Marketing Midterm

Roles and status

People usually choose products appropriate for their roles and status

Product line filling

adding more items within the present range of the line * To reach extra profits, satisfy dealers, use excess capacity, be the leading full-line company, and plugging holes to keep out competitors

Occupation

affects the goods and services bought

The company

all departments - from manufacturing and finance to legal and human resources - share the responsibility for understanding customer needs and creating customer value

Lifetime value

an estimate of the average revenue that a customer will generate throughout their lifespan as a customer

SWOT analysis

an overall evaluation of the company's strengths (S), weaknesses (W), opportunities (O), and threats (T)

Public

any group that has an actual or potential interest in or impact on an organization's ability to achieve its objectives

Positioning

arranging for a market offering to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers

Business markets

buy goods and services for further processing or use in their production processes

Reseller markets

buy goods and services to produce public services or transfer the goods and services to others who need them

International markets

buyers in other countries, including consumers, producers, resellers, and governments

Media publics

carries news, features, editorial opinions, and other content

Learning

changes in individual's behavior arising from experience

Market development

company growth by identifying and developing new market segments for current company products

Market penetration

company growth by increasing sales of current market segments without changing the produc

Product development

company growth by offering modified or new products to current market segments

Diversification

company growth through starting up or acquiring businesses outside the company's current products and markets

Financial publics

company's ability to obtain funds

General public

concern about the general public's attitude toward its products and activities (public image and buying behavior)

factors influencing consumer behavior

cultural, social, personal, psychological

cultural factor on consumer behavior

culture, subculture, social class

threats

current and emerging external factors that may challenge the company's performance

Citizen-action publics

decisions may be questioned by consumer organizations, environmental groups, minority groups, etc. Need for PR

Differentiation

differentiating the market offering to create superior customer value

Market segment

dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors and who might require separate marketing strategies or mixes -geographic -demographic -age and life cycle -gender -psychographic -behavioral -occasion -benefit -intermarket

Economic environment

economic factors that affect consumer purchasing power and spending patterns

Economic situation

economic situations affect their store and product choices. Marketers watch for trends in spending, personal income, savings, and interest rates

Market targeting

evaluating each market segment's attractiveness and selecting one or more segments to serve

opportunities

external factors that the company may be able to exploit to its advantage

Marketing intermediaries

firms that help the company to promote, sell, and distribute its goods to final buyers

Technological environment

forces that create new technologies, creating new product and market opportunities

Intermarket segmentation

forming segments of consumers who have similar needs and buying behaviors even though they are located in different countries

Environmental situation

physical, technological, and health circumstances will impact what products they buy, where and how they shop, etc.

Suppliers

provide the resources needed by the company to produce its goods and services

Social class

relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors

Culture

set of basic values, perceptions, wants, and behaviors learned by a member of society from family and other important institutions

Positioning maps

show consumer perceptions of their rband versus those of competing products on important buying dimensions (price and orientation axes)

Needs

states of felt deprivation (basic part of the human makeup)

microenvironment and it's forces

the actors close to the company that affect its ability to serve its customers - the company, suppliers, marketing intermediaries, customer markets, competitors, and publics -the company -suppliers -marketing intermediaries -competitors -public -customers

Customers

the aim of the entire value delivery network is to engage target customers and create strong relationships with them

Value (customer perceived value)

the customer's evaluation of the difference between all the benefits and all the costs of a market

Relative advantage

the degree to which the innovation appears superior to existing products

Compatibility

the degree to which the innovation fits the values and experiences of potential consumers

Complexity

the degree to which the innovation is difficult to understand or use

Divisibility

the degree to which the innovation may be tried on a limited basis

Communicability

the degree to which the results of using the innovation can be observed or described to others

Wants

the form human needs take as they are shaped by culture and individual personality

Production concept

the idea that consumers will favor products that are available and highly affordable; therefore, the organization should focus on improving production and distribution efficiency

Selling concept

the idea that consumers will not buy enough of the firm's products unless the firm undertakes a large-scale selling and promotion effort

Macroenvironment and it's forces

the larger societal forces that affect the microenvironment - demographic, economic, natural, technological, political, and cultural forces -demographic -economic -natural -technological -political -cultural

Production Concept vs. Marketing Concept

the marketing concept seeks to fully understand the customer and then use that knowledge in decisions, the product concept seeks to capitalize on the company's ability to innovate and create a compelling product

Selling Concept Vs. Marketing Concept

the marketing concept takes an outside-in perspective focusing on profits through customer satisfaction, the selling concept takes an inside-out view that focuses on profits through sales volume

Perception

the process by which people select, organize, and interpret information to form a meaningful picture of the world

The five stages in the adoption process

(1) Awareness = the consumer becomes aware of the new product but lacks information about it (2) Interest = the consumer seeks information about the new product (3) Evaluation = the consumer considers whether trying the new product makes sense (4) Trial = the consumer tried the new product on a small scale to improve his or her estimate of its value (5) Adoption = the consumer decides to make full and regular use of the new product

Strategic planning of developing and maintaining a strategic fit between the organization's goals and capabilities and its changing market opportunities

(1) Defining the company mission (2) Setting company objectives and goals (corporate level) (3) Designing the business portfolio (4) Planning marketing and other functional strategies (business unit, product, and market level)

The five characteristics that influence the rate of adoption

(1) relative advantage (2) compatibility (3) complexity (4) divisibility (5) communicability

Beliefs and attitudes

* Belief = a descriptive thought that a person holds about something * Attitude = a person's consistently favorable or unfavorable evaluations, feelings, and tendencies toward an object or idea

social factor on consumer behavior

* Groups and social networks * Family * Roles and Status

Contact methods

* Mail --> can be used to collect large amounts of information at a low cost * Telephone --> gathers information quickly, provides greater flexibility * Personal --> takes form in individual or group interviews, can be more costly * Online = through internet and mobile surveys, online focus groups, consumer tracking, experiments, and online panels and brand communities

What makes effective segmentation?

