MARKETING 360 EXAM 2

Share of Customer >Share of customer = _ of purchase a customer makes within a given category form a certain company (vs. _ of overall market) - Billy buys 3 pairs of Nikes and Adidas each year, this both companies share half of the market share (billy)

%

Promotion Overview >Promotion - Coordination of a marketer's communication ____ to influence attitudes and behavior >Promotion Strategy - A plan to use advertising, public relations, personal selling and promotion in the most _______ manner possible - Main goal? --> Communicate a competitive advantage

efforts effective

Cultural Differences in Evaluation of Brand Extensions - Background/Hypothesis >People from ______ cultures (e.g., India) more likely to think holistically >People from ______ cultures more likely to think analytically Hypothesis: People who think holistically should be more likely to see a fit between a parent brand (e.g., McDonalds) and a "brand extension" (e.g., onion rings) than people who think analytically

eastern western

Innovation >Something new or ______ >Typically purchased by a few, then spread through population

different

Classifying Products >_____ - Proven benefit over long term - High involvement in decision >Non-_____ - Provide benefit over short time - Low involvement in decision

durable

There are five categories of adopters: ____ Majority (34%) They are typically middle-class _______ and are deliberate and cautious. Early majority consumers have slightly above-average education and income levels.

early consumers

There are five categories of adopters: Early Adopters(13.5%) Unlike innovators, ____ adopters are very concerned about social acceptance, so they tend to gravitate toward products they believe ___ make others think they are cutting-edge or fashionable.

early will

Defining Emergent Nature: The unique capability to imagine or _____ how concepts might be further developed to that they will be successful int he mainstream marketplace" - Hoffman

envision

Watch this Youtube video, and determine how he is relevant to communication model: https://www.youtube.com/watch?v=Cbq6lUgG8gA

got it

Step 3 Pricing Product/Service - Determine Costs > Break-even Analysis - How many ___ must we produce & sell at a given price in order to cover our costs? (no loss, no profits) >Break-even Point (BEP) - When total revenues = ____ costs - Above BEP = profit - Below BEP = loss

units total

Common Age Segments: >Children (4-12) $130 billion/year >______ (9-12) $20 billion/year >Teens (12-17) $100 billion/year >Gen X (1965-1976) $200 billion/year >____ (1977-1994) $150 billion/year >Boomers and Seniors (1946-1964) $2 trillion/year

tweens gen y

Types of Innovation >Convergence - The coming together of ___ or more technologies to create a new system with greater benefits than its separate parts.

two

Product Placement - Russell & Stern argued within _ hours of watching shows such as Frazier, Friends, Everybody Loves Raymond, survey assessing attitudes toward product, character, and characters attitude. >Predictions based on BALANCE _____

2 theory

Integrating Marketing Communication (__) >__ - Coordinating all aspects of marketing communications to send a single message >Characteristics of __ - Unified voice - Ultimate ____ is on customer (not company) - Goal is to develop relationship with customer - Communication goes ___ way - Meet needs of both customer and broader stakeholders - Keeps communication ____/flowing (continuous) - Measures results

IMC focus both open

"Buzz Marketing" > Buzz - ___ communication >WOM - When consumers provide ___ to other consumers >WOM Markting - Give people a _____ to talk about your product >Buzz Marketing - Use some ___ of highly visible entertainment/news to communicate about your product >___ Marketing - Entertaining messages passed from customer to customer >Guerrilla Marketing - Promotion where you ____ expect it

WOM info form viral least

What Impacts Rate of Adoption? 1) relative _______ 2) compatibility with other ______ 3) complexity 4) Trial-ability 5) Observability

advantage products

Four Elements of the Promotion Mix: 1) ______ - impersonal paid communication in which sponsor is identified 2)______ relations - Communication about company in order to build understanding, acceptance and relations with the public - Can also be used to inform public about products and goals 3) Personal Selling - When a company rep. communicates directly with a potential buyer to communicate about a ____ or service 4) Sales Promotion - Marketing activities beyond advertising, PR, and Personal selling that encourage purchasing _____

advertising public good behavior

____/Generational Segmentation >Generational Marketing - Marketing to members of a generation who tend to share same outlook/priorities

age

Individual ____ strategy - A unique brand for each product item Family ____ or umbrella ____ strategy - Market multiple items under the same brand name Individual ____ may do a better job of communicating clearly and concisely what the consumer can expect from the product, while a well-known company like Apple may find that its high _____ equity in other categories (like computers) can sometimes "rub off" on a new ____ (like the iPod and iPhone). Kroger is a better example of Family ____ing

