Marketing 301 - Exam 2

Requirements for Effective Segmentation

-Measurable -Accessible -Substantial -Differentiable -Actionable

Maturity Stage Strategies

-Modifying Market: new users, reposition -Modifying Product: change charactersitics -Modifying Marketing Mix: change four P's

Buyer Decision Process

-Need Recognition -Information Search -Evaluation of Alternatives -Purchase Decision -Postpurchase Behavior

Individual Product Decisions

-Product Attributes -Branding -Packaging -Labeling -Product Support Services

Segmentation

Dividing the market into smaller parts with distinct needs, characteristics, or behavior that might require separate marketing strategies or mixes.

Subculture

Each larger part contains a smaller group of people with shared value systems based on common life experiences and situations - Hispanic, Afr/Asian-American.

Survivors

Elderly, passive people who are concerned about change. Loyal to their favorite brands.

New Brands

Extending a new brand name into a completely new product category.

Multibrands

Extending a new brand name into an existing product category.

Line Extension

Extending an existing brand name to new forms, colors, sizes, ingredients, or flavors of an existing product category.

Brand Extension

Extending an existing brand name to new product categories.

Product Line

Group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges.

Commercialization

Introducing new product into the market - final stage of new-product development.

More for the Same

Involves introducing a brand offering comparable quality but at a lower price.

More for More

Involves providing the most upscale product or service and charging a higher price to cover higher costs.

Less for Much Less

Involves settling for less than optimal performance in exchange for a lower price.

Growth

Life-Cycle stage of rapid market acceptance and increasing profits - Early Adopters (Stars).

Decline

Life-Cycle stage of sales and profit drop - Laggards (Dogs).

Introduction

Life-Cycle stage of sales growth as product is introduced, no profits because of heavy expenses - Innovators (Question Marks)

Maturity

Life-Cycle stage of slowdown in sales growth because of product acceptance, profits level off and begin decline - Middle Majority (Cash Cows).

Product Development

Life-Cycle stage where company finds and develops new product idea, sales are zero, and investment costs mount.

User Status

Market can be broken into non-users, ex-users, potential, first-time, and regular users.

Undifferentiated Marketing

Market coverage strategy of mass marketing in which firm decides to ignore market segment differences and go after whole market.

Concentrated Marketing

Market coverage strategy of niche marketing in which firm goes after a large share of one or a few segments.

Differentiated Marketing

Market coverage strategy of segmented marketing in which firm decides to target several market segments and design separate offers for each.

Micromarketing

Market coverages strategy of local/individual marketing in which firm tailors products to the needs of specific individuals and local customer segments.

Thinkers

Mature, satisfied, and reflective people who are motivated by ideals and value order, knowledge and responsibility.

Brand

Name, term, design, or symbol that identifies one seller's goods/services to another.

Customer-Centered NPD

New-product development that focuses on finding new ways to solve customers problems and create more satisfying experiences.

Same for Less

Offer many of the same brands as department stores but at deep discounts.

Brand Equity

Positive effect that knowing the brand name has on customer response to the product.

Makers

Practical, down to earth, self-sufficient people who like to work with their hands.

Targeting

Process of evaluating each market segment's attractiveness and selecting one or more to enter.

Indirect

Reference Group Including Aspirational, and Dissociative.

Direct

Reference Group including Primary (co-workers) and Secondary (Religious Group).

Consumer Buying Behavior

Refers to the buying behavior of individuals and households that buy goods and services for personal consumption.

Social Class

Relatively permanent and ordered divisions in society whose members share similar values, interests, and behaviors.

Business Analysis

Review of the sales/profit, and cost projections for new product to find out whether these factors satisfy the company's objectives.

Idea Screening

Screening new-product ideas in order to spot good ideas and drop poor ones.

Culture

Set of basic values, perceptions, wants, and behaviors learned by a member of society from family and other important institutions.

Target Market

Set of buyers sharing common needs or characteristics that the company decides to serve.

Test Marketing

Stage of new-product development in which the product and marketing program are tested in realistic market settings.

Achievers

Successful, goal-oriented people who focus on career and family. Favor premium products that demonstrate success to peers.

Innovators

Successful, sophisticated, take charge people with high self-esteem

Idea Generation

Systematic search for new-product ideas.

Concept Testing

Testing new-product concepts with a group of target consumers to find out if the concepts have strong consumer appeal.