* Measurable --> size, purchasing power, and profiles * Accessible --> effectively reached and served * Substantial --> segment should be the largest possible homogeneous group * Differentiable --> segments are distinguishable and respond differently * Actionable --> designed for attracting and serving segments

Research approaches

* Observational = gathering primary data by observing relevant people, actions, and situations * Survey = gathering primary data by asking people questions about their knowledge, attitudes, preferences, and buying behavior * Experimental = selecting matched groups of participants, giving them different treatments, controlling related factors, and checking for differences in group responses

Research instruments

* Questionnaire --> most common, very flexible * Mechanical instruments --> mechanical instruments to monitor consumer behavior; researchers also use a variety of physiological and neurological measures to gauge consumers' emotions and reactions

Groups and social networks

* Reference groups = groups that serve as direct or indirect point of comparison or reference in forming a person's attitudes or behavior * Opinion leaders = person within a reference group who, because of special skills, knowledge, personality, or other characteristics, exerts social influence on others * Word-of-mouth * Influencer marketing * Online social networks

Sampling plan

* Sampling unit = who is to be studied * Sample size = how many people should be included; large samples give more reliable results than small samples * Sampling procedure = how should the people in the sample be chosen; probability and nonprobability samples

personal factor on consumer behavior

* age and life-cycle stage * occupation * economic situation * environmental situation * lifestyle * personality and self-concept

Psychological factor on consumer behavior

* motivation * perception * learning * beliefs and attitudes

market research process

1. Define the problem 2. Design the research plan 3. Conduct the research (collecting and analyzing) 4. interpreting and reporting the findings

Natural environment

physical environment and the natural resources that are needed as inputs by marketers or that are affected by marketing activities

Family

The most important membership reference group and buying organization in society. Large interplay of each family role

Product line stretching

a company lengthens its product line beyond current ranges (downward, upward, or both ways)

Competitors

a company must provide greater customer value and satisfaction than its competitors do

Subculture

a group of people with shared value systems based on common life experiences and situations

Product line

a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, and are marketed through the same types of outlets, or fall within given price ranges

Motivation

a need that is sufficiently pressing to direct the person to seek satisfaction of the need (Maslow's hierarchy of needs)

Lifestyle

a person's pattern of living as expressed in his or her activities, interests, and opinions

Marketing concept

a philosophy in which organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors do

Mission statements

a statement of the organization's purpose - what it wants to accomplish in the larger environment *Should be market oriented and defined in terms of satisfying basic customer needs

Star

high market share, high market growth rate

Cash Cow

high market share, low market growth rate

Demands

human wants that are backed by buying power (products and services with benefits that add up to the most value and satisfaction)

A difference is worth establishing if it is...

important, distinctive, superior, communicable, preemptive (competitors cannot easily copy the difference), affordable, profitable

Internal publics

includes workers, managers, volunteers, and the board of directors

Consumer markets

individuals and households that buy goods and services for personal consumption

Primary data

information collected for the specific purpose at hand -research approaches -contact methods -sampling plan -research instruments

Secondary data

information that already exists somewhere, having been collected for another purpose (can be obtained quicker and at a lower cost) * Company internal database * Outside suppliers * Commercial online databases --> slight fee for general database services * Internet search engines

Cultural environment

institutions and other forces that affect society's basic values, perceptions, preferences, and behaviors

strengths

internal capabilities that may help a company reach its objectives

weaknesses

internal limitations that may interfere with a company's ability to achieve its objectives

Political environment

laws, government agencies, and pressure groups that influence and limit various organizations and individuals in a given society

Local publics

local community residents and organizations

Question Mark

low market share, high market growth rate (how most companies start out)

Dog

low market share, low market growth rate

Government publics

management must take government developments into account (product safety, truth in advertising, etc.)

Descriptive research

marketing research to better describe marketing problems, situations, or markets, such as the market potential for a product or the demographics and attitudes of consumers

Exploratory research

marketing research to gather preliminary information that will help define problems and suggest hypotheses

Causal research

marketing research to test hypotheses about cause-and-effect relationships

Age and life-cycle stage

people change the goods and services they buy over their lifetimes

demography

the study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics * Baby boomers--> post WWII, control majority of spending power (e.g. Travel) * Gen X --> "birth death" after baby boom, seek success & less materialistic * Millennials --> 80's and 90's, seek authenticity and value * Gen Z --> late 90's early 2000's, utter fluency and comfort with digital tech * Gen Alpha --> after 2012, influence on household buying decisions

Product position

the way a product is defined by consumers on important attributes - the place it occupies in consumers' minds relative to competing products

Personality and self-concept

unique psychological characteristics that distinguish a person or group