MARK 201 Chapter 5-9

What three attitude-change approaches are most common?

(1) Change beliefs about the extent to which a brand has certain attributes. (2) Change the perceived importance of these attributes. (3) Add new attributes to the product.

What are the two primary forms of personal influence?

(1) Opinion leadership—persons considered to be knowledgeable about or users of particular products and services and (2) word of mouth—the influencing of people (friends, family, and colleagues) during conversations.

What are the three main types of organizational buyers?

(1) industrial firms, which in some way reprocess a product or service they buy before selling it again to the next buyer; (2) resellers, which are wholesalers and retailers that buy physical products and resell them again without any reprocessing; and (3) government units, which are the federal, state, and local agencies that buy products and services for the constituents they serve.

What are the three types of buying situations or buy classes?

(1) new buy—the organization is a first-time buyer of the product or service; (2) straight rebuy—the organization reorders an existing product or service from a list of acceptable suppliers; and (3) modified rebuy—an organization's buying center changes the product's specifications, price, delivery schedule, or supplier.

In the marketing research for Tony's Pizza, what is an example of (a) a finding and (b) a marketing action?

(a) Figure 8-7A depicts annual sales from 2014 to 2017; the finding is that annual sales are relatively flat, rising only 5 million units over the four-year period. (b) Figure 8-7D shows a finding (the decline in pizza consumption) that leads to a recommendation to develop an ad targeting children 6 to 12 years old (the marketing action)

Effective marketing is of increasing importance in today's competitive environment. How can firms more effectively market to organizations?

Firms can more effectively market to organizations by following four guidelines when designing and implementing their marketing strategy: (1) understand the organization's needs, (2) get on the right bidder's list, (3) find the right people in the buying center, and (4) provide value to organizational buyers.

What are some criteria used to decide which segments to choose for targets?

Possible criteria include market size, expected growth, competitive position, cost of reaching the segment, and compatibility with the organization's objectives and resources.

What is the difference between product positioning and product repositioning?

Product positioning refers to the place a product occupies in consumers' minds based on important attributes relative to competitive products. Product repositioning involves changing the place a product occupies in a consumer's mind relative to competitive products.

Products may be sold globally in three ways. What are they?

Products can be sold: (1) in the same form as in their home market (product extension); (2) with some adaptations to make them more appealing to local consumers (product adaptation); and (3) as a totally new product to satisfy consumers' needs across countries (product invention).

What is protectionism?

Protectionism is the practice of shielding one or more industries within a country's economy from foreign competition through the use of (1) tariffs, which are a government tax on products or services entering a country that primarily serve to raise prices on imports and (2) quotas, which are restrictions on the amount of product allowed to enter or leave a country.

Explain what is meant by this statement: "Quotas are a hidden tax on consumers, whereas tariffs are a more obvious one."

Quotas represent a hidden tax on consumers because they limit supply of products, which in turn increases prices. Tariffs are literally a government tax imposed on imported goods.

What mode of entry could a company follow if it has no previous experience in global marketing?

indirect exporting through intermediaries

When foreign currencies can buy more U.S. dollars, are U.S. products more or less expensive for a foreign consumer?

less expensive

Which type of survey provides the greatest flexibility for asking probing questions: mail, telephone, or personal interview?

personal interview (or individual/depth interview)

What is the first stage in the consumer purchase decision process?

problem recognition—perceiving a need

What one department is almost always represented by a person in the buying center?

purchasing department

What is a bidder's list?

A bidder's list is a list of firms generated from a company's purchasing database that is believed to be qualified to supply a given item.

In the marketing research for Tony's Pizza, what is an example of (a) a finding and (b) a marketing action?

A cross tabulation, or "cross tab," is a method of presenting and analyzing data involving two or more variables to discover relationships in the data. As the most widely used technique for organizing and presenting marketing data, the simple format and flexibility of cross tabulations permit the direct interpretation of and an easy means to communicate the data.

