Marketing

What does "perceptual mapping" mean?

"a technique used to present visually the relative perception, in comparison to its competitors, of different marketing stimuli such as products, product lines, and brands."

What are the four main types of non-for-profit organisations and how does each of these organisations use marketing?

1. Charities: The process of giving is based on a string emotional involvement with the objectives of the charity. This means that charities try to communicate through messages that invoke an emotional response in their target donors. Charities need to provide people with a rationale - a reason to give money. Attitude to the cause, personal involvement or related experience, and trust that the charity will use the funds appropriately are critical to encouraging donations. Consequently, charities seek to develop empathy with potential donors and to build trust on the basis of which an initial transaction or donation can be made. The acquisition of a new donor is relatively expensive compared with the low costs associated with the collection of monthly standing orders and direct debits. Costs are minimised when repeat donations occur, so charities, just like private-sector organisations, practice relationship marketing principles. However, charities are recognising the power of social media to generate significant increases in fund-raising revenue quickly. Charities also try to raise funds by working win partnership with commercial organisations in cause marketing campaigns. Companies differentiate themselves by sponsoring popular social causes to win the public's favour. Such an approach, termed cause marketing, it a useful way of developing a positive brand image for the private company because it build not only customer loyalty, but also employee respect. The charity gains vital income from this partnership. 2. Social enterprises: A social enterprise is enterprise that is a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners. Companies, and their wealthy owners, also frequently donate to charitable causes. Examples include Google, Microsoft, PepsiCo, and Shell. All have active corporate philanthropy programmes whereby the company will match the amounts that its employees donate to charity. Indeed, Porter has long argued that companies should be more philanthropic because there is a long-term strategic opportunity in being so. 3. The public sector: The term "public sector" covers a range of activities around the provision of services by local and central government. These services are concerned with satisfying social needs and benefiting society. Public-sector organisations operate in industrial, governmental, consumer, and societal markets, and their marketing activities are driven by a complex web of stakeholder relationships. Marketing in the public sector is governed by three main forces: social; economic; and political. The interaction of these forces within an increasingly uncertain and unstable environment makes the provision of customer choice of service more problematic. Internal marketing is crucial in these organisations. Rather than refer to buyers and sellers, the public-sector concerns the political tensions that arise between the various stakeholder groups. Governments use marketing for a variety of reasons, including as a complement to law enforcement and to help to promote services to support companies with their export business, as well as "to bring about societal change or improvement". Most social marketing campaigns are clear-cut - designed to advance social causes to the benefit of a particular audience by changing social attitudes and behaviours. 4. Political Parties and campaigning organisations: Political parties use marketing to exchange political influence (for example legislative change or amendment) for political support (e.g. votes, petitions, donations, volunteering). Political marketing can be seen as a marketing-propaganda hybrid. This is particularly the case, but not exclusively so, in the U.S. where negative campaigning is rife. In representative democracies, political parties use marketing to provide citizens and voters with information son current plans for running the country (that is, their manifestos). In the process, parties seek to improve social cohesion, democratic participation, and citizen belongingness. Most political marketing campaigns have historically been undertaken by specialised marketing and PR agencies, although political parties and multinational corporations are increasingly conducting their political marketing activity in-house. In the US, political consultant are more specialised, undertaking work in such areas as polling, petition management, fundraising, strategy, media buying, advertising, public affairs, grass-roots lobbying, law, donor list maintenance, online campaigning, and campaign software consulting. The Internet and social media have become important ares for generating campaign finance and grass-roots support. Social media have become the battleground of political campaigning efforts in elections around the world. Under certain circumstances, it is possible to influence the political environment, and therefore the political agenda, in favour of an organisation's strategy. Charities and not-for-profit organisations frequently focus on campaigning to change legislation or government policy agendas.

What five characteristics are services characterised by?

1. Intangibility: - Services are delivered and experienced only post-purchase. - Intangibility does not mean that customer buy services without using their senses; rather, it means that they use substitute cues to help them to make these purchasing decisions and to reduce the uncertainty because they cannot touch, see, smell, or hear the service. People make judgements based on a range of quality-related cues. The cues serve to make the intangible service tangible. Two types of cue can be identified: intrinsic (cues are drawn directly from the "service product" itself and are regarded as difficult to change); extrinsic (cues are said to surround the "service product" and can be changed relatively easy). - Different types of service brand need different types of cue. Financial and investment-baed brands prosper from the use of intrinsic cues, which stress objective information resources, such as strong reputation, industry ranking, an favourable media reviews. The reverse is true of services that have a more tangible element, such as hotels and transport services. In these circumstance, more subjective communication, such as advertising and referrals through word or moth, is more influential. 2. Perishability: - Services are manufactured and consumed simultaneously; they cannot be stored either prior to or after the service encounter. - One of the tasks of service marketers is to ensure that the number of empty seats and lost-forever revenue is minimised. In cases of predictable demand, service managers can vary the level of service capacity. However, demand may vary unpredictability, in which case service managers are challenged to provide varying levels of service capacity at short notice. - One of the main ways in which demand patterns can be influenced is through differential pricing; demand can be levelled and marginal revenues increased. In addition to differential pricing, extra services can be introduced to divert demand. 3. Variability: - Difficult to standardise the delivery of services for even the same customer on consecutive occasions. It is also difficult to deliver services so that they always meet the brand promise, especially because these promises often serve to frame customer service expectations. - The variability of services does not mean that planning is a worthless activity. By anticipating situations I which service breakdown might occur (in which case it is not possible to provide a service level that can be consistently reproduced), service managers can mitigate the potential harm. 4. Inseparability: - Products can be built, distributed, stored, and eventually consumed at a time specified by the ultimate end user. Services, however, are consumed at the point at which they are produced. In other words, service delivery cannot be separated or split out of service provision or service consumption. This event in which delivery coincides with consumption means not only that customers come into contact with the service providers, but also that there must be interaction between the two parties. This interaction is of particular importance not only to the quality of service production, but also to the experience enjoyed by the customer. - If there is a broad mix of customer present during the service delivery, it may be affected because the needs of different groups to be attended to by the service provider. Such a mixture may dilute the impact of the service actually delivered. 5. Lack of ownership: - The final characteristic associated with services marketing arises naturally from the other features: services cannot be owned, because nothing is transferred during the interaction or delivery experience. Although a legal transaction often occurs with a service, there is no physical transfer of ownership as there is when a product is purchased. - One last point concerns loyalty schemes, such as frequent flyer programmes and membership clubs, whereby the service provider actively promotes a sense of ownership. By creating customer involvement and participation, even tough there is nothing to actually own, customers can develop an attitude based around their perceived right to be a part of the service provider. Rather than consider the five core characteristics of services as definite prescriptions for how to undertake services marketing, we should instead consider them as general guidelines that apply, alone or in combination, in many situations. Their effective importance should, however, be considered critically in each case.

What does the different stages of the new product development process (NPDP) imply?

1. Idea generation: Ideas can be generated through customers, competitors (through website and sales literature analysis), market research data (such as reports), social media analyses, R&D, customer service employees, the sales force, project development teams, and secondary data resources such as sales records. What this means is that organisations should foster a corporate culture that encourages creativity and supports people when they bring forward new ideas for product enhancements and other improvements. 2. Screening: All ideas need to be assessed so that only those that meet predetermined criteria are advanced. Key criteria include; the fit between proposed new idea and the overall corporate strategy and objectives; the view of customers, which can be determined using concept testing; how the market will react to the idea and what effort the organisation will need to make if the offering is to be Brough to market successfully. Whatever approaches are used, screening must be a separate activity to the idea-generation stage. If it is not, creativity might be impaired. 3. Business planning and market analysis: The development of a business plan is crucial, simply because it will indicate the potential and relative profitability of the product. To prepare the plan, important information about size, shape, and dynamics of the market should be determined. 4. Product development and selection: It is management's task to select those that have commercial potential and are in the best interest of the organisation and its longer-term strategy, goals, and use of resources. There is a trade-off between the need to test and reduce risk, and the need to go to market and drive income to get a return on the investment committed to the new proposition. Prototypes and test versions are developed for those projects that are selected for further development. These are then subjected to functional performance tests, design revisions, manufacturing requirement analysis, distribution analysis, and a multitude of there testing procedures. 5. Before committing to a new product to a market, most organisations decide to test market the finished product. By piloting and testing the product under controlled real-market conditions, many of the genuine issues as perceived by customers can be raised and resolved, while minimising any damage or risk to the organisation brand. The intention of test marketing is to evaluate the product and the whole marketing programme under real working conditions. Test marketing (including field trials) enables the product and marketing plan to be redefined or adapted in the light of market reaction, but before release to the whole market. It is vital for organisations to set up a system to measure the success or failure of new product development. Criteria for measuring success and failure include (but are not limited to) measures based on customer acceptance, financial performance, and product- and firm-level considerations. 6. Commercialisation: To commercialise a new product, a launch plan is required. This considers the needs of distributors, end users, marketing communication agencies, and other relevant stakeholders. The objective is to schedule all those activities that are required to make the launch successful. These include communications (to inform audiences of the product's capabilities, and to position and persuade potential customers), training, and product support for all customer-facing employees.

What are the three key activities of marketing strategy development?

1. Strategic market analysis. 2. Strategic marketing goals. 3. Strategic market action.

What is the difference between "customers" and "consumers"?

A customer purchases or obtains an offering, but a customer uses it.

What is a "pipeline" strategy?

A linear chain approach, which considers successive supplier/distributor participants to add value as a product moves along a chain to be consumed by end users.

What is B2B market segmentation?

B2B market segmentation is the identification of "a group of present or potential customers with some common characteristic which is relevant in explaining (and predicting) their response to a supplier's marketing stimuli. There are two main groups of interrelated variables used to segment B2B markets. The first involves organisational characteristics, such as organisational size and location, sometimes referred to as firmographics. Those seeking to segment business markets might start with these variables. Organisational Size: By segmenting organisations by size, we can identify particular buying requirements. Large organisations may have particular delivery or design needs based on volume demands. Geographical location: Geo-targeting is one of the more common methods used to segment B2B markets and is often used by new or small organisations attempting to establish themselves. This approach is useful because it allows sales territories to be drawn around particular locations that sales staff can service easily. However, this approach is becoming less useful because the Internet cuts across geographic distribution channels. SIC codes: Standar Industrial Classification codes are used to designate different industrial markets. They are easily accessible and standardised across most Western countries. However, some marketers have argued that SIC codes contain categories that are too broad to be useful. Consequently, SIC codes have received limited application, although they do provide 'some preliminary indication of the industrial segments in a market'. More commonly, companies segment B2B markets using industry types (so, called verticals). The second group is based on the characteristics surrounding the decision-making process. Those organisations seeking to establish and develop customer relationships would normally expect to start with these variables. Customer characteristics concern the buyers within the organisations that make up a business market. Numerous criteria could be used to cluster organisations, including by decision-making unit, by purchasing strategies, by relationship, attitude to risk, choice criteria, and purchase situation. Decision-making unit: An organisation's decision-making unit may have specific requirements that influence purchase decisions in a particular market, for example policy factors, purchasing strategies, the levels of importance attached to these types of purchase, or attitudes towards vendors and risk. These characteristics can be used to segregate groups of organisations for particular marketing programmes. The starting point of any B2B segmentation is a good database or customer relationship management (CRM) system. It should contain customer addresses, contact details, and detailed purchase and transactional history. Ideally, it will also include the details about those buyers present in the customer company's decision-making unit structure. Choice criteria: Business markets can be segmented based on the specifications of offerings they choose. Choice criteria is the principal dimensions on the basis of which we select a particular product or service, such as price, location, range of services, level or expertise, friendliness of staff, and so on. Purchase situation: Companies sometimes seek to segment on the basis of how organisations make purchases. Thus three questions associated with segmentation by purchase situation should be considered, as follows: 1. What is the structure of the buying organisations purchasing procedures: centralised, decentralised, flexible, or inflexible? 2. What type of buying situation is present: new task; modified rebuy; or straight rebuy? 3. What stage in the purchase decision process have target organisations reached? Are they buyers in early or late stages, and are they experienced or new?

What is "brand positioning"?

Branding is a process by which manufacturers and retailers help customers to differentiate between various offerings. Brand names provide information about content, taste, durability, quality, price, and performance, without requiring the buyer to undertake time-consuming comparison tests with similar offerings or other risk-reduction approaches to purchase decisions. In other words, brand positioning is not about a brand's physicality; rather, it is about the place the brand occupies in a consumer's mind. Brand positioning is a strategic activity used to differentiate and distinguish a brand, so that a consumer not only remembers the brand, but also understands it.

What is a buying phase and what do the different stages imply?

Buying stages are a series of sequential activities through which organisations proceed when making purchasing decisions. - Need/Problem: The need/problem recognition phase is about the identification of a gap between the benefits an organisation is experiencing now and the benefits it would like to have. The first decision is therefore about how to close this gap. There are two broad options for the organisation - that is, whether it should outsource the whole, or parts, of the production process, or build or make the offering itself. - Product Specification: As a result of identifying a problem and the size of the gap, influencers and users can determine the desired characteristics of the solution needed to solve the problem. This make take the form of either a general functional description, or a much more detailed analysis and the creation of a detailed technical specification for a particular proposition. - Supplier and Proposition Search: At the supplier and proposition reach stage, the buyer actively seeks suppliers who can supply the necessary solution(s). There are two main issues at this point: will the solution match the specification and the required performance standard; and will the potential supplier meet the other organisational requirements, such as experience, reputation, accreditation, and credit rating? In most circumstances, organisation review the market and their internal sources of information, then arrive at a decision based on rational criteria. Wherever possible, organisations work to reduce uncertainty and risk. By working with other organisations that it knows, of which it has direct experience, and which can be trusted, the organisation can reduce risk and uncertainty. This highlights another reason why many organisations prefer to operate within established networks that can provide support and advice when needed, rather than to operate individually. - Evaluation of Proposals: Depending on the complexity and value of potential order(s), the proposal is a vital part of the process and should be prepared professionally. The proposals from the shortlisted organisations are reviewed in the light of two main criteria: the purchase order specification; and the evaluation of the supplying organisation. If the potential supplier is already part of the network, little research and review time is needed. If the proposed supplier is not part of the network, a review may be necessary to establish whether it will be appropriate (in terms of price, delivery, and service), as well as whether there is the potential for a long-term relationship or whether this is a single purchase that is unlikely to be repeated. - Supplier Selection: The DMU will normally undertake a supplier analysis and use a variety of decision criteria, according to the particular type of item sought. A further useful perspective is to view supplier organisations as a continuum, ranging from reliance on a single source to the use of a wide variety of suppliers for the same offering. - Evaluation: Next, the order is written against the selected supplier, which is then monitored and evaluated against diverse criteria such as responsiveness to enquiries, modifications to the specification, and timing of delivery. When the offering is delivered, it may reach the stated specification, but fail to satisfy the original need. In this case, the specification needs to be rewritten before any future orders are placed.

What role do retailers play in the distribution channel? What type of retailers are there? What role does store presence play?

Retailing encompasses all the activities directly related to the sale of products and services to consumers for personal use. Retailers help to reduce the uncertainty experienced by other intermediaries in the channel, such as wholesalers and manufacturers. They do so by taking small quantities of stock on a regular basis, promoting cash flows, and providing demand for their products and services. Retailers provide consumers with access to products. As such, it is very important to find out what consumers actually want from a retailer if they are to deliver value. Convenience and time utility is the primary concern for most consumers, with people increasingly being "leisure time poor", and keen to trade shopping time for more leisure time. From a customer's perspective, convenience means speed and ease in acquiring a product, and it consists of four key elements: - access: being easy to reach. - search: enabling customers to easily identify what they want. - possession: being easily obtained. - transaction: ease of purchase and return of products. There are numerous types of retailer. These can be classified according to the marketing strategy employed (that is, product, price, and service) and the store presence (that is, store or non-store retailing). - Department stores: are large-scale retailing organisations that offer a very broad and deep assortment of products (both hard and soft goods) and provide a wide array of customer service facilities for store customers. - Discount retailers: positioned based on low prices combined with the reduced costs of doing business. They key characteristics here involve a broad, but shallow, assortment of products, low prices, and very few customer services. To keep prices down, the retailers negotiate extensively with suppliers to ensure low merchandise costs. - Limited line retailers: have narrow, but deep, product assortment and customer services vary from store to store. The breath of product variety differs across limited line stores, and a store may choose to concentrate on several related product lines, a single product, or a specific part of one product line. - Category killer stores: are designed to kill off the competition and are characterised by a narrow, but a very deep, assortment of products, low prices, and few-to-moderate customer services. - Supermarkets: are large self-service retailing environments offering a wide variety of differing merchandise to a large consumer base. Operating largely on self-service basis, with minimum customer service and centralised register and transactional terminals, supermarkets provide the benefits of a wide product assortment in a single location, offering convenience and variety. - Convenience stores, or corner shops: offer a range of grocery and household items that cater for convenience and the last-minute purchase needs of consumers. Key characteristics include long opening times, being family-run, and belonging to a trading group. One can further categorise retailers according to their presence - either store or non-store retailing. Most retailing occurs through fixed stores, with existing operators having "sunk" investment into a physical building and equipment. The physical location of a store is seen as a source of competitive advantage, providing crucial entry barriers to competitors. Several characteristics make store retailing unique from the customer viewpoint. The retail environment provides the sensation of touch, feel, and smell, which is very important for many product categories. Furthermore, customers can interact and seek advice with in-store staff. Once a product is selected and a purchase made, customers can walk out of the store with the merchandise in hand. In contrast, retailing can also involve non-store retailers. These are retail transactions that occur away from a fixed store location. Examples include automatic vending machines, direct selling, and, most notably, online retailing. Online shopping: can be considered as a two-stage process. The first is a browsing stage, which requires consumers to spend time visiting several web pages (page views) and which may lead to a purchase decision; the second stage, purchase, involves the completion of the financial transaction. However, these two stages mask several complexities, involving what is is that is being purchased, the product or service, and where it is being purchased - namely, the website. Online stores are thus interested in ensuring that browsing is converted into sales (that is, the conversion rate), as well as driving the basket size for each transaction. The shopping behaviour of contemporary consumers tends to reflect a mix of online and offline channels. This is reflected in the practices of "showrooming" and "webrooming". From a retailer's perspective, understanding and managing consumer movements between channels is thus increasingly important.

What role does "customer experience" play in relationship marketing?

The idea that providing a superior customer service might help in the (repeat) purchase decision process is something that several organisations now appreciate. For a long time, it was assumed that product quality and pricing were sufficient differentiations. However, product quality is no longer a viable means of establishing competitive advantage, simply because of shortening life cycles and evolving technologies. Service, although difficult to deliver in a consistent way, is very difficult to replicate and has become an important aspect of customer management. Customer value is regarded by an increasing number of academics and practitioners as the central marketing activity, and that value is now central to customer's experiences. Customer experience encompasses every aspect of a company's offering - the quality of customer care, of course, but also advertising, packaging, product and service features, ease of use, and reliability. Themed restaurants, such as Starbucks and Hard Rock Café, are prime examples of good companies generating excellent customer experiences. These brands are not only about the consumption of coffee, but also present a situation or environment in which the consumption of series occurs and relationships are develop, thereby providing a meaningful or valuable customer experience. Customer experience is an individual event, and concerns emotional reactions following direct and indirect interaction with an organisation. It is also related to events prior to, during, or after consumption. Perhaps one crucial point is that it is not possible for two people to have or to share the same experience. As a result, the task of managing and measuring customer experiences is inherently complex. To help to disentangle some of this complexity, one can derive four distinct realms of experience, based on two dimensions: a customer's participation in an experience (weak/passive or active/strong); and an individual's connection with the environment of the experience or environmental relationship (from absorption/weak to immersion/strong). the four realms that emerge from these dimensions are as follows: - The educational realm: emerges when an individual leans and enhances their skills and knowledge as a result of the events unfolding before them. - The entertainment realm: occurs when an individual views a performance, listens to music, or reads for pleaser. The experience is absorbed passively. - The aesthetic realm: occurs when an individual passively appreciates an event or environment, but leaves without affecting or altering the nature of that environment. - The escapist realm: occurs when individuals become completely immersed in their environment and actively participate, so that they affect actual performances or occurrences in the environment. The key dimensions of customer experience: - the sensory dimension: refers tot the extent to which a brand appeals to, and makes impressions on, a consumer's sense. - the affective dimension: refers to how strongly a brand induces consumer feelings and emotions. - the intellectual dimension: speaks of how much a brand stimulates a consumer's curiosity, thinking, and problem-solving. - the behavioural dimension: measures how strongly a brand engages consumers in physical activities. - the relational dimension: refers to how well an experience creates value for customer by driving social engagement, providing a social identity and a sense of belonging. One should stress the significance of the relational dimension and its strong positive influence on both brand satisfaction and brand loyalty.

In what ways can one classify physical propositions?

