Intro to Business Chapter 11 Vocabulary
Marketing
the activity set of institutions and processes for creating, communicating, delivering, and exchanging offerings that have value for customers clients' partners and society at large
Marketing plan
is a written document that tells us what resources, objectives, strategies, implementation, and control efforts that are used to market a specific product
Sales forecast
is an estimate of the amount of product that an organization expects to sell during a certain period of time
Consumer buying behavior
centered around the purchases of products for household use (it is largely affected and determined by your income)
Institutional markets
churches, non for profits, schools .... Buying products to operate those businesses
Market segment
a group of individuals within a market that shares one or more characteristics
Concentrated
a single marketing mix is directed at a single market segment
Value
(marketing is how we convey that there is a value to our customers) is the customers definition of worth ^Value is going to look at a comparison of cost and benefits especially quality
Secondary data
- Commercial reports - Government reports Internal databases
Using technology to gather and analyze marketing information
- Data base - Single-source data - Online information services - Internet
Common bases of market segmentation
- Demographic (people) - Psychographic (personality attributes) - Geographic (based on location) - Behavioristic (consumer behavior... loyalty, price sensitivity)
A firm does not have control: ^ Make up the external marketing environment
- Economic forces - Sociocultural forces (different influences consumers are faced with) - Political forces (arise through the actions of political figures) - Competitive forces - Legal and regulatory forces (laws that protect consumers) - Technological forces (can create new marketing opportunities or cause some products to become obsolete)
Marketing research: Primary data directly from consumers
- Mail surveys - Telephone surveys - Personal interview - Online - Focus group - Social networking surveys - Direct observation of consumer behavior
A firm can control: ^internal forces
- Product - Price - Distribution - Promotion
Marketing mix
- Product - Price - Distribution - Promotion
Eight functions of marketing:
1) Buying 2) Selling 3) Transporting 4) storing 5) Financing/facilitating 6) Standardization 7) Risk taking 8) Gathering
Two market segmentation approaches
1) Concentrated 2) Differentiated
The 6 steps of marketing research
1) Define the problem 2) Make a preliminary investigation 3) Plant the research 4) Gather factual information 5) Interpret the information 6) Research a conclusion
Marketers consider income in three different ways
1) Personal income 2) Disposable income 3) Discriminatory income
Creating a Marketing Mix When combines, these four elements form a marketing mix
1) Product - All of the decisions of the product 2) Price - Base price as well as discounts 3) Distribution - Not only about the transportation and distribution of products but also how are we going to get it to the end user and intermediaries 4) Promotion - How we prove information to our target market - Advertising, personal selling, sales relationships
Evolution of customer orientation
1) Production orientation 2) Sales orientation 3) Customer orientation (where we are right now in society) 4) customer needs
How to implement the marketing concept (4 steps)
1) The business needs to learn about their present and potential customers (research oriented) - What are the customers' needs? - How do our products satisfy those needs? - How to the products of our competitors satisfy those needs? (Allows us to know how to make our product better) - How can we improve upon either of them? 2) We are going to use the information gathered to pinpoint the specific needs and potential customers towards our direct marketing activities 3) Mobilize our marketing resources - How we mobilize them? 1. Provide the product 2. Price the product 3. Promote the product 4. Distribute the product 4) Evaluate how we are doing - Go back and research the effectiveness of our efforts
Marketing concept process
1) The firm communicates with potential customers to assess their product needs 2) The firm develops a good or service to satisfy those needs 3) The firm continues to seek ways to provide customers satisfaction
Marketing approaches
1) Undifferentiated approach 2) Market segmentation approach 3) Market segment 4) Market segmentation
Components of a marketing plan
1. Executive summary 2. Environmental analysis 3. SWOT analysis (Strength, weakness, opportunities in the environment and industry, threats in the environment and industry)
Managers reliance on sales forecast
1. Helps to figure out how much raw materials need to be purchased 2. Higher personal 3. schedule production 4. secure financial resources 5. consider equipment purchases
Importance of developing a marketing plan
1. High importance 2. Need a clear plan 3. Establishes a unified vision 4. Cover all responsibilities tasks schedules for implementation 5. Outlines how resources are allocated 6. Helps to monitor and evaluate the performance of a marketing strategy
Forecasting methods
1. Historical data 2. Executive judgment 3. Survey of buyers or sales personal 4. Market tests 5. Correlation analysis
· Is a product a consumer buy or a business buy
Buying for a home business answer would be business buying since it is for the business and not the home
Internal data
Gives us data Inventory costs Marketing costs
External data
How suppliers are doing How intermediaries are doing How are the competitors are doing
If there was a 5th step, what do you think that marketers would do next?
