MARK EXAM 2

Types of Products

1. Specialty - lots of effort to find. 2. Shopping - fair amount of effort to find. 3. Convenience - minimum effort to find. (4 for $1) 4. Unsought - not normally think of buying.

Steps to Marketing Research Process

1. define objectives and research needs 2. designing the research 3. data collection process 4. analyzing data and developing insights 5. action plan and implementation

Through research, Publix has learned that people buy certain products at the same time. Knowing this, Publix will promote and display these products together. To uncover these customer purchasing patterns, marketers use...

Data Mining

Primary Data

Data collected specifically for this research, creating new information. Sampling Issues: who is the population? what will be used for sampling frame? what type of sample?

Sentiment Mining

Data gathered by evaluating customer comments posted through social media sites.

Old Spice Health and Wellness products and Lams pet nutrition products are two brands made by the same company - Proctor and Gamble. Old Spice and Lams are known as....

Individual Brands

Product Mix Audience

Innovators: adventuresome, certainly outliers, first to purchase. (price skimming) Early Adopters: purchase after a careful review. Early Majority: deliberate is a key characteristic Late Majority: skepticism is a key characteristic, care about feedback from others Laggards: tradition is a key characteristic, often ignored by marketers

Brand Dilution

Occurs when a brand extension adversely affects consumer perceptions about the attributes the core brand is believed to hold. (Not successful brand extensions essentially.)

Idea Generation

o Internal R&D o R&D Consortia - firms that explore new ideas or obtain solutions for developing new products o Licensing o Brainstorming o Outsourcing - hiring of an outside firm to help o Competitor Products o Customer input

Strategic Relationships

1. Mutual trust 2. Open communications 3. Common goals 4. Interdependence 5. Credible commitments

Churn Rate

% of customers who discontinue the use of a service.

Product Life Cycle Concept

- Most products follow a similar pattern of growth and decline 1. Introductory Stage 2. Growth Stage 3. Maturity Stage 4. Decline Stage

Brand Equity

- Perceived Value - Brand Associations - it's all about image - Brand Loyalty - consumers are often less sensitive to price, marketing costs are much lower, firm insulated from the competition

Using the Diffusion of Innovation Theory

- Relative advantage - Compatibility - Observability - Complexity and trialability

Channel Intermediaries

- Retailers - Merchant Wholesalers (Same Club, Costco) - Agent and/or Broker

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

5 C's of Pricing

1. Company Objectives 2. Customers 3. Costs 4. Competition 5. Channel Members

Functions of Packaging

1. Contain and protect 2. Promote 3. Facilitate storage, use, convenience 4. Facilitate recycling 5. Provide information

Designing Marketing Channels

1. Direct: producer --> consumer 2. Indirect: producer --> agents or brokers --> wholesalers --> retailer --> consumers

Value of Branding for the Customer Pyramid

1. Facilitate purchasing 2. Establish loyalty 3. Protect from competition 4. Reduce marketing costs 5. Are assets 6. Impact market value

How Firms Develop New Products

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

The Distribution Center

1. Inbound Transportation 2. Receiving and Checking 3. Storing and Cross-Docking 4. Getting Merch Floor Ready 5. Shipping Merch to Stores 6. Inventory Management

Levels of Distribution Intensity

1. Intensive - convenience goods - many # of intermediaries 2. Selective - shopping and some specialty goods - several # of intermediaries 3. Exclusive - specialty goods and industrial equipment - one intermediary

Inventory Management

1. Just-in-Time - delivers less merchandise on a more frequent basis. 2. Quick Response BOTH ARE PULL SUPPLY

Branding

A brand can use name, logo symbols, characters, slogans, jingles, and distinctive packages.

Status Quo Pricing

A competitor-oriented strategy in which a firm changes prices only to meet those of competition.

Competitive Parity

A firm's strategy of setting prices that are similar to those of major competitors.

Before Tow It manufactured its two-wheeled people movers, it built a prototype and had its corporate engineers test it for performance and stability. At this stage, Tow It was involved in...

