Marketing Dev Final

George just bought a new phone. However, almost immediately he started experiencing glitches. George called the phone company's helpline. He was surprised to find that the helpline was entirely automated. The automated helpline described some common problems that customers might experience and provided instructions on what to do. George followed the instructions and his phone started working correctly. Although George was happy that the problem was fixed, he was frustrated that the entire process was automated. George would prefer to have a higher degree of ____________________ when he calls in to ask for help

Customer Contact

intangibility marketing challenges

Difficult for customer to evaluate; Customer does not take physical possession; Difficult to advertise and display; Difficult to set and justify prices; Service process is usually not protectable by patents

intangibility in service marketing

Increases the overall importance of the brand image when a consumer is deciding which to purchase; physical markers of quality and the experience

inseparability marketing challenges

Service provider cannot mass-produce services; Customer must participate in production; Other consumers affect service outcomes; Services are difficult to distribute

customer contact marketing challenges

Service providers are critical to delivery; Requires high levels of service employee training and motivation; Changing a high-contact service into a low-contact service to achieve lower costs is difficult to achieve without reducing customer satisfaction

heterogeneity marketing challenges

Service quality is difficult to control; Service delivery is difficult to standardize

perishability market challenges

Services cannot be stored; Balancing supply and demand is very difficult; Unused capacity is lost forever; Demand may be very time sensitive

client-based relationships marketing challenges

Success depends on satisfying and keeping customers over the long term; Generating repeat business is challenging; Relationship marketing becomes critical

When a customer takes part in the production of a service, other customers can affect the outcome of the service

True

demand curve

a graph of the quality of products expected to be sold at various prices if other factors remain constant; Many types of demand exist, and not all conform to the classic demand curve shown; ch19 slide5

category killer

a large specialty store that concentrates on a major product and competes based on low prices and product availability knocks out small businesses like, tech stores or bookstores (ex. Barnes and Noble, Best Buy, Petco)

tradition speciality retailers

a store that carries a narrow product mix w deep product lines; also called limited-line retailers, typically sells sports gear, apparel, jewelry, fabrics or computers ect. (ex. Dick's, Sunglass Hut)

power shopping center

a type of shopping center that combines off price stores w category killers (ex. no department stores, more anchor stores, Gap, TJ Maxx, Home Depot)

neighborhood shopping centers

a type of shopping center usually consisting of several small convenience and specialty stores, target market is within a ten minute drive, depth of the product line is limited (ex, local mini-marts, convenience stores)

regional shopping centers

a type of shopping center w the largest department stores, widest product mixes, and deepest product lines of all shopping centers, target markets may be customers traveling for far to get product or prices that their hometowns may not have

superregional shopping centers

a type of shopping center w the widest and deepest product mixes that attracts customers from many miles away;often have more beyond stores like ice skating rinks or amusement centers (ex. American Dream Mall, more rare)

community shopping centers

a type of shopping center with one or two departments stores, some speciality stores, and convenience stores; draws customers looking for specialty products not available in neighborhood shopping center's, wide varies of product mixes and deep product lines

sales promotion

activity and or material intended to induce resellers or salespeople to sell a product or consumers to buy it; can be designed to specifically stimulate reseller's demand and effectiveness, some are directed at increasing consumer demand, and some focus on both consumers and sellers; considerations - product and target market characteristics, product distribution and resellers, competitive and legal environment

institutional advertising

adverting that promotes organizational images, ideas and political issues

reinforcement advertising

advertising that assures users they choose the right brand and tells them how the most satisfaction from it (ex. 'you made the right choice' - on packaging like arm & hammers

advocacy advertising

advertising that promotes a company's position on a public issue

product advertising

advertising that promotes the uses, features and benefits of products; two types - pioneer and competitive

pioneer advertising

advertising that tries to stimulate demand for a product category rather than a specific brand by informing potential buyers about the product; goes back to stimulating primary vs. selective demand

reminer advertising

advertising used to remind consumers about an established brand's uses, characteristics, and benefits (ex. reminder 'were still here and the product is still good' - seen in food and bev)

when a company promotes its position on a public issue, this is specifically referred to as ______ advertising