Pivot...if our methods were not effective we need to go back and determine what we should do to get the result we desire BUT if we are doing good then we should keep doing what we are doing
Measuring market segments
Why? It can help a firm determine the feasibility of entering an new segment and how best to allocate its marketing resources.
Target Market
a group of individuals or organizations that a company has chosen to develop their marketing mix around - Selection - Resources
Marketing information systems (MIS)
allows us to manage the information from both internal and external sources in order to make our objectives in the most effective manor
Market
and is a group of people or organizations that need products and have the ability to buy them
Governmental markets
are markets where items are being purchases (federal, state, local, county) are buying the goods and services that go into providing the supply needed for the community
Different types of markets
consumer, reseller, and institutional markets
2 types of buyers
consumers and business buyers
Possession utility
created by transferring the title or ownership of a product to a buyer
Customer orientation (where we are right now in society)
determine customer needs - develop products to fill these needs - achieve the organizations goals
Market segmentation approach
determines a market segment
Relationship Marketing
establishing long term relationships that are beneficial for both the buyer and the seller
Producer markets
in which we are going to buy certain products to use in the manufacturing of another product
Sales orientation
increase advertising - enlarge sales force - intensify sales techniques
marketing strategy
is a plan that will help a business make the best use of their resources in order to meet its objectives ^consist of the selection of analysis of a target market ^create and maintain your marketing mix
Consumer
is made up of household members who intend to buy products for their own personal use, you do not buy it to make a profit...consists of purchasers who buys products for their own benefit not wanting to make a profit (do not make a profit)
Form utility
is one we create a value by creating production and input into a finished product (turning product (example: only your size shoe will satisfy your need)
Business - to - business or industrial
is one when they are purchasing a product to make a profit for resale or day to day operations (buy to resell product to make a profit or use in day to day operations)
Utility
is the ability of a good or service to satisfy a need
Marketing concept
is the idea that a business should provide goods or services that satisfies needs through a set of coordinated activities
Business buying behavior
is the purchasing of products by producers, resellers, governmental units, and institutions (NOT consumers) ^goes through a similar process but it is surrounded on the purchasing of goods and services for the businesses
Buying behavior
looking at the decision and actions of people involved in buying and using products
Place utility
making a product available where we need it to be available for purchase (AKA place value)
Differentiated
multiple marketing mixes are focused on a multiple market segment
4 elements of a marketing mix
product, price, distribution, and promotion
Production orientation
take order - distribute goods
Consumer Buying Decision Process
recognize problem, search for information, evaluate alternatives, purchase, and evaluate after purchase
Undifferentiated approach
selects one marketing mix for the entire market for a particular product (exp. sugar, salt)
Consumers values
social, cultural, economic, sociocultural forces
Market segmentation
the process of dividing a market into segments and directing a marketing mix at a specific segment and not the whole
Time utility
value created by the product being available when the customer wants to purchase the product
Customer lifetime value
what a company does to determines a customer's worth over their lifetime (one transaction as profitable as possible)^a measure of a customer's worth (sales minus costs) to a business over one's lifetimes
Customer relationship management (CRM)
when companies use information about customers to create specific strategies that will help them develop the relationships
Reseller market
when we are looking at a intermediary (wholesalers, retailers) to buy something ... those groups are buying a product to resell them