What is a cross tabulation?

A cross tabulation, or "cross tab," is a method of presenting and analyzing data involving two or more variables to discover relationships in the data. As the most widely used technique for organizing and presenting marketing data, the simple format and flexibility of cross tabulations permit the direct interpretation of and an easy means to communicate the data.

What is a make-buy decision?

A make-buy decision is an evaluation of whether components and assemblies will be purchased from outside suppliers or built by the company itself.

What are some advantages and disadvantages of secondary data?

Advantages of secondary data are the time-savings, the low cost, and the greater level of detail that may be available. Disadvantages of secondary data are that the data may be out of date, unspecific, or have definitions, categories, or age groupings that are wrong for the project.

List and discuss the key characteristics of organizational buying that make it different from consumer buying.

Although the buying processes organizations go through when making a purchase also apply to consumer buying, there are some key differences: a. Organizations buy products and services to help them achieve organizational objectives, namely, to increase profits through reducing costs or increasing revenues. b. Demand for products and services from organizations is derived from the demand for consumer products and services. c. The size ($ or #) of organizational purchases is much larger than consumer purchases. d. There are fewer organizational buyers than consumer buyers. e. The buying criteria for organizational buyers generally focus on three critical factors: (1) ability to meet quality standards, (2) ability to deliver the product on time, and(3) past performance on previous contracts. f. Several people, typically in a buying center, get involved in an organizational purchase. g. The post purchase evaluation is often more formalized.

What country is the biggest as measured by world trade?

China

What are constraints, as they apply to developing a research plan?

Constraints in a decision are the restrictions placed on potential solutions to a problem, such as time and money. These set the parameters for the research plan—due dates, budget, etc.

What is the difference between the demographic and behavioral bases of market segmentation?

Demographic segmentation is based on some objective physical (gender, race), measurable (age, income), or other classification attribute (birth era, occupation) of prospective customers. Behavioral segmentation is based on some observable actions or attitudes by prospective customers—such as where they buy, what benefits they seek, how frequently they buy, and why they buy.

What is dumping?

Dumping is when a firm sells a product in a foreign country below its domestic price or below its actual cost to produce to build a company's market share or a surplus exists because the company cannot sell it domestically.

What are e-marketplaces?

E-marketplaces are online trading communities that bring together buyers and supplier organizations to make possible the real-time exchange of information, money, products, and services.

What factor is estimated or measured for each of the cells in a market-product grid?

Each cell in the grid can show the estimated market size of a given product sold to a specific market segment.

What does lifestyle mean?

Lifestyle is a mode of living that is identified by how people spend their time and resources, what they consider important in their environment, and what they think of themselves and the world around them.

What is marketing research?

Marketing research is the process of defining a marketing problem and opportunity, systematically collecting and analyzing information, and recommending actions to reduce the risk of and thereby improve marketing decisions.

How are marketing and product synergies different in a market-product grid?

Marketing synergies run horizontally across a market-product grid. Each row represents an opportunity for efficiency in the marketing efforts to a market segment. Product synergies run vertically down the market-product grid. Each column represents an opportunity for efficiency in research and development (R&D) and production. Marketing synergies often come at the expense of product synergies because a single customer segment will likely require a variety of products, each of which will have to be designed and manufactured. The company saves money on marketing but spends more on production. Conversely, if product synergies are emphasized, marketing will have to address the concerns of a wide variety of consumers, which costs more time and money.

What is the difference between a multidomestic marketing strategy and a global marketing strategy?

Multinational firms view the world as consisting of unique markets. As a result, they use a multidomestic marketing strategy because they have as many different product variations, brand names, and advertising programs as countries in which they do business. Transnational firms view the world as one market. As a result, they use a global marketing strategy to standardize marketing activities when there are cultural similarities and adapt it when cultures differ.

What is the difference between observational data and questionnaire data?