There are two main ways of classifying physical offerings: as consumers offerings; and as B2B offerings. Consumer goods: (1.) Classifying in terms of durability - Durable goods: can be used repeatedly and provide benefits each time they are used. Often require the purchaser to have high levels of involvement in the purchase decisions. There is a high perceived risk in these decisions, and so consumers often spend time, care, and energy searching, formulating, and making the "right" decision. As a result, marketers should seek to understand these patterns of behaviour, provide and make accessible sufficient amount of appropriate information, and ensure that there is the right type of service and support necessary to meet the needs of the market. - Non-durable goods: have a limited duration (that is, they are perishable) and are often used only once. Services are intangible propositions that cannot be stored. Reflect low levels of involvement and buyers are seldom concerned what product they buy. Risk is seen to be low and so there is little need to shop around for the best possible price. Buyers may buy on the basis of availability, price, habit, or brand experience. A deeper and more meaningful way of classifying consumer goods is to consider how and where consumers buy them. How consumers make purchases: - Extensive problem- solving: occurs when consumers give a great deal of attention and care to a purchase decision of which they have no previous or similar product purchase experience. - Limited problem-solving: occurs when consumers have some product and purchase familiarity. - Routinised response behaviour: a form of purchase behaviour that occurs when consumers have suitable product and purchase experience and they perceive low risk. Four main categories about behaviours consumers demonstrate in purchases: 1. Convenience products: are non-durable and are bought because the consumer does not want to put very much effort, if any, into the buying decision. Routinised response behaviour corresponds most closely to convenience products because they are bought frequently and are inexpensive. Convenience products can be subdivided into three further categories: staples; impulse; and emergency products. All of these types of convenience product indicate that different marketing strategies might be required to make each work. Common element; distribution: if the product is not available when an emergency arises, or when a consumer is waiting to pay or walking around the supermarket, then a sale cannot be made. Pricing is also important, because customers know the expected price of convenience items and may well switch brands if price exceeds that of the competition. 2. Shopping products: are not bought as frequently as convenience products. Consequently, consumers do not always have sufficient up-to-date information to make buying decisions. Consumers give time and effort to planning these purchases, because the level of risk is more substantial than that associated with convenience products. Not surprisingly, levels of brand loyalty are quire low, because consumers switch brands to get the level of functionality and overall value they need. The marketing strategies followed by manufacturers - and, to some extent, retailers - need to accommodate the characteristics of limited problem solving. Shopping products do not require the mass distribution strategies associated with convenience products. 3. Specialty products: represent high-risk purchases, are very expensive, are bought infrequently (often only once), and correspond to extended problem-solving; there are few, if any; substitute offerings worth considering. People plan these purchases carefully, each intensively for information on the offering, and are often concerned only with a particular brand an in finding a way of gaining access to an outlet that can supply it. Marketing strategies to support speciality products focus on a limited number of distribution outlets. Advertising seek to establish the brand name and values. The few retailers appointed to carry the item require training and support so that the buyer experiences high levels of customer service and associated prestige throughout the purchase process. 4. Unsought products: refer to offerings people do not normally anticipate buying nor indeed want to buy. Very often, consumers have little knowledge or awareness of the brands in the marketplace and are motivated to find out about them only when a specific need arises. (2.) Business products: are either used to enable the organisation to function smoothly or they form an integral part of the profits, processes, and services supplied by the organisation for resale. Six main categories according to how organisational customers use them: 1. Equipment goods: cover to main areas concerning the everyday operations of the organisation: - Capital equipment goods: PPE required to build or assemble products. They also include major government schemes to build prisons, highways, and bridges. Whatever their nature, they require substantial investment, are subject to long planning processes, are often one-off long-term purchases, and require the involvement of many different people and groups in the procurement process. - Accessory equipment goods: should support the key operational processes and activities of the organisation. Typically, they include photocopiers, computers, stationery, and office furniture. Whereas a poor capital equipment purchase may put the entire organisation at risk, a poor accessory purchase frustrates and slows down activities, but is unlikely to threaten the existence of the organisation. 2. Raw materials: are the basic materials used to produce finished goods. They are bought in large quantities and buyers often negotiate heavily on price. However, these buying decisions can also be influenced by non-product factors, such as length of relationship, speed of delivery, service quality, and credit facilities. 3. Semi-finished goods: are raw materials that have been converted into a temporary state. 4. Maintenance, repair, and operating (MRO) goods: are those products, other than raw materials, that are necessary to ensure that the organisation continues to function. MRO goods are used to maintain the capital and accessory equipment goods. 5. Component parts: are finished complete parts, bought from other organisations, which components are then incorporated directly into the finished product. 6. Business service: are tangible services used to enhance the operational aspects of organisations. Most commonly, these include management consultancy, finance, and accounting, including auditing, legal, marketing research, information systems, and marketing communications.

What is value?

Value refers to the quality of what we get for what we pay. To effectively express the relationship between price and value, it can be expressed as: Value = Perceived benefits - perceived price.

What does the "economic environment" refer to?

Companies and organisations must develop an understanding of the economic environment because a country's economic circumstances have an impact on what economists term factor prices within a particular industry, for a particular organisation. The economic environment of a firm is affected by the following: Wage inflation; price inflation; GDP per capita; Income, sales, and corporation taxes; Exchange rates; and Export quota controls and duties.

What is a "corporate strategy"?

Corporate strategy is the means by which organisational resources are matched with the needs of the organisation's operations environment. Corporate strategy involves bringing together Human Resources, logistics, production, operations, marketing, information technology, and the financial parts of an organisations into a coherent strategic plan that supports, reinforces, and accomplishes the organisation's goals in the most effective and efficient way.

What does the term "social class" refer to in marketing?

" a system of classification of consumers or citizens, based on the socio-economic status of the chief income earner in a household, typically into various subgrouping of middle- and working-class categories." There is a widely held belief that consumers make purchases based on their socio-economic position within society and that different social classes have different self-images, social horizons, and consumption goals. Such variations in attitutudes, motivations, and value orientations reflect differences in occupational opportunities and demands, childhood socialisation patterns, and educational influences, leading consumer to vary in their purchase behaviours accross social classes.

What is a "reference group"?

"...one that the individual tends to use as an anchor point for evaluating his/her beliefs and attitudes. One may or may not be a member and may or may not aspire to membership in a reference group. It can have great influence on one's values, opinions, attitudes, and behaviour patterns."

What does the "Service Perspective" imply?

- Developed to recognise that the goods-centric marketing approach was ill-suited to the marketing of services. Services marketing thinkers suggested that the intangible performance-dependent nature of services substantially affected how they should be marketed.

To move towards a "general theory of marketing", we would need to understand the phenomenon of marketing more completely in terms of:

- the behaviour of buyers - that is, why which buyers purchase what they do, where they do, when they do, and in what way they do; - the behaviour of sellers - that is, why which sellers price, promote, and distribute what they do, where they do, when they do, and in the way they do; - the institutional framework around selling and buying - that is, why which kinds of buyers, buyer behaviour, seller behaviour, and institutions have what kinds of consequences on society, when these institutions will develop, where they will develop, and how they will develop; and - the consequences for society of buying and selling - that is, why which kinds of buyers, buyer behaviour, seller behaviour, and institutions have what kinds of consequences on society, when, where and how.

What are the key characteristics of not-for-profit organisations?

1. Multiple stakeholders: Although for-profit or private sector organisations interact with a range of stakeholders to achieve their business goals, their focus is on customers and shareholders. What differs about not-for-profit organisations is their concern for a wider group of stakeholders. Stakeholders are groups with whom the organisations has a relationship and which impact on the operations of the organisations. Not-for-profits provide an offering, but their customer or end users seldom pay the full costs incurred by the organisations to provide them. Many not-for-profits rely on stakeholders to finance the organisation's operations. Instead of revenue from customers being used to reward shareholders, there are usually no profits to be redistributed because those who fund the organisations do not require a return on their resource provision. Because they serve multiple stakeholders, not-for-profits do not always value their beneficiary customers (that is, those who receive their charitable services) as well as they should and they sometimes fail to explain sufficiently to donors (that is, supporter customers) how donations will be used. Not-for-profit should determine which of the different stakeholders have the most interest in their activities and the most power to affect their organisation's performance. One common method used to distinguish between the interests and power of stakeholders is the stakeholder mapping matrix. The matrix can be used to identify four types of stakeholder, based on the high or low levels of interest that they have in an organisation and the level of power they exert over it. 2. Multiple objectives: As the name suggests, in the not-for-profit sector, profit is not the central overriding goal. Not-for-profit organisations have a range of goals - a multiple set of tasks that they seek to achieve.These include generating awareness, motivating people to be volunteers, distributing information, contacting customers, raising funds, allocating grants, and lobbying member of Parliament for changes in regulations or legislation. Other goals include increasing their geographical spread to reach new people who might benefit from the organisation's activities and campaigning to focus media attention on a particular issue. 3. Orientation: As a general rule, not-for-profit organisations deliver a service. Developing a market orientation is important, because the stronger the market orientation, the stronger the organisation's market performance, particularly for smaller charities. Not-for-profit organisations need to create positive awareness about their cause of activities. The principal focus of the organisations is to motivate and encourage people to become involved and identify with the aims of the organisation, which might lead on to financial contributions and/or volunteering support. Raising funds is an ongoing critical activity in the not-for-profit sector. Raising funds for a charity requires people or donors to contribute money, so the expectations of not-for-profit customers are different from those of commercial firms. This leads to a greater focus on engaging supporters to become a part of, and identify with, the ethos of the not-for-profit organisation rather than simply being a customer. 4. Customer's perception: Customer's perception of not-for-profit organisations differ from those of their commercial counterparts because the not-for-profit typically has a unique mission and set of values, as well as non-financial organisational purpose. 5. Transparency: Because not-for-profit organisations do not distribute funds to shareholders and are social enterprises, public-sector organisations, or charities, there is a need for transparency in determining how the organisations operate, because they are claiming to act for the common good. The use of public money and donations in not-for-profit organisations requires their source and allocation to be understood, audited, and tracked. Public scrutiny or transparency of funding is a feature that distinguishes these organisations from their private-sector counterparts. For donations to continue to flow, not-for-profit organisations should demonstrate trust, integrity, and honesty.

What are the four pricing approaches?

1. The cost-oriented approach (prices set based on costs): The marketer sells output at the highest price possible, regardless of the buyer's preferences or costs. If that price is high enough compared with the seller's costs, the firm earns a profit and survives. If not, either the seller finds a way of increasing the price or lowering costs or both. The cost-oriented approach considers the total costs of a proposition in the pricing equation, but does not take into account non-cost factors, such as brand image, degree of prestige in ownership, or effort expended. The cost-oriented approach means that we have to use a mark-up pricing approach. This method operates on the basis of a set percentage mark-up. When used, the cost-oriented method leads to the use of list prices, with single prices set for all customers. We simply add to the cost a mark-up of X per cent and the total constitutes the price. 2. The demand-oriented approach: With the demand-oriented approach to pricing, the firm sets prices according to how much customers will pay. 3. The competitor-oriented approach: Companies can also set prices based on competitors' prices, also known as the going rate, or "me too" pricing. The advantage of this approach is that when your prices are lower than those of the competition, customers are more likely to purchase from you, provided that they know your prices are lower. However, it is worth considering that adopting a competitor-oriented pricing strategy can lead to price wars. Price wars occur when competitors' pricing policies are overly focused on competitors, rather than customers, when pricing is pushed downwards, and when pricing results in interactions between competitors that lead to unsustainable prices. Calculating and anticipating competitor response is important when setting prices and responding to competitors' price cuts. We should analyse consumer responses when a competitor starts to cut prices, but if purchase behaviour changes only modestly or temporarily, other marketing mix elements (for example promotion, distribution, or product differentiation) may be more likely to win back customers. We do not always have to respond to a price war with a price cut. Instead, we might promote increased service quality or customer value improvements more generally. 4. The value-oriented approach: We no longer live in an era in which offerings are priced at what people can afford. Resources are more plentiful and consumers have much of what they need. So they are more interested in obtaining value from the offerings they buy. With value-based pricing, the pricing process begins with the customer, determining what value they derive from the offering and then determining price. Deciding what is of value to the customer is determined using customer research. The result may be that the company does not necessarily offer a cheaper price. In fact, it could mean a higher-priced offering. If that offering is to represent true value to the customer, they must feel that is has more benefits than equivalent offerings. Research indicated that brands that generate revenues over and above those obtained by an own-label or generic version of the offering also generate revenue premiums, which acts as a useful measure of brand equity. Brand equity is important, because it contributes to company valuations when they are sold, acquired, or merged. Companies increasingly focus on generating price premiums. Nevertheless, a price premium is useless if it is perceived to be unfair. When setting value-based prices, it is important to consider the following questions: 1. What is the market strategy for the segment? What does the supplier want to accomplish? 2. What it the differential value that customers are likely to perceive - that is, the value between this offering and the next best alternative, assuming that the differential value can be verified with the customer's own data? 3. What is the price of the next-best selling alternative? 4. What is the cost of the supplier's offering? 5. What pricing tactics will be used initially (for example price discounting)? 6. What is the customer's expectation of a "fair" price?

Which are the four elements that impact on the implementation of most strategic marketing plans?

1. The structure and type of marketing function: The structure and type of marketing function used by an organisation can influence the degree to which the implementation process is successful. How we organise ourselves to undertake the task of marketing has an impact on how effective we are. A marketing department can be structured in many ways, bu the internal alignment with the sales department, how brands are managed, and how the reporting lines involve the SBU and corporate headquarters, accompanied with varying levels of bureaucracy, can be influential. 2. Organisational culture: The structural issue needs to be considered alongside the degree to which a marketing orientation prevails across an organisation. Marketing is present in all aspects of an organisation, because all departments have some role to play with respect to creating, delivering, and satisfying customers. Marketing should be distributed throughout an organisation and all employees should be considered to be part-time marketers. Marketing is not something that only people in the marketing department undertake. Apart from the need to have a customer orientation, the extent to which the prevailing organisational culture is innovative is also important. An atmosphere that promotes creativity, innovative behaviour, and a willingness to take risks can have positive impact on employee commitment. The manner and involvement of top management in supporting the implementation process is also significant. Research shows that it is critically important that the process of marketing strategy planning occurs within a suitable positive culture. A final element concerns the level of freedom, or autonomy, that managers have to make meaningful decisions and to independently adjust behaviours. Managers without suitable autonomy may waste critical managerial resources or fail to respond to competitors' actions. 3. Once the aggregate amount is determined, managers should devise a marketing budget indicating how much is to be spent on marketing activities and when. Yet there are no hard-and-fast rules on how much should be allocated to marketing spend. One perspective is that many companies lack a formal and appropriate budgeting process. When marketing budgets are properly determined, there are based on pre-set tasks, numerical and times goals, and, of course, sales forecasts. Kehrer (2015) claims that companies that maintain or even increase their marketing spend during an economic downturn are very likely to recover more quickly than their competitors when the economy recovers. However, other work suggest that investment in both R&D and advertising during a recession should be based on the actual conditions facing the firm. 4. Marketing metrics: The implementation of any marketing plan is incomplete without methods to control and evaluate its performance. It is vitally important to monitor the results of the programme as it unfolds, not only when it is completed.

The extended marketing mix was developed after recognition that the 4Ps were inadequate to describe how the marketing of services should be undertaken. What are the further three Ps that was incorporated into the market mix?

5. Physical evidence - This emphasises that the tangible components of services are strategically important. For example, potential university students might asses whether or not they want to attend a university and a particular course by requesting a copy brochures or by visiting the campus to assess the servicesscape for themselves. 6. Process - This emphasises the importance of the service delivery. When processes are standardised, it is easier to manage customer expectations. 7. People - This emphasises the importance of customer service personnel, who are sometimes experts and often professionals, interacting with the customer. How they interact with customers, and how satisfied customer are a result of their experiences, is of strategic importance.

What is the difference between "product differentiation" and "market segmentation strategy"?

A product differentiation strategy involves highlighting a product's attributes and feature to emphasise the differences between it and - hence distinguishing it from - those of competitors or other product offerings (first a focus on the product offering and then sees which part of the market responds, basing its decisions on intuition). A market segmentation strategy requires a focus on particular segments or groups of customers who share similar needs or characteristics (first a focus on researching the needs and wants of a specific market segment, and then developing the product to meet those needs). Because consumers exhibit a wider range of tastes and have greater disposable income, marketer increasingly design offerings around consumer demand - that is, market segments - rather than around their own production needs - that is, product differentiation.

What are the "AIDA" and "HoE" models?

AIDA and HoE are models used to explain how advertising works. The AIDA model refers to the need to first create awareness, then to generate interest and drive desire, from which action (a sale) emerges. As a broad interpretation of the sales process, the model is generally correct, but if fails to provide insight into the depths of how advertising works. The Hierarchy of effects (HoE) approach assumes that a prospect must pass through a series of steps before a purchase will be made. It is assumed - correctly- that advertising cannot generate an immediate sale because there are a series a though processes that need to be fulfilled prior to action. However, this sequential approach has several drawbacks. People do not always process information nor do they always purchase offerings following a series of sequential steps. There are also questions about what actually constitutes adequate levels of awareness, comprehension, and conviction. How can it be known which stage the majority of the target audience has reached at any one point in time and is this purchase sequence applicable to all consumers for all purchases? Awareness--> Knowledge --> Liking --> Preference --> Conviction --> Purchase.

What are the five different tools that can be included in a marketing communications mix?

An overview of each of the tools highlights a number of characteristics that they share - that is, the degree to which a tool and the message conveyed are controllable, the credibility of the message conveyed, the associated costs, the degree to which a target audience is dispersed, and the DRIP (differentiate, reinforce, inform, persuade) tasks that marketing communications are required to accomplish. 1. Advertising: Richards and Curran suggested that advertising might be said to be "a paid mediated form of communication from an identifiable source designed to persuade the receiver to take some action, now or in the future". Since then, the nature of advertising and the different forms of engagement have, of course, evolved with changing technology, economic development, and shifting societal and cultural values. Today, it can be argued that advertising is not only about paid media, that is does not always seek to persuade audiences, and that the source need be neither identifiable nor non-personal. 2. Sales promotion: offer a direct inducement or an incentive to encourage customers to buy an offering. These inducements can be targeted at consumers, distributors, agents, and members of the sales force. Sales promotions are concerned with offering customers additional value to induce an immediate sale. 3. Public relations: is used to influence the way in which an organisation is perceived by various groups of stakeholders, such as employees, the public, supplying organisations, and the media. These type of message are low cost and are perceived to be extremely credible. Public relations attempts to integrate its own policies with the interests of stakeholders, and it formulates and executes a programme of action to develop mutual goodwill and understanding. Different types of PR can be identified, but the main approach is referred to as "media relations" and consists of press releases, conferences, and events. 4. Direct marketing: The primary role of direct marketing is to drive a response and shape the behaviour of the target audience with regard to a brand. This is achieved by sending personalised and customised messages, often requesting a "call to action", designed to provoke a change in the audience's behaviour. Direct marketing is used to create and sustain a personal and intermediary-free communication with customers, potential customers, and other significant stakeholders. In most cases, this is a media-based activity and offer great scope for the collection and utilisation of pertinent and measurable data. One of the key benefits of direct marketing is that there is limited communication wastage - unlike advertising, whereby messages often reach some people who are not targets and are unlikely to be involved with the brand. 5. Personal selling: involves interpersonal communication through which information is provided, positive feelings developed, and behaviour stimulated. Personal selling is an activity undertaken by an individual representing an organisation, or collectively in the form of a sales force. It is a highly potent form of communication simply because messages can be adapted to meet the requirements of both parties. What is clear is that the nature, configuration, and use of what was once called the promotional mix have changed. No longer can the traditional groupings of tools be assumed to be the most effective forms of communication; the role of the media in the communication process is now much more significant than it was previously. The arrival and development of digital media expands opportunities for people and organisations to converse globally, personally, more speedily, and factually. Word-of-mouth communication also plays a more significant part in contemporary communications, especially because communications-literate consumer are increasingly sceptical of the messages conveyed by many organisations.

Why does "not all digital marketing communications fit with a traditional definition of advertising as paid placements"?

Because consumers are actively searching for and sharing information on the Internet, marketers need to make sure that information is easily accessed and shred, meaning that the brand's own online channels and the potential of its content to be passed on is becoming increasingly important. The borders between paid-for (advertising) media, earned media (publicity and word-of-mouth), and own media (e.g. websites, profiles on social media, emails) are blurry and hard to establish.

Why should digital marketing be considered more widely? What characterises digitally advanced companies?

Because digital marketing does not exist in a silo, independent of other marketing principles (for example pricing, distribution, or customer service). Integrating digital marketing into marketing research, marketing communications plans, and channel distribution plans requires detailed consideration if it is to be effective, not at least because the digital environment is not simply another channel, but a channel in which consumers often behave differently. The following key characteristics identify digitally advanced companies: - Strategy: digital initiatives are fully integrated into their strategic planning process, not added as a bolt-on. - Culture: instead of waiting for perfection, digital leaders adopt a fail-fast-forward mindset. They push a simple product into the market, gauge interest, collect customer feedback, and iterate. There is an emphasis on failing often and succeeding early. - Organisation: leading companies use non-traditional organisational structures, digital talent acquisition, and management to execute their digital vision Sixty-five percent of digital leaders have an aggregated digital budget and sufficient budget allocation to scale their digital initiatives. - Capabilities: digital leader make decisions based on data and build capabilities that connect people, processes, and technology across all channels that engage with consumers.

What does "channel conflict" imply in the context of managing relationships in the channel?

Channel conflict can be defined as: the perception on the part of a channel member that its goals attainment is being impeded by another, with stress or tension the result. Because channels are open social systems, some level of conflict between channel members is inevitable. Conflict follows a breakdown in the levels of cooperation between channel partners and may well affect channel performance. Channel conflict may involve intermediaries on the same level (tier), for example between retailers or between agents (horizontal conflict). It may also occur between members on different levels (tiers), for example, involving a producer, wholesaler, and a retailer (vertical conflict).

What does "customer engagement" imply?

Customer engagement can be defined as the level of customers' contribution to the company through both direct and indirect activities. Direct contributions refer to product or service purchases; indirect contributions comprise a range of activities that are crucial for firms, especially in today's interconnected word - that is, referring customers to the firm, influencing customers through positive online and offline activities, and offering feedback to the firm so that it can continuously improve its products.

What type of intermediaries are there?

Each fulfilling different roles and providing various forms of specialisation. Some of the more common ones are as follows: - Agent/broker: acts. as the intermediary between the seller of an offering and buyers, bringing them together without taking ownership of the offering. These intermediaries have the legal authority to act on behalf of the manufacturer and typically make morey though commissions. - Merchant: undertakes the same actions as an agent, but takes ownership of a product. - Distributors/dealers: distribute the product. They offer value though services associated with selling inventory, credit, and aftersales service. - Franchisee: holds a contract to supply and market an offering to the requirements or blue-print of the franchisor, the owner of the original offering. The contract might cover many aspects of the design of the offering, such as marketing, product assortment, or service delivery. Franchise agreements are also used: - - Wholesaler: stocks goods before the next level of distribution and takes both legal title ad physical possession of the goods. In consumer markets, wholesalers do not usually deal with the consumer, but with other intermediaries. In B2B markets, sales are made directly to consumers. -- Retailers: sell directly to consumers and may purchase directly from manufacturers or deal with wholesalers. this is dependent on their purchasing power and the volume purchased. -- Intermediaries: are Internet-based organisations, such as Google and Pricerunner, designed to provide information to channel members, including end users.