Alpha Testing

The government-funded National Institutes of Health sponsor medical foundations to conduct research to treat diseases. The research is then distributed to the medical community, thus encouraging the development of drugs and therapies more quickly and at a lower cost than would be possible if the research were privately funded. This is an example of....

An R&D Consortia

When Nintendo asks a few of its customers to try out a new video game that has not yet been released on the market, this is an example of...

Beta Testing

When a restaurant chain, Mostly Burgers, launches its own brand of frozen meals, this is an example of a...

Brand Extension

When Disney saturated retail stores with products based on its movie The Lion King, this illustrated...

Brand Licensing

When Molly shops for lipstick, she always buys Burnt Orange by Revlon. This is an example of...

Brand Loyalty

In addition to outdoor and online advertising, Under Armor has intensified its ... efforts by signing Major League Baseball stars to huge endorsement deals.

Branding

Pull Factors in Marketing

Builds an audience over time oftentimes from scratch. slowly pulls audience in.

Dynamic Pricing

Charging different prices depending on individual customers and situations.

Shell Visa, created cooperatively by Shell Oil Company and Visa, is an example of...

Co-Branding (two or more brands on one product)

When companies use a promotion technique giving away samples of its new products... is known to influence the diffusion of the product.

Trialability

Premarket Testing

Conducted before a product or service is brought to market to determine how many customers will try and then continue to use it.

Product Mix

Constantly changing, consumers adopt products at different speeds, products remain viable for different time periods.

Radio Frequency Distribution Tags (RFID)

Container computer chips

FORMULAS

Contribution Margin = price - variable cost (or contribution per unit) Units sold to break even = fixed costs / (price - variable cost) Units sold to make profit = (fixed cost + profit) / (price - variable cost)

What is the main benefit of adding new product lines beyond its current line of production?

Create diversification and reduce risk.

Lead Users

Customers who use products for some other task, who can give insights and ideas for new and improved products.

Which of the following statements is not a good characterization of the information in a supply chain?

Customers will send and receive information from stores and manufacturers.

Marketers of luxury brands must use brand extension with caution in order to avoid...

Diluting the core brand.

A channel typically used for industrial products is the .... channel

Direct

The ... diffusion of innovation group is extremely important because few new products can be profitable until this large group buys them.

Early Majority

After installing a .... in its JIT system, Banana Mania (a retail candy store) was able to reduce lead time for merchandise orders.

Electronic Data Interchange

Carefully allocated marketing expenditures can result in greater brand awareness, recognition, perceived value, and consumer loyalty for the brand, which all enhance the brand's....

Equity

Line Extension

Extending an existing brand name to new forms, colors, sizes, ingredients, or flavors of an existing product category.

Brand Extension

Extending an existing brand name to new product categories.

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.

Michelle is looking for data with a new marketing research study. When Michelle reviews secondary data from a past research study, Michelle should pay careful attention to....

How the secondary data were collected.

Which of the following is not an advantage of using a distribution center?

Increased customer awareness and appreciation of a firm's supply chain.

Marketers with successful brands sometimes wait before expanding their brands because....

It is costly to maintain many product lines, and it might weaken the brand's meaning.

Which of the following statements regarding secondary packaging is NOT true?

It is of little value to the average customer.

What do manufacturers trying to implement a just-in-time delivery system need to begin with?

Knowledge of customer demand.

Considering the five steps of the marketing research process, researchers....

May not always go through them in the exact sequence if the situation changes or new information is discovered.

Quantitative Research

Large number of respondents, statistically valid, can generalize. · Experiments - changing a variable and analyzing results, usually change one of the 4 P's, field or lab · Surveys - telephone interviews, mail surveys, internet surveys, mail intercept interviews, in-person interviews

Brand Ownership

Manufacturer brands or national brands. - Private-label brands or Store Brands 1. Premium 2. Generic 3. Copycat 4. Exclusive co-branded

Advanced Shipping Notice

Message saying that the order is en route to the retailer's distribution center.

