Exam 1: Chapter 1, 2, 3, 8

5 Step Marketing Research Approach

1)Define The Problem -Set research objective -Identify possible marketing actions 2) Develop the research plan -Specify Constraints -Identify data needed for marketing actions -Determine how to collect data 3) Collect relevant info -Obtain secondary data -Obtain primary data 4) Develop Findings -Analyze the data -Present the findings 5) Take marketing actions -Make action recommendations -Implement action recommendations -Evaluate results.

Special Methods vital to research

1)Sampling - selecting a group of distributors, customers, or prospects, asking them questions, and treating their answers as typical of all those in whom they are interested. 2) statistical inference to generalize the results from one sample to much larger groups of distributors, customers, or prospects to help decide on marketing actions.

Planning Phase of the Strategic Marketing Process

3 Steps: 1) Situation (SWOT) Analysis - Taking stock of where the firm or product has been recently, where it is now and where it is headed in terms of the organization's marketing plans and the external forces and trends affecting it. Appraisal of its internal Strengths and Weaknesses and its external Opportunities and Threats. Four areas that form the foundation upon which the firm builds its marketing program: -Identify trends -Analyze the organization's competitors -Assess the organization itself Research the organization's present and prospective customers 2) Market-Product Focus and Goal Setting: Determine products will be directed toward which customer. Market segmentation which involves aggregating prospective buyers into groups or segments that have common needs and will respond similarly to a marketing action. -Set marketing and product goals -Select target markets -Find points of difference (characteristics of a product that make it superior to competitive substitutes) -Position the Product 3) Marketing Program (the how aspect) -Product Strategy -Price Strategy -Promotion Strategy -Place (distribution) Strategy

Generation X

50 million 1965-1976 Baby bust, during this time the number of children born each year was declining. Self-reliant, supportive of racial and ethnic diversity, and better educated than previous generations. Not prone to extravagance and are likely to pursue lifestyles that are a blend of caution, pragmatism, and traditionalism. Net worth = less than previous generation. Most dominant force in many markets.

Strategy

An organization's long-term course of action designed to deliver a unique customer experience while achieving its goals. All organizations set a strategic direction. Marketing helps to both set this direction and move the organization there.

Stakeholders

Employees, shareholders, board of directors, suppliers, distributors, creditors, unions, government, local communities, and customers.

Sherman Antitrust Act (1890)

Encourage competition FORBIDS: 1) Contracts, combinations or conspiracies in restraint of trade 2) atual monopolies or attempts to monopolize any part of trade or commerce.

Uncontrollable Factors

Environmental Forces - affect a marketing decisions. Consists of social, economic, technological, competitive, and regulatory forces. Examples ) what consumers want and need, changing technology, the state of the economy in terms of whether it is expanding or contracting, actions that competitors take, and government restrictions. They may serve as accelerators or brakes on marketing.

Madrid Protocol Act

Facilitates the protection of US trademark rights throughout the world.

Amendments for Food

Infant Formula Act (1980) The Nutritional Labeling and Educational Act (1990)

Intranent

Internet based network within the boundaries of the organization

Extranent

Internet based technologies permit communication between a company and its suppliers, distributors, and other partners.

Organization

Legal entity that consists of people who share a common mission. This motivates them to develop offerings (goods, services, or ideas) that create value for both the organization and its customers by satisfying their needs and wants.

Robinson Patman Act(1936)

Makes it unlawful to discriminate in prices charged to different purchasers of the same product.

Organizational buyers

Manufacturers, wholesalers, retailers, and government agencies that buy products and services for their own use or for resale.

Pure competition

Many sellers and each have a similar product.

Monopolistic Competition

Many sellers complete with substitutable products within price range

Secondary Data: Internal

Marketing Input data - the effort expended to make sales. Advertising budgets and expenditures to salespeople call reports, which describe the number of sales calls per day, who was visited and what was discussed. Marketing outcome data - the results of the marketing efforts. Accounting records on shipments and include sales and repeat sales, broken down by sales representative, industry, and geographic region.

The Four Ps : Controllable Marketing Mix Factors

Product = A good, service, or idea to satisfy the consumer's needs Price = What is exchanged for the product Promotion = A means of communication between the seller and buyer Place = A means of getting the product to the consumer These four are used by the marketing manager to solve a marketing problem.

Environmental Scanning

Process of continually acquiring info on events occurring outside the organization to identify and interpret potential trends These five forces affect the marketing activities of a firm in numerous ways. Social Economic Technological Competitive Regulatory

Marketing Research

Process of defining a marketing problem and opportunity, systematically collecting and analyzing info, and recommending action through imperfect, marketers conduct marketing research to reduce the risk of and thereby improve marketing decisions.

Constraints

Restrictions placed on potential solutions to a problem.