What can be said about "email marketing communications"?

Email is one of the most frequently used digital marketing tools. Email, when used properly, goes beyond simply sending a sales message; it also helps to create trust, retain customer, build customer referral, and generate revenues. The communicator sends the message only to those who have agreed to receive messages. Such permission-based email marketing is a highly-cost effective form of digital marketing. As a marketing tool, it is easy to use and costs little to send. However, costs can be higher when personalising messages and where a database must be developed or purchased. Nevertheless, email can reach millions of willing prospects within minutes. In designing a successful email campaign, marketers need to think carefully about the target audience and the willingness to receive emails. It will be good practice to allow list members to choose what type of email offerings they are interested receiving (e.g. newsletters, discount offers, and specific updates), and, as far as possible, emails should be personalised. Using an email system that allows tracking and reporting on all elements of the campaign (including opens, clicks, pass along, unsubscribe, and bounce-backs) allows marketers to closely test and monitor different email marketing strategies in terms of when and how often to send them, as well as what to offer, what to write, and what to highlight. This insights from such data-mining exercises can be invaluable.

How can "experience quality" be defined and what five dimensions are associated with outstanding customer experience?

Experience quality can be conceptualised as a customer's emotional judgement about their total experience and they identify five dimensions for the construct: the physical surroundings; the service providers; other customers; customers' companions; and the customers themselves. There are five dimensions associated with outstanding customer experience. For these authors, however, these dimensions are: sensory experience (feel), affective experience (sense); creative cognitive experience (think); physical experience, behaviours and lifestyles (act); and social identity experience (relate).

What do the following promotional methods imply? Field marketing; exhibitions; and viral marketing?

Field marketing: is about providing support for the sales force and merchandising personnel. One of the tasks is concerned with getting free samples of a product into the hands of potential customer; another is to create an interaction between the brand and a new customer; yet another is to create a personal and memorable brand experience for potential customers. Exhibitions: Organisations benefit from meeting their current and potential customers, developing relationships, demonstrating products, building industry-wide credibility, placing and taking orders, generating leads, and gathering market information. Viral marketing: the unpaid peer-to-peer communication of often provocative content, originating from an identified sponsor, using the internet to persuade or influence an audience to pass along the content to others.

What are the differences between "sales" and "marketing"? Remember: marketing = "product pull" ; sales = "market push"

First, marketing tends towards long-term satisfaction of customer needs; part of the design and development of customer value processes. Sales tends towards short-term satisfaction of customer needs; part of the value delivery process. Second, marketing tends towards greater customer input into design of offering (co-creation). Sales tends towards lesser customer input into design of offering. Finally, marketing tends towards high focus on stimulation of demand. Sales tends towards low focus on stimulation of demand; more focused on meeting existing demand.

In which ways have the ideas about competitive strategy developed?

Ideas about strategy have developed from those based on competition through attack and defence strategies to a perspective based on the idea that customer value can be increased by means of cooperation. By working cooperatively with other companies and their brands, relationships can evolve. These in turn provide strong opportunities to add value by means of the differentiation of brands and the development of sustainable competitive advantage. Cooperative relationships within networks benefit participants through shared knowledge about offerings, markets, and competitors, can lead to improvements in product and brand performance, and help to develop stronger market positions, enabling more efficient use of resources. This all adds up to a unique form of differentiation that can be of significant value to customers. Outsourcing and renewable purchasing agreements are relatively short-term cooperative arrangements. Information sharing can be seen in agreements to distribute offerings; licensing and technological collaboration represents resource and asset sharing; cooperation based on share ownership is normally seen in merges and acquisition (M&A) activity, which has a long-term perspective. All organisations in a cooperative arrangement - sometimes called network alliances - have an advantage over their rival organisations outside an alliance. However, not all alliances and mergers are successful. At a marketing level, alliances can be developed with key distributors and retailers to control the distribution channel. Relationships with prominent or geographically important dealers provide opportunities for exclusive distribution to reach target markets. Relationships can also be developed with strategically important customers (key accounts). In many markets, there is little difference between offerings, so organisations try to differentiate themselves based on the services they provide to their customers both before and after a purchase has been made. Relationships between customer and supplier can be strengthened through the provision of services, because the service is perceived to offer added value. Relationships can also be developed with consumers. Marketing strategies designed to retain customers often use loyalty schemes and customer retention programmes. Relationships can also develop through branding. Some consumers develop a strong affinity with a brand to the extent that they want to share their relationship with others and talk openly about their positive brand experiences (word of mouth). Relationships with suppliers are important simply because competitive advantages can be developed through cost reduction, speed to market, and product differentiation. Marketing strategy should be founded on developing customer value, and this can be achieved trough a strategy based on building cooperative relationships with a network of suppliers, customers, distributors, and other strategically relevant stakeholders. The centrality of cooperation and relationships within marketing has become an important concept for both organisations and marketing academics. Marketing has evolved from ideas that are based solely around the 4Ps; now, marketers think and act in terms of the different types of relationship that an organisation has and try to find ways of improving the right relationships with the right customers. This is referred to as relationship marketing.

What is the second stage of the consumer proposition acquisition process?

Information gathering: We seek alternative ways of solving our problems. Our search for solution may be active - that is, an overt search - or passive; we are open to ways of solving our problem, but we are not actively looking for information to help us. The search for information may be internal - that is, we might consider what we already know about the problem and the offerings we might buy to solve our problem. Alternatively, it might be external - that is, we realise that we do not know enough about our problem and so we seek advice or supplementary information. At this stage, we build awareness by increasing our knowledge of both an offering and the competitors making that offering available.

What are "key performance indicators" (KPIs)? What are the benefits and limitations of the ten key marketing performance metrics?

KPIs is a set of quantifiable measures used to determine and compare an organisation's achievements in terms of meeting its strategic and operational goals. 1. Profit/Profitability: - Main key performance measure - The approach indicates the "bottom line" However, the problem with profit/profitability is that its link with marketing activity is not always clear. The process required to determine the link requires considerable input from the finance department to measure the contributions individual offerings make towards the overall profit levels of a business. Therefore it can be difficult to determine whether the marketing itself has led to improved levels of profitability or some other factor was responsible. Finally, we might have a very profitable business operating in the short term, for example with customers buying more of a low-value overpriced offering, but in the long term customers will detect and leave the business once they realise that they can either get better value elsewhere or they perceive manipulative intent on the part of the company from which they are buying. 2. Sales: - Sales value is determined by measuring how many units of an offering are sold, then multiplying this by the average unit price, and sales volume is calculated simply by determining how many units of an offering have been sold. - Sales values and volumes can be measured directly against individual offerings; they are also easier to determine. - Sales values and volumes may be linked to geographical sales territories. - Sales values may hide the fact that an offering is being sold at unprofitable levels. 3. Operating Margin (return on sales): - Measures performance based on the operating profit margins one can achieve in a particular industry. - Determined by dividing operating income by net sales. - Does not always provide an indication of how much the customer is actually willing to pay. 4. Brand awareness: - Useful metric for determining whether marketing communications activity is having the required impact on customer recognition. - Generally true that the more a target market recognises a brand, the more likely they are to become purchasers of it. - While a customer may be aware of a brand, it does not mean they will buy that brand; therefore awareness may not necessarily build sales. 5. Market share: - Useful for determining a company's performance within the marketplace, particularly when measured relative to the market leader, because it gives an indication of how competitive a company is. - Determined by measuring a company's sales revenues, incorporating the sales of all companies within the industry itself, as a proportion of total industry sales revenues. - Relative market share is determined by measuring a company's market share against the market share of the market leader, or its nearest competitor. - Nevertheless, a company's market share, as determined by the value of the sales, is not necessarily indicative of a profitable company. 6. Number of New Products: - Most companies pride themselves on their capacity to innovate. In many industries, innovating new offerings is vital for the prosperity of the industry. - Nevertheless simply developing new offerings without measuring or predicting their impact on the sales of existing offerings can be problematic, because the new offering can cannibalise the existing sales without adding new business. In addition, this strategy may cause customer confusion as customers try to determine what they want from a variety of offers. 7. Relative Price: - The price of a company's offerings can be indicative of how much it is valued in the marketplace. - Relative price is determined by measuring the price of the company's offering against that of the offering of the market leading company, or the nearest competitor. - There is increasing recognition that a company that can charge a price premium vis-à-vis its competitors if it has a competitive advantage over them. - The problem with measuring marketing effectiveness using relative price only is that a company may obtain only a proportion of the total revenue possible in a marketplace if the price it charges is too high. In other words, a higher relative price may lead to a smaller market share if customers do not value the company's offering more than those of its competitors. 8. Customer Satisfaction: - Many companies operate on the principle of satisfying their customers. In the past, this meant measuring levels of service quality to determine whether companies providing the level of quality of service that customers expected. - Some companies measure the churn rate in the industry, that is, the proportion of disaffected customers as a proportion of new customers. - Some companies attempt to go beyond simply satisfying customers, aiming to empower their employees to provide a high level of individual and personal help for customers. - Nevertheless, businesses may spend too much time and effort serving customers who are neither profitable nor offer the most profit potential in the future. Generating high levels of customer satisfaction or delight may ultimately reduce shareholder value because the costs involved produce lower levels of profitability. 9. Customer Advocacy: - According to Reichheld (2003), successful firms create exceptional growth by nurturing loyal customers. They invest huge amount of time and effort in measuring customer satisfaction. However, most of the indices they have previously employed are complex, produce unclear results, and do not connect to profits or growth. - The net promoter score (NPS) was developed based on measuring how likely it is that a customer would recommend a firm to a friend or a colleague. The more promoters a company can gain, the bigger its growth - that is, the inclination to promote related to a strong degree of loyalty and growth. 10. Distribution/ Availability: - The extent to which an offering is distributed within the marketplace can be an important marketing metric. - The quantity of locations within which a product is sold matter less in for some businesses than the quality of those locations, and vice versa. - In a wide range of diverse industry sectors, distribution is critical so that customers can readily purchase a company's offerings. For this reason, companies set up sophisticated systems to link their customer's purchasing needs with their own purchasing and distribution needs.

What is the "benefits sought" approach?

The benefits sought approach is based on the principle that we should provide customers with exactly what they want, based on the benefits they derive from using a particular proposition.

What are "segmentation bases"?

To segment consumer markets, we use market information based around key customer- , product- , or situation-related criteria. These are classified as segmentation bases and include: - Profile criteria: (who are my market, and how does it behave?); demographic; socio-economic; geographic. - Behavioural criteria: (where, when, and how does my market behave?); purchase/transaction; consumption/usage; media usage; technology usage. - Psychological criteria (why does my market behave that way?); lifestyle; personality; perceptions; attitudes; motives; benefits sought. - Contact data

What are some pricing tactics that can be adopted in a B2B setting?

- Geographical pricing: sees prices based on customer location. - Negotiated pricing: sees prices set according to specific agreements between a company and its clients or customer. This approach occurs where a sale is complex and consultative, although sales representatives should not concede on price too quickly before properly understanding a client's needs. - Discount pricing: sees companies reducing the price on the basis that a customer commits to buying a large volume of that offering now or in the future, or is prepared to pay for it quickly. - Value-in-use pricing: focuses attention on customer perceptions of the attributes of offerings and away from cost-oriented approaches. It prices offerings based on what the customers prepared to pay for the individual benefits received from that proposition. - Relationship pricing: seeks to understand customers' needs before pricing the offering around those needs to generate a long-term relationship. - Pay-what-you-want pricing - Transfer pricing: occurs in large organisations where considerable internal dealing between different company divisions occurs, often across national boundaries. Prices may be set at commercial rates, on the basis of negotiated prices between divisions, or using a cost-based approach, depending on whether the division is a cost or profit centre. - Economic value to the customer pricing: a company prices an offering according to its perceived value by means of comparison with a reference or market-leading offering, takin into consideration not only the actual purchase price of the offering, but also the start-up and post-purchase costs, to give an overall indication of how much better its pricing structure is compared with that of a competitor. - Tendering and bid pricing: organisations invite other organisations to bid for the right to deliver a particular job or task (a tender) and to name their own price.

What building blocks does the "brand pyramid" consist of?

1. Brand salience: how easily and often customers think of a certain product brand when thinking about that respective product category or when shopping. 2. Brand performance: how well customers believe the product brand does what it is supposed to. 3. Brand imagery: describes the extrinsic properties of the product, and the level to which these satisfy customers' psychological needs. 4. Brand judgements: focus on customers' own personal opinions and evaluations of the product. 5. Brand feelings: refers to customers' own personal opinions and evaluations about the shampoo. 6. Brand resonance: speaks of the nature of the relationship that customers have with the product brand and the extent to which they feel loyal to the brand. Brand resonance is most likely to result when marketers create proper salience, as well as breadth and dept awareness.

What are the six types of media?

1. Broadcast: Advertisers can use broadcast media because they can reach mass audiences with their messages at a relatively low cost per target reached. Both television and media have the potential to tell stories and to appeal to people's emotions when transmitting a message. 2. Print: Print is very effective at delivering messages to target audiences because it allows explanation in a way that is not possible with most other media. 3. Out-of-Home: The key characteristic associated with OOH media is that they are observed by their target audiences at locations away from home and they are normally used to support messages that are transmitted through primary media - namely, broadcast and print. 4. Digital: Digital media enable two-way interactive communication, with information flowing back to the source and again to the receiver, as each participant adapts their message to meet the requirements of their audience. These interactions are conducted at high speed and low cost, and usually with great clarity. People drive these interactions at a speed that is convenient to them; they are not driven by others. Space (or time) within traditional media is limited, so costs rise as demand for the limited space or time increases. Conversely, because space is unlimited on the Internet, costs per contact fall as more visitors are received. 5. In-store: The primary objective of using in-store media is to get the attention of shoppers and to stimulate them to make purchases. The content of messages can be controlled easily by both retailers and manufacturers. In addition, the timing and the exact placement of in-store messages can be equally well controlled. 6. Other: Cinema/ambient (sponsorship, brand placement e.g.).

What are six pricing tactics?

1. List pricing. 2. Loss-leader pricing. 3. Promotional pricing. 4. Segmentation pricing. 5. Customer-centric pricing. 6. Pay-what-you-want approach to pricing.

What are the three main types of brand?

1. Manufacturer brands: "a brand created and sustained by a producer to encourage consumer awareness, recognition, and purchase." In many markets and especially the fast-moving consumer goods (FMCG) sector, retailers influence the way in which a product is displayed and presented to customers. As a result, manufacturers try to create brand recognition and name recall by means of their marketing activities with end users. The goals is to help customers to identify the producer of a particular brand at the point of purchase. For example, persil, Heinz, Cadbury, and Coca-Cola are strong manufacturer brands; they are promoted heavily, and customers develop preferences based on performance, experience, communications, and availability. 2. Distributor Brands: "a brand developed by a wholesaler, distributor, dealer, or retailer within the distribution channel." The various organisations that make up the marketing channel often choose to create a distinct identity for themselves. The private table strategy potential offers advantages to the manufacturer, which can use excess capacity to manufacture such brands, as well as to retailers, who can earn a higher margin than they can with manufacturer's branded goods and, at the same time, develop strong store images. 3. Generic Brands: "brands sold without any promotional materials or any means of identifying the company."

What are the two main types of exchanges that can occur between a pair of buyers and sellers?

1. Market exchanges: occur when there is no prior history of exchange and no future exchanges are expected between a buyer and a seller. In these transactions, the primary focus is on the product and price. Often referred to as transactional marketing, the 4Ps approach to the marketing mix variables is used to guide and construct transactional behaviour. Buyers are considered to be passive and sellers, active, in these short-term exchanges. 2. Collaborative exchanges: Based on the notion that buyers are active problem-solvers seeking solutions that are both efficient and effective. Research into business markets identified that, in practice, purchasing is not about a single discrete event; rather, it is about a stream of activities between two organisations. This framed the relationship marketing school of thought, in which the buyer-seller relationship was the central element of analysis. This meant that the focus was no longer the product, or even the individual buying or selling firm, but the relationship and its particular characteristics over time. Therefore relationship marketing is based on the principle that there is a history of exchanges and an expectation that there will be exchanges in the future. Furthermore, the perspective is long term, envisaging a form of loyalty or continued attachment by the buyer to the seller. Price, as the key controlling mechanism, is replaced by customer service and quality interaction between the two organisations. The exchange is termed collaborative because the focus is on both organisations seeking to achieve their goals in a mutually rewarding way and not at the expense of one another.

How does channels help to reduce uncertainty?

1. Reducing complexity: The impact of intermediaries in channel exchanges is that the number of transactions falls drastically. The fall in the number of transactions indicates not only that are costs reduced, but also that producers are better placed to redirect their attention towards the needs of intermediaries. This allows them to focus on their core activities - that is, production or manufacturing. 2. Increasing value and competitive advantage: By using intermediaries, producers can reduce purchase risk - that is, the uncertainty that customers might reject the offering. Intermediaries, rather than producers, have the skills and core competencies necessary to meet end users' requirements, e.g. retailing. By improving the overall value that customers perceive in an offering relative to competing products and customer experience, it is possible to develop competitive advantage. 3. Routinisation: Performance risk can be reduced by improving transaction efficiency. Standardising, or "routinising", the transaction process - perhaps by regulating order sizes, automating operations, and managing delivery cycles and payment frequencies - allows distribution costs to be reduced. 4. Specialisation: By providing specialist training services, maintenance, installation, bespoke deliveries, or credit facilities, intermediaries can develop a service that has real value to other channel members or end users. Value can also be improved for customers by helping them to locate the offerings they want. Intermediaries can provide these specialist resources, whereas producers are not normally interested to do so. Utility-based benefits that intermediaries provide includes: - Sorting and smoothing. - Place utility. - Time utility. - Ownership utility. - Information utility. There are some disadvantages to the use of intermediaries. E.g., as the number of intermediaries in a channel increases, a lack of product control can develop. Some manufacturers are unable to influence intermediaries in terms of in-store merchandising, placement, and even pricing. For many manufacturers and producers, intermediaries often become a market in their own right, and developing and sustaining a relationship with them can require considerable time, money, and personnel.

Zeithaml (1981) developed a framework categorising different services, which, in turn, influence the degree to which market offerings van be evaluated and identified three main properties, as follows:

1. Search properties: are those elements that help customers to evaluate an offering prior to purchase. Physical products tend to have high search attributes, which serve to reduce customer risk and increase purchase confidence. 2. Experience properties: do no enable evaluation prior to purchase. The service can be explained, and it can be illustrated, but only through the experience of the performance. 3. Credence properties: relate to those service characteristics that customer find difficult to evaluate even after purchase and consumption (complex surgery and legal services e.g.).

1. What is service quality? 2. To help organisations to manage and provide a consistent level of service, various models have been proposed. Primarily these have been based on...:

1. Service quality: the extent to which customer expectations of a service are met in an actual service encounter. So if the perceived service meets, or even exceeds, expectations, customers are deemed to be satisfied and are much more likely to return at some point in the future. However, if the perceived service fall below what was expected, they are much more likely to feel disappointed and are unlikely to return. 2. Performance measures: this approach simply asks customers to rate the performance of a service encounter. Disconfirmation: this approach is based on the difference between what is expected from a service and what is delivered, as perceived by the customer. Importance- performance: this seeks to compare the performance of the different elements that make up a service with the customer's perception of the relative importance of these elements.

What are the three main models of how communication works?

1. The linear model of communication: The linear model is regarded as the basic model of mass communications. The model can be broken down into a number of phases, each of which has distinct characteristics. The linear model emphasises that each phase occurs in a particular sequence - a linear progression - in which information, ideas, attitudes, or emotions are transmitted from one person or group to another by means of symbols. The model and its components are straightforward, but it is the quality of the linkages between the various elements in the process that determines whether the communication will be successful. One of the problems associated with the linear model of communications is that it ignores the impact that other people can have on the communication process. People are not passive; they actively use information - and the views and actions of other people can impact on the way in which information is sent, received, processed and given meaning. One of the other difficulties with the linear model is that it is based on communication through mass media. 2. Two-step model of communication: The two-step model compensates for the linear, or one-step, model because it recognises the importance of personal influences when information and persuading audiences to think or behave in particular ways. This model depicts information flowing via various media channels to particular types of person (opinion leader/ opinion former) to whom other members of the audience refer for information and guidance. 3. The interaction model of communications: The interaction model of communication is similar to the two-step model, with one important difference: in this model, the parties are seen to interact among themselves and communication flows among all the members in what is regarded as a communication network. Mass media are therefore not the only source of communication. Unlike the linear model, in which messages flow from the source to the receiver through a channel, the interaction model recognises that messages can flow through various channels, and that people can influence the direction and impact of a message. It is not necessarily one-way, but interactive communication that typifies much of contemporary communications.

What is a "brand"? What makes a brand successful?