Test Marketing

Mini product launch, more expensive than premarket tests, market demand is estimated. Limited to specific geographic locations. EX: CFA Cauliflower sandwich

Mobile Task Management

Mobile task management technology is a wireless network and a mobile device that receives demand notification and enables a speedy response.

Samantha purchased an Internet service that alerts her whenever other firms in her industry are quoted in the media. This allows Samantha to stay on top of what these other firms are doing. Samantha is using this type of marketing research primarily to....

Monitor her competitors.

Even if they are successful, new-to-the-world products are ...

Not adopted by everyone at the same time.

Product Mix Depth

Number of CATEGORIES within a product line. Increase Depth: different Oreo flavors Decrease Depth: McCormick spices eliminates dozens of products each year.

Product Mix Breadth

Number of product lines. Increase Breadth: a jeans brand becoming a lifestyle brand with belts, swimwear, fragrances, etc. Decrease Breadth: TCBY - due to competitive changes, they only focus on yogurt.

In the diffusion of innovation process, the innovator group enjoys taking risks and they are regarded as highly knowledgable. Marketers want to identify innovators because...

Other consumers defer to their judgement, creating the opportunity for word-of-mouth referrals.

Non-Probability Sampling

Out of convenience

Secondary Data

Pieces of information collected prior to this research project. "Looking things up"

David belongs to a national consumer panel created by a market research company. He regularly receives samples of new products from a variety of firms and fills out surveys about the products. The national consumer panel David is a part of is engaged in....

Premarket Testing

UGA has separate graduate and undergraduate admission offices. The university recognizes that these are distinct....

Product Lines

Qualitative Research

Provides initial information, generally in-depth and unstructured. 1. Observation - manual, mechanical, ethnographic 2. Social Media - monitoring blogs, online communities, sentiment mining 3. Focus Groups - groups of 8-12 consumers, discuss one topic, facilitation by trained moderator 4. In-Depth Interviews - limited number, somewhat unstructured, time consuming and costly

Push Factors in Marketing

Pushes marketing techniques to quickly sell products. - Merchandise allocated based on forecast - Does not need sophisticated IS system - Good for steady demand items

When Sam's Club sells to consumers directly, it acts as a .... ; when Sam's Club sells to other businesses, such as restaurant owner, it acts as a ....

Retailer ; Wholesaler

Supply Chain

Sometimes called value chain or demand chain. 1. Physical Supply Network o Raw materials o Components o Mfg 2. Marketing Channel o Mfg o Resellers o Consumers

Data Mining

Statistical tools used to uncover previously unknown patterns or relationships among variables stored in the big data databases.

Types of Questions

Structured - choices are provided. Unstructured - choices are not provided. Fill in the blank. Projective (If...)

Kristy is the marketing manager for a well-known jazz band. She wants to know more about music industry trends including sales by different musical genres, online downloads, and concert attendance. Kristy will most likely use ... to gather this type of data.

Syndicated Data (data available for a fee from commercial research firms)

When Burger Kind comes up with a new sandwich or drink for its restaurants, it often markets it in about a dozen of its outlets. When the company does this, it is engaged in...

Test Marketing

Concept Testing

Testing the new product among a set of potential customers.

Lead Time

The amount of time between the recognition that an order needs to be placed and the arrival of the needed merchandise at the seller's store, ready for sale.

Alpha Testing

The firm attempts to determine whether the product will perform according to its design and whether it satisfies the need for which it was intended.

Prototype

The first physical form that is tentative but has the same properties as a new product.

When a customer purchases a smartphone at Walmart, the purchase triggers all of the following information flows within the supply chain except...

The purchase added to the customers purchasing habit records.

Companies like UPS and FedEx are reaping the benefits of the current trend toward disintermediation.

True

Disintermediation

Use of electronic channel to go direct to the consumer and eliminate the middle man. Increased reliance on FedEx and UPS.

For years, political consultants have been using marketing research to help their candidates understand....

Who makes up the voting public and how to reach them.

What is the first question that a marketing researcher should ask before starting a research study?

Will the research be useful?