BUAD 100 - University of Delaware

Joint Venture

2 companies invest funds and create a third jointly company. Combines features without altering

Brand

A brandname is just a trademark for a specific product/service. In marketing, it is a contract. A brand is whatever the consumer thinks it is. BRANDS ARE ASSETS

Mission statement

A company must do this so they show how they differentiate, show where they see themselves in the future, and so they can communicate effectively. Definition: written declaration of an organizations core purpose. typically, it is UNCHANGED overtime. They serve as FILTER to filter what is important and what is not. And they state which markets (types of consumers) will be served. These statements are a sense of intended direction to the organization. Decisions companies make are in line with their mission statement.

Stakeholders

A party that has an interest in a company and can be affected by the business. CAN BE INTERNAL OR EXTERNAL.

Product

A product is a set of benefits from which customers desire value. NOT a set of features/ performances/ characteristics. Think about a drill and hammer. We don't care how it looks. We are not just talking about goods but services as well.

Strategic Alliance

AKA partnership. Agreement to pursue objectives while remaining independent.

Threat of New Entry

Ability of people to enter your market.

Price

Amount in which a marketer seeks to sell their product. The issues: how much does it cost to produce? how informed is the customer? can the consumers go elsewhere for cheaper? The objective is to maximize longer run profit.

Worker Productivity

Amount of goods and services produced for each hour worked.

Bargaining Supplier Power

Assessing how easy it is for suppliers to drive up the price. Driven by number of suppliers, uniqueness of product, their strength or control over you

3 goals of promotion explained (APR)

Awareness: Informational and Educational Persuasion: Why is your brand better Reminder: Reinforce brand messages like ads.

How do we evaluate our economy?

Balance of trade, consumer price index, inflation, unemployment rate, per capita income, worker productivity and competition.

What is business?

Business is any activity that seeks to provide goods and services.

Intensive

CAN BUY anywhere. Like coca cola. Does not involve a lot of search and is less expensive.

Consumer price index

CHANGES in PRICES of GOODS AND SERVICES for consumption by an urban household.

External Factors

Can not be controlled BUT predicted. Think of the 6 business environment factors.

Segmentation Methods, looking at

Characteristics of the Customer, Geography, Product related behavior, and benefits sought.

3 economic systems we learned about?

Communism, socialism, and capitalism.

FOUR types of consumer products

Convenience goods, shopping products, specialty, and unsought.

Place

Distribution strategy. Distribution channel occurs here

Public Companies can also pay:

Dividends. They pay out the money which is attractive to investors because it shows that they are doing well as a company. Reivest Money: they can put their money into research and development and can expand their product on the lines of a new market.

Opportunities

EXTERNAL.

Threats

External

Undifferent MASS Marketing

Focus on what is common. Like sugar

Logos

Graphics that identifies your organization while differentiating your brand

Distribution channel AKA place

How a product makes it to the consumer and where a consumer can purchase a product / service

Buyer Power

How easy it is for buyers to drive prices down. Driven by the number of buyers and the cost of them switching.

Promotion

How you communicate with a customer. There are three goals of promotion 1) Awareness 2) Persuasion 3) Reminder

Segmentation

Identify customer needs and understand the different customers. We are profiling based on variables like age, income, and education.

Per Capita Income

Income level of "average" Americans.

Weaknesses

Internal. What makes the company not do well.Could be lack of marketing expertise, undifferentiated products/services, location of business, damaged rep.

Communism Explained

Introduced by Karl Marx. Most businesses are OWNED AND OPERATED by the government. There is no competition and limited choice of goods for consumers at HIGH prices.

Capitalism

Japan, USA. Individuals own and operate ALL businesses. Competition is encouraged and many choices for goods and services.

Exclusive

Limited in number of places, not a lot of distribution places and expensive. Think of Covette or Rolls Royce

Monopolistic

Many buyers along with large amount of sellers. Think of SODA. Some are different in price though.

Monopoly

Market structure where there is only ONE business providing a product in a given company. Ex: Utility electric companies providing electric.

Marketing

Marketing should be referred to as a BROAD activity with a long term value. It is NOT a department. Marketing is an exchange for something of value. Think or Starbucks creating value with their WiFi. Value is Subjective and is influenced by PERSONAL feelings.

Inflation

Monitors PRICE INCREASE in consumer goods and services over specified periods of times. The USA rate is 2 percent.

Mulltibrand

New brand name but being an existing category

Brand extension

New product CATEGORY but same brand name

Industry Rivalry

Number and capability of your competitors is most important. Many competitors with equal attractive services = little power. Suppliers and buyers will go elsewhere with a deal.

Colgate Palmolive has 4 product lines

Oral Care, Personal Care, Home Care, Pet Nutrition.

What are the three MUSTS in business?