A multidimensional and emotional construct, with many definitions; typically refers to the added value a product or service is granted in consumers' minds when identified as different from other products. A brand can be distinguished from its proposition or unbranded commodity counterparts by the perceptions and feelings that consumers have about its attributes and performance. Ultimately, a brand resides in the mind of the consumer. Brands are products and services that have added value. This value has been deliberately designed and presented to augment a product with associations that are recognised by, and are meaningful to, their customers. Although marketing managers have to create, sustain, protect, and develop the identity of the brands for which they are responsible, it is customer perception, the use of the various senses that help to fashion images of these brands, and the meaning and value that customers give to the brand that are important. Thus both managers and customers are involved in the branding process. A brand comprises both brand awareness (identification) and brand attitude or brand knowledge (differentiation) as defining elements. The latter is also referred to in terms of brand associations. Brands have characters - personalities, even, that set them apart from the competition in the minds of consumers. To develop character, it is important to understand that brands are constructed of two main types of attribute: intrinsic and extrinsic: - Intrinsic attributes: are the functional characteristics of a proposition, such as its shape, performance, and physical capacity. If any of these intrinsic attributes were to be changed, this would directly alter the proposition. - Extrinsic attributes: refer to those elements that, if changed, do not alter the material functioning and performance of the proposition itself. These include devices such as the brand name, marketing communications, packaging, price, and mechanisms that enable consumers to form associations that give meaning to the brand. Buyers often use the extrinsic attributes to help them to distinguish one bran from another, because, in certain categories, it is difficult for them to make decisions based on the intrinsic attributes alone. Successful brands such as Aston Martin, Apple, and Airbnb represent customer promises and shape their expectations. When expectations and experiences of the brand in use matches the promise, brand performance is accomplished. Successful brands tend to be innovators and deliver consistently on their promises. This serves to reinforce the positioning and credibility of the promise. Successful brands can therefore be said to capture three core brand elements: promises, positioning, and performance (the 3 BPs). At the core of this concept is communication, which enables a promise to be known (brand awareness), positions the brand correctly (brand attitude), and delivers brand performance (brand response). And increasingly consumers are actively participating in the branding process by co-creating meaning, for example through social media.

What role does "customer satisfaction" play in relationship marketing?

A natural outcome from building trust and developing commitment is the establishment of customer satisfaction. This is seen as important because satisfaction is thought to be positively related to customer retention, which in turn leads to an improved return on investment and hence profitability. Unsurprisingly, many organisations seek to improve levels of customer satisfaction, with the intention of strengthening customer relationships and riving higher levels of retention and loyalty. So the simple equation is build trust, drive satisfaction, improve retention, and increase profits. However, customer satisfaction is not driven by trust alone; customer expectations also play an important role and help to shape a customer's perception of product or service performance. Customers compare performance against their expectations and, through this process, feel a sense of customer satisfaction or dissatisfaction. More recent ideas suggest that the perceived value of a relationship can be more important than the trust when building customer satisfaction. The following elements contribute to customer satisfaction and are therefore within the marketer's purview to exploit in pursuit of building customer loyalty: - the core product or service: the bundle of attributes, features, and benefits that must reach competitive levels if a relationship is to develop. - support services and systems: the quality of services and systems used to support the core product or service. - technical performance: the synchronisation of the core product or service with the support infrastructure to deliver on the promise. - the elects of customer interaction: the quality of customer care demonstrated through face-to-face and technology- mediated communications. - the affective dimensions of services: the subtle and non-core interactions that say something about hw the organisation feel about the customer.

What is a service process? If processes are an integral part of the operations performed by service organisations, in the general sense, what are they processing? Lovelock, Vandermerwe, and Lewis (1999) present a categorisation into four different processes - which?

A service process is a series of sequential actions that lead to the delivery of a predetermined service. 1. People processing: People have to physically present themselves so that they become immersed within the service process. This involves spending varying amount of time actively cooperating with the service operation. From a marketing perspective, consideration of the process and the outcomes arising from participation in the service process can lead to ideas about what benefits are being created and what non-financial costs are incurred as a result of the service operation. 2. Possession processing: People will either have to take an item to the service provider or invite someone in to undertake the necessary work. In possession processing, the level of customer involvement is limited compared with that in people processing. This detachment from the service enables people to focus on other tasks. The key difference here is that the quality of the service is not dependent on the presence of the owner or representative of the possession while the service operation takes place. 3. Mental stimulus processing: Mental stimulus processing tries to shape attitudes and behaviour. To achieve this, these services have to be oriented to people's minds and hence phrase mental stimulus processing. Examples of these types of service include education, entertainment, professional advice, and new. In all of these, people have to become involved mentally in the service interaction and give their time if they are to experience the benefits of this type of service. 4. Information processing: Concerns the huge arena of information processing, the most intangible of all the services. Transformed by advances in technology in general, and computers in particular, information processing has become quicker, more accurate, and more frequent. The use of technology is important, but we should not exclude people, because individuals have huge capacity to process information. One key issue that organisations need to consider concerns the degree to which employees should become involved in the delivery of information processing services.

What is the implication of the commitment-trust model of relationship marketing?

According to the commitment-trust model, the greater the losses anticipated through the termination of a relationship, the greater the commitment expressed by the exchange partners. When relationship partners share similar values, commitment increases. Building a relationship based on trust and commitment can givers to a number of benefits. Some of these are developing a set of shared values, reducing cots when the relationship finishes, and increasing profitability as a greater number of customers are retained because of the inherent value and satisfaction they experience. Cooperation arises from a relationship driven by high levels of both trust and commitment.

What does "automation", "convergence", and "ad avoidance" imply in the context of the changing marketing communications landscape?

Automation: The automation of the media planning, buying, and selling process is referred to as programmatic. Programmatic is about systems that automatically buy audiences, wherever they appear, according to particular predetermined parameters. Convergence: Convergence means a "bringing together" - in this case, of media and various technologies. This movement represents a threat to traditional media owners. For example, newspaper publishers experience declining readership as people get their news at different times of the day from a variety of digital news platforms through various devices. In turn, this can be seen as an opportunity by reformatting content and distributing it across different digital platforms, and so attracting different advertisers. Ad avoidance: The changes in the way in which ads are presented through the media, and the rise of digital media in particular, has led to a increased use of ad-blockers. This raises questions about the longer-term effectiveness of online and mobile advertising, about the role of content in apps, and about privacy, as well as the ethics and morality of advertising to audiences who are largely disinclined to engage with advertising.

What does "Big Data" refer to? The different sources employed in big data analysis can be divided into five categories - which?

Big data is the systematic gathering and interpretation of high-volume, high-velocity, and/or high-variety information using cost-effective innovative forms of information processing to enable enhanced insight, decision-making, and process automation. It thus refers to a more comprehensive set of data than that traditionally used to provide marketing information and customer insights. The notion of "big" refers primarily to the volume, velocity, and variety of data used. "Volume" denotes the sheer amount of information used. "Velocity refers to the fact that data is recorded in real time. "Variety" denotes that big data analytics combines data from several different sources. The different sources employed in big data analysis can be divided into five categories: 1. Public data 2. Private data 3. Data exhaust; refers to data that is passively collected - that is, non-core data with limited or zero value to the original data-collection partner. When individuals adopt and use new technologies (for example smartphones), they generate ambient data as by-products of their everyday activities. These data can be recombined with other data sources to create new insights. Another source of data exhaust is information-seeking behaviour, such as online searchers and call centre calls, which can be used to infer people's needs, desires, or intentions. 4. Community data; refers to distilled unstructured data, for example consumer reviews on products or liking in social media, which is combined into dynamic networks that capture social trends. 5. Self-quantification data; is revealed when individuals use technology to quantify their personal actions and behaviours, for example through wristbands that monitor exercise and movement.

What are "brand associations"? What are "brand personalities"?

Brand associations are the physical and non-physical product attributes and benefits aligned with attitudes that consumers use to create an image of a brand. Clayton and Heo (2011) refer to brand image, perceived quality, and brand attitude as the main dimensions of brand associations. In fact, many brands are deliberately imbued with human characteristics, to the point at which they are identified as having brand personalities. Brand personalities are the associations and images that enable consumers to construe a psychosocial meaning associated with a particular brand. The development of brand personalities means that marketing managers can position their brands using emotional attributes and hence develop stronger consumer-brand relationships. Belk (1988) suggested that brands offer a means of self-expression, whether this is in terms of who they want to be (their desired self), who they strive to be (their ideal self), or who they think they should be (their ought self). Brands therefore provide a way in which individuals can indicate to others their preferred personality, as they relate to these "self" concepts. The emotional and symbolic approach is intended to provide consumers with additional reasons to engage with a brand beyond the normal characteristics a brand offers, which are often easily copied by competitors. To be able to measure brand personality, Acker developed the Brand Personality Scale, which consists of five main dimensions of psychosocial meaning. The dimensions are: - sincerity (wholesome, honest, down-to-earth) - excitement (exciting, imaginative, daring) - competence ( intelligent, confident) - sophistication (charming, glamorous, smooth) - ruggedness (strong, masculine)

In the context of managing marketing channels, what implication does the "channel intensity" have?

Channel coverage/intensity refers to the number and dispersion of outlets an end user can use to buy a particular offering. This decision concern the level of convenience customers expect and suppliers need to provide to be competitive. The wider the coverage, the greater the number of intermediaries, which leads to higher costs associated with the management control of intermediaries. A decision to introduce a new channel refers to the addition of a new set of internal or external channel entities to the firm's existence channel system. This could be a decision to establish its own retail stores or to provide an online e-commerce shopping facility. There are three levels of channel intensity: 1. Intensive distribution: involves placing an offering in as many outlets or locations as possible. It is used most commonly for offerings that consumers are unlikely to search for and which they purchase on the basis of convenience or impulse. Retailers have increased control over the extent to which distribution is intensive. 2. Selective distribution: occurs when a limited number of outlets are used. This is because, when customers are actively involved with a purchase and experience moderate to high levels of perceived risk, they are prepared to seek out appropriate suppliers. Producers determine and control which intermediaries are to deliver the required products and level of services. 3. Exclusive distribution: occurs when intermediaries are given exclusive rights to market an offering within a defined "territory". This is useful where significant support is required from the intermediary, and hence the exclusivity is "payback" for their investment and support. The threat of price competition is also diminished, because it would be inconsistent with the positioning strategy these offerings normally adopt. The decision about the number of intermediaries is often driven by cost considerations. Disintermediation: concerns a reduction in the number or strength of intermediaries required in a marketing channel. More specifically, it refers to a situation in which market intermediaries are either displaced or eliminated, and manufacturers and buyers trade directly with each there without the presence of agents. Re-intermediation: the introduction of additional intermediaries into the distribution channel. Although there are significant numbers of customers who like buying directly, many customers value and prefer the role of traditional intermediaries for certain purchases.

What is the significance of brand names?

Choosing a name for a brand is a critical foundation stone, because should ideally allow the brand to be: - easily recalled, spelled, and spoken; - strategically consisted with the organisation's branding policies; - indicative of the offerings major benefits and characteristics; - distinctive; - meaningful to the customer, and - capable of registration and protection.

What are the four main pricing strategies (how companies set prices in the short term)?

Companies tend to establish their pricing strategy based around what their pricing objectives are. The four main pricing strategies are: 1. Premium pricing: focuses on pricing an offering to indicate its distinctiveness in the marketplace. 2. Penetration pricing: refers to setting the price low relative to the competition to gain market share. This strategy is frequently used for new proposition launches. 3. Economy pricing: involves setting the prices at a bare minimum to attract price-sensitive customers. 4. Price skimming: occurs when the price is initially set high and then lowered in sequential septs. This strategy is frequently used for the launch of new offerings.

Why do consumers like brands? Why do manufacturers and retailers use brands?

Consumers like brands because they: 1. Help people identify their preferred offerings. 2. Reduce levels of perceived risk and, in doing so, improve quality of the shopping experience: - Risks include financial risks, social risks, or functional risks. Strong brands encapsulate a range of values that communicate safety and purchase security. 3. Help people to gauge the quality of the product, service, or experience: - Helps consumers to save shopping time and, again, helps to reduce the amount of risk they experience. --> 4. Reduce the amount of time that must be spent making proposition-based decisions and hence decrease the time that must be spent shopping around. 5. Provide psychological reassurance or rewards, especially for offerings bought on a occasional basis: - Perhaps above all other factors, brands help consumers to develop relationships based on respect and trust. Strong brands are normally well trusted and creating trust is important, because it enables consumers to buy with confidence. 6. Inform consumers about the source of an offering (country or company). Manufacturers and retailers use brands because they: - can increase the financial valuation of companies - enable premium pricing - help to differentiate one propositions from competitive offerings - can deter competitors from entering the market - encourage cross-selling to other brands owned by the manufacturer - help to develop customer trust, loyalty/rentention, and repeat-purchase buyer behaviour - help in the development and use of integrated marketing communications - contribute to corporate identity programmes - proved some legal protection. The greater the number of product-based brands, the greater an organisation's motivation to develop a corporate brand. Organisations such as Aviva and Johnson & Johnson use an umbrella branding approach. This requires that they need invest heavily in only one brand, rather than in each and every product-based brand. This approach is not applicable to all sectors, although in B2B markets, in which there is product complexity, corporate branding is an effective way of communicating and focusing on a few core brand values.

What is "content marketing communications"?

Content marketing is an approach to marketing communication in which brands create and disseminate content to consumers with the intention that the content will generate interest, engage consumers, and influence behaviour. A lot of digital marketing communication activities rely on consumers actively deciding to take part in marketing. For example, search marketing requires consumers to actively click on a link and social media marketing relies on consumers actively negating content created by brands. This means that brand are under increasing pressure to create online content that consumers value; hence marketers are paying increasing attention to creating online content that can benefit their target audiences. The intention of content. marketing is to create content that has value for the receiver (for example by being useful, educational, or entertaining in and of itself), thereby pulling the consumer toward the brand.

What does "environmental scanning" refer to?

Environmental scanning is the process of gathering information about a company's external events and relationships to help top management in making decisions and developing a course of action. It is the internal communication of external information about issues that may potentially influence an organisation's decision-making process, focusing on the identification of emerging issues, situations, and potential threats in the external environment. The process by means of which companies scan the external environment typically involve three stages: 1. Data gathering; 2. Interpretation of the data gathered in a process of environmental interpretation or analysis; and 3. Strategy formulation.

In which way has the usage of commercial media changed?

For a long time, commercial media have been used to convey messages designed to develop consumers' attitudes and feelings towards brands. This is referred to as an attitudinal response and concerns building a brand over the longer term. Today, many messages are designed to provoke audiences into responding, either physically, cognitively, or emotionally. This is referred to as behavioural (direct) response, which concerns activation and is essentially a short-term activity. It therefore follows that attitude and behaviourally oriented communications require different media. Direct response media are characterised by the provision of a contact mechanism, such as a telephone number or web address, and increasingly through search activities on the Internet. These mechanisms enable receivers to respond to messages. Direct-response media also allow clients the opportunity to measure the volume, frequency, and value of audience responses. This enables them to determine which direct-response media work best and so helps them become more efficient, as well as more effective. One aspect that is crucial to the success of a direct-response campaign is not the number of responses, but the conversion of leads into sales. This means that the infrastructure to support these activities must be thought through and implemented; otherwise, the work and resources invested at the visible level will be wasted if customers cannot get the information they require when they respond. Those media with a broad reach, such as television, radio, OOH, and other traditional display media, as well as online display, are best for brand building. Those channels that enable tight targeting, such as search, telemarketing, email, and classified media, are more appropriate for short-term selling to narrow audiences. Extensive research shows that, on average, a 60:40 brand building- response split appears to maximise efficiency and effectiveness.

What is implied by "trust" in the context of relationship marketing?

Gambetta argues that trust is a means of reducing uncertainty so that effective relationships can develop. It often refers to ideas concerning risk, power and dependency. It emerges that B2B relationships are about the creation of mutual business advantage and the degree of confidence that one organisation has in another. Trust involves judgements about reliability and integrity, and is concerned with the degree of confidence that one party to a relationship has that another will fulfil its obligations and responsibilities. The presence of trust in a relationship is important because it reduces both the threat of opportunism and the possibility of conflict, which in turn increases the probability of buyer satisfaction. It has been claimed that the three major outcomes from the development of relationship trust are: 1. Satisfaction: defined as meeting customer expectations. 2. Perceived risk: concerned with the expectation of loss and therefore is tied closely to organisational performance. Trust that a seller will not take advantage of the imbalance of information between buyer and seller effectively reduces risk. 3. Continuity: Related to business volumes; trust is associated with continuity, and therefore, when present, it is indicative of long-term relationships.

How we perceive prices as customers can be summarised in a theoretical framework:

Here, price perceptions are based on a variety of antecedents. Once we see a price, we make a judgement. This judgement is a newly formed price perception, which affects our willingness to pay, which in turn affects our purchase behaviour. Price perception formation is a dynamic process. In other words, the framework indicated that once the purchase behaviour occurs, there is a recalibration of the customer's price perception because new purchase experiences and new information provide the stimulus for that recalibration. Therefore the process is cyclical.

What does "integrated marketing communications" (IMC) imply?

IMC is an approach associated with the coordinated development and delivery of a consistent marketing communications message(s) with a target audience. Integrated marketing communications can be considered both from a tactical and strategic perspective. The tactical perspective can be observed in the following levels of integration: - Advertising-led campaigns: are united by "look and feel". Referred to as the "matching luggage" concept, unification is often achieved visually through an icon (a celebrity, logo, or brand identifier) deployed across all tools and media. - Brand-led orchestration campaigns: are built on the tangible brand concept associated with a specific need-state, occasion, tightly defined target audience, or specific "point of market entry" upon which to focus the activity and the channel orchestration. - Participation-led integration campaigns: are based on the use of digital media designed to integrate brands into people's lives through conversation, and brand and audience interaction. At a strategic level, IMC can be considered to be a part of a firm's overall capacity, which contributes to brand performance. This is achieved by enabling the development and implementation of IMC campaigns that result in positive brand-related market performance and improved financial outcomes. (In the book) IMC is used to denote both a strategic and tactical approach to the planned management of an organisations communications. Integrated marketing communications require that organisations coordinate their various strategies, resources, and messages to enable meaningful engagement with audiences. The main purposes are to develop a clear positioning and to encourage stakeholder relationships that are of mutual value. One quite common use of an integrated approach can be seen in the use of the tools: rather than using advertising, PR, sales promotions, personal selling, and direct marketing separately, it is better to use them in a coordinated manner. So organisations often use advertising and sales promotion to create awareness, then involve PR to provoke media comment, and the reinforce these messages through direct marketing or personal selling. IMC has emerged for two main reasons: First, organisations began to realise that their customers were more likely to understand a single message, delivered through various sources, than to try to appreciate a series os different messages transmitted through different tools and a variety of media. The second reason concern costs: as organisations seek to lower their costs, it is becoming clear that it is far more cost-effective to send a single message, using a limited number of agencies and other resources, than to develop several messages through a number of different agencies.

What does development researchers posit that organisations need to do to improve the effectiveness if their service development processes?

If organisations are to improve the effectiveness of their service development processes, service development researchers point towards the need for them to: - leverage their employees' skills, resources, and experiences in the new service development process; - develop more customer-oriented services; and - undertake an interdisciplinary approach to service development, bringing together marketing, operations, and innovation staff.

Which pricing strategies does organisations tend to adopt when launching new offerings?

In the first approach, they charge a lower price in the hope of generating a large volume sales and recouping their research and development investment that way (hence penetration pricing). The market penetration pricing is used for fast-moving consumer goods and consumer durables, where the new offering introduced is not demonstrably different from existing formulations. With the second approach, they charge an initially high price and reduce the price over time, recouping the cost of the R&D investment from sales to the group of customers who are prepared to pay the higher price (hence price skimming the market). Skim pricing is a fairly standard approach for high-tech offerings or those offerings that require substantial R&D investment initially.

What does the composite approach to how marketing communications work imply?

In using marketing communications, it is not necessary to follow each component sequentially; rather, the focus can be on what the audience requires - whether that is a learning, feeling or acting component, as determined by the audience. In other words, for marketing communications to be audience-entered, we should develop campaigns based on the overriding need of the audience at any one time - that is, their need to learn, feel, or behave in particular ways. - Learn: when learning is the priority, the overall goals should be to inform or educate the target audience. If the offering is new, it will be important to make the target audience aware of the offering's existence and to inform them of the brand's key attributes and benefits. Other than making them aware of the offering's existence, additional tasks include showing the target audience the ways in which a brand is superior to competitive offerings. - Feel: once the audience is aware of a brand and knows something about how it might be useful to them, it is important that they develop a positive attitude towards the brand. This can be achieved by imbuing the brand with a set of emotional values that it is thought will appeal and be of interest to the audience. These values need to be repeated in subsequent communications to reinforce the brand attitudes. Indeed, for some people, advertising works only at this emotional level and the cognitive approach is irrelevant. Do: Most organisations find that, to be successful, they need to use a much broader set of tools and that the goal is to change the behaviour of the target audience. This behavioural change may be about getting people to buy the brand, but it may often be about motivating them to visit a website, call for a brochure, fill in an application form, or simply visit a shop and sample the brand free of cost and other risk. This behavioural change is also referred to as a call to action.

What are the three core brand strategies?

Individual branding: Individual branding requires each product offered by an organisation to be branded independently of all the others. One of the advantages of this approach is that it is easy to target specific segments and to enter new markets with separate names. If a brand fails or becomes subject to negative media attention, the other brands are not likely to be damaged. However, there is a high financial cost because each brand need to have its own promotional programme and associated support. Family branding: Family branding requires that all the products use the organisation's name, either entirely or in part. For these types of brand, promotional investment need not be as high. This is because there will always be a halo effect across all the brands when one is communicated and brand experience will stimulate word of mouth following usage. Corporate Branding: Many retail brands adopt a single umbrella brand, based on the name of the organisation. This name is then used at all locations, and is a way of identifying the brand and providing a form of consistency differentiation and a form of recognition, whether on the high street or online. Corporate branding strategies are also used extensively in business markets. One of the advantages of a single-name strategy approach is that promotional investments are limited to one brand. However, the risk is that damage to one offering or operational are can cause problems across the organisation.

What are the four main forms of message content that are not independent entities?