advocacy

retailing

all transactions in which the buyer intends to consume the product through personal, family, or household use

wholesaler

an individual or organization that sells products that are bought for resale, for making other products, or for general business operations; bulk buying; warehouse clubs / warehouse showrooms

retailer

an organization that purchases products for the purpose of reselling them to ultimate consumers

experience qualities

attributes that can be assessed only during the purchase and consumption of the service (ex. when going to get a haircut and don't know how it will be - friendliness of the staff)

credence qualities

attributes that customers may be unable to evaluate even after purchasing and consuming a service; quality you figure out after service is complete (ex. after a hair cut you don't really know if they got all of your dead-ends or if the color will last/they got all your roots or the right color)

preappraoch - step 2

before contacting acceptable prospects, a salesperson finds and analyzes info ab each prospect,s specific product needs, current use of brands, feelings ab available brands, personal characteristics; involves identifying key decision makers, reviewing account histories and problems, contacting other clients for information, assessing credit histories and problems, preparing sales presentations, identifying product needs, and obtaining relevant literature ch18 slide14

client-based relationships in service marketing

build trust, demonstrate customer commitment, satisfy customers, word of mouth communication is a key factor (relationship marketing is VERY important - to keep existing clients and growing client base)

advertising agency

business dedicated to creating, planning, and handling advertising and sometimes other forms of promotion and marketing for its clients

marginal revenue - MR

change in total revenue resulting from the sale of an additional unit of product ch19 slide11

SEO - search engine optimization

choosing the right keywords to include on our website/in our content so when someone searches those keywords, we pop up (ex. organic); search engine optimization (SEO) takes a lot of work

promotion mix

combination of promotional methods used to promote a specific product

hypermarket

combination of supermarket and discount store; larger than a superstore (ex. Carrefour)

public relations

communication efforts used to create and maintain favorable relations between an organization and its stakeholders; internal or external stakeholders; focus on enhancing image of total organization

comparative advertising

compares the sponsored brand w one or more identified brands on the basis of one or more product characteristics (ex. print and commercials - bounty)

Tectron Products Company advertises a specific product heavily, and Initech wants to offset the effects of that advertising. In this case, Initech would most likely employ ______ advertising

competitive

service quality

customer's perceptions of how well a service meets or exceeds their expectation (two levels of expectation: desired and acceptable) (search, experience, and credence qualities)

primary demand

demand for product CATEGORY rather than a specific BRAND

selective demand

demand for specific BRAND; stimulated but differing product from competitors, increasing/encouraging more product usage, and advertising requires singling out attributes important to potential buyers

demand

depends on other factors in the marketing mix, including product quality, promotion, and distribution, as prices fall - demand rises; influence of demand - Changes in buyers' needs, Variations in the effectiveness of other marketing mix variables, presence of substitutes, Dynamic environment; some demand is predictable but some are not - organizations watch this to predict and fluctuate product and price to reflect customer needs; improvement of factors changes curve D2

fixed costs

do not vary w/ change in the number of units

perishability in service marketing

do the best job every time with training, make it worth the time because once it's gone you can't get it back; an airline ticket is for a certain day and time so if you get a cold you & can't travel you lose that ticket value and time

nonprice competition

emphasizing factors other than price to distinguish a product from competing brands; effective only under certain conditions - company must be able to distinguish its brand through unique product features, higher product quality, effective promotion , distinctive packaging, and/or excellent customer service (DIFFERIENTAION); distinguishing characteristics must be as important; company must extensively promote the brands distinguishing characteristics to establish its superiority and set it apart from competitors in the minds of buyers; advantages - can build customer loyalty toward its brand (Gucci or Louis Vuitton)

price competition

emphasizing price as an issue and matching or beating competitor's prices; to compete effectively on a price basis, a firm should be the low-cost seller of the product; disadvantages: competitors have the flexibility to change prices causing a price war advantages: gaining lowest price to draw customers

customer contact in service marketing

employee satisfaction is one of the most important factors in providing high service quality to customers

multichannel (or omnichannel) retailing

employing multiple distribution channels that complement their brick-and-mortar stores with websites, catalog's, and apps where consumers can research products, read other buyer's reviews and make actual purchases