brand

Overall Effect of Product Placement? >Placements have direct effects on three different outcomes... - _____ recognition/____ (cognition) - _____ attitudes (affective reaction) - Consumer ___ (behavioral intentions)

brand choice

Bonding/Connecting with Brands: 1) _____ salience - identity who are you (deep, broad brand awareness), 2) _____ performance/imagery - meaning, and what are you? (strong, favorable, and unique brand associations), 3) _____ judgements/feelings - Responses, what about you? (positive, accessible responses), 4)Consumer _____ Resonance - Relationships, and what about you and me? (intense, active relationships)

brand consumer

Co-Branding >Benefits Partner Brands in Combining Recognition Power >Ingredient Branding Phenomena - Can attract customers to the host brand from familiarity and strong _____ reputation of ingredient bran - _______ brand can sell more of its product and obtain additional revenue fro the licensing agreement in place

brand ingredient

Price Elasticity = % _____ in quantity demanded over % _____ in _____ >Elasticity less than 1 is inelastic.

change price

Step one in the Target Marketing process requires segmentation: dividing larger market into smaller segments based on meaningful shared _______

characteristics

Step 3: Positioning - Four Steps in Positioning 1) Evaluate (direct and indirect) ______ - Dirent: Starbucks vs. Tully's - Indirect: Starbucks vs. McDonalds 2) Create product/service with competitive _______ - Unique selling/value proposition 3) Develop marketing mis to appeal to target segments - Product, price, promotion, place of distribution - Develop a 'brand ______' for the product 4) Measure ______ and adapt strategy if needed - May need to reposition product/service - May involve introducing a 'retro brand'

competition advantage personality response

Product Development Steps: 1) Idea generation - how can we meet needs? 2) Product ______ development/screening (evaluate technical/commercial success potential) 3) Develop ______ strategy 4) Business analysis (visibility of product) 5) Technical development (refined/perfected) 6) Test ________ in limited markets (some top test markets - Rochester, Greensboro) 7) Commercialization (launch new _____)

concept marketing product

Of the four key categories of segmentation variables - Attitude and Preferences Regarding the Product: is of _______ specific and _____ > Benefits wanted >Level of involvement >Awareness of product alternatives >Brand loyalty - perceived commitment and level of relationship

consumption facts

Control ________: > Mass Appeals (high control) - advertising - ____ promotion - public relations >Personal Appeals (low control) - personal selling - ____ marketing > Word of mouth (lowest control)

continuum sales direct

_________ Products >_________ Products - Low price, purchased often, widely available - Not much time in decision making >Types - Staples (necessary items widely available) - Emergency (buy in a situation of dire need) - Fast moving Consumer Goods

convenience

Layers of a Product >____ product - All benefits provided by product >____ product - Physical good or service >____ product -Actual prod. + features supporting product (e.g., warranty, repair, service after sale)

core actual augmented

Basic Steps in CRM: 1) Know your ______ in as much detail as possible - Characteristics, needs, nature and frequency of prior purchases, responsiveness to previous ads, problems with the firm, returns 2) Differentiate customers _____ on needs and value to the company - High value vs. low value customers - Tailor marketing mix based on values/needs/etc. 3) Interact with customers and find ways to improve the interactions - Take on role of customer and find out how food your customer service is - Reach out to customers and use incoming calls as selling opportunities - Improve compliant handling 4) Customize _____ to individual customers - Customize marketing efforts to different customers based on needs, responssiveness

customer based products

Step 2 Pricing Product/Service: Estimate Demand >Demand - Customer's desire for a product >Demand Curves - Graphs that show impact of price on demand >Normal Products - As price _____, demand increase >Prestige Products - Curvilinear - Demand increases as prices increase, but... - If price too high, demand begins to decline

decreases

Types of Innovation >Dynamically continuous - innovation that requires a fair amount of relearning A dynamically continuous innovation is a pronounced modification to an _____ product that requires a modest amount of learning or change in behavior to use it. The history of audio equipment is a series of dynamically continuous innovations. For many years, consumers enjoyed listening to their favorite Frank Sinatra songs on record players.