Informational messages: As a general, but not universal, guideline, when audiences experience high involvement, the emphasis of a message should be on the information content, with the key attributes and the associated benefits emphasised. Emotional messages: When audiences experience low involvement, messages should attempt to gain an emotional response. The presentation of messages should reflect the degree to which factual information or emotional content is required for a message to engage an audience - namely, to command attention and then be processed. User-generated content (UGC): Refers to all of the ways in which people make use of social media - that is, the various forms of media content that are publicly available and created by end users. There are three main elements that characterise UGC: 1. The content is freely accessible to the public. 2. The material demonstrates creativity. 3. The material should be amateur in nature, in the sense that is has not been created by an agency or professional organisation. The very nature of this type of content takes the communications initiative away from organisations. As a result, marketers are listening to and observing consumers through UGC. As a consequence, many are finding out the different meanings consumers attribute to brands, which helps the marketers with brand development and helps to reposition brands. Branded content: refers to the use of entertainment material that features a single company or brand. The recent growth in the use of branded content rests with a drive to realise the potential that "owned" media offers. Branded content can enable conversations, particularly in social media, and this serves to raise a brand's profile and its credibility.

What does a "life-stage analysis" imply?

Life-stage analysis based on the principle that people need different products and services at different stages in their lives. One moderns lifecycle classification - that is, Target Group Index (TGI) from Kantar Media - classifies 12 or 13 life-stage groups based on age, marital status, household composition, and children, for example whether a person has children and the age(s) of the child(ten).

What is "the services marketing triangle"?

Many organisations recognise the importance and complexities associated with the marketing or services. As a result, they often develop and plan their marketing activities is such a way that they help and reassure their customers prior to, during, and after purchase. The services triangle is a marketing framework that summarised these complexities. The model suggest that success in services marketing depends on three sets of relationships: customer's relationship with the firm; customer's interaction with the employees who deliver the service; and the employees commitment to the company. Managers need to consider three types of marketing to deal with such relationships effectively: external marketing; interactive marketing; and internal marketing. - External marketing ("Making the promise"): relates to the offering that makes the service attractive to customers. - Interactive marketing ("Delivering the promise"): concerns the relationship between staff, for example how effectively employees can deal with customers' requests and whether they are able to provide an excellent experience. - Internal marketing ("Enabling the promise"): requires offering a good experience to staff, so that good employees can be attracted and retained over time. Service marketing thus need these three types of activities working together to achieve financial success. Understanding service encounters, customer satisfaction, and associated service measurement techniques, however, fails to lead to an understanding beyond the moment of truth - that is, point at which the service is actioned. Understanding and measuring the experience that customers take away as a result of an interaction is much more pertinent and insightful.

What is implied by a "distribution channel" or "marketing channel"?

Marketing channels are chains of organisations that are concerned with the management of the processes and activities involved in creating and moving products from producers and manufacturers to end users. Each organisations adds something of value before passing it to the next, and it is this interaction that provides mutual advantage and underpins the concept of channel marketing.

What are "Marketing communications"?

Marketing communications can be defined as a management process by means of which an organisation attempts to engage with its various audiences. By conveying messages that are of significant value, the organisation encourages audiences to offer attitudinal and behavioural responses. There are three main aspects associated with this definition, as follows: 1. Engagement - What are the audience's communications needs and is it possible to engage with them on their terms, using one-way, two-way or dialogic communications? 2. Audiences - Which specific audience(s) do we need to communicate with, and what are their various behaviour and information-processing needs? 3. Responses - What are the desired outcomes of the communication process? Are they based on changes in perception, values, and beliefs, or are changes in behaviour required? Marketing communications is used to communicate the elements of an organisation's offerings to target audiences. The offer might refer to a product, a service, or the organisation itself as it tries to build its reputation. Fundamentally, marketing communications comprises three elements - that is, a set of tools, media, and messages. The five common tools are advertising, sales promotion, personal selling, direct marketing, and public relations (PR). In addition, a range of media, such as televisions, radio, press, and the Internet, are used to convey different messages to target audiences. Still, these tools, media, and messages are not the only sources of information for consumers; there is also implicit and important communication through the other elements of the marketing mix, as well as unplanned or unintended experiences in relation to the offer.

What is the practicality of the concept of price elasticity of demand for a marketing manager?

Marketing managers should seek to understand whether their offerings are price elastic or inelastic, because this allows them to predict how price changes will affect the total quantity supplied in the market. E.g. customer practices such as show rooming (visiting shops to view an offering, then buying it cheaper online) and web rooming (researching products online then buying them in-store) have increased price sensitivity, because those customers who may not previously have compared prices do so, having fallen into the habit of doing so easily online.

What does "media fragmentation" and "audience fragmentation" refer to?

Media fragmentation: the splintering of a few mainstream media channels into a multitude of media and channel formats. Audience fragmentation: the disintegration of a large media audiences into many smaller audiences, caused by the development of alternative forms of entertainment that people can experience, which means that, to reach large numbers of people in a target market, companies need to use a variety of media, not rely on only a few mass-media channels.

What are some methods in search engine marketing (SEM)?

Methods include: - Paid listings, or pay per click: refers to payments made for clicks on text links that appear at the top or side of search results for specific keywords. - Contextual search: is a form of targeted advertising, with advertisements appearing on websites. - Paid inclusion: occurs when a search engine company charges fees related to inclusion of websites in its search index. - Site optimisation: occurs when a website's structure and content is improved to maximise its listing in organic search engine results pages using relevant keywords or search phrases. All of these search marketing methods allow marketers to match users with content according to their interest. Search engines and directories take a different approach, but one thing unites them: search marketing is one of the most cost-effective methods of digital marketing.

What does "mobile marketing" refer to?

Mobile marketing refers the set of practices that enables organisations to communicate and engage interactively with their audiences by means of any mobile device or network. With the added benefits of store-and send technology giving the option of message storage, mobile marketing is quick and inexpensive, and reaches markets wherever they are, despite limitations in message content. Investments in mobile are through both paid-for media (mobile advertising) and the development of own media, such as apps. Current changes in behaviours clearly show that mobile is taking over more and more of consumer online searches, and that marketers need to consider how to stay relevant and accessible at different stages in the consumer decision process. Increasingly, the use of smartphone apps is becoming the default mechanism for such searches. These apps use a combination of barcode scanning and location-based services to provide relevant information, for example showing only store near the consumer when they are carrying out a price comparison. This these apps are suited to delivering context-specific, and hence more relevant, information to consumers. Mobile search also enables the convergence of online and offline, for example by enabling barcode scanning.

What are "opinion leaders"? What are "opinion formers"?

Opinion leaders: are more predisposed than others towards receiving information and then reprocessing it to influence others. These individuals has the capacity to be more persuasive than information received directly from the mass media. One of the defining characteristics is that these people belong to the same peer group as the people whom they influence - that is, they are not distant or removed. Opinion leaders have greater exposure to relevant media and, as a result, have more knowledge of, or familiarity and involvement with, a certain category of offering than others. Opinion-followrs turn to opinion leaders for advice and information about offerings they are interested in. Opinion leaders are also more gregarious and self-confident than non-leaders, and are more confident of their role as influencers. Therefore it is not surprising that many marketing communication strategies are targeted at influencing opinion leaders, because they will, in turn, influence others. Opinion formers: The other main type of independent personal influencer is the opinion former. They are not part of the same peer group as the people they influence; rather, their defining characteristic is that they exert personal influence because their profession, authority, education, or status is associated with the object of the communication process. They provide information and advice as part of the formal expertise they are perceived to hold. Organisations target their marketing communications at opinion leaders and formers to penetrate the market more quickly than relying on communication directly with the target audience.

What is "PESTLE"?

PESTLE is the easiest and one of the most popular frameworks for examining the external environment, standing for the political, economic, socio-cultural, technological, legal, and ecological environments.

In what way has the role of media shifted?

Previously, the emphasis of a marketing communications mix was to enable and persuade customers to buy products and services in the short term. Today, although a short-term focus still prevails form many firms, goals such as developing understanding and preference, reminding and reassuring customers, and building brand value have become accepted as important aspects of marketing communications. This longer-term brand-building perspective has been shown to be a more profitable approach than a short-term direct-response focus on sales. It is now expected that marketing communications, and the mix of tools, messages, and media used, needs to become an integral part of an organisation's overall communications and relationship management strategy.

What are "Porter's Five Forces" when it comes to industry analysis?

Porter (1979) suggests that competition in an industry is a composite of five main competitive forces. Porter's model is useful because it exposes the competitive forces in operation in an industry and can lead to an assessment of their relative strengths. An organisation needs to determine a competitive approach that allows it to influence the industry's competitive rules, protects it from competitive forces as much as possible, and gives it a strong positions from which to compete. 1. New Entrants (the level of threat that new competitors will enter the market): - could be a potential threat because the new entrant might occupy a similar space in the market to the existing company; - one should consider whether economies of scale are required for a successful performance within it; - new entrants may be restricted as a consequence of government and regulatory policy; - new entrants may be frozen out of an industry because of the capital requirement necessary to set up business; and - new entrants may be locked out because companies within a market are using proprietary offerings or technologies. 2. Substitutes (the threat posed by substitute products): In analysing our place within an industry, we should consider what alternative offerings exist in the marketplace that also, to a greater or lesser extent, meet our consumer's needs. - In an industry, there are usually substitute offerings that perform the same function or meet similar customer needs. Substitutes are thus a threat because they could, in the long run, replace current offerings. - It takes time for consumers to become aware of new offerings and to obtain the necessary information to allow them to make a decision over whether or not to switch. Consumers consider the switching costs associated with such a decision, which, in turn, affect their propensity to substitute the offering from another. - Consumers consider the relative price performance of one offering over another. 3. Buyers (the bargaining power of buyers): When analysing an industry, we should understand the bargaining power that buyers have over their suppliers because this can impact on the price charged and the volumes sold or total revenue earned. - Companies should ask themselves what percentage of their sales a single buyer represents. This is an important question because if one buying company purchases a large volume of offerings from the supplying company, it is likely to be able to demand price concessions when there are a lot of competing suppliers in the marketplace relative to the proportion of buyers (that is, supplier concentration versus buyer concentration). - Buyers may decide to increase their bargaining power through what is known as backward integration (when a company moves into manufacturing the offerings it previously bought from its suppliers). - Another factor impacting on a buyers bargaining power is how price-sensitive a particular company is. If companies are more price-sensitive and yet there are a lot of competing suppliers for their business, they are likely to switch supplier rather than be loyal to one. 4. Suppliers (the bargaining power of suppliers): Any industry analysis should determine how suppliers operate and the extent of their bargaining power. - We should also consider whether or not the suppliers are providing unique components, products, or services that may enhance their bargaining situation. - In some industries, suppliers increase their market dominance by forward integration. This allows companies not only to better control their own supply chains, but also to sell at lower prices, thereby increasing sales and profit from increased retail sales. - If companies face high switching, economic, resource, and time costs associated with using another supplier, the supplier has stronger bargaining power with that particular company. -- These forces will affect the fifth force -- 5. Competitors (the intensity of rivalry between the current competitors): To analyse an industry, we must also understand how the companies within that particular market operate. In undertaking a competitor analysis, we should (1) outline each company's structure (for example details of the main holding company, the individual business unit, any changes in ownership); (2) current and future developments (often gleaned from reading company prospectuses, websites, and industry reports); and (3) the company's latest financial results. We should be interested in calculating the market volumes and shares for each competitor, because market share is a key indicator of company profitability and return on investment. To undertake an analysis of our firm's competitors, we must answer five key questions, as follows: 1. What are our competitors? - Competitors are those firm providing offerings that attempt to meet the same market need as do our offerings. There are several ways in which a need might be met, but essentially two approaches can be identified: firms need to be aware of their direct and indirect competitors. Direct competitors provide similar offerings to the same target market and also offer a product in the same category, but different segments. Indirect competitors are those which address the same target market, but provide a different offering to satisfy the market need. By understanding who the main competitors are, it becomes possible to make judgements about the nature and intensity of the competition. 2. What are their strengths and weaknesses? It is important to gather information about each competitor's range of offerings and their sales volumes and values, the competitor's profitability, prices, and discount structures, the nature of its relationships with suppliers and distributors, and its communications campaign and special offers. Also non-marketing elements as production and manufacturing capabilities, its technical, management, and financial resources, and its processes, distribution channels, and relative success in meeting customer and market needs. We use the information to understand two main issues: What a competitor's strengths and weaknesses might be; and how we might avoid the areas in which the competitor is strong or exploit its weaknesses. The overall task is to determine what competitive advantage a competitor might have and whether this advantage can be sustained, imitated, or undermined. 3. What are their strategic goals? - Developing a full understanding of a competitor's strategic goals is not easy and can usually be inferred only from a competitor's actions. 4. Which strategies are they following? - Once a competitor's goals are understood, it becomes easier to predict what its marketing strategies are likely to be. These strategies can be considered by means of two main factors: competitive scope and positioning. Competitive scope refers to the breadth of the market addressed. Brands can be positioned in markets according to the particular attributes or benefits a brand offers. Once this is understood, the marketing mix elements are aligned to support the positioning strategy. 5. How are they likely to respond? - Understanding the strategies of competitors helps to alert to whether they are intent on out-right attack or defence and how they might react to particular strategies initiated by others.

What is the implication of "proposition quality" when it comes to pricing levels?

Quality can be defined as "the standard of something as measured against other things of a similar kind; the degree of excellence of something; a distinctive attribute or characteristic possessed by someone or something". In this context, the quality of goods and services relates to standards to which that offering satisfies needs. But quality is not a single standard in an offering; rather, with encompasses many standards because there are many levels at which our needs might or might not be satisfied. Quality is multifaceted (that is, comprising different functional and non-functional needs) and multilayered (that is, comprising degrees of satisfaction.). Because each person has their own definition of quality, we prefer to talk of perceived quality. For example, some might be very dissatisfied and other highly satisfied with even the same offering. *There is an assumptions that as price increases, so does quality, and that, in general, pricing reflects quality. However, research has demonstrated that there is only a weak relationship between price and perceived quality, although this is category-dependent. *

What can be said about the "customer relationship life cycle"?

Relationship cost theory identified benefits associated with stable and mutually rewarding relationships. Such customers avoided switching costs associated with finding new suppliers, whereas suppliers experienced reduced quality costs, incurred when adapting to the needs of new customers. A long-term relationship leads to lower relationship costs and higher profits. It is on the basis of this simple, yet crucial, principle that many organisations develop and run loyalty programmes. By undertaking a customer profitability analysis, it is possible to identify those segments that are worth developing. This enables the construction of a portfolio of relationships, from which it is possible to identify relationships that the potential to provide mutually rewarding benefits. This then provides a third dimension of the customer dynamic - namely, customer development. Understanding the economics associated with relationship stability and profitability allows us to develop a customer relationship life cycle. This consists of four main stages - namely, customer acquisition, customer development, customer retention, and finally customer decline and termination. Just as different strategies can be applied to different phases of the product life cycle, so it is possible to observe that customers have different requirements as a relationship evolves. These requirements are reflected in the intensity of the relationship, and there are three primary indicators that make up this intensity dimension: 1. The psychological intensity indicators: are based on a customer's judgement about the quality of the relationship and the extent to which they trust, and are committed to, the seller or supplying organisation. 2. Behavioural intensity indicators: refer to the manner and scope of a customer's search for information, including word-of-mouth communication, as well as their purchasing behaviour. 3. Economic intensity indicators: refer to both the profit contribution and the lifetime value a customer represents.

What is "social media marketing"?

Social media marketing describes the use of the social web and social media or any online collaborative technology for marketing activities (e.g. sales, PR, research, distribution, customer service). Social media marketing includes both the creation and curation of corporate or brand profiles and content on social media and advertising. Social media advertising refers to advertising delivered on social platforms, including networking and social gaming websites and apps, across all device types. The top reasons for using social media is to raise brand awareness and brand building, followed by customer acquisition. It is important to keep in mind that social media come in many different variations and that social media marketing strategies need to be adjusted to the type of consumer engagement taking place on the specific platform being used. The social web does not make conversations happen; it simply support them. By understanding how social media supports conversations, businesses can open up interaction with individuals and communities. Because social media is increasingly used as part of the marketing manager's planning (for both communications and research), there is an increasing need to understand whether what marketers are doing in social media is working or not. Web activity is amazingly measurable, because web users leave traces of their presence and activity on the various sites they visit. However, the process of measuring social media effectiveness requires a systematic approach. 1. Start out by setting campaign objectives. This means identifying specific and clear evaluation objectives that are aligned with marketing objectives and overall business goals. 2. Identify key performance indicators (KPIs) that fit the objectives set. This step involves identifying the most appropriate performance indicators that fit with the overall campaign objectives set in step 1. 3. Identify metrics to be used to asses the selected KPI's. 4. Collect and monitor the previously identified metrics and KPI's from relevant social media channels. 5. Report results. Often benchmarks are needed, in terms of previous performance or industry standards in terms of KPIs, to allow the marketer to draw conclusions. 6. Make a decision based on the insights gained. based on the report, the performance of the campaign can be assessed and conclusions for future iterations or campaigns can be drawn.

What is "stakeholder marketing" and what are the two aspects to the implementation of it?

Stakeholder marketing is marketing activities undertaken in a system of interaction with different stakeholders and aimed at generating value for all stakeholder involved, both internal and external to the organisation. The first aspect to the implementation is recognising marketing's important role in engaging with stakeholders meaningfully to define suitable CSR programmes. The second relates to the importance of managing stakeholders' relationships to achieve superior performance. In other words, actively managing relationships with many stakeholders is a specific capability of the firm, since these relationships are strategic resources to be leveraged to achieve a competitive advantage.

What is the aim of Internet advertising and what are some major considerations when using it?

The aim of Internet advertising is to increase website traffic and/or encourage product trial, purchase, and repeat purchase activity, and ad format and payment should be adapted accordingly. Major considerations when using Internet advertising include the following: - Cost - Internet adverts are still relatively cheap compared with traditional advertising. - Timeliness - Internet adverts can be updated at any time with minimal cost. - Format - Internet adverts are richer, using text, audio, graphics, and animation. In addition, games, entertainment, and promotions can be incorporated. - Personalisation - Internet adverts can be interactive and targeted to specific interest groups and/or individuals. - Location-based - By using wireless technology and geo-location technology, Internet advertising can be targeted to consumers wherever they are. - Intrusive - Some Internet advertising formats (for example pop-ups) are seen as intrusive and suffer more consumer complaints than other formats. Recent developments in Internet advertising focus on programmatic buying, in which advertising is planned, analysed, and optimised via demand-side software interfaces and algorithms.

What's the implication of the "buy grid framework"?

The buy grid serves to illustrate the relationships between buyphases and buyclasses. It is important because it highlights the need to focus on buying situations or contexts, rather than on offerings.

To price properly, what does a company need to consider first?

The company needs to know what the proposition costs to make, produce, or buy. Cost represents the total money, time, and resources sacrificed to produce or acquire an offering. Typically, a firm determines what its fixed costs are and what its variable costs are for each proposition.

In the context of managing marketing channels, what implication does the "channel design" have?

The design of an appropriate channel - that is, its structure, length, and the membership and their roles - varies according to context. The channel design decision process requires three key decisions: - the distribution intensity decision: the level of purchase convenience required by the different customer segments to be served. - the channel configuration decision: the number and type pf intermediaries necessary to deliver products to the optimum number of sales outlets. - the multichannel decision: the number of different types of channel to be used. This helps is to determine what is the most effective and efficient way of getting the offering to the customer. When designing distribution channels, three broad elements need to be considered: - Economics: requires us to recognise where costs are being incurred and profits being made in a channel to maximise our return on investment. - Coverage: is about maximising the offering's availability in the market for the customer, satisfying the desire to have the offering available to the largest number of customers, in as many locations as possible, at the widest range of times. - Control: refers too achieving the optimum distribution costs without losing decision-making authority over the offering; how it is priced, promoted, and delivered in the distribution channel. All organisations face a trade-off between these elements. When devising a distribution channel strategy, several key decisions need to be made to serve customers and to establish and maintain appropriate buyer-seller relationships. The first decision is selecting how the channel will be structured. If the channel requires intermediaries, we need to consider the type of market coverage we want, the number and type of intermediaries to use, and how we should manage the relationships between members in the channel. These choices are important because they can affect the benefits provided to customers.

"Transaction and Purchase" is a behavioural construct that can be used to aid consumer market segmentation. What does it imply?

The development of electronic technologies and integrated purchasing systems has facilitated a rapid growth in the collection of consumer purchase and transactional data. Companies have the ability to monitor purchase patterns in various geographical regions, at different times or seasons of the year, for various offerings and, increasingly, for differing market segments. Social media can also be analysed t track what people are saying once they have purchased and used particular offerings. Transactional and purchase information is very useful for marketers to assess who are their most profitable customers. By analysing the recency, frequency, and monetary (FRM) value of purchases, marketers can identify their most profitable market segments. Transactional data are records of behaviours and provide some insight into purchasing trends. Online, we can track from where someone is accessing our website. The executional segmentation category focuses on how individual customers are treated. One approach is through "triggers", such as commercially significant occurrences on customer's account.

Enhancing physical propositions through service development; Shelton (2009) considers service innovation in the context of four stages of solution management maturity - which ones?

The early stages of innovation maturity are characterised by goods focus, with relatively few services used only to augment and complement those goods. The mature stages are characterised by much higher levels of service, some integrated with the products to provide solutions for customer problems: Stage 1: Services are used as after sales support for goods. Service innovation is framed around maintaining the good and ensuring that customers are satisfied with their purchase. Stage 2: Characterised by aftersales services designed to complement the core element of the proposition. Here, services should improve customer satisfaction with existing goods, should increase loyalty, and may generate additional purchases. Stage 3: The portfolio includes a full line of services and goods designed to provide a clearly differentiated offering amines at solving clients' lifecycle problems. Stage 4: The highest end of innovation maturity - firms seek to integrate the services dimension as part of their total offer. Known as servitisation, this involves the provision of an integrated bundle of goods-service solutions for the entire life cycle of their customers. These solutions are developed collaboratively with clients and therefore require a deep understanding of the customer's overall business.

In which two main ways has social media had a major impact on marketing practices?

