Marketing 300 Exam 2

Disney Mickey Check (step 3)

A nutritional seal of approval program: After survey feedback revealed parents' concern about childhood health.

Total Quality Management

Approach that involves constantly improving the quality of products/ services

Brand Association

Are consumer thoughts connected to the consumer's memory about the brand Tesla is electric, Apple is different, Downy is soft

New Products

At one point, every product around today was new-to-the-market (Never been seen before).

Brand Name Selection

Begins with a review of the product, its benefits, target market and proposed marketing strategy

Measurement Role

Brand price compared to unbranded price

Geographic Segmentation

Divides groups based on physical location "Birds of a feather flock together nations, regions, states, counties, cities, neighborhood

age distribution

Easy to determine, preferences tend to follow age progression leading to different needs and wants

Targeting

Evaluate market segments & Select the best segment(s) to enter/serve (Profitability) Create Value for Targeted Customers

new brands (new,new)

Existing brand waning or enters new product category Toyota created separate Lexus brand (luxury)

Line Extension (existing, existing)

Extends to New forms, color, sizes, flavors, etc. KFC Original to Grilled, Boneless, Hot wings

Information Requirements for Developing a Marketing Plan

External Environment (Macro) Internal Environment (Micro Consumer Behavior (External) Competitive Positioning (Internal/External Target Market Selection (Internal), Target Market Characteristics (External)& Market Trends (External)

Competitive Analysis (step 1)

Firms must understand the position other competitors have taken in the marketplace. More important when competitors all appear to offer a similar good or service.

Mass Marketing

Firms that try to meet every need of every customer typically end up serving no needs of any customer particularly well.

Concentrated (Niche)

Focus effort on a large share of one/few segments (niches).Harry's Shaving products - Convenience •Limited resources •Market Knowledge •More efficient & effective

Conformance Quality

Freedom from defects & consistency in delivering: Zero Defect or 6-sigma philosophy (3.4 defects per million) - Baldrige Award (1987) vs. Deming Award Japan (1951)

Labeling & Logos

Identifies the product or brand, describes attributes, and provides promotional value

Competitive Advantage

Identify competitive advantages & select the ones consistent with consumer beliefs

Packaging

•Involves designing and producing the •Container/wrapping (protects) •Advertising/promotions - Retail Clutter •Increase convenience - Storage •Sustainability - Environment

Quality Levels

Level of quality that will support positioning (High price/High value to Low price/Low value)

Brand Sponsorship Options

Manufacturer Brand: Manufacturer sells under their own brand name Private (Store) Brand: brand created/owned by reseller Licensed Brand: Companies extend their brand by licensing Co-Branded: Use brand name of two different companies

multi brands (new, existing)

Many brands in given product category. PepsiCo has 8 brands of soft drinks

Positioning (brand)

Marketers need to position brands clearly in the target market's mind. There are three levels: Product Attributes Benefits Beliefs & Values

Strategic Fit (target selection process)

Marketers should work to ensure that the selected target markets fit with what the organization is and wants to be

Effective Segmentation

Measurable: Measure elements that define segment (Size, purchasing power) Accessible: Reach and serve Substantial: Must be Large enough to be profitable and support separate marketing mix Differentiable: Selected target market must respond differently to different marketing strategies Actionable: Marketing strategies can be designed for attracting & serving segment

Online Classes (step 3)

More universities began to offer due to fluctuating student work schedules, high gas prices, a weak economy, and most recently the pandemic

Types of New Products

New Product: New to the company New-to-Market: New been seen before (Not many) New Category: New to the company, not market Product Line Extensions: Extend product line (related products) Revamped Products: Packaging, features, design, etc.

brand extension (existing, new)

New/modified Brand in New Category Starbucks: supermarkets, teahouses, home coffee

Seven Stages of New Product Development

Stage 1: New Product Development Strategy Stage 2: Idea Generation Stage 3: Idea Screening Stage 4: Business Analysis Stage 5: Product Development Stage 6: Test Marketing Stage 7: Product Launch

Service Differentiation

•Using service to create a competitive advantage Ordering ease Delivery Installation Customer training Customer contact & consulting Maintenance & repair Returns

Product Quality

The characteristics of a product or service that bear on its ability to satisfy stated or implied customer needs. (Positioning attribute?)

Brand Recognition

The degree to which customers identify the brand under a variety of circumstances (Brand Marks - not expressed in words)

Brand Equity

The differential effect that knowing the brand name has on customer responses Ability to capture consumer preferences and loyalty High brand equity provides competitive advantage

Growth Potential (target selection process)

The higher the future growth rate, the more attractive is the segment.

Service

The intangible part of the product bundle of benefits that satisfies needs/wants (no ownership) Service sector represents 80% of U.S. GDO

Level of Competition (target selection process)

The more intense the competition within a segment, the less attractive the segment is to marketers.

Branding

The name, term, sign, or design or a combination of these, that identifies the maker or seller of a product or service.