Regulation

Restrictions state and federal laws place on business with regard to the conduct of its activities. It exists to protect companies and consumers.

Marketing Plan

Road map for the marketing actions of an organization for a specified future time period, such as one year or five years.

Culture

Set of values, ideas, and attitudes that are learned and shared among the members of a group. The elements of culture influence consumer buying patterns, monitoring national and global cultural trends is important for marketing.

Cross-functional Teams

Small number of people from different departments who are mutually accountable to accomplish a task or a common set of performance goals. These teams will have representatives from outside the organization, such as suppliers or customers.

Goals or Objectives

Statements of an accomplishment of a task to be achieved, often by a specific time. Goals convert an organization's mission and business into long and short term performance targets. Business firms can pursue different types of goals: Profit: Maximize profit, to get as high a finical return on their investments as possible Sales: If profits are acceptable a firm may elect to maintain or increase its sales even though profits may not be maximized. Market Share: the ratio of sales revenue of the firm to the total sales revenue of all firms in the industry, including the firm itself. Quality: Customer satisfaction Employee welfare Social responsibility (pg 31)

Strategic Business Unit Level

Subsidiary, division, or unit of an organization that markets a set okf related offerings to a clearly defined target market. Managers set a more specific strategic direction for their businesses to exploit value-creating opportunities.

Diversification analysis

Technique that helps a firm search for growth opportunities from among current and new markets as well as current and new products. For any market, there is both a current product and a new product. Market penetration - marketing strategy to increase sales of current products in current markets. No change in basic product line or markets served. Market development - sell current products to new markets. Product development - selling new products to current products Diversification - marketing strategy of developing new products and selling them in new markets.

Population Explosion

The most recent estimates indicate there are 7.1 billion people in the world today, and likely to grow to 9.6 billion by 2050. US population: 316 million, by 2030: 358 million. Niche markets based on age, life stage, family structure, geographic location, and ethnicity will become increasingly important.

Customer Relationship Management (CRM)

The process of identifying prospective buyers, understanding them intimately, and developing favorable long-term perceptions of the organization and its offerings so that buyers will choose them in the marketplace. This requires the involvement and commitment of managers and employees throughout the organization and a growing application of info, communication, and Internet technology, as will be described throughout this book. (Many expensive CRM computer systems haven't provided the expected benefits because they failed to identify exactly which customer segments the company wanted to reach.

Business Model

The strategies an organization develops to provide value to the customers it serves. Technological innovation is often the trigger for this business model change.

Technology

The third environmental force refers to inventions or innovations from applied science or engineering research. Connectivity will grow "Internet of Things" Computers will develop all five senses to create intelligent data collection Green technologies will gain widespread acceptance 3D Technologies will move from movie theatres and televisions to many new and useful applications

Social Marketing Concept

The view that organizations should satisfy the needs of consumers in a way that provides for society's well being.

Marketing Dashboard

The visual computer display of the essential info related to achieving a marketing objective.

Corporate Level

Top management directs overall strategy for the entire organization. It usually means the board of directs and senior management officers with a variety of skills and experiences that are invaluable in establishing the organization's overall strategy. The president or chief executive officer (CEO) is the highest ranking. Chief marketing officer (MO increasingly important role in top management because of their ability to think strategically.

Gross Income

Total amount of money made in one year by a person, household, or family unit.

Descriptive Research

Trying to find the frequency with which something occurs or the extent of a relationship between two factors.

Gross Domestic Product (GDP)

Unemployment, price changes (inflation or deflation)

Pure Monopoly

When only one firm sells the product.

Nonprofit organization

nongovernmental organization that serves its customers but does not have profit as an organizational goal. Its goal may be operational efficiency or client satisfaction.

Customer Value

unique combination of benefits received by targeted buyers that includes quality, convenience, on time delivery, and both before sale and after sale service at specific price. Firms try to place a dollar value on the purchases of satisfied customers during their lifetimes. Best Price: Target , "expect More, Pay less" Best Product: Starbucks, stresses quality coffee and ethics Best service - "all of US serving you" best-in class customer service.

Generation Y

72 million 1977-1994 INcreasing births Baby boomers having children Echo-boom or baby boomlet. Exerts influence on music, sports, computers, video games, and all forms of communication & networking. Distinctive, memorable, and personal experiences and are very adept at managing their lives to create a work life balance. Strong willed, passionate about the environment and optimistic.

Baby Boomers

76 million 1946-1964 Retiring at a rate of 10,000 every 24 hours The will be 65 by 2030 The wealthiest generation in US history, estimated 50% of all consumer spending.

Product

A good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfied consumers' needs and is received in exchange for money, or something else of value. Ideas are most often marketed by nonprofit organizations or the government.