Buyer's Black Box

The Why's of Buyer's behavior that marketers don't exactly understand.

Relative Advantage

The degree to which an innovation appears superior to existing products.

Compatibility

The degree to which an innovation fits the values and experiences of potential customers.

Complexity

The degree to which an innovation is difficult to understand or use.

Divisibility

The degree to which an innovation may be tried on a limited basis.

Communicability

The degree to which the results of using the innovation can be observed or described to others.

Value Proposition

The full positioning of a brand - full mix of benefits upon which it is positioned.

Reference Group

The people to whom an individual looks when forming an attitude about an object.

Perception

The process by which people select, organize, and interpret information to form a meaningful picture of the world.

Product Adoption Process

-Awareness -Interest -Evaluation -Trial -Adoption

Adopter Categories

-Innovators -Early Adopters -Early Majority -Late Majority -Laggards

Brand Strategy Decisions

-Brand Positioning -Brand Name Selection -Brand Sponsorship -Brand Development

Factors of Influencing Consumer Behavior

-Cultural -Social -Personal -Psychological

Occasion Segmentation

Dividing market into segments according to occasions when buyers get idea to buy.

Demographic Segmentation

Dividing market into segments based on age, gender, family size, family life cycle, income, occupation etc.

Behavioral Segmentation

Dividing market into segments based on consumer knowledge, attitudes, uses or responses to a product.

Psychographic Segmentation

Dividing market into segments based on social class, lifestyle or personal characteristics.

Belief

A descriptive thought that a person holds about something.

Motive

A need that is sufficiently pressing to direct the person to seek satisfaction of the need.

Attitude

A person's consistently favorable or unfavorable evaluations, feelings, and tendencies toward an object or idea.

Lifestyle

A person's pattern of living as expressed in his or her activities, interests, and opinions.

Early Adopters

Adopter Class that are opinion leaders in their communities and adopt new ideas early but carefully.

Early Majority

Adopter class that's deliberate, and although they are rarely leaders, they adopt new ideas before the average person.

Late Majority

Adopter class that's skeptical, they adopt an innovation only after a majority of people have tried it.

Laggards

Adopter class that's tradition bound, they are suspicious of changes and adopt the innovation only when it's become something of tradition.

Innovators

Adopter class that's venturesome, they try new ideas at some risk.

Service

Any activity, benefit, or satisfaction offered for sale that is essentially intangible and does not result in the ownership of anything.

Product

Anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need.

Positioning

Arranging for the market offering to occupy a clear, distinctive, and desirable place relative to competing products in minds of target consumers.

Actual Product

Brand Name, Quality Level, Packaging, Design, Features - Physical entity in terms of form, functional characteristics around the benefit.

Believers

Conservative, conventional, and traditional people with concrete beliefs.

Convenience Product

Consumer product that customers usually buy frequently, immediately, and with a minimum of comparison and buying effort - Paper Towels.

Unsought Product

Consumer product that the consumer either doesn't know about or knows about but does not normally think of buying - Life Insurance.

Shopping Product

Consumer product that the customer, in the process of selection and purchase, usually compares on such bases as suitability, quality, price, and style - NorthFace.

Specialty Product

Consumer product with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort - Rolex, Ferrari.

Augmented Product

Delivery and Credit, After-Sale Service, Warranty, Product Support - Value added services and experiences obtained with the product.

Marketing Strategy Development

Designing an initial marketing strategy for a new product based on the concept.

Product Concept

Detailed version of the new-product idea stated in meaningful consumer terms.

Product Development

Developing the product concept into a physical product in order to ensure that the product idea can be turned into a workable market offering.

New Product Development

Development of original products, product improvements, product modifications, and new brands through the firm's own efforts.

Differentiation

Differentiating the market offering to create superior customer value.

Geographic Segmentation

Dividing market into different geographic units such as nations, states, regions, counties, cities, or neighborhoods.

Product Position

The way the product is defined by consumers on important attributes - the place the product occupies in consumers' minds relative to competition.

Positioning Statement

To (target segment and need) our (brand) is (concept) that (point-of-difference).

Strivers

Trendy and fun-loving people who are resource-constrained. Favor stylish products that emulate purchases of those with greater wealth.

Experiencers

Young enthusiastic impulsive people who seek variety and excitement. Spend a comparatively high proportion of income on fashion, entertainment, and socializing.