The first change has to do with power. Social media enables us to generate, share, and comment on content at their own discretion. Content in social media's created by consumers rather than primarily created by media companies and marketers. The proliferation of UGC, such as review sites and widely shared first-hand feed-back about consumer experiences means that consumers have become increasingly influential. The second shift has to do with control. Whereas marketers have traditionally been in charge of the messages they communicate, this is no longer the case. In a social media environment, consumers not only are able to create and modify content to pertain to their needs, and to share this content with consumers, companies, or third parties, but also have a voice in reacting to product offers and marketing that they do or do not like. With social media come higher transparency and less control for marketers in terms of how their communications are received and passed on. The changing power and control over communication clearly shows how social media marketing is not about mass marketing, but about facilitating conversations around the organisation, the brand, or an individual. Engaging in these digital conversations requires trust and transparency, and involves authentic engagement in a real two-way dialogue.

What are the key differences between non-for-profit organisations and commercial organisations in how marketing is used?

The key differences are as follows: 1. Proposition: with not-for-profit offerings, the unique selling proposition is weaker - that is, there are weaker benefits. For social marketing, the proposition relates to the audience benefit gained from undertaking a specific desired behaviour. 2. Price: This has different connotations in not-for-profit situations. In social marketing, "price" can be perceived as the incentives and costs of (not) taking up a particular desired behaviour - "demarketing". In relation to charities, the amount donated is often left the discretion of the donor (although suggestion of specific amounts tends to be more effective) and is largely determined by the donor, rather than being specified as in a commercial transaction. 3. Involvement: We speak of high and low involvement in commercial situations regarding how consumers learn more bout an offering during the purchasing process. The involvement in not-for-profit situations displays more extreme tendencies - either people are really engaged or they exhibit strong reactions against it. 4. Segmentation: In the not-for-profit environment, it is often important to develop a campaign that drives behaviour in all targets rather than a specific segment, as in commercial markets. Another key difference in the marketing of not-for-profit organisations is the need to check the marketing strategy against the environment, the available resources, and uniquely - against the organisation's social values. In the latter case, the social values of the organisations impact not only on why the organisations exists, but also on how it goes about its marketing activities, including fundraising, promotional programmes, and operational programme developments. Like any other organisations, a charity interacts with its environment and must stay relevant within the context that it operates if it is to attract funding.

What is the "process of adoption", and what are its different stages?

The process of adoption is the process by which individuals accept and use new propositions. The different stages are sequential and are characterised by the different factors that are involved at each stage (for example the media used by each individual. 1. Knowledge stage: consumer become aware of the new proposition. They have little information and have yet to develop any particular attitudes towards the product. Indeed, at this stage, consumers are not interested in finding out any more information. 2. Persuasion stage: is characterised by consumers becoming aware that the innovation may be of use in solving a potential problem. Consumers become sufficiently motivated to find out more about the proposition's characteristics, including its features, price, and availability. 3. Decision stage: individuals develop an attitude toward the proposition and reach a decision about whether the innovation will meet their needs. 4. Implementation stage: users try the innovation for the first time. Sales promotions often offer samples to allow individuals to test the product without any undue risk. Individuals accept or reject an innovation on the basis of their experience of the trial. 5. Confirmation stage: signalled when an individual successfully purchases the proposition on a regular basis without the help of the sales promotion or other incentives. Generally, mass communications are more effective in the earlier phases of the adoption process for propositions that buyers are actively interested in and more interpersonal forms are more appropriate in later stages - especially implementation and confirmation.

What is the "process of diffusion"?

The process of diffusion is the rate at which a market adopts an innovation. According to Rogers (1962), there are five categories of adopter: 1. Innovators: - Kick-starts the adoption process. - Like new ideas, and are often well educated, young confident, and financially strong. - More likely to take risks associated with new propositions. 2. Early adopters: - Characterised by a high percentage of opinion leaders. - Very important for speeding up the adoption process. - Marketing communications need to be targeted at these people, who, in turn, will stimulate word-of-mouth communications to spread information. 3. Early majority: - More risk-averse; individuals require reassurance that the offering words and has been proved in the market. - Tend to wait for prices to fall, prefer more informal sources of information, and are often prompted into purchase by other people who have already purchased. 4. Late majority: - Sceptical of new ideas and adapt new offerings only because of social or economic factors. 5. Laggards: - Suspicious of all new ideas and their opinions are very hard to change. - Take a long time to adopt an innovation, if they ever adopt it at all. One of the tasks of marketing communications is to speed up the process, so that the return on the investment necessary to develop the innovation is achieved as quickly and efficiently as possible. Marketing managers need to ensure that they consider diffusion groups when attempting to understand and predict the diffusion process for innovations. It is likely that a promotional campaign targeted at innovators and the early majority, and geared towards stimulating word-of-mouth communications, will be more successful as a result.

Why is the relationship between pricing and proposition costs important?

The relationship is important because: 1. Costs should be substantially less than the price assigned to a proposition; otherwise the firm will not sell sufficient units to obtain sufficient revenues to cover costs and make long-term profits. 2. The price at which a proposition is set is important because increases in price have a disproportionately positive effect on profits and decreases in price have a disproportionately negative effect on profits. Whenever possible, then, we should aim to increase prices. However, deciding how to price a proposition is complex and customer seldom want to pay more. To increase the accuracy of cost data, we need to spend more time collecting and analysing it. *Determining costs is an exercise in which we trade off accuracy against the benefits and costs of data collection, storage and processing.*

What is the "strong theory" of advertising? What is the "weak theory" of advertising?

The strong theory: stipulates that advertising has a strong effect because it can persuade people to buy an offering that they have not previously purchased. Advertising can also generate long-run purchase behaviour. The strong theory proposes that advertising is capable of increasing sales for a brand and for the product class. The strong theory has close affiliation with an advertising style that is proposition-oriented, in which features and benefits are outlined clearly for audiences, and pack shots are considered important. The weak theory: proposes that a consumer's brand choices are driven by purchasing habit rather than by exposure to promotional messages. Advertising has little impact on persuading consumers to buy offering, mainly because consumers process information actively, not passively. Ehrenberg proposed the awareness-trial-reinforcement (ATR) framework. Awareness is required before any purchase can be made. Out of the mass of people exposed to a message, a few will be sufficiently intrigued to want to try an offering - that is, to trial. Reinforcement follows, to maintain awareness and provide reassurance to help customers to repeat the patterns of thinking and behaviour. Advertising's role is to breed brand familiarity and identification. According to the weak theory, advertising is employed as a defence, to retain customers and to increase brand usage. Advertising is used to reinforce existing attitudes, not necessarily to drastically change them. For advertising to work, involvement is likely to be high and so here the strong theory is the most applicable. However, the vast majority of product-purchase decisions generate low involvement and so decision-making is likely to be driven by habit. Here, advertising's role is to maintain a brands aware with the purchase cycle, so the weak theory is most applicable.

What is the "theory of planned behaviour"?

The theory of planned behaviour explains that behaviour brought about by our intention to act in a certain way. This intention to act is affected by; (1) the attitude a subject has towards a particular behaviour, encompassing the degree to which a person has favourable or unfavourable evaluations or appraisals of the behaviour in question; (2) the subjective norm, which is perceived social pressure to perform or not perform a particular behaviour; and (3) the perceived behavioural control, referring to the perceived ease or difficulty of performing the behaviour, based on a reflection on past experience and future obstacles.

In the context of managing marketing channels, what implication does the "channel structure" have?

The three main configurations involving producers, intermediaries, and customers: 1. Direct channel structure: the producer uses strategies to reach end users directly rather than through an intermediary. The advantages of this structure are that the producer or manufacturer maintains control over its product and profitability, and builds strong customer relationships. It is ideally suited to those products that require significant customisation, technical expertise, or commitment on behalf of the producer to complete a sale - although electronic technologies such as the Internet have enabled a greater number of product manufacturers to reach customers directly. Efficiency within the direct channel structure can be improved in the following ways: - By processing orders and distributing the offering electronically directly to customers. - Supporting the physical distribution of the product offering directly to customers. The disadvantages of a direct channel structure typically include the large amount of capital and resources required to reach customers. This means that there are virtually no economies of scale. Manufacturers might also suffer from a low variety of offerings, which may not meet the needs of buyers. 2. Indirect channel structure: enable producers to concentrate on the skills and processes necessary to make offerings, and use one or more intermediaries for distribution. 3. Multichannel structure: the producer controls some marketing channels and intermediaries control others. The benefits of a multichannel structure include the following: - Increased reach: by utilising existing direct networks and the relationships of intermediaries, the provider can reach a wider target audience. - Producer control: producers have greater control over prices, communication, and can reach customers directly. - Greater compliance: adherence to channel rules is more likely when producers use multiple intermediaries and are not perceived to be a competitor. - Optimised margins: producers can improve margins from the direct channel element and increase their bargaining power as the become less dependent on intermediaries. - Improved market insight: by developing relationships with their direct customers, producers can derive a better understanding of their needs and market issues. The use of multichannel strategies has been encourage by the growth of the Internet, which has increase the efficiency with which consumers and manufacturers can interact. At the same time, technologies are increasing the efficiency of information exchange between producers and intermediaries, e.g. through extranets. However, the sharing of profits among change members can be a source of conflict, especially when intermediaries perceive the producer to be a competitor, as well as a supplier. This structure may also confuse and alienate customers who are unsure which channel they should use.

What are the main two types of decision aid; interactive decision aids to help users to locate data, information, and/or an organisation's digital objects?

The two main types of decision aid are a search directory and a search engine. A search directory is a human-edited database of information. It lists websites by category and subcategory, with categorisation usually based on the whole website, rather than one page or a set of keywords. Search directories often allow site owners to submit their site directly for inclusion and editors rehires submissions for fitness. In contrast, a search engine operate algorithmically, or uses a mixture of algorithmic and human input, to collect, index, store, and retrieve information on the web, making this information available to users in a manageable and meaningful way in response to a search query.

What is required to build a successful brand?

This requires marketers to achieve three essential branding activities: to enable identification and differentiation; to maintain consistency; and to communicate the existence and attributes to customers and other marketing channel audiences. According to Keller, successful brand building is best accomplished by considering the brand-building process as a sequence of steps. 1. Enable customer to identify with the brand and help them to make associations with a specific product class or customer need. 2. Establish what the brand means by linking various tangible and intangible brand associations. 3. Encourage customer responses based around brand-related judgement and feelings. 4. Foster an active relationship between customers and the brand.

How has the perspective on organisations' purchasing activities changed since the 90's, and why has it changed?

Today, organisations reduce the number of their suppliers, sometimes to only one, and strategic procurement is used to negotiate with suppliers on a cooperative basis to help to build long-term relationships. Purchasing has become an integral and strategic part of an organisation's operations, and managing a smaller number of suppliers can improve performance considerably. One of the main reasons for this changed approach was research that shows that business performance improves when organisations adopt a collaborative, rather than adversarial, approach to purchasing and account management. Integral to this approach is the use of information systems, which, according to Rodríguez- Escobar and González-Benito, are tools for streamlining and simplifying the way in which the purchasing task is undertaken. However, there are several other related issues that have changed the role of purchasing, namely: 1. Customer Sophistication: Owing to increasing customer sophistication, organisations are trying to differentiate their offerings and become more specialised. Organisational purchasing has to follow this movement and also become more specialised; otherwise, the organisation will become increasingly ineffective in meeting customer needs. 2. Increasing Competition: With increasing competition, margins have been eroded. As a result, more attention has been paid to internal costs and operations. By influencing the purchasing costs and managerial costs associated with dealing with multiple suppliers, the profitability of the organisation can be directly impacted. Consequently, the importance of purchasing policies, processes, and procedures within organisations has increased. 3. Digital Technology: Digital marketing refers to the use of all kinds of digital tools, including social media, and encompasses various integrated elements, platforms, and tools that facilitate social interaction. In a B2B context, these instruments allow companies to develop interaction and dialogue between businesses and customer networks with a view to securing stronger relationships, increased cooperation, and opportunities for co-creation. 4. Branding: Despite the view that business brands are important assets that can enhance customer trust, branding remains a greatly under-utilised resource within business marketing. The role of branding within business markets appears to be gaining momentum at a time when digital marketing has gained a stronger presence. In a digital interactive environment, the brand should be considered to be the platform for all of a B2B company's actions. In addition, branding in industrial contexts provides a means of enabling the integration of different functions - an important requirement in B2B organisations. 5. Strategic issues: There are several strategic issues related to the purchasing activities undertaken by organisations. First is the "make or buy" decision: should organisations make and/or assemble products for realise, or outsource or buy in particular products, parts, services, or sub-assemblies and concentrate on what are referred to as core activities or competences? Second, the benefits that arise through closer cooperation with suppliers, as well as the increasing influence of buyer-seller relationships and "joint value creation", have inevitably led to a tighter, more professional, and integrated function. The third strategy-related issue concerns the degree to which the purchasing functions is integrated into the organisation. New IT systems have raised the level of potential integration of purchasing and operations to the extent at which competitive strength of the organisation is enhanced.

What are the four types of "loyalty" and what role does "loyalty trends" play in relationship marketing?

Types of loyalty: - Emotional loyalty: true form of loyalty, and is driven by personal identification with real or perceived values and benefits. - Price loyalty: is driven by rational economic behaviour and the main motivations are cautious management of money and financial necessity. - Incentivised loyalty: refers to promiscuous buyers with no one favourite brand, who demonstrate through repeat experience the value of becoming loyal. - Monopoly loyalty: arises where a consumer has no purchase choice owing to a national monopoly. This is not a true form of loyalty. Five clear trends within the loyalty market can be identified. These trends suggest that successful sales promotions schemes will be those that enable members to perceive significant value linked to their continued association with a scheme. The medium-term goal might be that these schemes should reflect customers' different relationship needs and recognise the different loyalty levels desired by different people.

According to Porter (1979), why should we review the "competitive" environment"?

We should review the competitive environment within an industry to identify the major competitive forces, because this helps us to asses their impact on an organisation's present and future competitive positions. Numerous variables help us to determine how attractive an industry is and shape the longer-term profitability for the different companies that make up the industry. An organisation needs to determine a competitive approach that allows it to influence the industry's competitive rules, protects it from competitive forces as much as possible, and gives it a strong position from which to compete.

What implications does "willingness to pay", "price consciousness", "pricing cues" and "price bundling and rebates" have on pricing decisions?

Willingness to pay: If we are to price an offering according to customer needs, we should understand which customers think a particular price is a fair price to pay, or what they expect to pay, or what they think other would pay. Price consciousness: In addition to deciding whether a price is fair or what customer expect to pay, we also need to know whether customers are conscious of prices in a particular category. Pricing cues: When customers assess prices, they estimate value using pricing cues because they do not always know the true cost and price of the item that they are purchasing. - Sales signs act as cues, indicating the availability of a bargain. This seduces the customer to buy, suggesting that an item is desirable and may not be available if it's not bought quickly enough. - Odd-number pricing- that is, prices that en in the figure 9. The reason for why an increase in demand takes place when there is a higher price is because we perceive prices that end in figure 9 as cheaper relative to the its reference price. - Purchase context Price bundling and Rebates: Marketers highlight their prices to customers by bundling the products and services into an offering to make the price look more reasonable.

What is "word of mouth" communication?

Word of mouth communication can be defined as "interpersonal communication regarding products or services where the receiver regards the communicator as impartial". Word-of-mouth communication does not involve any payment for media, because communication is freely given through conversation. Personal influence within the communication process is important because customers perceive word-of-mouth recommendations as objective and unbiased. Word-of-mouth messages are used either as information inputs prior to purchase or as a support and reinforcement of a consumer's own purchasing decisions. Today, organisations actively manage word-of-mouth communications to generate positive comments and as a way of differentiating themselves in the market. Both online and offline word of mouth is becoming increasingly important if marketing communications is to have its desired impact. For many organisations, it is important to direct messages at individuals who are predisposed to discussing its content, because it is likely that they will propel word-of-moth recommendations. Therefore the target of certain campaigns is not necessarily the target market, but opinion leaders within target market - that is, those individuals who are most likely to volunteer their positive opinions about the offering and who, potentially, have some influence over people in their peer group.

What does "customer insight" mean?

"Knowledge about the customer that is valuable for the firm". Customer insights are generated based on the knowledge gained by different research activities. Information requires transformation to generate insight. Customer insights are thus distinct from customer information because they encompass a deeper understanding of what drives customer's behaviours. Customer insight is typically derived by fusing knowledge generated from a range of sources, including industry reports, sales force data, competitive intelligence, customer relationship management (CRM) systems data, employee feedback, social media analysis data, and managerial intuition. A customer insight can be said to be of value if it is rare, difficult to imitate, and of potential use to formulate management decisions.

What does "involvement" mean?

"the greater the personal importance a person attaches to a given communication message, the more involvement they are said to have with that communication."

What does the "Business-to-Business Perspective" imply?

- B2B marketing is different from consumer marketing because the customer focus is a professional buyer within a business rather than an individual. It requires that marketers deal with more sophisticated customers buying in volume and often part of a decision-making unit '(alongside other bytes and technicians), who are trained to buy (or "procure") professionally and who are rewarded for buying the right propositions at the right price. - Much B2B marketing activity revolves around the need to develop strong prospects for a company's offerings, to ensure effective supply chain management operation to develop the market for a B2B offering, and to ensure that is is delivered appropriately. - The emphasis in b2B markets is strongly focused on the development and building of mutually satisfying relationships based on commitment and trust, both to win the contract in the first instance and to deliver it to the customer's specifications. Whether or not a firm meets these specifications is in part linked to the logistics function (that is, warehousing, inventory management, delivery) of the firm. Consequently, B2B marketers can create a competitive advantage if they develop a strong linkage between the marketing and logistics functions, developing a strong customer service proposition.

What does the "Consumer Goods Perspective" imply?

- Consumer goods are convenience goods (purchased frequently, with minimum effort), shopping goods (purchased selectively), or speciality goods (purchased highly selectively). - The consumer goods perspective has dominated marketing's history. This perspective gave birth to ideas such as "marketing mix" and the 4Ps. - The offering exchanged is tangible (that is, has physical form), and is exchanged between buyer and sell through retail distribution outlets. Consumption takes place later, with demand stimulated through the promotional mix - that is, advertising, personal selling, digital and direct marketing, and PR. - The focus on marketing in this context is on how to facilitate the rapid exchange of goods, the effectiveness of marketing in matching supplier offering to customer demand and efficiency in managing the distribution of the product through the supply chain. Of particular importance in this context are the principles of practice of multichannel marketing and retailing. - Because of the need to stimulate demand from consumers, focus is placed on the use of advertising to stimulate demand, and market research to determine how to develop appropriate consumer products and to determine how they are received once launched into the market place. - Most buying decisions are made by individual customers, but occasionally they are made by several people.

What does the concept of "relationship marketing" imply?

- If marketing was about exchange, shouldn't marketing also be concerned with relationships between those parties that are exchanging value and not only what was exchanged? - A paradigm shift from the need to engage in transactions towards the need to develop long-term customer relationships, including relationships with other stakeholders. - Concerned with integrating customer service, quality assurance, and marketing activity. - Companies employing a relationship marketing approach stress customer retention over customer acquisition. Customer retention is an important activity in marketing, because research has demonstrated that when a company retains loyal customers, it is more likely to be profitable with competitors who do not, because loyal customers: -- will increase their purchases over time; -- are cheaper to promote; -- who are happy with their relationship with a company refer it to others; and -- are preferred to pay a (small) price premium if they are loyal. - Relationship marketing moved the concept away from simply adopting the 4Ps towards adopting an interactive marketing approach, paying more attention to the customer base rather than being preoccupied with building market share. - Because offerings are inherently service-based, customers become co-creators of the service experience; hence the value-in-use of the offering is specified by customer, often after the sales has taken place. - Organisations should use co-creation to differentiate their offerings, given that value is tied up inside the customer's experience with the organisation. - Organisations wishing to enhance customer input to co-creation should map supplier and customer processes to identify how to design their services accordingly.

What are the different roles in a Decision-making unit?

- Initiators: start the whole process by requesting an item for purchase. They may also undertake other roles within buying centres. - Users: use the product once it is acquired. They also evaluate its performance. - Influencers: often help to establish the technical specifications for the proposed purchase and help to evaluate potential supplier's alternative offerings. - Deciders (also known as key decision-makers, or KDMs): are those who make decisions and they are the most difficult to identify. This is because they may not have formal authority to make a purchase decision, yet are sufficiently influential internally that their decision carries the most weight. - Buyers, or purchasing managers: select suppliers and manage the process whereby the required offerings are procured. Buyers may not decide which offerings is to be purchased, but they influence the framework within which the decision is made. They will formally undertake the process whereby offerings are purchased once a decision has been made to procure them. - Gatekeepers: have the potential to control the type and flow of information to the organisation and the members of the DMU. These gatekeepers may be personal or other assistants or secretaries, technical personnel, or telephone switchboard operators.

As if to highlight the variation in approaches to purchasing behaviour, Svahn and Westerlund (2009) identify six principal purchasing strategies that organisations may use, as follows:

- The "price minimiser" purchasing strategy sees a buyer increase their efficiency, seeking the lowest priced offering. To help them to achieve this, the buyer actively promotes competition among several potential suppliers. - A "bargainer" purchasing strategy means that a buyer aims to achieve operational efficiency through long-term collaboration with a selected supplier. - The "clockwise" purchasing strategy refers to network relationships that function predictably and precisely, just as a clock works. Here, the goals is strict efficiency, achieved through the vigilant integration of production-based integrated control systems and It, and the careful coordination of the value activities performed by each supply network partner. - The "adaptor" purchasing strategy focuses on adapting the manufacturing processes between the exchange parties. This can arise during the purchase of one major product or service, when the sellers required to accommodate its offerings to the particular needs of the buyer. - The "projector" purchasing strategy occurs between buyers and sellers who are development partners. It can arise during projects when partners develop their offerings in a collaboration, after which the joint development project is completed and the parties continue the development work independently. - The "updater" purchasing strategy is based on collaboration in research and development (R&D). Here, collaboration between partners is continuous and the nature of the relationship is not dyadic, but a supply network.