existing

Of the four key categories of segmentation variables - Personality, Lifestyles, and Sociocultural Values: is of _____ and are ______-rooted >Personality traits >Lifestyles, psychographics, and VALS >Sociocultural values and beliefs

facts consumer

Of the four key categories of segmentation variables - Empirical Personal Features: is of _____ and are Consumer ______ >Demographics: age, age cohorts, gender, marital status, family life cycle, income, education, occupation, social class >Geographic location, address, and geodemographics

facts rooted

Customer Equity >Customer value treated like a _______ asset involving an investment and return >Want to attract and retain customers who offer the best "investment"

financial

Calculation of BEP = total ____ costs over (variable ____ per unit over price __ unit)

fixed cost per

Geodemographic Segmentation: >Combination of __________ and demographic information >Creates classifications of actual, addressable, _____ neighborhoods where consumers live and shop >Looking for clusters of similar people >Assumes "people of a feather flock together" >PRIZM by _____ - 66 clusters by zip code (classified as a geographic)

geographic mapable claritas

Step 4 Pricing Product/Service: Evaluate Pricing Environment > Overall ____ - Once costs are covered, create a competitive advantage >Factors to _____ - Economy (e.g., reduce prices during recession) - Competition (what are competitors doing?) - Consumer trends(e.g., bargain hunting)

goal consider

General acceptance of product (early majority) and Adopters with little/no risk (when necessary or due to social pressure) <- (late majority) = both make up 34% of market for a combined 68%

got it

Study 2a: Production Development _____ > Four _____ of 6 people asked to further develop the Smartbox concept to be appealing to consumer >Control _____ - Averaging on all three traits (emergent nature, innovativeness, lead ____ status) > High innovativeness group - High on innovativeness and low on emergent nature and lead _____ status > High lead _____ status - High on lead _____ status and low on emergent nature and innovativeness >High emergent nature ______ (CONCEPTS DEVELOPED BY CONSUMERS IN HIGH EMERGENT NATURE __ BETTER RECEIVED)

group user are

Product Life Cycle: Issues at Different Stages 1) Introduction Stage - Get first-time buyer to adopt product 2) _____ Stage - Encourage loyalty, expand offerings, increase market share 3) Maturity Stage - Increased competition, price competition, reminder advertising 4) _____ Stage - Should I stay or go?

growth decline

Other Product Categories >Shopping products - ____ involvement decision >Speciality products - Provide _____ benefit >Unsought products - Consumer not aware of ____ - Often impulsive buys

high unique needs

_______ segmentation (first step in target market) includes: segmenting the market based on more than one segmentation variable (ex. age and ethnicity rather than just age)

hybrid

Focus on High Value Customers >CRM can _____ customers who have a high lifetime value and return for the company >More intense marketing efforts (e.g., personal sales) can target the ___ valuable customers >Less _____ intense marketing (e.g., direct marketing) can target less valuable customers

identify more labor

Step 6 Pricing Product/Services: Developing Pricing Tactics >Pricing for ______ Products - Two part pricing: need to pay two times (yearly fee, plus per use) - Payment pricing: breaking overall price into smaller payments > Pricing for ______ Products - Price bundling: put multiple items together in a bundle - Captivate pricing: Price product low, and second (complementary and necessary product) at high profit margin

individual multiple

Consumer Adoption Stages: 1) Awareness (media blitz) 2) ______ (start to see benefits, search info) 3) Evaluation +/- 4) ____ (before purchasing) 5) Adoption (buy product) 6) _______ (good experiences = loyalty)

interest trial confirmation

Design good/service to meet segments needs. Create marketing mix that leads to competitive advantage

positioning

Customer-Based Brand Equity >Customer-based brand equity is defined as the effect of brand ________ on consumer response to the marketing of the brand >Involves consumers' reactions to an element of the marketing mix for the brand in comparison with their reactions to the same marketing mix element attributed to a fictitiously name or unnamed version of the product or service > Customer-based brand equity occurs when the consumer is ______ with the brand and hold some favorable, strong, and unique brand associations in memory

knowledge familiar

Brand Leveraging Strategy > ____ extension - Minor variants of a single product are marketed under the same brand name > Brand _______ - _______ of the brand name to other product categories as a marketing strategy to increase brand equity - The new product is referred to as a spin-off Differs from brand ________

line extension

Types of Innovation >Discontinuous innovation - New product changes way we ___ To qualify as a discontinuous innovation, the product must create major changes in the way we ___. Consumers must learn a great deal to use a discontinuous innovation because no similar product has ever been on the market. Major inventions such as the airplane, the ___, and the television radically changed modern lifestyles.

live car

What is a Brand? >Brand Elements: Name, ____, Symbol, and Slogan >Purpose of Brand - Enhance ________ - Form strong, favorable, and unique brand associations >Branding provides a recognition factor that helps _______ succeed in the marketplace - Domestic - International >Brands Can Build an Emotional Connection with Consumer >Firms can take on various ______ when executing a brand strategy

logo awareness products methods

There are five categories of adopters: Laggards (16%) Laggards are typically ____ in social class than other adopter categories and are bound by tradition.