Marketing Program

A program that integreates the marketing mix to provide a good, service, or idea to prospective buyers. They can be formed into market segments which are relatively homogeneous groups of prospective buyers that 1) have common needs 2) will respond similarly to a marketing action. This action might be a product feature, promotion, or a price. Consumer needs trigger product concepts that are translated into actual products that stimulate further discovery of consumer needs.

Advantages and Disadvantages of Secondary Data

Advantages: The tremendous time savings because the data has already been collected, the low cost, free or inexpensive census reports. A greater level of detail is often available. Disadvantages: May be out of data. Definitions or categories might not be quire right for a researcher's project.

Marketspace

An information and communication based electronic exchange environment mostly occupied by sophisticated computer and telecommunication technologies and digitized offerings. Marketspace is the transformative power of technology best illustrated by the rapid growth.

Strategic marketing process

An organization allocates its marketing mix resources to reach its target markets. This process is divided into three phases: planning, implementation, and evaluation.

Organizational Culture

An organization must connect with all of its stakeholders. The set of values, ideas, attitudes, and norms of behavior that is learned and shared among the members of an organization.

Barriers to entry

Business practices or conditions that make it difficult for new firms to enter the market. Capital requirements, advertising expenditures, product identity, distribution access, or the cost to customers of switching suppliers.

MIssion

By understanding core values, an organization can take steps to define its mission, a statement of the organization's function in society that often identifies its customers, markets, products, and technologies. Vision, a mission statement should be clear, concise, meaningful, inspirational, and long-term. Clear, challenging, and a compelling picture of an envisioned future.

Business

Clear, broad, underlying industry or market sector of an organization's offering. An organization looks at the set of organizations that sell similar offerings.

Multicultural Marketing

Combinations of the marketing mix that reflect the unique attitudes, ancestry, communication preferences, and lifestyles of different races. In-depth marketing research allows an accurate understanding of each culture is essential.

Oligopoly

Common industry structure occurs when a few companies control the majority of industry sales.

Evaluation Phase of the Strategic Marketing Process (Phase 3)

Compare the results of the marketing program with the goals in the written plans to identify deviations Act on these deviations, exploiting positive deviations and correcting negative ones.

Measures of success

Criteria or standards used in evaluating proposed solutions to the problem.

Social Forces

Demographic characteristics of the population and its culture. Changes in these forces can have a dramatic impact on marketing strategy.

Demographics

Describing a population according to selected characteristics such as age, gender, ethnicity, income, and occupation.

Customer Value Proposition

Designing an effective marketing mix conveys this. It is a cluster of benefits that an organization promises customers to satisfy their needs.

Marketing Tactics

Detailed day to day operational marketing actions for each element of the marketing mix that contribute to the overall success of marketing strategies.

Data

Facts and figures related to the project, divided into two parts: Primary Data - facts and figures that are NEWLY collected for the project. - Observational data -Questionare Data -Other sources of data (social media, panels and experiments, info technology, and data mining) Secondary Data - Facts and figures that have already been recorded prior to the project at hand. - Internal data (inside firm) - External Data (outside firm)

Market Orientation

Focuses its efforts on: 1) Continuously collecting info about customers' needs 2) Sharing this info across departments, 3) Using it to relate customer value.

Clayton Act (1914)

Forbids certain actions that are likely to lessen competition, although no actual harm has yet occurred.

Competiton

Fourth Component of environmental scan The alternative firms that could provide a product to satisfy a specific market's needs.

Core Values

Fundamental, passionate, and enduring principles that guide its conduct over time. A firm's founders or senior management develop these core values, which are consistent with their essential beliefs and character. They capture the firm's heart and soul and serve to inspire and motivate its stakeholders. To be effective, an organization core values must be communicated to and supported by its top management, and employees.

Consumerism

Grassroots movement started in the 1960s to influence, power, and rights of consumers in dealing with institutions. It is relfected in the growing consumer demand for ecologically safe products and ethical and social responsible business practicies.

Functional Level

Groups of specialists actually create value for the organization. The term department generally refers to these specialized functions such as marketing and finance.

Exploratory Research

Ideas about a vague probllem

Concepts

Ideas about products or services.

Digital Millennium Copyright Act (1998)

Improve protection of copyrighted digital products.

Utility

Marketing creates utility. The benefits or customer value received by users of the product. FOUR UTILITIES Form :The production of the product or service Place : Having the offereing available where consumers need it Time Having it available when needed Possession :the value of marketing an item easy to purchase through the provision of credit cards of financial arrangements. Marketing creates its utilities by bridging space (place utility) and hours (time utility) to provide products (form utility) for consumers to own and use (possession utility)

Marketing Metric

Measure of the quantitative value or trend of a marketing action or results.

Profit

Money left after a for profit organization subtracts its total expenses from its total revenues and is the reward for the risk it undertakes in marketing its offerings.