What are the two main approaches to market segmentation?

1. Build-up method: approaches the task from the perspective of identifying markets that consist of customers who are similar. 2. Breakdown method: identifies those groups that share particular differences. While the breakdown method is the most established approach to segmenting consumer market, the build-up approach seeks to move beyond the individual level, at which all customers are indeed different, to a more general level of analysis based on identifying similarities. In other words, the build-up method is customer-oriented, seeking to determine common customer needs. The aim of both methods is to identify market segments between which identifiable differences exist - segment heterogeneity - but within which similarities exist between members - member homogeneity.

What do the three service innovation strategies imply?

1. Established services within competitive markets: - Established services with a relatively stable value creation process are often generated under intense competition to improve operational efficiency. 2. Incremental service innovation targeting value-added propositions: describes a value creation strategy in which services are developed to provide extra value. Working together, the service provider and the client can produce more effective solutions. 3. Radical service innovation, which aims to produce completely novel offerings: concerned with value creation generated through novel or unusual service concepts. This requires new technologies, offerings, or business concepts, and involves radical system-wide changes in existing value systems.

What are the three principal business types of goods and services?

1. Input goods (Raw materials, semi-manufactured parts, and finished goods): Input goods have been subjected to different levels of processing, and so they lose their individual identities and become part of the finished item. 2. Equipment goods (Otherwise known as capital or investment goods): These are necessary for manufacturing and operations to take place. Land and buildings, computer systems, and machine tools are all necessary to support the production process, but they cannot be identified in the finished proposition. 3. Supply goods (Otherwise known as maintenance, repair, and operating (MRO) materials): These goods and services are "consumables" because they are necessary to keep production processes and the organisation running. For example, lubricants, paints, screws, and cleaning materials may all be necessary to maintain a firm's operations. Computer or IT servicing is necessary to maintain operations and to avoid down time, whilst accounting audits are legal requirements.

1. What does developing a "market orientation" refer to? 2. What are the three components of market orientation?

1. It refers to "the organisation-wide generation of market intelligence pertaining to current customer needs, dissemination of the intelligence across departments, and organisation-wide responsiveness to it". 2. customer orientation - concerned with creating superior value by continuously developing and redeveloping offerings to meet customer needs - which means that we must measure customer satisfaction on a continuous basis and train front-line service staff; competitor orientation - which requires an organisation to develop an understanding of its competitors' short-term strengths and weaknesses, and its own long-term capabilities and strategies; and interfunctional coordination - which requires all functions of an organisation to work together for long-term profit growth.

What are the three main types of buyclasses (buying situations)?

1. New Task: As the name implies, in a new task the organisation is faced with a first-time buying situation. Risk tends to be high at this point because there is little collective experience of the offering being purchased (the "solution") or relevant suppliers. As a result of these factors, if the solution purchased is a complex one, there may be a large number of DMU participants. Each participant requires a lot of information, and a relatively long period of time is needed for the information to be assimilated and a decision to be made. 2. Modified Rebuy: Having purchased a solution previously, uncertainty is reduced, but not eliminated, so the organisation may request through their buyer(s) that certain modifications be made to future purchases, for example adjustments to the specification of the solution, further negotiation on price levels, or perhaps an arrangement for alternative delivery patterns. 3. Straight Rebuy: The purchasing department reorders on a routine bases, very often working from an approved supplier list. Offerings repurchased in this situation may be solutions that an organisation consumes to keep operating (for example office stationery), or low-value materials used within the operational value-added part of the organisation (for example the manufacturing processes), or low-value services (for example maintenance contracts). Straight rebuts presents the classic conditions for the use of automatic reordering systems, allowing costs to be reduced, managerial time redirected to other projects, and the relationship between buyer and seller embedded within a stronger framework.

What are the 4Ps by Eugene McCarthy (1960)? (Elements which the manufacturer should consider when developing marketing mix policies and procedures).

1. Product - that is, the offering and how it meets the customer's need, its packaging, and its labelling. 2. Place (distribution channels) - that is, the way in which the offering is delivered to the customer. 3. Price - that is, the cost to the customer and the cost plus profit to the seller; and 4. Promotion - that is, how the offering's benefits and features are communicated to the potential buyer.

What are the three definitions of marketing?

1. The Chartered Institute of Marketing (CIM): "The management process responsible for identifying, anticipating, and satisfying customer requirements profitably". 2. The American Marketing Association (AMA): "Marketing is 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". 3. A French perspective: "A strategy of adaptation of organisations to competitive markets in order for them to influence the behaviour of the publics on which they depend, through an offering whose perceived value is durably superior to that of competitors. In the commercial sector, the role of marketing is to create economic value for the company by creating value as perceived by customers."

What are the four key characteristics of business markets?

1. The nature of demand There are three key aspects of demand in business markets: derivation; variance; and elasticity. 2. The buying process Organisations' buying processes differ in a number of ways from those of customers. These differences are a reflection of the potentially high financial value associated with B2B transactions, the product complexity, the typically high value of individual orders, and the nature of risk and uncertainty. As a result, organisations have developed specific buying processes and procedures involving large numbers of people. The group of people involved in organisations purchasing processes is referred to as a decision- making unit (DMU). The types of purchase that they make are classified as buyclasses. The circumstances in which they by are called buy phases. 3. Internationalism In comparison with consumer markets, B2B marketing is easier to conduct internationally. this is because the needs of businesses around the world are more similar to one another than the needs of consumers, whose preferences, tastes, and resources vary. B2B organisations display a lower variety of product functionality and performance. This is partly because trading associations around the world have agreed standards relating to content and performance. Having agreed standards means that the buying and selling processes and the trading environment can be well regulated and controlled. Many industries have commonly agreed standards aiming to facilitate inter-organisational exchange processes. 4. Buyer-seller relationships If there is one characteristic that separates business marketing from consumer marketing, it is the importance of relationships. In consumer markets, the low perceived value of the offerings and the competitive nature of the market, which makes product substitution relatively easy, make relationships between manufacturers and consumers relatively more difficult to establish. In business marketing, the interaction between buyers, sellers, and other stakeholders is of major significance. The development and maintenance of relationships between buying and selling organisations is pivotal to success. Interdependence, collaboration, and in some cases partnership in the development, supply, and support of products and services is considered a core element of B2B marketing. Strong inter-organisational relationships are referred to as embedded ties.

What are four differing approaches to targeting identified segments?

1. The undifferentiated approach is used where there is no delineation between market segments and the market is viewed as one mass market with one marketing strategy for the entire market. Although expensive, this approach is used for markets in which there is limited or no segment differentiation. 2. The differentiated targeting approach is used where there are several market segments to target, each being attractive to the marketing organisation. To exploit them, a marketing strategy is developed for each segment. A disadvantage of this approach is the loss of economies of scale because of the resources required to meet the needs of multiple market segments. 3. A concentrated marketing strategy (or niche marketing strategy) is used where there are only a few market segments. This approach is adopted by firms with limited resources to fund their marketing strategy or who prefer a very exclusive strategy towards the market. 4. A customised targeting strategy involves developing marketing strategy for each customer, rather than each segment. This approach predominated in B2B markets or consumer markets with high value and/or highly customised products.

What are two definitions of organisational buying behaviour (OBB)?

1. Webster and Wind defined organisational buying as "the decision making process by which formal organisations establish the need for purchased products and services and identify, evaluate and choose among alternative brands and suppliers'. This adopts a buying organisation's perspective and highlight how OBB involves numerous processes, rather than being a single static one-off event. There are a number of stages, or phases, associated with procurement, each often requiring a key decision to be made. 2. Organisational buying behaviour can be seen as more of an exercise of muddling though the buying problem rather than working through a well-planned, goal-oriented process, largely because the organisational buying decisions involves decision points and evolving information requirements (Makkonen, Olkkonen, Halinen, 2012). Organisational buying behaviour is concerned with three issues: - the functions and processes that buyers move through when purchasing products for use in business markets; - strategy, where purchasing is designed to assist value creation and competitive advantage, and to influence supply chain activities; and - the network of relationships that organisations belong to when purchasing, in that the placement of orders and contracts between organisations can confirm a current trading relationship, initiate a new set of relationships, or signal the demise of a relationship. What should be clear is that OBB is not only about the purchase of other companies' offerings, but also the strategic development of the organisation, creating value, and the management of inter-organisational relationships, all of which are key issues in B2B marketing. These issues overlap with each other and are not discrete items.

What is a "SWOT Analysis"?

A SWOT analysis is the analysis of strengths, weaknesses, opportunities, and threats. It is a series of checklists deriving from the marketing audit and PESTLE analysis, and is presented as internal strengths and weaknesses (that is, relative to competition), and external opportunities or threats. SWOT analysis is used to determine an organisation's strategic position and is therefore an input to the strategy option formulation process. Strengths and weaknesses relate to the internal resources and capabilities of the organisation, as perceived by customers. - A strength is something an organisations good at doing, or something that gives it particular credibility and market advantage. - A weakness is something an organisation lacks or performs in an inferior way in comparison with others. Opportunities and threats are externally oriented issues that can potentially influence the performance of an organisation or offering. - An opportunity is the potential to advance the organisation by developing and satisfying an unfulfilled market need. - A threat is something that, at some time in the future, may destabilise and/or reduce the potential performance of the organisation. Once the three or four elements of each part of the SWOT matrix have been derived, then a number of pertinent questions need to be asked, as follows: 1. Does the organisation do something far better than its rivals? If it does, this is known as competitive advantage, and can lead to a competitive edge. 2. Which of the organisation's weaknesses does the strategy need to correct and is it competitively vulnerable? 3. Which opportunities can be pursued, and are there the necessary resources and capabilities to exploit them? 4. Which strategies are necessary to defend against the key threats?

What is a "blue ocean strategy"?

A blue ocean strategy is a strategic approach that focuses on the importance of reconfiguring a market space to identify uncontested new spaces that offer high potential, while avoiding those in which the company must compete on the same terms as most other organisations.

"Usage" is a behavioural construct that can be used to aid consumer market segmentation. What does it imply?

A company may segment a market based on how often a customer uses its offerings, categorising these into high, medium, and low users. This allows the development of service specifications or marketing mixes for each user group. Consumer usage of offerings can be investigated from three different perspectives: 1. The social interaction perspective: examines the symbolic aspects of usage and the social meaning attached to the consumption of socially conspicuous offerings, such as a car or house. 2. The experiential consumption perspective examines the emotional and sensory experiences that result from usage - especially emotions such as satisfaction, fantasy, feelings, and fun. 3. The functional utilisation perspective: assesses the functional usage of products and their attributes is different situations.

What is a "customer (or account) portfolio matrix? What is its practicality?

A customer portfolio matrix is a 2 x 2 grid used to reflect the strength of the relationships between a buyer and seller, and the profitability that each account represents to the seller. The relationship dimension incorporates the strengths from a customer's perspective relative to competitors. For example, a strong relationship is indicative of two organisations working closely together, whereas a weak relationship suggests that they have little interest in each other. Customer attractiveness refers to total revenue spend, average rate of growth, and the opportunities a buyer represents to the seller in terms of profit potential. These calculations can be complicated and involve a measure of management judgement. For clarity, these scales are presented as high or low, strong or weak. However, they should be considered as a continuum and account can be positioned on the matrix not only within a sector, but also at a particular position within a sector. As a result, strategies can be formulated to move accounts to different positions, which, in turn, necessitate the use of different resources: Sector A: "must have" customer enjoy a close business relationship and are also attractive in terms of their profit potential. Many of these customers are assigned key account statues, but all present investment opportunities and resources should be allocated to develop them all. Sector B: "good-to-have" customers are essentially prospects, because although they are highly attractive, their relationship with the seller is currently weak, In this situation, marketing resources should be allocated on a selective basis proportional to the value of each prospect represents - that is, high investment for good prospects and low for the others. Sector C: Relationships with customers are strong, but customers do not offer strong potential; hence these "need to have" customers are important only because they provide a steady background business that is marginally profitable, so resources need to be maintained. Sector D: Little reason to invest in the "do-not-need" customers. These customers represent a net drain on the selling organisation, and hence customers in this sector should receive little support, and resources subsequently freed up should be directed to customers in sectors A and B. One of the benefits of developing a customer portfolio matrix is that it becomes easier to allocate sales channels to customers. Multichannel marketing decisions are important and should be rooted within the customer portfolio matrix.

What is "perceptual mapping"?

A diagram, derived from attitudinal market research data, which displays the differences in perceptions that customers, consumers, or the general public have of different products or services, or brand in general. Understanding the complexity associated with the different attributes and brands can be made easier by developing a visual representation of each market. This is important because positioning is a two-way process by means of which organisations seek to impose attribute perceptions onto customers and customers assimilate those perceptions, modify them, or reject them entirely. Perceptual mapping data reveal strengths and weaknesses that can help management to make strategic decisions about how to differentiate based on the attributes that matter the most to customers.

What is a "marketing mix"?

A marketing mix is a list of items marketing manager should consider when devising plans for marketing products, including product decisions, place (distributions) decisions, pricing decisions, and promotion decisions; later extended t include physical evidence, process, and people decisions to account for the lack of physical nature in service products.

What is a "product life cycle"?

A product life cycle is the pathway a product assumes over its lifetime, in which there are said to be five main stages: development; introduction, growth, maturity, and decline. Sales and profits rise and fall across the various life stages of the product. Speed of movement through the stages varies, but each product has a limited lifespan. Although the life of a product can be extended, for example by introducing new ways of using the product, finding new users, and developing new attributes, the majority of products have a finite period during which management can maximise the returns on the investment made. Just as the nature and expectations of customer groups differ by stage, so do the competitive conditions. The means that different marketing strategies, relating to the offering and its distribution, pricing, and promotion, need to be deployed at particular times so as to maximise financial returns. The product life cycle does not apply to all offerings in the same way. For example, some offerings reach the end of the introduction stage and then die as it becomes clear that there is no market to sustain them. When discussing the product life cycle, care should be taken to clarify exactly what is being described. The concept can apply to a product class (computers), a product form (a tablet), or a brand (Lenovo). The shape of the curve varies, with product classes having the longest cycle because the mature stage is often extended. Product forms tend to comply most closely with the traditional cycle shape, whereas brand cycles tend to be the shortest.

What is a "proposition"? What are the three levels of propositions?

A product or service that represents a promise made to customers and stakeholders. 1. The core proposition consists of the core benefit or service. This may be a functional benefit in terms of what the offering will enable you to do, or it may be an emotional benefit in terms of how the product or service will make you feel. 2. The embodied proposition consists of the physical good or delivered service that provides the expected benefit. It consists of many factors, for example the features and capabilities, the durability, the design, the packaging, and the brand name. 3. The augmented proposition consists of the embodied offering plus all those other factors that are necessary to support the purchase and any post-purchase activities, such as credit, finance, training, delivery, installation, guarantees, and the overall perception of customer service. - When these levels are brought together, it is hopes that they will provide customers with a reason to buy and keep buying. Each individual combination or bundle of benefits constitutes added value and serves to differentiate. Marketing strategies should be designed around the actual and augmented propositions, because it is through these that competition occurs and people are able to understand how one disposable camera differs from another.

What is a "strategic market analysis"?

A strategic market analysis is the starting point of the marketing strategy process is the development of knowledge and understanding about the target market(s) identified as part of the corporate strategy. - PESTLE - Porter's "Five Forces" - The importance of understanding the internal environment and how a firm's resources need to complement the external and performance environments. The task now is to assimilate this information - to bring together in a form that can be easily understood. The most commonly used strategic analysis tool is SWOT analysis.

What is the fifth stage of the consumer proposition acquisition process?

Acquisition/Purchase (Conversion stage): Once selection has taken place, different approaches to purchasing might exist. - Routine purchase - purchase is regular, we don't get too involved in the decision-making process; we simply buy the offering again that we bought previously, unless new circumstances have arisen. - Specialized - conducted on a one-off or infrequent basis; we may become much more involved in the decision-making process to ensure that we understand what we are buying and that we are happy that it will satisfy our needs. -Acquisition also differs by payment, channel and the prevalence of any promotional offers.

What is a "platform" strategy?

An approach that enables organisations to connect their businesses with hosts on top of which to build products and services, and hence co-create value; sometimes referred to as plug and play, platforms are developing through digital environments. A platform creates a two-sided market where the value generated increases as the number of developers and users increases. This is referred to as network effects and is a central tenet of platform strategy. Platform businesses bring together producers and consumers to drive high-value exchanges. Their source of value and their competitive advantage is rooted in both information and data and interactions that the platform generates.

What does the "ecological environment" imply?

An important questions for marketers concerns the way in which an organisation should embrace and incorporate the changing trend in sustainability. Orsato (2006) suggests that a company can adopt one of the following four different green marketing strategies: 1. Eco-efficiency - It might lower costs by means of improved organisational processes, such as the promotion of resource productivity (for example energy efficiency) and better utilisation of by-products. This approach should be adopted by those firms that need to focus on reducing the costs and environmental impact of their organisational processes. 2. Beyond compliance leadership - This involves the adoption of a differentiation strategy through organisational processes such as certified schemes to demonstrate the company's ecological credentials or its environmental excellence by adopting environment management system (EMS) schemes and codes. This approach should be adopted by firms that supply industrial markets. 3. Eco-branding - The firm might differentiate its products or services to promote environmental responsibility. 4. Environmental cost leadership - This involves offerings that provide greater environmental benefits at a lower price. This strategy particularly suits firms operating in price-sensitive and ecologically sensitive markets, such as the packaging and chemical industries. Whatever the company and industry, ecological trends in marketing look set to stay and further develop as the sustainability debate rages on and as companies use it to develop their own competitive strategies. It is important to assess how this movement towards greener and more sustainable marketing is affecting a particular industry to ensure that a company within that industry not only is not adversely affected by these changes, but also can take advantage of the opportunities.

The external environment can pose serious challenges to an organisation for two reasons - which?

First, some elements of the external environment, while not having an immediate impact on the performance of an organisation, can radically change market conditions in the longer term. Second, even when managers are clear that the factors in the external environment are important, it is often not possible to control them in any way. This suggest that companies need to monitor the external environment to assess the level of risk associated with their business activities.

According to Leone and Shultz (1980), there are law-like generalisations of marketing, they are:

Generalisation 1 - Advertising has a direct and positive influence on total industry (market) sales - that is, all advertising done at industry level serves to increase sales within that industry. Generalisation 2 - Selective advertising has a direct and positive influence on individual company (brand) sales - that is, advertising undertaken by a company tends to increase the sales of the particular brand for which it was spent. Generalisation 3 - The elasticity of selective advertising on company (brand) sales is low (inelastic) - that is, for frequently purchases goods, advertising has only a very limited effect in raising sales. Generalisation 4 - Increasing store shelf capacity (display) has a positive impact on sales of non-staple grocery items, such as products bought on impulse (for example ice cream, chocolate bars) rather than those that are planned purchases, which are less important, but perhaps more luxurious types of good (for example gravy mixes, cooking sauces). For instance, for impulse goods, the more shelf space you give an item, the more likely you are to sell it. Generalisation 5 - Distribution, defined by the number of outlets, has a positive influence on company sales (market share) - that is, setting up more retail locations has a positive influence on sales.

What is the third part of the STP process?

Having segmented the market, determined the size and potential of market segments, and selected specific markets, the final stage of the STP process is to position a brand within the target market(s). Positioning is th earns by which offerings are differentiated from one another to give customer a reason to buy and it encompasses two fundamental elements. The first concerns the attributes, the functionality, and the capability that a brand offers; the second positioning element concerns the way in which a brand is communicated and how customers perceive the brand relative to competing brand. This element of communication is important because it is not what you do to an offering that is important, but "what the advertising does for the product in the prospects mind", that determines how a brand obtains its market positioning. Positioning concerns an offering's attributes and design - that is, how the offering is communicated and the way in which these elements are fused together in customer's minds. It is not only the offering (physical or otherwise) that is important for positioning not the communication that leads to successful positioning. Positioning is about how customers judge and offering's value relative to its competitors, its ability to deliver against promises made, and what value customers derive from the offering. To develop a sustainable position, we must understand the market in which the offering is competing.

What does "scenario planning" refer to?

In scenario planning companies considers potential scenarios that their company may face in the future. Historically, companies focused on developing scenarios based on their probability and then developed different courses of action depending on the changes in the environment. Recent perspectives on scenario planning stress the importance of: - dedicating specific resources to scenario planning and to the constant updating of the scenes developed; - engaging a broad range of internal and external stakeholders in the development of scenarios; and - challenging the assumptions in the scenario to spot potential flaws.

What does the concept of "Service-Dominant Logic" imply?

It implies that all propositions really embody a service. The traditional marketing management approach can be considered product-dominant logic. So if products alone are insufficient to meet customer needs, it is better to consider services as a more realistic means of understanding how marketing works; suggest the need for a proposition with characteristics more like those of a service than a core product offering. The SDL concept has been criticised for being of little practical use to marketers, but it has generated important discussions about how organisations and their customers work together to co-create new propositions and that, regardless of the physical embodiment of those propositions, they are inherently a service offering.

What does the "socio-cultural environment" imply?

Lifestyles are constantly changing and, over time, consumers shift their preferences. Companies that fail to recognise changes in the socio-cultural environment and to adapt their offerings often fail. When considering the socio-cultural environment, firms need to consider the changing nature of households, demographics, lifestyles, and family structures, and changing values in society. What should companies do? The most sensible strategy is plan ahead and aim for the best diversification strategy to minimise any potential disruption caused by external trends.

What does the idea "Marketing as Exchange" imply?

Marketing is a two-way exchange process. It is not solely about the marketing organisation doing the work; the customer also inputs - sometimes extensively. Customers specify how we might satisfy their needs, because marketers cannot read their minds. Customers must then pay for the offering. - By understanding how exchanges take place between members of the supply chain, we can determine where to add value to the customer experience.

What is the difference between market research and marketing research?