Observational data are facts and figures obtained by watching, either mechanically or in person, how people behave. Questionnaire data are facts and figures obtained by asking people about their attitudes, awareness, intentions, and behaviors.

"The greater the perceived risk in a purchase situation, the more likely that ​cognitive dissonance will result." Does this statement have any basis given the ​discussion in ​the text? Why?

Perceived risk represents the anxieties felt because the consumer cannot anticipate the outcomes of a purchase but believes that there may be negative consequences (cost, safety, performance, or psychosocial). Typically, the greater the perceived risk, the more extensive the external research phase is likely to be for consumers before a purchase is made to reduce the negative consequences that may result after the purchase. Accordingly, this extensive external search will most likely produce a larger number of attractive alternatives and therefore a greater propensity for cognitive dissonance to develop once a purchase decision is made. However, when faced with two or more highly attractive purchase alternatives, consumers, after purchasing one of them, may experience cognitive dissonance, a feeling of post-purchase psychological tension or anxiety, or wishing they had bought one of the other alternatives.

Why do marketers use perceptual maps in product positioning decisions?

Perceptual maps are a means of displaying in two dimensions the location of products or brands in the minds of consumers. Marketers use perceptual maps to see how consumers perceive competing products or brands as well as their own product or brand. Then, they can develop marketing actions to move their product or brand to the ideal position.

What is the difference between secondary and primary data?

Secondary data are facts and figures that have already been recorded prior to the project at hand, whereas primary data are facts and figures that are newly collected for the project.

What is the North American Industry Classification System (NAICS)?

The NAICS provides common industry definitions for Canada, Mexico, and the United States, which makes it easier to measure economic activity in the three member countries of the North American Free Trade Agreement (NAFTA).

How do you make a lost-horse forecast?

To make a lost-horse forecast, begin with the last known value of the item being forecast, list the factors that could affect the forecast, assess whether they have a positive or negative impact, and then make the final forecast.

As a novice in global marketing, which alternative global market-entry strategy would you be likely start with? Why? What other alternatives do you have for a global market entry?

The best alternative for a novice firm is indirect exporting—selling its domestically produced goods in a foreign country through an intermediary, such as a distributor, that has the marketing know-how and the resources necessary for the effort to succeed. This will allow consumers in the target country to try the firm's products and to begin to recognize its name. It also entails the lowest risk and investment from the firm. Other alternatives in order of increasing level of risk and investment are: a. Direct exporting. Selling the firm's domestically produced goods in a foreign country without intermediaries. b. Licensing. Offering the right to a trademark, patent, trade secret, or other intellectual property in return for a royalty or fee. c. Joint venture. Occurs when a firm and local firm invest together in a foreign country to create a local business. d. Direct investment. Entails a domestic firm investing in and owning a foreign subsidiary or division.

What is the five-step marketing research approach?

The five-step marketing research approach provides a systematic checklist for making marketing decisions and actions. The five steps are: (1) define the problem; (2) develop the research plan; (3) collect relevant information (data); (4) develop findings; and (5) take marketing actions.

Market segmentation involves aggregating prospective buyers into groups that have two key characteristics. What are they?

The groups (1) should have common needs and (2) will respond similarly to a marketing action.

What is the trade feedback effect?

The phenomenon in which one country's imports affect the exports of other countries and vice versa, thus stimulating trade among countries.

In terms of market segments and products, what are the three market segmentation strategies?

The three market segmentation strategies are: (1) one product and multiple market segments; (2) multiple products and multiple market segments; and (3) "segments of one," or mass customization—the next step beyond build-to-order.

In evaluating marketing actions, what are the two dimensions on which they should be evaluated?

There are two aspects marketers use to evaluate the results of marketing actions: (1) evaluate the decision itself, which involves monitoring the marketplace to determine if action is necessary in the future and (2) evaluate the decision process used to determine whether (a) the marketing research and analysis used to develop the recommendations was effective or flawed in some way and (b) the process could be improved for similar situations in the future.