Discretionary Income

Money that remains after paying for taxes and necessities. Discretionary income is used for luxury items such as a Crunard cruise. A problem with this is determining what is a luxury item and what is a necessity.

Implementation Phase of the Strategic Marketing Process (second phase of the strategic marketing process)

Obtaining resources Designing the marketing organization Defining precise tasks, responsbilities, and deadlines 4) Actually executing the marketing program designed in the planning phase.

Blended Family

One formed by merging two previously separated units into a single household.

Industry

Organizations that develop similar offerings create an industry, such as the computer industry or the automobile industry. Much of an organization's marketing strategy is having a clear understanding of the industry within which it competes.

Secondary Data: External

Outside the organization. US Census Bureau publishes a variety of reports. Census 2010 most recent count of the US population. Every 10 years. Economic Census, every 5 years. Syndicated Panel economically answer questions that require consistent data collection over time.

New Product Concept

Picture or verbal description of a product or service the firm might offer for sale.

Data Visualization

Presents info about an organization's marketing metrics graphically so marketers can quickly 1) spot deviations from plans during the evaluation phase 2) take corrective actions

For-profit Organization (business firm)

Privately owned organization that serves its customers to earn a profit so that it can survive. Target, Nike

Business Portfolio Analysis

Technique that managers use to quantify performance measures and growth targets to analyze their firms' strategic business units as though they were a collection of separate investments. The purpose of this tool is to determine which SBU or offering generates cash and which one requires cash to fund the organization's growth opportunities. Cash Cows - SBUs that generate large amounts of cash, more than they can use. Slow-growth markets Stars - SBUs with a high share of high-growth markets, that may need extra cash to finance their own rapid future growth. When they slow, they become cash cows. Question Marks - SBUS with low share of high growth markets. They require large injections of cash to maintain their market share, much less increase it. Choosing the right ones to invest in and phasing out the rest. Dogs - SBUs with low shares of slow-growth markets. They generate enough cash to sustain themselves, they may not become real winners for the organization.

Casual Research

The extent to which the change in one factor changes another one.

Customer Experience

The foundation to customer relantionship management. It is the internal response that customers have to all aspects of an organization and its offering. This internal response includes both direct and indirect contacts of the customer with the company. Direct contacts include the customer's contacts with the seller through buying, using, and obtaining service. Indirect Contacts most often involve unplanned touches with the company through word of mouth comments from other customers, reviewers and news reports.

Relationship Marketing

The hallmark of developing and maintaining effective customer relationship which links the organization to its individual customers, employees, suppliers, and other partners for their mutual long-term benefit. It is a personal, ongoing relationship

Marketing Concept

The idea that an organization should 1) strive to satisfy the needs of consumers 2) Trying to achieve the organization's goals.

Marketing Strategy

The means by which a marketing goal is to be achieved, usually characterized by a specified target market and a marketing program to reach it.

Disposable Income

The money a consumer has left after paying taxes to use for necessities such as food, housing, clothing, and transportation. If taxes rise or fall faster than income, consumers are likely to have more or less disposable income. Dramatic changes in prices of products can require spending adjustments.

The Breadth and Depth of Marketing

Who Markets? What is marketed? Who buys and uses what is marketed? Who benefits from these marketing activites? How consumers benefit

Trademark Law Revision Act

allowing a company to secure rights to a name before actual use by declaring an intent to use the name.

Methods

approaches that can be used to collect data to solve all or part of a problem.

Micropolitan statistical area

at least one urban cluster of at least 10,000 but less than 50,000 people

Metropolitan Statistical area

at least one urbanized area of 50,000 or more people adjacent territory

Primary Data: Observational Data

collected by mechanical, personal, or neuromarketing methods. Mechanical Methods - 1) people meter attached to TV, VCR, DVR, cable box, dish 2) Remote that operates the people meter when a viewer begins and finishes tv program 3) Stores and then transmits the viewing info each night to Nielsen. Personal Methods 1) Mystery Shopper - to check on the quality and pricing of their products and the integrity of and customer service provided by their employees. 2) Ethnographic research - specialized observational approach in which trained observers seek to discover subtle behavioral and emotional reactions as consumers encounter products in their natural use environment. Neuromarketing Methods - Brain scanning to analyze the buying process. Martin Lindstorm believes that most traditional marketing research - like focus groups and surveys is wasted because consumers' feelings toward products and brands reside deep within subconscious part of their brains.

Decision

conscious choice from among two or more alternatives

Powerful buyers

exist when they are few in number, there are low switching costs, or the product represents a significant share of the buyer's total cost. A supplier gains power when the product is critical to the buyer and when it has built up the switching costs.

Lanham Act

provides for registration of a company's trademarks. Doesn't confer ownership

Ultimate consumers

the people who use the products and services purchased for a household.

Decision making

the act of consciously choosing from among alternatives.