Market research is work undertaken to determine the structural characteristics of the industry of concern (for example demand, market share, market volumes, customer characteristics, and segmentation), whereas marketing research is work undertaken understand how to make specific marketing strategy decisions (for example for pricing, sales forecasting, proposition testing, and promotion research).

What does "sustainable marketing" imply?

Marketing activities undertaken to meet the wants and/or needs of present customers without comprising the wants and/or needs of future customers, particularly in relation to negative environmental impacts on society. *note to self* "The received wisdom is that marketing works to meet the needs of customers and consumers. However, Alvesson, coming's from outside the marketing discipline, rejects this notion. He argues that people in affluent societies seek more without gaining any further long-term satisfaction from suck consumption, because much of the consumption is superficial anyway, and because appealing to people's fantasies and highlighting their imperfections (to encourage them to reduce these feelings of inadequacy by buying a particular offering) leads to narcissistic tendencies. Inherently, the notion that more choice is good in itself has been challenged.

What is the difference between marketing effectiveness and marketing efficiency?

Marketing effectiveness measures the contributions your marketing strategies have made to the business - that is, market share growth, revenue growth, market position and marketing efficiency. Marketing efficiency, on the other hand, is a measure of sales and marketing expenses as a proportion of gross revenue. There is some evidence that companies that succeed on one dimension - that is, either marketing efficiency or effectiveness - are less successful on the other. This makes sense because, to be effective at marketing, we have to spend more on marketing activity, which makes marketing inefficient. Firms that manage to be both marketing effective and marketing efficient probably do so by changing the "rules of the game": they do not spend on high-cost activities such as advertising to achieve effectiveness; instead, they consider new and innovative approaches that make customers pay more attention.

What are "marketing metrics"?

Marketing metrics is a set of measures that senior marketers use to assess the performance of their marketing strategies and programmes.

What is "marketing planning"?

Marketing planning is a sequential process involving a series of activities leading to the setting of marketing objectives and the formulation of plans for achieving them. A marketing plan is the key output from the overall strategic marketing planning process. It details a company's, or brands, intended marketing activity. The strategic appraisal and evaluation phase of the planning process should be undertaken first. This covers a 3-5 year period and provides a strategic insight into the markets, the competitors, and the organisation's resources that shapes the direction and nature of the way in which the firm has decided to compete. Once agreed, this should be updated on an annual basis and modified to meet changing internal and external conditions. Only once the strategic marketing plan has been developed should detailed operational or functional marketing plans, covering a one-year period, be developed. This makes marketing planning a continuous process, not something undertaken once a year or, worse, when a product is launched.

What is the difference between "marketing research" and "market testing"?

Marketing research reveals attitudes to a campaign, brand, or some other aspect of the exchange process, whereas market testing, by comparison, measures actual behaviour. There is a difference, because attitudes do not always determine action. For example, a consumer may respond very positively to the launch of a new television set in surveys, but family circumstances or lack of funds may mean that they never purchase it. Market testing studies use test markets to carry out controlled experiments in specific country regions, showing specific adverts, before exposing the "new feature" (offering, campaign, distribution, etc.) to a full national or even international launch. Another region or the rest of the market may act as the control group against which results can be measured. For example, films are often test-screened before release because of the substantial costs of producing the film in the first place.

What is the first stage of the consumer proposition acquisition process?

Motive development: The process begins when we decide that we wish to obtain an offering. This involves the initial recognition that we need to solve a problem - and if we are to recognise the need to solve the problem, we must first become aware of it.

What is "the centrality-distinctiveness (C-D) map"?

One of the issues with the conventional approaches to positioning is that brand performance cannot be incorporated and is measured separately to positioning in most organisations. In response to this challenge, Dawar and Bagga (2015) developed the centrality-distinctiveness (C-D) map, which incorporates performance dimensions: - Centrality is concerned with the extent to which a brand is representative of its category. Such a brand serve as a reference point by which others in the same category are compared and evaluated. - Distinctiveness refers to a brand's individuality and the extent to which it is positioned away from the direct competition of popular brands. The centrality-distinctiveness map links consumer's perceptions about brands with their business performance. Brands are positioned in quadrants according to how customers score them on two universal dimension. Each quadrant carries strategic implications for sales, pricing, risk, and profitability. The distribution of brand across the map offers insights about competitive opportunities and threats.

Which three options do organisations have to ensure a stream of new propositions? What are the three main reasons for that new products fail?

Organisations have three main options: 1. buy in finished products from other suppliers, perhaps from other parts of the world, or license the use of other products for specific period of time; 2. develop products through collaboration with suppliers or even competitors; 3. develop new products internally, often through R&D departments or by adapting current products with minor design and engineering changes. The three main reasons for why new products fail: 1. No market need exists for the product. 2. There is a market need, but the product fails to meet customer requirements. 3. The product's ability to meet the market, although satisfactory, is not adequately communicated to the target market.

What is "picking"?

Picking is the deliberative selection of an offering from among a repertoire of acceptable alternatives, even though the consumer believes the alternatives to be essentially identical in terms of ability to satisfy their needs. It can be motivated by intrinsic or extrinsic evaluations, or both. Intrinsic evaluation occurs because a consumer likes a product, while extrinsic reasons for purchase can be subdivided into five categories: economic, technical, social, legalistic and adaptive.

What are "generic strategies" when it comes to achieve competitive advantage?

Porter (1985) proposed that there are two essential routes to achieving above-average performance: to become the lowest cost producer; or to differentiate the offering until it is of superior value to the customer. These strategies can be implemented in either broad (mass) or narrow (focused) markets. Porter suggested that this gives rise to three generic strategies: 1. Cost leadership: By having the lowest cost structure, an organisation can offer standard offerings at acceptable levels of quality, yet still generate above-average profit margins. If attacked by a competitor using lower prices, the low-cost leader has a far bigger cushion than its competitors. Charging a lower price than rivals is not the critical point; the competitive advantage is derived from how the organisation exploits its cost/price ratio. By reinvesting the profit, for example by improving product quality, investing more in product development, or building extra capacity, it is more likely to achieve long-run superiority. 2. Differentiation: A differentiation strategy requires that all value chain activities are geared towards the creation of offerings that are valued by, and which satisfy the needs of, particular broad segments. By identifying particular customer groups, each of which has a discrete set of needs, a product can be differentiated from its competitors. Offerings can be differentiated using a variety of criteria. Indeed each element of the marketing mix is capable of providing the mean of successful long-term differentiation. Differentiation can lead to greater levels of brand loyalty. 3. Focus: Organisations use focus strategies to seek gaps in broad market segments or to find gaps in competitors' ranges. In other words, focus strategies help to seek out unfulfilled market needs. The focused operator then concentrates all value chain activities on a narrow range of offerings. There are two options for a company wishing to follow a focus strategy - one is low cost and the other is differentiation - but both occur within a particular narrow segment.

What is the third stage of the consumer proposition acquisition process?

Proposition Evaluation ("Consideration stage"): Once we have all the information necessary to make a decision, we evaluate alternative propositions - but, first, we must determine the criteria used to rank the various offerings. These might be rational or irrational. A consumer is said to have an evoked set of products in mind when they come to evaluate which particular product, brand, or service they want to solve a particular problem.

What is the fourth stage of the consumer proposition acquisition process?

Proposition Selection: Typically, the offering we eventually select is the one we evaluate as fitting our needs most closely. However, we might select a particular offering away from where we actually buy or acquire it. Therefore proposition selection is a separate stage in the process, distinct from proposition evaluation, because there are times when we must re-evaluate what we buy or acquire because what we want is not available.

What does "psychographics" imply?

Psychographic approaches rely on the analysis of consumer's activities, interests, and opinions to understand consumers' individual lifestyles and behaviour patterns. Psychographic segmentation includes understanding the values that are important to different customer types. A traditional form of lifestyle segmentation is based on customers' activities, interests, and opinions (AIO).

What is the sixth stage of the consumer proposition acquisition process?

Re-evaluation: The theory of cognitive dissonance suggests that we are motivated to re-evaluate our beliefs, attitudes, opinions, or values if the position we hold on them at one time is not the same as the position we held at an earlier period owing to some intervening event, circumstance, or action. This difference in evaluations, termed cognitive dissonance, is psychologically uncomfortable (that is, it causes anxiety). Thus we are motivated to reduce our anxiety by redefining our beliefs, attitudes, opinions, or values to make them consistent with our circumstances. We will also actively avoid situations that might increase our feelings of dissonance. However, if we are happy with our purchase, we might decide to repurchase it, thereby playing some degree of behavioural loyalty to a particular brand. This stage is termed the "loyalty stage". A popular model differentiates between behavioural loyalty demonstrated by repeat purchase and loyalty in terms of relative attitude, which is a preference for the product or brand above other relevant competitors. This differentiation is important because even consumers disappointed with a brand might continue to purchase it if they have no choice. The goal of marketers is to build loyalty on the basis of both repeat purchase and superior relative attitude.

What are the five stages of the "Marketing research process"?

Stage 1: Define the problem The first step in a market research project is defining the management problem and writing the research brief. Often, the problem is described in vague terms, because organisations are not always sure what information they require. The problem description provides the researcher with relatively little depth of understanding of the situation in which the organisation finds itself, so the researcher needs to discuss the problem with the staff commissioning the study to investigate further. This allows the researcher to translate the management problem into a marketing research question. once the agency discusses the brief with the client, the agency provides a detailed outline of how it will investigate the problem. This document is called research proposal. Stage 2: Decide the Research Plan Once the marketing research question(s) have been decided, it is time to develop a research plan. At this stage, the framework for conducting the project is developed. In developing this framework, marketing researchers need to consider what type of research is needed. The market research need can be specified based on objective (explanatory research, descriptive research, causal research). Once we know what type of research to conduct, we should consider: - who to question and how (the sampling plan and procedures to be used); - what methods to use (for example discussion groups or an experiment); - which types of question are required (whether open questions for qualitative research or closed questions for a survey); and - how the data should be analysed and interpreted (what approach to data analysis should be undertaken). Stage 3: Data Collection and Sampling This stage involves the conduct of fieldwork and the collection of data. At this stage, we send out questionnaires, or run online focus group sessions, or conduct a netnographic study, depending on the decisions taken in the first design stage of the fieldwork. Stage 4: Data Analysis and Interpretation This stage comprises data input, analysis, and interpretation. At this stage, it is important to be aware of an to counter different biases that might affect the conclusions drawn. How the data are input naturally depends on the type of data collected. Stage 5: Report Preparation and Presentation The final stage of a research project involves reporting the results and the presentation of the findings of the study to the external or in-house client. The results should be presented free from bias. Marketing research data are of little use unless translated into a format that is meaningful to the manager or client who initially demanded the data.

What does "Strategic Market Action" imply?

Strategic Market Action concern the identification of the most appropriate way of achieving the goals and putting the plan into action: the implementation phase. Competitive advantage: Sustainable competitive advantage is achieved when an organisation has a significant and sustainable edge in terms of attracting buyers. Advantage can also be secured by coping with the competitive forces better than its rivals. Advantage can be developed in many different ways: - Best-known organisation or brand in the market. - Producing the best-quality offering or by having attributes that other offerings do not have. - Having the lowest prices. - Providing the best support and service in the industry. According to Porter (1985), the conditions necessary for the achievement of sustainable competitive advantage are as follows: 1. The customer consistently perceives a positive difference between the offerings provided by a company and its competitors. 2. The perceived difference results from the company's relatively greater capability. 3. The perceived difference persists for a reasonable period of time- that is, sustainable competitive advantage is durable as long as it is not easily imitated.

What does "Strategic marketing goals" imply?

Strategic marketing goals are for determining what the marketing strategy should achieve - that is, what are the strategic marketing goals that need to be accomplished? There are four main strategic objectives: 1. Niche: Niche objectives are often the most suitable when firms operate in a market dominated by a major competitor and financial resources are limited. A niche can be a small segment or even a small part of a segment. Niche markets arise because it is not economic for the leading competitors to enter this segment given that these customer have social needs and the leading form does not want to devote resources to them. To be successful in niche markets, it is important to have a strongly differentiated product offering, supported by a high level of service. 2. Hold: Hold objectives are concerned with defence. They are designed to prevent and fend off attack from aggressive competitors. Market leaders are the most likely to adopt a holding strategy because they are prone to attack from new entrants and their closest rivals as they strive for the most market share. Market leadership is important because it generally drives positive cash flows, confers privileges such as strong bargaining positions with suppliers, and enhances image and reputation. Hold strategies can take a number of forms, varying from "doing nothing" to maintain market equilibrium, through implementing a counter-offensive, to withdrawing from a market completely. 3. Harvest: Harvest objectives are often employed in mature markets as firms/offerings enter a decline phase. The goal is to maximise short-term profits and stimulate a positive cash flow. By stripping out marketing communications and R&D, it becomes possible to generate cash for use elsewhere. 4. Divest: Divest objectives are necessary when offerings continue to incur losses and generate negative cash flows. Divestment can follow on naturally from a harvesting strategy. Typically, low share offerings in declining markets are prime candidates to be divested. Divestment can make companies much more profitable if they reinvest the returns in new profitable ventures. Divestment may be actioned by selling off the offering should a suitable buyer be available, or by simply withdrawing from the market. (5). Growth: - Intensive growth: refers to concentrating activities on markets and/or offerings that are familiar. By increasing market share or introducing new offerings to an established market, growth is achieved by intensifying activities. - Integrative growth: occurs when an organisation continues work with the same offerings and the same markets, but starts to perform some of the activities in the value chain that were previously undertaken by others. - Growth through diversification: refers to developments outside the current chain of value-adding activities. This type of growth brings new value chain activities because the firm is operating with new offerings and in new markets.

What does "market segmentation" imply?

The division of a mass market into distinct and identifiable groups, or segments, each of which is defined by common characteristics and needs, and displays similar responses to marketing actions. The purpose of market segmentation is to ensure that elements of the marketing mix - namely, price distribution, products, and promotion (and people, process, and physical evidence for service offerings) - meet the needs of different customer groups.

What does the "technological environment" imply?

The emergence of new technologies has affected most businesses. New technology changes the way in which companies go to market. For example, companies are now compelled to use a variety of channels. Changes in technology particularly affect high-tech industries, in which firms must decide whether they wish to dominate that market by pushing their own particular technology standards - especially where new technology renders existing standards obsolete. For most firms, the risk of investing in radical or cutting-edge technologies is high because the potential benefits are unsubstantiated. Fear of obsolescence is usually a strong incentive to invest in new technologies. Therefore companies have every reason to be concerned about the impact of technological changes on their product and service life cycles. However, innovation becomes a necessary condition in the strategic marketing decision-making of high-tech firms. For less technology-intensive firms, innovation, or at least rapid adoption of new offering variant based on competitors offerings, is still necessary to stay ahead of the competition.

What does the "legal environment" imply?

The legal environment covers every aspect of an organisation's business. Laws and regulation on the transparency of pricing, the prevention of restrictive practices, product safety, good practice in packaging and labelling, the abuse of dominant position, and codes of practice in advertising, to take just a small selection, are enacted in most countries. Companies need to keep up with changes in their sector's legislation and other legislation, because failure to do so might jeopardise their business.

"Media usage" is a behavioural construct that can be used to aid consumer market segmentation. What does it imply?

The logic of segmenting markets by frequency of readership, viewership, or patronage of media vehicles is well established. Segmenting users by media usage frequency can provide insights into whether or not a publisher, or social networking site, attracts and retains consumers who are more or less responsive to an advertiser's communication. This information provides input when evaluation the efficiency and effectiveness of media. Furthermore, differences in frequency may lead to differences in response to repeated passive ad exposures, competing ads of other sponsors, and prior ad exposure. Frequency of media usage has been the predominant measure of media usage experience. However, Olney, Holbrook, and Batra (1991), have identified viewing time as an important dependent variable in a model of advertising effects. On media websites, users might be segmented either by their visit frequency or by their dwell time (that is, how long they spend on a website), among other variables.

What does the "marketing strategy-implementation matrix" tell us?

The matrix sets out four different situations as a balance between how efficient/effective a marketing strategy has been (what markets to be targeted, the basis on which the firm will compete, the competitive advantages to be used, and the way in which the product is to be positioned), and how efficient/effective the marketing implementation has been (the way in which the marketing plan is to be controlled and evaluated; the financial scope of the plan; and the operational implications in terms of Human Resources, R&D, and system and process needs).

What is the "STP process"? What are the key benefits of the process?

The method by which whole markets are subdivided into different segments; segmentation, targeting and positioning process. Marketers use the STP process to identify on whom, out of all their potential customers, they should focus - that is, the most attractive and accessible groups of customers or segments. Marketers also use the STP process to identify new products and service opportunities, to develop suitable positioning and communication strategies, and to allocate scarce resources to support key marketing goals. The key benefits of the STP process include: - enhancing a company's competitive position, providing direction and focus for marketing strategies , including targeted advertising, new proposition development, and brand differentiation; - examining and identifying market growth opportunities in terms of new customers, growth segments, or proposition uses; and - the effective and efficient matching of company resources to targeted market segments, promising greater return on marketing investment (ROMI).

What is the "performance environment" and what does an analysis of this environment imply?

The performance environment consists of the organisations that directly or indirectly influence an organisation's ability to achieve its strategic and operational goals. There are three main types of organisations in this environment: 1. those companies that compete against the organisation in the pursuit of its objectives; 2. those companies that supply raw materials, goods, and services, and those that operate as distributors, dealers, and retailers further down the marketing channel, all of which have the potential to directly influence the performance of the organisation by adding value in the production, assembly, and distribution of products prior to their reaching the end user; and 3. those companies that have the potential to indirectly influence the performance of the organisation in the pursuit of objectives, which organisations often supply services, such as consultancy or financial services, or are marketing research or communication agencies. Analysis of the performance environment is undertaken so that organisations can adopt better positions in relation to their stakeholders and those of their competitors. These adjustments are made in recognition of emerging trends, as circumstances develop, and/or anticipation of evolving environmental and performance conditions.

What does the "political environment" refer to?

The political environment relates to the interaction between business, society, and government. An understanding of the political environment helps us to evaluate the conditions that lead to the development of laws and their enactment. Political environmental analysis is important because companies can detect signals concerning potential legal and regulatory changes in their industries and thus have a chance to impede, influence, and alter that legislation. Companies often respond to political pressure because of a concern that otherwise legislation could be introduced to regulate their activities, at least in part. As a consequence, monitoring the political process is important if a company is to foresee and potentially anticipate regulatory changes that can significantly impact its day-to-day running.

What is the usefulness of the consumer proposition acquisition process model?

The process model is useful because it highlights the importance of distinctiveness of proposition selection and re-evaluation phases in the process. The buying process is iterative - that is, each stage can lead back to previous stages or move forward to the next stage.

What does "selective exposure" mean?

The process of distinguishing meaningful from non-meaningful information.

Why is it important to understand the competitive positions adopted by companies? What four positions can be identified? What are their characteristics and what "prime strategies" do they imply?

The reasons to why we try to understand competitive positioning is that, by establishing how various firms are positioned in the market, the company can understand where it is currently positioned itself and decide where it wants to be positioned. This shapes the nature and quantity of the resources required and the strategies to be pursued. Four positions can be identified: 1. Market leader: The market leader has the single largest share of the market. Market leadership is important because it is these offering and brand that can shape the nature of competition in the market, and set out standards relating to price, quality, speed of innovation, and communications, as well as influence the key distribution channels. - Attack the market: create new uses and/or users; increase frequency of use. - Defend the position: regular innovation; larger ranges; price cutting and discounts; increased promotion. 2. Market challenger: Products that aspire to the leadership position are referred to as market challengers. They actively seek market share and use aggressive strategies to take share from all their rivals. - Attack the market leader: pricing; new product attributes; sharp increase in advertising spend. - Attack rivals: special offers and limited editions; superior competitive advantages. - Maintain status quo. 3. Market follower: Market followers have low market shares and do not have the resources to be serious competitors. They pose no threat to the market leader or challengers and often adopt "me too" strategies when the market leader takes an initiative. - Avoid hostile attacks on rivals. - Copy the market leader and provide good-quality products that are well differentiated - Focus on differentiation and profits, not market share. 4. Market nicher: Market niches are specialists. They select small segments within target markets that larger companies fail to exploit. They develop specialised marketing mixes designed to meet the needs of their customers. - Provide high level of specialisation: geography; proposition; service; customer group. - Provide tight fit between market needs and the organisation's resources.

What are the implications of the second important part of the STP process?

The second part of the STP process is to determine which of the segments uncovered should be targeted and made the focus of a comprehensive marketing programme. Ultimately, managerial discretion and judgement determines which markets are selected and exploited. For market segmentation to be effective, the mnemonic DAMP can be applied, comprising the following four criteria: 1. Distinct - Is each segment clearly different from other segments? If so, different marketing mixes will be necessary. 2. Accessible - Can buyers be reached through appropriate promotional programmes and distribution channels? 3. Measurable - Is the segments easy to identify and measure? 4. Profitable - Is the segment sufficiently large to provide a stream of constant future revenues and profits? Another approach to evaluating market segments uses a ratio approach for different segment attractiveness factors, such as market growth, segment profitability, segment size, competitive intensity within the segment, and the cyclical nature of the industry. Other examples of segment attractiveness factors might include segment stability (that is, stability of the segment's needs over time) and mission fit (that is, the extent to which dealing with a particular segment fits the company's mission). Once the attractiveness factors have been determined, the importance of each factor can be weighted and each segment rated on each factor. This generates a segment attractiveness evaluation matrix. Decisions need to be made about whether a single offering is made available to a range of segments, or a range of offerings to multiple segments or a single segment, or whether one offering should be presented to a single segment. Whatever the decision, a marketing mix strategy should be developed to meet segment needs, which should reflect the organisation's capabilities and competitive strengths. Key questions around the development of the marketing mix include the following: - How can the segment(s) be reached with appropriate communications? - What is the media consumption pattern of the target audience? - Where can they gain access to our offerings to purchase them? - Does the offering need to be adapted for different segments and should it be priced the same or differently for all segments?