As Hana prepares the script for a radio commercial for her boutique, she is engaging in the ________ stage of the communicating process

encoding

marginal cost - MC

extra cost incurred by producing one more unit of a product ch19 slide11

warehouse showroom

facility in a large, low-cost building with large in premise inventories and minimal service (ex. IKEA)

Because of service perishability, it is difficult to price services in a manner that takes into account fluctuations in demand

false

If a restaurant, known for its delicious food and fun entertainment, does not serve alcohol, it is displaying advocacy advertising

false

If an organization is large and has a large promotional budget, it should utilize all four promotional methods

false

Promotion to encourage trial uses attempts to retain loyal customers

false

Sarafina own a popular Mexican restaurant. she makes all her waiters, waitresses, and cooks go through a three-week training program in the hopes that they will learn how to offer moreconsitant, high-quality service. This is Sarafina's attempt to reduce problems associated with perishability

false

The preapproach is the first step in the sales process

false

a cash-and-carry wholesaler provides transportation, delivers product directly to customers, and places products on the retailer's shelves

false

a hairstylist who gives good haircuts in the morning but tends to give haircuts of lesser quality in the afternoon is suffering from the challenges associated with intangibility

false

a reseller advertising a manufacture's products is viewed as strong manufacturer support

false

credence qualities are attributes, such as taste, satisfaction, or pleasure, which can be assessed during the purchase and consumption of a service

false

in a comparative advertisement, advertisers point out that their brand has characteristics that are superior to those of competing brands, but they do not actually mention the brand names of competitors

false

retailers form an important link in the marketing channel because they are both producers and customers

false

sale promotion activity occurs more during peak selling periods than in off-peak selling periods

false

supermarkets specialize in selling shopping products

false

suppose Little Caesar's Pizza discounts its pizzas on Tuesday evening because demand is slow. this pricing strategy is known as low demand pricing

false

the core service is used to differentiate the service bundle from those of competitors

false

meghan is planning her upcoming wedding later this year. She has made a list of all the expenses that will be required for the wedding she has planned. Which of the following is NOT one of service products associated with Meghan's wedding

flowers for the church actual service products: delivery of the wedding cake, hiring a limo/driver & renting a reception hall

the final stage of the selling process is

follow up

name an industry where a broker is used (hint: remember, broker are for temporary exchanges)

food, real estate, securities, insurance

superstore

giant outlet offering food and non-food products founds in supermarkets, as well as most routinely purchases products (ex. SuperWalmart, SuperTarget)

services have six basic characteristics: intangibility, inseparability of production and consumption, perishability, client-based relationship, customer contact, and

heterogeneity

heterogeneity in service marketing

hire the right people, train them - invest in training, develop standards, evaluate consistently (training of starbs employees get trained so all mocha fraps taste the same in jersey and pgh)

prospecting - step 1

identifying and developing a database of potential customers; sales people use referrals - recommendations from current customers they have good relationships w/ to find prospects; advantages include more highly qualified sales leads, greater sales rates, larger initial transactions - aka planning stage ch18 slide12

what stage of the consumer buying process can promotion be used

information search (interest, stage 2), eval of alternatives (desire, stage 3), and purchase (action, stage 4) of 5

6 characteristics of services

intangibility, inseparability of production and service, perishability, heterogeneity, client-base relationship, close customer contact

In DHL decided to outsource all of its marketing efforts to the TAZ Advertising Agency, which specializes in advertising, sales promotion activities, and public relations, DHL would likely be striving to practice

integrated marketing communications IMC

brokers

intermediaries that bring buyers and sellers together temporarily; reps company only in that one customer interaction

agents

intermediaries that represent either buyers or sellers on a permanent basis; continuously rep company again and again over time, not just one experience

client-based relationships

internations that results in satisfied customers who use a service repeatedly over time

Pioneer advertising is most likely to be used during which of the following product life-cyclestages?

