Chapter 1:Overview of Strategic Marketing-Principles of Marketing-BCOR 2201

From a company's perspective, there is a trade-off between

Increasing the value offered to a customer and maximizing the profits from a transaction.

The process of creating, distributing, promoting, and pricing goods, services, and ideas to facilitate satisfying exchange relationships with customers and to develop and maintain favorable relationships with stakeholders in a dynamic environment

Marketing

The competitive, economic, political, legal and regulatory, technological, and sociocultural forces that surround the customer and affect the marketing mix

Marketing Environment

Tend to get a feel of worth of products based on

Our own expectations and previous experience

A specific group of customers on whom an organization focuses its marketing efforts

Target Market

Consumers develop a concept of value through

The integration of their perceptions of product quality and financial sacrifice.

A company can increase product availability, thereby making it more convenient for buyers to purchase the firm's products

To reduce time and effort

A customer's subjective assessment of benefits relative to costs in determining the worth of a product

Value

What is the first step for marketers in implementing the marketing concept? a. Establish an information system to discover customers' real needs b. Engage in personal selling or advertising to promote products that customers desire c. Modify a communication system that allows information to be disseminated throughout the organization d. Modify existing products to meet customer needs more effectively e. Develop a feedback system so customers can describe their thoughts about a product

A. Establish an information system to discover customers' real needs

Anything a buyer must give up to obtain the benefits the product provides.

Customer costs include

Which stakeholders are the focal point of all marketing activities? a. Regulators b. Suppliers c. Communities d. Customers e. Employees

D. Customers

You are advising a local nonprofit on strategy. The nonprofit supports cancer research and relies entirely on donations. You recommend that the nonprofit engage in marketing activities. The executive director tells you that because it is a nonprofit that does not engage in selling activities and has a small budget, the nonprofit has no use for marketing. You disagree and explain that marketing is not just for for-profit organizations. You explain the different ways the nonprofit can engage in marketing without changing its practices or the mission. Which of the following marketing activities would be most feasible for this nonprofit? a. Use inexpensive digital marketing tools to inform the community about an upcoming fundraising event b. Purchase an advertisement in a state newspaper that is popular in the local community about the nonprofit c. Engage in extensive marketing research to determine what its contributors want d. Send out coupons for the organization's products in the local bulletin e. Get volunteers to sell T-shirts and other items at the nonprofit's major events

A. Use inexpensive digital marketing tools to inform the community about an upcoming fundraising event.

Anthony works at a local electronics retailer. He has two customers in particular that he sees regularly. One customer, Mr. Johnson, comes in frequently asking about new deals. However, he rarely buys anything, and when he does buy something it is usually small. The other customer, Mr. Montoya, comes in a little less frequently. He does not purchase products all the time, but when he does the products are expensive. Anthony recognizes that Mr. Montoya is a more valuable customer over time than Mr. Johnson. He has therefore worked hard to develop a strong relationship with Mr. Montoya. What marketing method is Anthony most likely using to direct his actions? a. Customer feedback b. Customer lifetime value c. A customer loyalty program d. The marketing concept e. A sales orientation

B. Customer Lifetime Value

Which of the following equations describes customer value? a. Customer value= income - price b. Customer value= customer benefits - customer costs c. Customer value= customer benefits - opportunity costs d. Customer value= customer costs - customer benefits e. Customer value= customer benefits - price

B. Customer Value= Customer benefits- Customer Costs

A Subaru representative has a solid relationship with Phil, a satisfied customer. Phil loves Subaru and will not accept anything else. The representative determines that if Phil continues to do business with Subaru every time he wants to purchase a new car, his total value to the company would be $350,000. This includes purchases made by customers who were referred to the firm by Phil. The Subaru representative has calculated Phil's _______. a. relationship marketing b. monetary and nonmonetary benefits c. customer lifetime value d. value of referrals e. commitment

C. Customer lifetime values

The essence of marketing is to develop satisfying _______ from which both customers and marketers benefit. a. marketing mixes b. environmental factors c. exchanges d. target markets e. values

C. Exchanges

The marketing concept is based upon the idea that an organization should try to provide products that satisfy customers' needs through a coordinated set of activities that also allows the organization to achieve its goals. During which orientation (time period) are marketers most likely to adopt the marketing concept? a. Production orientation b. Exchange orientation c. Market orientation d. Sales orientation e. Promotion orientation

C. Market Orientation

Shannon is driving in downtown Santa Fe. She is not very familiar with the area and is running late for her appointment. She heads to a nearby paid parking lot and is told that it costs $20 to park. Shannon is irritated by the price. Although there are likely other paid parking lots that are less expensive, Shannon pays the price to park there. Different cost considerations impacted Shannon's decision, but clearly one stood out over all the others. Which cost exerted the most influence over Shannon's decision to park in the $20 parking lot? a. The non-monetary cost of risk b. The monetary cost of the effort involved c. The non-monetary cost of time d. The $20 monetary cost e. The monetary cost of time

C. The non-monetary cost of time.

The marketing-mix variables—which include product, distribution, promotion, and price—are often viewed as

Controllable because they can be modified

Include anythign a buyer receives in an exchange

Customer benefits

The purchasers of organizations' products; the focal point of all marketing activities

Customers

Which of the following sentences is true about a marketing exchange? a. Products in an exchange must be traded for money. b. Seeing an advertisement is an example of an exchange. c. An exchange will always take place if four conditions are met. d. It requires four conditions to take place. e. An exchange only needs to provide a benefit to one party.

D. It requres four conditions to take place.

Charlotte loves her mom's edible cookie dough recipe, and she assumes everyone else will too. She starts a cookie dough business. Charlotte views promotion, such as advertising and personal selling, as the most important activities needed to sell her product. She figures that consumers only have to learn about her product before becoming loyal and steadfast customers. What type of orientation does Charlotte seem to embrace? a. Market orientation b. Promotion orientation c. Production orientation d. Sales orientation e. Exchange orientation

D. Sales Orientation

Kroger decided to introduce a new product that appeals to Hispanic consumers. While the product is highly successful among Hispanic consumers, other ethnic groups seem to like the product as well. For this product, Hispanic consumers comprise Kroger's _______. a. community b. exchange c. marketing environment d. target market e. marketing mix

D. Target Market

Subaru developed a new luxury car model, but, after performing some market tests, it realized that it was pricing its vehicles too high, even for the luxury market. Subaru had to make some changes in its marketing mix. Unfortunately, it made the mistake of launching its product right when a recession hit. As unemployment rose, sales of luxury products such as Subaru's new luxury vehicle tend to decrease. In this case, the pricing of its vehicle is a(n) _______ force for Subaru, while the economic downturn is a(n) _______ factor. a. unpredictable; predictable b. uncontrollable; controllable c. stable; unstable d. predictable; unpredictable e. controllable; uncontrollable

E. Controllable; Uncontrollable

Marketing environmental forces are often _______. a. easy to predict b. controllable c. non-influential d. stable e. interdependent

E. Interdependent

Sheryl works at Southwest Airlines as a digital marketer. A major part of her job is communicating with customers, answering questions and letting them know about how the airline offers them the best in customer value. Sheryl is working to create long-term, mutually beneficial arrangements in which both the buyer and seller focus on value enhancement through the creation of more satisfying exchanges with customers. This is an example of _______. a. customer loyalty programs b. the marketing mix c. a sales orientation d. customer lifetime value e. relationship marketing

E. Relationship Marketing

The provision or transfer of goods, services, or ideas in return for something of value

Exchanges

Two or more individuals, groups, or organizations must participate, and each must possess something of value that the other party desires.

First Condition

For an exchange to take place

Four conditions must exist

To build trust, the parties to the exchange must meet expectations.

Fourth Condition

Third nonmonetary cost is

Risk

The exchange should provide a benefit or satisfaction to both parties involved in the transaction.

Second Condition

Constituents who have a "stake," or claim, in some aspect of a company's products, operations, markets, industry, and outcomes

Stakeholders

Each party must have confidence in the promise of the "something of value" held by the other.

Third Condition

Buyers must be satisfied with the good, service, or idea obtained, and sellers must be satisfied with the financial reward or something else of value received.

To maintain an exchange relationship

By offering good basic warranties or extended warranties for an additional charge. Another strategy is the offer of a 100 percent satisfaction guarantee.

To reduce risk cost

the time and effort customers expend to find and purchase desired products

Two nonmonetary costs are