Internal Databases: Electronic collections of consumer and market information obtained from data sources within the company network. •Marketing Intelligence: Systematic collection and analysis of publicly available information about competitors and developments in the marketing environment. •Marketing Research:Systematic design, collection, analysis, and reporting of data relevant to a specific marketing situation facing an organization.
internal and external factors that affect pricing
•Internal factors: -Overall marketing strategy, objectives, and the marketing mix -Organizational considerations •External factors: -Nature of the market and demand-Other environmental factors
standard test markets
•Introducing the product and marketing program in realistic market settings
Test Marketing
•Introducing the product and marketing program in realistic market settings •Not for all products •Can be expensive and time consuming, but better than making a major marketing mistake •Standard test markets are usually extensive and costly to use •Simulated test markets-Researchers measure consumer responses to in laboratory stores or simulated online shopping environments •Controlled test markets-New products and tactics are tested among controlled panels of shoppers and stores
Informative advertising
•Issued heavily when introducing a new-product category •Objective is to build primary demand
franchise systems- types
•Manufacturer-sponsored retailer franchise •Manufacturer-sponsored wholesaler franchise •Service-firm sponsored retailer franchise
strategies that a company use to grow (through the product/market expansion grid)?
•Market penetration—increase sales to current market segments without changing the product •Market development—identify and develops new market segments—demographic or geographic—for current company products. •Product development— offer modified or new products to current market segments. •Product diversification—offer new products to new markets.
factors that determine the size of a sales force?
•May range from only a few to thousands •Many companies use some form of workload approach to set sales force size -Company first groups accounts into different classes according to size, account status, or other factors -Then determines the number of salespeople needed to call on each class of accounts
recent trends and developments in retailing
•New retail forms, shortening retail life cycles, and retail convergence •Rise of mega-retailers •Growth of direct and online retailing •Growing importance of retail technology •Green retailing •Global expansion of major retailers
sales force morale can be enhanced by
•Organizational climate •Sales quotas •Positive incentives •Sales meetings •Sales contests
reasons for new-product failures?
•Overestimation of market size•Design problems•Incorrect pricing or positioning•High development costs•Competitor reaction
role and impact of PR?
•PR has a strong impact on public awareness at a much lower cost than advertising •Can be a powerful brand-building tool •Should work hand in hand with advertising within an integrated marketing communications program to help build brands and customer relationships
Product idea vs. product concept vs. product image
•Product idea: An idea for a possible product that the company can see itself offering to the market •Product concept: A detailed version of the new-product idea stated in meaningful consumer terms •Product image: The way consumers perceive an actual or potential product
factors contributing to the growth of sales promotion
•Product managers view promotion as an effective short-run sales tool •Competitors use sales promotion to differentiate their offers •Advertising efficiency has declined •Sales promotions help attract today's more thrift-oriented consumers
two broad classes that products and services fall into
•Pure tangible good •Pure service
push strategies
•Sales force and trade promotion are used to push the product through channels •Producer promotes the product to channel members who in turn promote it to final consumers
components that the customer-driven marketing process entails?
•Segmentation •Targeting •Differentiation and Positioning
functions wholesalers perform
•Selling and promoting •Buying and assortment building •Bulkbreaking •Warehousing •Transportation •Financing •Risk bearing
Market-skimming pricing
•Setting a high price for a new product to skim maximum revenues layer by layer from the segments willing to pay the high price •Product's quality and image supports its higher price •Costs of low volume cannot be so high that they cancel out the benefit of higher price •Competitors should not be able to enter market easily and undercut price
Market-penetration pricing
•Setting a low price for a new product to attract a large number of buyers and a large market share •Market is highly price sensitive, so a low price produces more growth •Production and distribution costs decrease as sales volume increases •Low price can help keep out the competition, and the penetration price can maintain its low-price position
major American social classes
•Upper class: 1% social elite who live on inherited wealth •Lower uppers: 2% have earned high income or wealth through exceptional ability & are active in social and civic affairs •Middle class: Upper Middles 12% professionals/businesspersons/corporate managers who possess neither family status nor unusual wealth "want better things in life" •Middle class: 32% average pay white and blue collar workers who live on the better side of town & buy popular products to keep up with trends and have nice homes •Working Class: 38% depend heavily on relatives for economic/emotional support •Lower class: Upper Lowers 9% working poor living standard just above poverty but strive for higher/ they lack education and do unskilled work •Lower lowers: 7% visibly poor/often poorly educated and unskilled/ often out of work and tend to live a day by day existence
Team-Based New-Product Development
•Various company departments work closely together, overlapping the steps in the product development process to save time and increase effectiveness -Cross-functional teams lead to fast and flexible development -Causes more organizational tension and confusion than the sequential approach
steps in the marketing research process
•defining the problem and research objectives •developing the research plan for collecting information •implementing the research plan—collecting and analyzing the data •interpreting and reporting the findings
Commercialization
•introducing a new product into the market •Companies must decide: -When to introduce the product-Where to introduce the product:--->Single location, state, region, nationally, internationally