introduction

department store

large organization offering a wide product mix and organized into separate departments (ex. Macy's Khols, JCPenny's)

warehouse club

large-scale, members-only establishment combining cash-and-carry wholesaling with discount retailing - bulk buying (ex. BJ's, Costco)

customer contact

level of interaction between provider and customer needed to deliver the service - not only whom you interact with but where you interact too

name of the three different types of agents

manufactures agent, selling agent, commission merchant

what stages in the consumer buying process is made up of public relations and advertising

need recognition (awareness, stage 1); info search (intertest, stage 2); elav of alternative (desire, stage 3)

services buyer behavior process & journey

need recognition, info search, purchase, evaluation of alternatives, reaction

overcoming objections - step 5

one of the best ways to overcome objections is to anticipate and counter them before the prospect raises them - this approach is risky bc the salesperson may mention objections that the prospect would not have raised; if possible the salesperson should handle objections as they rise ch18 slide17

advertising

paid nonpersonal communication about an organization and its products transmitted to a target through mass media

Yusef has just finished compiling a list of potential customers and evaluating their ability, willingness, and authority to buy. He knows his next step in the personal selling process is to

preappraoch

inelastic demand

price change doesn't affect demand as much, a marketer can adjust the price upward without demand change = increase in overall profits; too much of an increase can cause a negative impact on the company; electricity is inelastic because it's not really affected by price change, but probably bc of an external factor (not a lot of competition); (ex. if the price increases demand doesn't change)

profits equation

profits = total revenue - total costs

Kevin Esposito, a salesperson for O'Malley Office Products, develops a list of potential customers and evaluates them on the basis of their ability, willingness, and authority to purchase copy machines. This process is called

prospecting

7 steps of personal selling process

prospecting, preapproach, approach, making the presentation, overcoming objections, closing the sale, and following up

uses of public relations

publicity - news release (press release), feature article, captioned paragraph, press conference; builds credibility, news value, significant word-of-mouth communications, perceptions of media endorsement and low cost compared to advertising, ch12 slide 61

sales corralation w advertising

rational appeal- focuses on info influence (arguments - central route); peripheral appeal- focuses on emotional influence (emotions - peripheral route) based on sex, humor, fear, personal relevance/resonance, storytelling

revenue equation

revenue = price * # of units

making the presentation - step 4

salespeople should match their influencing tactics like info exchange, recommendations, threats, promises, ingratiation, and inspiration appeals to their prospects; during the presentation, the salesperson must not only talk but listen; listening is most important - listening and cognitive empathy developed thru sales are linked; nonverbal modes of communication are especially beneficial in building trust during the presentation ch18 slide16

follow-up - step 7

salesperson determines whether the order was delivered on time and installed properly; contact customers to learn if they have any problems or questions - cant abandon after they buy, need to support and open the door to repeat purchases or referrals; used to determine customer's future product needs; vital to establish a strong relationship and create loyalty on the part of the buyer; ch18 slide23

supermarket

self-service store offering a complete line of food products found in supermarkets, as well as most routinely purchased products (Kroger, Safeway, Publix)

discount store

self-service, a general-merch store offering brand-name and private brand products at low prices (ex. Walmart, Target, Dollar Store)

elastic demand

sensitivity of demand to changes in price; percentage change in quality demanded caused by a percentage change in price it's much greater for products w elastic demand than for inelastic demand; if a marketer sells a product that is price elastic, then price increases will result in a significant decrease in demand = decreased profits; ch19 slide6

perishibility

services are produced at the time the consumer needs them, there is no way to hold them in inventory (ex. can't return a bad haircut, service can't be stored or just put the hair back)

convenience store

small, self-service store offering narrow product assortments in convenient locations (ex. 7-Eleven)

communication process

source -> coded message -> communication channel -> decoded message -> receiver or audience -> feedback sent to source and do cycle again ch16 slide2

closing the sale - step 6

stage in the personal selling process when the salesperson asks the prospect to buy the product; during the presentation, salesperson may use trial close by asking questions that assure the prospect will buy (fianaical terms, desired colors and sizes, or delivery arrangements and reactions to this is how they indicate how close the prospect is to buying ); salesperson should try to close at several pts during the presentation because the prospect may be ready to buy - comes w negations for deal terms and price; ch18 slide20

off-price retailers

stores that buy manufacturers' second, overruns, returns, and off-season merchandise for resale to consumers at a deep discount; limited lines of designers and 20-50% cheaper than department stores; ensure a regular flow of merch by establishing long-term relationships w suppliers (ex. Marshalls, TJ Maxx)