Lifestyle Segmentation

divides people into groups based on their opinions and the interests and activities they pursue.

Product Support Services

element of the product strategy that augments the actual product,

Behavioral Segmentation

involves categorizing customers based on what they actually do or how they act toward products. Most difficult to execute. loyalty, price sensitivity, occasions, usage rate

Co-branding

occurs when two or more companies issue a single product in an effort to capitalize on the equity of each company's brand. has many benefits, but if one of the brands involved receives negative publicity, it could impact the co-branding partner in a negative way.

segmentation bases

demographic: age, gender, income, family size geographic: nations, regions, states. neighborhoods psychographic: psychological traits, motivation, customer attitudes behavioral: loyalty, price sensitivity, occasions, usage rate

Repositioning

Involves re-establishing a product's position to respond to changes in the marketplace.

Positioning

A company's market position is the customer's perception of a company's efforts, including its products, services, and even ideas.

Target Market Strategies

(very broad to very narrow) Undifferentiated (Mass Marketing) Differentiated Concentrated (Niche) Micro-Marketing

Style & Design

----: describes the appearance of the product (eye catching, attention grabbing,) but does not necessarily make the product better ----: broader measure, contributes to the products usefulness & looks (more that skin deep)

Brand Loyalty

A consumer steadfast allegiance to a brand by repeatedly purchasing it "I'd walk a Mile for a Camel

Positioning Strategies

A firm may focus its positioning strategy on certain product attributes, features, or value perceptions

Target Market

A group of customers toward which an organization has decided to direct its marketing efforts (Profitability).

Stage 4: Business Analysis

A review of the sales, costs, and profit projections for a new product to find out whether these factors satisfy the company's objectives.

Performance Levels

Ability to perform its function (Mercedes vs. Chevy

Product Features

Characteristics that describes the product A stripped down model (Good, Better, Best) - Automobiles, Electronics, etc. A competitive tool for differentiating a product from competitive products Assessed based features that customers value highly in relation to cost to the company (Core Values)

Communications

Communicate important attributes and deliver on promise

Product Diffusion (Speed of Acceptance)

Competitive Advantage: If consumers believe it has more value than other products in its category (faster diffusion). Compatibility: The product fits a potential customer's needs, values, product knowledge, and past behaviors (faster diffusion). Observability: People can see others using a product and perceive value in its use (faster diffusion) Complexity: Product is easier it is to understand and use a product (faster diffusion). Trialability: Products that consumers can try without significant expense (faster diffusion)

gender

Consumers more receptive to products or communications tailored to their gender Traditional gender roles are blurring Youngest generation disputes binary gender classifications

Five Specific Drivers of Innovation

Customer Expectations: Related to changes in what consumers need or want. Competition: Forced to update/add products because of competitors Globalization: Their product is sold in an expanded global marketplace. Technology: Has always driven product innovation. Changing Society: How societies operate is constantly changing.

Stage 5: Product Development

Determines if product can be produced to profitably meet customer needs Develop into a physical product (Protype) to ensure that the product idea can be turned into a workable market offering.

Marketing Strategies

Develop marketing strategies consistent with offering's competitive advantages (Product, Price, Place, Promotions)

Differentiation

Differentiate offering from competition & create superior value Create Value for Targeted Customers

Segmentation

Divide total market into smaller markets, based on shared characteristics to Identify needs & wants Create Value for Targeted Customers

Stage 3: Idea Screening

Identify good ideas & drop poor ideas (R-W-W) Is it Real? Can it Win? Is it Worth doing? Can it be done? Can the company make it?. Saves money in product development cost by going forward with only profitable ideas

Undifferentiated (Mass Marketing)

Ignore segments & sell one offer to entire market (Rarely used - Coca-Cola •Needs not met •Less expensive •Cheap to develop •Low distribution costs

Number of Target Markets

In addition to selecting and evaluating the target market, a firm must use market data to decide how many target markets to serve. Differentiate the target market offering from competition and position the offering in the minds of the target market & determine the resources required

Product Diffusion and Types of Adopters

Innovators: First to try new products, risk takers & Influencers Early Adopters: Purchase product soon after it is introduced, wait for product reviews and info before purchasing Early Majority: Careful in their approach, competitors enter the market so they have some choice as to which product to buy Late Majority: Tend to be cautious about new things and ideas, often older Laggards: Don't like change, may remain loyal to a product until it is no longer available, may not use the Internet

Characteristics of Services

Intangible: Cannot be seen, tasted, felt, heard or smelled before purchase Inseparable: Produced & consumed at same time & cannot be separated from their provider. Perishable: Cannot be stored for later sale (cannot maintain inventory) Variability: Quality depends on who provides them, when, where, & how

Stage 6: Test Marketing

Introducing a new product to a geographically limited market to see how well the product sells and the reaction to it from potential users.