lower

Targeting Strategies: - Undifferentiated (appeal to _____)

masses

Targeting Strategies: - Individualized: one to one, ____-targeting, behavioral targeting (deliver specific ads based on websites individual has visited), counter-segmentation (over time 2 segments may merge into 1 with similar needs)

micro

Why engage in Target Marketing? 2. Given that customers have different sets of needs and desires, _______ helps identify appropriate marketing mix (product, price, promotion, place of distribution)

segmentation

Types of Innovation >Continuous A continuous innovation is a ________ to an existing product, such as when Crocs reinvigorated the market for clogs by offering a version of the comfy shoe with big holes punched in it. This type of modification can set one brand apart from its competitors. For example, people associate Volvo cars with safety, and Volvo comes out with a steady stream of safety-related innovations.

modifaction

Quality as a Product Objective >Product quality - Overall ability of product to satisfy a ____ > ____ dimensions: reliability, durability, precision, _____, ease of use, versatility

need quality safety

Why engage in Target Marketing? 3. An appropriate marketing mix, in turn, helps products compete because they are designed to meet more specific ______

needs

Types of Innovation >Knock___ (copies existing product with a few changes)

offs

There are five categories of adopters: Late Majority (34%) Are ____, even more conservative majority tive, and typically have lower-than-average levels of education and income. The late majority adopters avoid trying a new product until it is no longer risky.

older

What is Product Placement? - "the insertion of branded products or services into mass media content with the intent of influencing consumer attitude or behavior" Why? >Over-saturation of traditional advertising ____ > Reach a captive and involved audience > Fly under the radar - may help avoid counter-arguing and enhance persuasion > Is a $3.368 billion industry today and growing

outlets

Creating the brand _______ >Brand ______ - A distinctive image that captures a product's services or essence (character, benefits) >Where does by brand stand? - Ask customers what characteristics are important - Measure your brand and competition on those dimensions - Plot and evaluate your brand's location in a perceptual map (SEE CHAPTER 7 FOR CHART!) types: Openness to experience, Conscientiousness, Extraversion, Agreeableness, Neuroticism

personality

Step 5 Pricing Product/Service: Choose Pricing Strategy > Cost ___ pricing - Add a fixed amount to total costs of producing product > Demand-Based _____ - Adjust price based on expected demand > Target Costing - Figure out price & _____ of product customer wants - Figure out how much it costs to make desired product - Evaluate whether you can make a profit > Yield Management Pricing - Charge different folks different ____ to manage demand and maximize profits > Value _____ - Pricing to provide "ultimate value" to customer (Wal-Mart) > New Product _____ - Skimming - high price for highly desired product - Trail - initially low prices so customers can try it out

plus pricing quality

Step 2 Pricing Product/Service: Estimate Demand: Cross-Elasticity of Demand >When changes in ___ for one product affect demand for another >If products = substitutes, an increased $ for Prod1 will lead to an ______ demand for prod2 >If products = complementary, an increase $ for Prod1 will lead to a ______ demand for Prod2

price increased decreased

Pricing the Product/Service - Steps in Price Planning: 1) Develop ______ objectives 2) Estimate ______ 3) Determine costs 4) Evaluate the ______ environment 5) Choose a ______ strategy 6) Develop _______ tactics

pricing demand

Product Line - A company's complete collection of ______ offerings to meet a single need

product

What is a "_____"? >Anything tangible/intangible that, through exchange process, satisfies consumer/business customer needs >Products can be: Physical goods, services, ideas, people or places

product

Lifetime Value of Customer = Potential ____ an individual customer generates over his/her lifetime

profit

Step 1 Pricing Product/Service: Objectives >Sales/marketing Objectives - Goal = reach a certain level of sales or marketing share >____ objectives - Critical when product is a fad >Competitive ______ - Goal = have an impact on the competition (cut into sales, pre-empt introduction of competing product) >Customer satisfaction - Price transparency >Image enhancement - Prestige _____ priced higher (expensive is good)

profit effect products

Usage ____ Segmentation >Segment based on how frequently people use a product - Former, potential, 1st time, low, med., heavy users >Companies often target heavy users - _/20 Principle: 20% of customers = _% of demand - Less costly to advertise to and more loyal >Brand ____ programs are popular - Need to know what consumers expect from their relationship with you (e.g., personal greeting when entering?) - Loyal customers are great, but don't make them mad b/c they will respond more negatively to a service failure