Organization, profit earning, and satisfaction.

Who are private businesses usually owned by?

Owned by founder or investor. But just because they are private businesses does not mean they are smaller.

Geography

People who live in similar neighborhoods have similar preferences. Prism: clusters.

Geographic Segmentation: PRISM

People who live in similar zip codes have similar preferences. The website clantas we see zipcode clustering.

Disposable Income

Personal income - taxes

The Business Environment Factors (6)

Political factors, legal factors, technological factors, demographic, socio-culture factors, and ecological

The 4 P's of Marketing

Price, Product, Place, Promotion.

What is profit?

Profit = REVENUE - EXPENSES. Difference of what it costs to make and sell the product

Variability

Quality of service depends on who, when, where, how

Targeting

Reaching out to specific segments. Here, we select which segment to serve.

Competition

Rivalry among businesses for money.

segmentation, targeting, positioning acronym

STP

Inseparability

Services can not be separated from their providers. Services are produced and consumed at the same time

Perishability

Services can not be stored for later sale/use

What is economics

Social science concerned with the production, distribution, and consumption of goods and services. There is micro and marco economics.

Threat of Substitutes

Store branded options, other brands.

Strengths

Strengths are INTERNAL. Could be a new, innovative product or service, location on business, and overall ANY aspect that adds value.

SWOT ANALYSIS TOOL IN MARKETING

Strengths, weaknesses, opportunities, threats.

Specialty Products

Strong brand preference and loyalty. They do little comparison. More expensive. Not widely distributed and rather exclusive. Carefully promoted. Ex: Lamborghini

Socialism Explained

Sweden, Israel and India practice Socialism. The government operates MAJOR industries and individuals own SMALL businesses. Competition is restricted in major industries but encouraged in small businesses. Prices are determined by supply and demand. There is some choice of goods.

Positioning must consider the three

Target segment, point of difference and frame of reference

Brand Equity

The value premium that a company generates from a product with a recognizable name vs the same product without the name. Think of generic Tylenol and Tylenol.

What do Public Companies do with profit?

They sell portion public VIA Initial Public Offering (IPO) Or they sell some stocks. And they sell stocks to investors to make money.

What is the goal of all goods and services?

To benefit the consumer.

Porters Five Forces

Used to help us understand the industry we are going into. It is an industry analysis. Threat of entry, bargaining power of suppliers, bargaining power of buyers, threat of substitutes, industry rivalry

Oligopoly

Very FEW businesses selling a product. Sellers are large and major investments are necessary. Price of product stays close. Think of airline business or car rental companies. It is expensive for new firms to enter.

Integrated of 3rd Parties (depth)

Website for American airlines of a 3rd party like Expedia.

Product Line

a group of products that are closely related.

Shopping Products

bought less frequently and require more planning and effort with brand comparisons on the basis or price, quality, and style. More research and carefully compared. Example: washing machines, clothing, used cars

Convenience Goods

bought most frequently and quickly without too much comparison across brands. Soda, laundry detergent. Many of them at a low price and not too much thought. Mass advertising.

exclusive, selective, intensive coverage

breadth

Product - related behavior

channel purchasing behaviors and loyalty and purchase status.

Characteristics of the customer

demographics; looking at where they live, income, age, gender, education. psychological: values/lifestyle cohort analysis: life experiences, boomers, gen x, etc.

Balance of trade

difference between exports and imports. If it is negative this is called a TRADE DEFICIT. If it is positive, it is called a trade surplus.

Concentrated (niche) marketing

go after the large share of one segment for example pens for left handed people

What is marketed?

goods, services, events, experiences, persons, organizations, properties.

Positioning

how do we put the product in the mind of the consumer and how we want them to perceive or brand. We are now implementing a chosen image and appealing it to the chosen segment. Here, we think about the 4 P's when trying to appeal.

unemployment rate

how many people working - americans who are not working that desire to.

Line Extension

introduction of new products under same brand same. Example: adding a new flavor of icecream to Breyers

Unsought Products

items that the consumer does not think about buying until they have to. Most new innovations fall here. Life insurance, preplanned funeral. Require much more marketing and sales because consumers are not motivated to buy and don't know a lot.

PURE competition

many small businesses selling ONE standardized product. Prices are determined by supply and demand. For example; cotton.

New Brands

new name needed

Intangibility

services can't be seen, tasted, felt, heard or smelled before a purchase.

Differentiated segmented marketing

target several segments with separate offerings (gas station providing diesel, etc)

Micromarketing (local or individual marketing)

targeting narrow tailor products and marketing to individuals. Think of Build a Bear

Appropriate Vehicle

tool of delivering advertising to a specific place.

Selective

washing machines at best buy or home depot. They are medium prices with competition and comparable prices

The word Market

when we use this word, we are talking about a group of people and customers.