What are the three kinds of sales forecasting techniques?

They are: (1) judgments of the decision maker who acts on the results of a sales forecast; (2) surveys of knowledgeable groups, those who are likely to know something about future sales; and (3) statistical methods such as trend extrapolation, which involves extending a pattern observed in past data into the future.

How successful would a television commercial in Japan be if it featured a husband surprising his wife in her dressing area on Valentine's Day with a small box of chocolates containing four candies? Explain.

This commercial would be a failure. It violates a number of cultural norms in Japan: (1) The Japanese consider it inappropriate for a husband to intrude on his wife;(2) Japanese women give men chocolates on Valentine's Day; and (3) the number four is unlucky in Japan.

How does licensing differ from a joint venture?

Under licensing, a company (licensor) offers the right to a trademark, patent, trade secret, or other similarly valued items of intellectual property in return for a fee or royalty. It is a low-risk, capital-free strategy to enter a foreign country. However, the licensor forgoes control of its offerings and potential profits are reduced while the licensee gains information that may give it a competitive advantage in the future. In a joint venture, a foreign company and a local firm invest together to create a local business to produce some product or service. The two companies share ownership, control, and profits of the new entity. Neither firm may have the resources necessary to enter the foreign market on its own. However, the two companies may disagree about policies or courses of action or when government bureaucracy bogs down the efforts.

The North American Free Trade Agreement was designed to promote free trade among which countries?

United States, Canada, and Mexico

Suppose your dean of admissions is considering surveying high school seniors about their perceptions of your school to design better informational brochures for them. What are the advantages and disadvantages of doing (a) telephone interviews and(b) an Internet survey of seniors who have requested information about the school?

When choosing to use a telephone interview or Internet survey, the marketing researcher must balance the cost against the expected quality of the information obtained, which is affected by the time required to complete the survey, equipment required, previous experiences, ability to probe the responses given, interview bias, anonymity of the respondent, etc. Specific advantages and disadvantages are listed below. a. Telephone interview. 1. Advantages. · Virtually everyone in the senior high school class has a land line/mobile telephone. · A representative sample of high school seniors may be obtained. · The telephone interview permits answers to be probed easily to obtain extra information from respondents. · It is moderately expensive, assuming a reasonable completion rate. To reduce costs, some marketing researchers use automated/computerized-calling systems instead of live human beings to complete the telephone interviews. ·Some anonymity is given to respondents since there is not a face-to-face interview, and a specific mailing address is not known to the market researcher. 2. Disadvantages. · The difficulty of getting students to respond to telephone questions and to respond to scaled questions they can hear but not see in writing. · Including students in the sample who have no interest in the school. · Moderately expensive, assuming a reasonable completion rate. · Some interviewers can bias the results due to the inflection of their voices when asking questions. · Respondents typically limit calls to 5 to 15 minutes in length. Any interview that lasts longer will substantially increase noncooperation—respondents just hang up. · Some potential respondents may have caller ID or other screening technology that allows them to not answer calls from unapproved telephone numbers. · Past experiences of telemarketers using a marketing research telephone survey as a guise for a sales call. · Very intrusive—market researchers typically call during the "dinner hour" from5:30 p.m. to 9:00 p.m. · Many potential qualified respondents have unlisted telephone numbers and/or placed themselves on the federal government's Do Not Call registry. This eliminates them from the universe of qualified respondents, thereby introducing bias into the results since the marketing researcher is not able to adequately reach the desired target market. · Many potential qualified respondents use their mobile phones as the primary telephone and therefore may not want to cooperate due to connect charges. · Many mobile phone users are not in any directory nor online website that may provide phone numbers such as 411.com. b. Internet surveys. 1. Advantages. · The sampled respondents have shown their interest in the university so the response rate should be high. · Usually the least expensive method, assuming adequate completion rates. It is relatively easy to design an Internet survey, post it to a website, and generatee-mails requesting respondent cooperation using off-the-shelf software. · No opportunity to bias results since form is completed without an interviewer. · Some anonymity given to respondents since there is not a fact-to-face interview or a specific mailing address is not known to the market researcher. 2. Disadvantages. · Getting new ideas from seniors not requesting information. · Little flexibility to probe responses or ask complex questions since the self-administered online form must be short and simple to complete. · Potential qualified respondents need to have a computer, Internet connection, and an e-mail address to send the survey to. · Some respondents have 'junk mail' filters that prohibit unapproved e-mails. · Respondents may get 'spammed' with other unwanted e-mail surveys or theire-mail addresses are sold to other firms. · E-mail survey forms are visually different than mail or fax surveys and require typing or selecting the desired responses with a keyboard or mouse. ·Seniors are less likely to have Internet access or go online than younger demographic age groups.