rate 80 loyalty

Psychological Issue in Pricing > Internal _______ Price - Set price or range of prices consumers think are reasonable > Price-_____ inferences - Odd prices sell more - However, for certain products/services (e.g., medical), this strategy may convey low quality >Price _____ - Developing a variety of products at different price points

reference quality lining

Traits Related to Emergent Nature >Those high in emergent nature report higher: Rational processing, ______, verbal visual processing (a balance), ______, creativity, optimism >Emergent nature only moderately correlated with innovativeness and lead user status (i.e., is it not the same as those constructs)

reflection openness

There are five categories of adopters: Innovators (first 25%) This segment is extremely adventurous and willing to take ___ with new products. Innovators are typically well educated, younger, better off financially than others in the population, and worldly.

risks

Price Elasticity: The percentage change in unit ___ that result from a percentage change in ___

sale price

Targeting Strategies: - Concentrated (go after just one _____)

segment

Identify and describe market segments

segmentation

Demographic ______: >Demographics are statistics on observable characters (age, sex, ethnicity, income, education) >most ______ involves demographics >Demographic ______ has several advantages 1) Demographics drive much of consumer behavior 2) Demographics can be accurately measured 3) Most cost-efficient approach to reach people (e.g., secondary ________ data are easy to obtain) 4)Can be used to anticipate changes in a segment's needs over time (e.g., aging baby boomers will soon need...)

segmentation demographic

The first step in Target Marketing process is to identify the market _______, whether that be baby boomers, ____ or Gen Y

segmentation gen x

Why engage in Target Marketing? 1. ______ have different sets of needs and desires

segments

The Self > Cognitive ___-schemas - Provide motive for future behavior - Consist of various facets > Dynamic nature of the ___ - Two components: knowledge and evaluative >Consumers gravitate towards products and brands that ___ with their self-concepts

self align

Person in-_______ Segmentation >Divide market up on the basis of the benefits certain types of individuals desire in certain situations >Different strokes for different folks.. in different situations >Example: Shoes in two segments and two contexts (kids & adults, home & sports) >Example: Old Spice

situation

Psychographic Segmentation: >Psychographics - Uses psychological, __________, anthropological factors to develop segments >Examples: Motives (status), personality (sensation seeking), culture/subculture (interdependent), lifestyles (activities, interest) >VALS2 (values + _____) system - Based on psychological characteristics that refer to consumer behavior - Can identify prevalence of _ types by zip code

sociological lifestyle 8

Communication Model: Is the basics of how any kind of message works. In this perspective, a _____ transmits a message through some medium to a receiver who (we hope) listens and understands the message.

source

Situation-_____ Segmentation >Segment based on special occasions >'When-then' Scripts - When I encounter situation X, I always buy Y >Examples: Christmas, Valentines Day etc.

specific

Of the four key categories of segmentation variables - Usage and Purchase Behaviors: is of Consumption-______ and _____ >Usage rate >Usage situation/occasion >Brand loyalty (the behavior component) >Psychographics - factual behaviors (e.g., leisure activities, hobbies)

specific facts

Managing Product Lines >Limited Line _____ - Meeting need of a smaller target segment > ___ Line Strategy - Attempt to meet needs of broad consumer market >Strategies for production __ extension

strategy full line

Product Line Extensions 1) _____ - adding new items to line 2) Filling - adding sizes or ____ 3) Contracting a product line - Dropping items > One ___ to extension: cannibalization

stretching styles risk

Pricing and Placebo >MIT ___ on "Veladone" >FDA approved drug in dental surgery >In opiate family, similar to codeine >Made up pens and brochures >Price - 10 cents per pill or... - $2.50 per pill >Effectiveness? - 85% in expensive condition said it ____ pain - 61% in cheap condition said it ____ pain

study reduced

Step 2: Targeting Steps in Targeting 1) Decide if Market segment is likely to be _______ 2) Decide the segment _____ (typical customer) 3) Choose targeting strategy - Undifferentiated (appeal to masses) - Concentrated (go after just one segment) - _________ (one to one, micro-targeting, behavioral targeting (deliver specific ads based on websites individual has visited), counter-segmentation (over time 2 segments may merge into 1 with similar needs))

successful profile individualized

Self-Concept Within Marketing > James (1890) contended that we are the ___ of our possessions >"The consumer is not as functionally oriented as he used to be - if he ever really was" > The extended ___ - Loss of possessions - