UCF MAR 3023 Exam 3 Review (Ch. 9 -12 Study Guide)

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Top 5 global brands in order

1. Apple 2. Google 3. Microsoft 4. Coke 5. Amazon

5 steps to Marketing Research Process

1. Defining Objectives 2. Designing the Research 3. Collecting the Data 4. Analyzing the Data and Developing Insights 5. Developing and Implementing an Action Plan

What are the 5 steps of STP Analysis?

1. Establish Strategy or Objectives 2. Use Segmentation Methods 3. Evaluate Segment Attractiveness 4. Select Target Market 5. Identify and Develop Positioning Strategy

What are the 6 stages of the Product Development Process?

1. Idea Generation 2. Concept Testing 3. Product Development 4. Market Testing 5. Product Launch 6. Evaluation of Results

Why do firms create new products?

1. changing customer needs 2. market saturation 3. managing risk through diversity 4. fashion cycles 5. improving business relationships

Sources of new product ideas

1. internal R&D 2. R&D consortia 3. licensing 4. brainstorming 5. outsourcing 6. competitors' products 7. customer input

What is a *Perishable* service?

A characteristic of a service: it cannot be stored for use in the future.

What is an *Inseparable* service?

A characteristic of a service: it is produced and consumed at the same time; that is, service and consumption are inseparable.

What is an *Intangible* service?

A characteristic of a service; it cannot be touched, tasted, or seen like a pure product can.

What is Brand Licensing?

A contractual arrangement between firms, whereby one firm allows another to use its brand name, logo, symbols, or characters in exchange for a negotiated fee.

What are Family Brands?

A firm's own corporate name used to brand its product lines and products. Household names

Prototype

A full-scale working model used to test a design concept by making actual observations and necessary adjustments.

What are Early Majority?

A group of consumers in the diffusion of innovation model that represents approximately 34 percent of the population; members don't like to take much risk and therefore tend to wait until bugs are worked out of a particular product or service; few new products and services can be profitable until this large group buys them. *34%*

Test marketing

A method of determining the success potential of a new product; it introduces the product to a limited geographical area prior to a national launch.

What is Behavioral Segmentation?

A segmentation method that divides customers into groups based on how they use the product or service. Some common behavioral measures include occasion and loyalty.

What is Brand Repositioning (Rebranding)?

A strategy in which marketers change a brand's focus to target new markets or realign the brand's core emphasis with changing market preferences.

What is Scanner Data?

A type of syndicated external secondary data used in quantitative research that is obtained from scanner readings of UPC codes at check-out counters. Quantitative

What is a *Heterogeneity* service?

As it refers to the differences between the marketing of products and services, the delivery of services is more variable.

Brands Facilitate Purchases

Brands are often easily recognized by consumers, and because they signify a certain quality level and contain familiar attributes, brands help consumers make quick decisions, especially about their purchases.

What is Brand Ownership?

Brands can be owned by any firm in the supply chain, whether manufacturers, wholesalers, or retailers. There are two basic brand ownership strategies: *manufacturer brands* and *retailer/store brands*.

What are Manufacturer Brands (National Brands)?

Brands owned and managed by the manufacturer.

What are Laggards?

Consumers who like to avoid change and rely on traditional products until they are no longer available. *16%*

Types of Internal Secondary Data...

Data Mining, Big Data

What is Syndicated Data?

Data available for a fee from commercial research firms such as Information Resources Inc. (IRI), National Purchase Diary Panel, and ACNielsen.

What is Primary Data?

Data collected to address specific research needs.

Step 3: Collecting the Data

Data collection begins only after the research design process. Based on the design of the project, data can be collected from secondary or primary data sources.

What is Data Mining?

Data mining uses a variety of statistical analysis tools to uncover previously unknown patterns in the data stored in databases or relationships among variables.

What is Big Data?

Data sets that are too large and complex to analyze with conventional data management and data mining software.

What is the 4th stage of Product Life Cycle?

Decline: Stage of the product life cycle when sales decline and the product eventually exits the market.

Changing product mix breadth

Decrease: to address changing market conditions or meet internal strategic priorities (ex: to focus on a different product line) Increase: to capture new or evolving markets and increase sales (ex: adding a new line of jam products to compliment its bread line)

What is the Product Life Cycle?

Defines the stages that new products move through as they enter, get established in, and ultimately leave the marketplace and thereby offers marketers a starting point for their strategy planning.

What is a Perceptual Map?

Displays, in two or more dimensions, the position of products or brands in the consumer's mind.

Step 5: Developing and Implementing an Action Plan

Executive summery, body, conclusions, limitations, supplements

What is Exploratory Research?

Exploratory research is research conducted for a problem that has not been clearly defined. It often occurs before we know enough to make conceptual distinctions or posit an explanatory relationship. Exploratory research helps determine the best research design, data collection method and selection of subjects.

Brands are Assets

For firms, brands are also assets that can be legally protected through trademarks and copyrights and thus constitute a unique form of ownership. Firms sometimes have to fight to ensure their brand names are not being used, directly or indirectly, by others.

What are the 5 segmentation methods?

Geographic, Demographic, Psychographic, Benefits, Behavioral

What are Product Lines?

Groups of associated items, such as those that consumers use together or think of as part of a group of similar products.

What is the 2nd stage of Product Life Cycle?

Growth: Stage of the product life cycle when the product gains acceptance, demand and sales increase, and competitors emerge in the product category.

Brands Affect Market Value

Having well-known brands can have a direct impact on the company's bottom line. The value of a company is its overall monetary worth, comprising a vast number of assets. When the brand loses value, it also threatens other assets.

Changing product assortment depth

Increase: changing consumer preference or to preempt competitors while boosting sales Decrease: realign firms resources. eliminate unprofitable and low margin items

What is Panel Data?

Information collected from a group of consumers. Quantitative

What is the 1st stage of Product Life Cycle?

Introduction: Stage of the product life cycle when innovators start buying the product.

What is Market Positioning?

Involves the process of defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what the product does or represents in comparison with competing products.

What is a Communication Gap?

actual service provided to customers vs. firm's promotion program promises.

Calculating market share ratios

company's sales / total market share x 100

What is a Knowledge Gap?

customers' expectations vs. firm's perception of those expectations.

Product development

development of prototypes and/or the product

Idea generation

development of viable new product ideas.

What is a Standards Gap?

firm's perceptions of customers' expectations vs. service standards it sets.

What is a Delivery Gap?

firm's service standards vs. actual service it provides to customers.

Beta testing

having potential consumers examine a product prototype in a real-use setting to determine its functionality, performance, potential problems, and other issues specific to its use

What is the 3rd stage of Product Life Cycle?

Maturity: Stage of the product life cycle when industry sales reach their peak, so firms try to rejuvenate their products by adding new features or repositioning them.

What is Brand Awareness?

Measures how many consumers in a market are familiar with the brand and what it stands for; created through repeated exposures of the various brand elements (brand name, logo, symbol, character, packaging, or slogan) in the firm's communications to consumers.

What are Pioneers (Breakthroughs)?

New product introductions that establish a completely new market or radically change both the rules of competition and consumer preferences in a market.

What is Brand Dilution?

Occurs when a brand extension adversely affects consumer perceptions about the attributes the core brand is believed to hold.

What is Brand Loyalty?

Occurs when a consumer buys the same brand's product or service repeatedly over time rather than buying from multiple suppliers within the same category.

Brands Establish Loyalty

Over time and with continued use, consumers learn to trust certain brands. They know, for example, that they wouldn't consider switching brands and, in some cases, feel a strong affinity to certain brands.

What is Secondary Data?

Pieces of information that have already been collected from other sources and usually are readily available.

What are Retailer/Store Brands (Private-Label Brands)?

Products developed by retailers. Ex. Publix brand, Great Value

What are Unsought Products/Services?

Products or services consumers either do not normally think of buying or do not know about.

Alpha testing

testing by the firm to determine whether a product will perform according to its design and whether it satisfies the need for which it was intended; occurs in the (R&D) department.

4 product characteristics which affect speed of diffusion of innovation...

Relative Advantage Compatibility Observability Complexity and Trialability

Step 1: Defining Objectives

Researchers assess the value of a project through a careful comparison of the benefits of answering some of their questions and the costs associated with conducting the research. When researchers have determined what information they need to address a particular problem or issue, the next step is to design a research project to meet those objectives.

Step 2: Designing the Research

Researchers identify the type of data needed and determine the research necessary to collect them.

Calculating segment profitability

Segment size x segment adoption percentage x purchase behavior (x amount of times purchased per year) x profit margin % - Fixed costs

Brands Protect from Competition and Price Competition

Strong brands are somewhat protected from competition from other firms and price competition. Because such brands are more established in the market and have a more loyal customer base, neither competitive pressures on price nor retail-level competition is as threatening to the firm.

Market Testing

Test the market for the new product with a TRIAL BATCH of products

Premarket tests

Tests that determine how many customers will TRY and then CONTINUE to use a product.

What is the Product Mix?

The complete set of all products offered by a firm.

What is Demographic Segmentation?

The grouping of consumers according to easily measured, objective characteristics such as AGE, GENDER, INCOME, and EDUCATION.

What is Benefit Segmentation?

The grouping of consumers on the basis of the benefits they derive from products or services. Convenience, economy, prestige

What is Geographic Segmentation?

The grouping of consumers on the basis of where they live.

What are Late Majority?

The last group of buyers to enter a new product market; when they do, the product has achieved its full market potential. *34%*

What are Brand Associations?

The mental links that consumers make between a brand and its key product attributes; can involve a logo, slogan, or famous personality.

Step 4: Analyzing the Data and Developing Insights

The next step in the marketing research process—analyzing and interpreting the data—should be both thorough and methodical. To generate meaningful information, researchers analyze and make use of the collected data.

What is Product Depth?

The number of categories within a product line.

What is the Primary Package?

The packaging the consumer uses, such as the toothpaste tube, from which he or she typically seeks convenience in terms of storage, use, and consumption.

What are Ideal Points?

The position at which a particular market segment's ideal product would lie on a perceptual map.

What is Co-Branding?

The practice of marketing two or more brands together, on the same package or promotion.

What is the Diffusion of Innovation?

The process by which the use of an innovation spreads throughout a market group over time and over various categories of adopters.

What is Perceived Value?

The relationship between a product's or service's benefits and its cost.

What are Early Adopters?

The second group of consumers in the diffusion of innovation model, after innovators, to use a product or service innovation; generally don't like to take as much risk as innovators but instead wait and purchase the product after careful review. *13.5%*

What is Brand Equity?

The set of assets and liabilities linked to a brand that add to or subtract from the value provided by the product or service.

What are Individual Brands?

The use of individual brand names for each of a firm's products. Famous Amos (Kellogg Brand)

What is a Brand Extension?

The use of the same brand name for new products being introduced to the same or new markets.

What is a Line Extension?

The use of the same brand name within the same product line and represents an increase in a product line's depth.

What is the Secondary Package?

The wrapper or exterior carton that contains the primary package and provides the UPC label used by retail scanners; can contain additional product information that may not be available on the primary package.

What are Innovators?

Those buyers who want to be the first to have the new product or service. *2.5%*

What are Shopping Products/Services?

Those for which consumers will spend time comparing alternatives, such as apparel, fragrances, and appliances.

What are Convenience Products/Services?

Those for which the consumer is not willing to spend any effort to evaluate prior to purchase.

What is Psychographic Segmentation?

Used in segmentation; delves into how consumers describe themselves; allows people to describe themselves using those characteristics that help them choose how they occupy their time (behavior) and what underlying psychological reasons determine those choices. Social status, daily activities, habits

What is Product Breadth?

variety of product lines

Step 5: Identify and Develop Positioning Strategy

(Positioning) The last step in developing a market segmentation strategy is positioning. Market positioning involves a process of defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what the product does or represents in comparison with competing products. Examples: Value, symbols, attributes. STANCE

Step 1: Establish Overall Strategy or Objectives

(Segmentation) The first step in the segmentation process is to articulate the vision or objectives of the company's marketing strategy clearly. The segmentation strategy must be consistent with firm's mission and objectives as well as its current situation—its strengths, weaknesses, opportunities, and threats (SWOT).

Step 2: Use Segmentation Methods

(Segmentation) The second step in the segmentation process is to use a particular method or combination of methods to segment the market. This step also develops descriptions of the different segments, which helps firms better understand the customer profiles in each segment.

Step 4: Select a Target market

(Targeting) The fourth step in the STP process is to select a target market. The key factor likely to affect this decision is the marketer's ability to pursue such an opportunity or target segment. A firm assesses its SWOT analysis. differentiated or not, concentrated, micro marketing

Step 3: Evaluate Segment Attractiveness

(Targeting) The third step in the segmentation process; is it worth pursuing? Is the segment identifiable, substantial, reachable, responsive, and profitable?

What firms should consider in order to prevent negative consequences of brand extensions

- evaluate the fit between the product class of the core brand and the extension -evaluate perception of core brand attributes and apply to extension -refrain from overally extending the brand into too many products and categories -should consider if brand extension distances from core

Advantages to using the same brand name for new products

-Brand is already established; spend less on consumer awareness and brand association -Perception can carry over -synergy between existing products can increase sales


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