Stage 1: New Product Development Strategy

Involves determining the direction a company will take when it develops a new product. Guidelines: Fit product Characteristics to Target markets to be served

Target Marketing (Targeting)

Occurs when marketers evaluate each market segment and determine which segments present the most attractive opportunity to maximize sales/profits. The segment(s) selected are the firm's target(s).

Attributes (step 2)

Often a product will have multiple attributes that create a unique position in the market.

Segment Evaluation

Only segments that will be responsive to the firm's marketing efforts are chosen as target markets.

Price/Quality Relationship (step 2)

Optionally priced according to quality

Positioning

Perception of Value vs. Competitors in the mind of the consumer Create Value for Targeted Customers

Product Lines

Product Item: Single, specific Product Product Lines: Series of related products - Beds (different versions of a product within a category) Product Mix: Assortment of product lines and individual product offerings - beds, arm chairs, mirrors, etc Width: Total Number of product lines a firm offer length: Number of different products a firm sells depth: riation in each product the firm offers

Analytic Implications of Segmentation

Product Markets: Characterized by heterogeneous demand - consumers seeking different things from same product/service. Segmentation Process: Requires finding homogeneous groups within the market. What if they are not homogeneous? Understanding Segments: To understand the needs/wants of different consumers in a given market. Evaluating Segments: Data are used to evaluate and determine the most appropriate segments to target.

Application (step 2)

Product/brand positioned in term of how it is used

Consumer Products

Products and services bought by final consumers for personal consumption Classified according to how a consumer shop, pays for, or uses the product

Perceptual Map (step 1)

Provides a valuable tool for understanding competitors' positions in the marketplace. It creates a visual picture of where products are located in consumers' minds.

Return on Equity

Quality is an investment, holding quality efforts accountable for bottom line results

The Key Steps to Effective Market Positioning

Successful positioning involves all of the marketing mix elements (product, place, price, and promotion). Step 1: Analyze Competitors' Positions Step 2: Highlight Competitive Advantage Step 3: Evaluate Consumer Feedback and Understand Its Importance

International Marketing Decision

Successful strategies in one country may not extend to other international markets What products/services to introduce Standardization vs. Customization Branding, Packaging & Labelling Customs, values, laws

Stage 2: Idea Generation

Systematic search for new product ideas (No Bad Ideas)

core customer values

Target Mktg. Purchase Benefits (Why purchasing)

Differentiated

Targets several market segments & designs separate offers (marketing mix) for different segment (Marriott: 30 Brands) •Higher costs •Higher sales •Stronger position •Expensive

Micro-Marketing

Taylors offers to needs of individuals and local customer segments: Rolls-Royce Bespoke -Custom Made •Needs better met •More expensive •More product design •Managing relations

The Cohort Effect

Tendency of members of a generation to be influenced and bound together by significant events in their formative year, ages 17 to 22

Market Size

The U.S. Census Bureau divides cities and urbanized areas into Metropolitan Statistical Areas (MSAs), which are free-standing areas with a core urban population of at least 50,000. Allows marketers to capitalize on Convenience.

Sustainable Marketing

The process of creating, communicating, and delivering value to customers through the preservation and protection of the natural systems that our society and economy depends.

Diffusion

The process through which a product is adopted and spreads across various types of adopters awareness>interest>evaluation>trill>adaption

Psychographic Segmentation

The science of using psychology and demographics to segment consumers is called ------ that divides groups into according to the reason consumers purchase

Values & Lifestyle Framework

VALS classifies adults age 18 years + into eight psychographic segments according to how they respond to a set of attitudinal and demographic questions.

PRIZM

Zip code driven with profiles that include demographic, lifestyle, media preferences, shopping behavior & technology use

Perceived Quality

a consumer's perception of the overall quality of the brand

marketing considerations

buying behavior, price, distribution, promotion, examples (convenience, shopping, specialty, unsought)

Trends Apparel Market

fashion: Growth of K-Pop & Work at home environment: Sustainability and Ethical shopping: Minimize shopping anxiety - Information, volume of trends/fashions sweeping brands and social media fluidity: Changes in attitudes toward gender identity and expression re-commerce: Second-hand and resale apparel

actual product

features, technology, experience, color, packaging, quality

augmented product

service, warranty, after sale support, experiences, product support, financing

Innovation

the creation of a new or significantly improved product offering

Market Trends Porter Five Forces

threat of new entrants: Brand loyalty, Access to distribution Barriers to entry threat of substitutes: Number of substitutes, Buyer willingness to switch, Relative price of substitutes, Perceived differentiation bargaining power of buyers: Number of customers, Differences between competitors, Price sensitivity, Information available bargaining power of suppliers: Number/Size of suppliers, Uniqueness in products rivalry among existing competitors: Number of competitors, Industry concentration, Industry growth, Switching costs

Brand Revitalization

•Brand revitalization, or rebranding, is a decision to recapture lost sources of brand equity and identify and establish new sources of brand equity. •Often begins with rebuilding trust with customers

Types of Consumer Products

•Convenience products •Shopping products •Specialty products •Unsought products