search qualities

tangible attributes that can be judged before the purchase of a product (ex. when searching for a place to get a haircut you like the variety of services offered)

marketing mix

the 4 P's: product, promotion, price and placement

intangibility

the characteristic that a service is not physical and cannot be perceived by the senses; Cannot physically see or touch service prior to purchase like you can with a good

product mix

the composite, or total, group of products that an organization makes available to customers

approach - step 3

the manner in which a salesperson contacts a potential customer; creating a favorable impression and building rapport w/ prospective clients are important tasks in the approach bc the prospect's first impressions of the salesperson are lasting ones; during initial visit, the salesperson strives to develop a relationship over just pushing a product; approaches through referrals, cold calling, social media, and repeat contacts ch18 slide15

personal selling

the marketing of products to ultimate consumers through face-to-face sales presentations at home or in the workplace OR online; paid personal communication that attempts to inform customers and persuade them to buy products in an exchange situation

inseparability

the quality of being produced and consumed at the same time; Production of a service cannot be separated from its consumption by customers - shared responsibility between customer and service provider

specialty retailers

they DO NOT sell specialty items but instead offer substantial assortments in a few product lines

when to use personal selling

to involve more specific communication than advertising; have greater impact on customers; provide immediate feedback

when to use agents or brokers

to negotiate the deals with manufactures for wholesalers

total cost equation

total cost = fixed costs + variable costs

inseparability in service marketing

train employees, create a nice atmosphere, and create a memorable experience; no two haircuts are the same but both customers will be treated with the same respect and have what they wanted done

wholesaling

transactions in which products are brought for resale, for making other products, or for general business operations; do not include exchanges w ultimate consumers

competitive advertising

tries to simulate demand for a specific brand by promoting its feature, uses, and advertising relative to competing brands; three types - comparative, reminder, and reinforcement

Because salespeople are an expense to the company, yet they are the ones who generate revenues for the company, management must strive to achieve optimality in the size of its salesforce

true

Rapid feedback enables communicators to quickly improve the effectiveness of theircommunication

true

department stores are characterized by wide product mixes

true

if possible, the salesperson should handle objections when they arise

true

lack of control over the content and timing of public relations is a limitation in using publicity-based public relation tools

true

merchant wholesalers assume risks of ownership

true

native advertising is called "native" because it is meant to resemble the content itself

true

tangible attributes such as color, style, size, feel, or fit that can be evaluated prior to purchase are known as search qualities

true

the broker's primary function is to bring the buyer and seller together and assist in negotiating an exchange

true

the focus of personal selling is shifting from selling a specific product to building long-term relationships with customers by finding solutions to their needs, problems, and challenges

true

lifestyle shopping center

type of shopping center that is typically open air and features upscale speciality, fancy dining, entertainment stores, have fountains, benches, other amenities that encourage 'causal browsing' (ex. luxury store but its more ab the entrainment and what ELSE they have)

direct marketing

use of phones, the internet, and non-personal media to introduce products to customers, who can then purchase them via mail, phone, or internet (ex. online retailing, catalog marketing, direct-response marketing, tv home shopping)

variable costs

variable directly w/ changes in the number of units (unit cost * # of units)

heterogeneity (variability)

variation in quality among encounters, usually increases as the degree of labor intensiveness increases

Trey is a service provider for a low-contact type of service. Which of the services below is Trey most likely to provide?

website design

demand-based pricing

when the demand for a service is high, the price is high; when demand for a service is low, the price is low (off peak pricing- reducing prices during slow periods to boost demand)

low contact services

where a customer is barely involved (ex. the accountant doing your taxes - the customer is rarely involved; mobile banking apps (don't need to contact anyone to deposit checks, check accounts etc.)

high contact services

where a customer is heavily involved ex. (buying a house)

Peter works for a company that buys snacks such as chips, cookies, and candy in bulk from manufacturers. Peter's company then repackages them and sells them to vending companies that have vending machines at government institutions. Peter most likely works for a _____, while the vending machine company is a _____.

wholesaler, retailer