Explain how the North American Industry Classification System (NAICS) might clarify industrial, reseller, and government markets and (b) discuss the limitations inherent in this system.

a. Advantages of the NAICS. The North American Industry Classification System (NAICS) provides common industry definitions for Canada, Mexico, and the United States, which makes easier the measurement of economic activity in the three member countries of the North American Free Trade Agreement (NAFTA). It groups economic activity to permit studies of market share, demand for goods and services, import competition in domestic markets, and similar questions. It then designates industries with a six-digit numerical code. The first two digits designate a sector of the economy. The third digit designates a subsector while the fourth digit represents an industry group. The fifth digit designates a specific industry and is the most detailed level at which comparable data are available for the three countries. The sixth digit designates individual country-level national industries. b. Disadvantages of the NAICS. Such breakdowns allow one to identify firms within categories and to monitor growth or decline with industries. The NAICS has two important limitations: (1) large firms engaging in different activities or providing different products or services are given only one NAICS code and (2) the five-digit national industry codes are not available for all three countries because the respective governments will not reveal data when too few organizations exist in a category.

The process of segmenting and targeting markets is a bridge between which two marketing activities?

identifying market needs and executing the marketing program

What is a buying center? (b) Describe the roles assumed by people in a buying center and (c) what useful questions should be raised to guide any analysis of the structure and behavior of a buying center.

a. Buying center. A buying center consists of a group of individuals within an organization who participate in the buying process and share common goals, risks, and knowledge important to purchase decisions. b. Buying center roles. Individuals in a buying center perform one or more roles: · Users are people in the organization who use the product or service. · Influencers affect the buying decision, usually by helping define the specifications for what is bought. · Buyers have formal authority and responsibility to select the supplier and negotiate the terms of the contract. · Deciders have the formal or informal power to select or approve the supplier that receives the contract. · Gatekeepers control the flow of information in the buying center. c. Questions. Four questions guide an analysis of a buying center: · Which individuals are in the buying center for the product or service? · What is the relative influence of each member of the group? · What are the buying criteria of each member? · How does each member of the group perceive our firm, our products and services, and our salespeople?

Describe the major differences among industrial firms, resellers, and government units in the United States.

a. Industrial firms, which account for most of all organizational buyers, in some way reprocess a product or service they buy before reselling it again to the next buyer. b. Resellers, the second largest group of organizational buyers, consist of wholesalers and retailers that buy physical products and resell them again without any reprocessing. c. Government units, the smallest of the three groups, consist of federal, state, and local agencies that buy goods and services for the constituents they serve.

What is the term for post purchase anxiety?

cognitive dissonance

The brands a consumer considers buying out of the set of brands in a product class of which the consumer is aware are collectively called the

consideration set

Cross-cultural analysis involves the study of

similarities and differences among consumers in two or more nations or societies.

​In general, which type of online auction creates upward pressure on bid prices and which type creates downward pressure on bid prices?

traditional auction; reverse auction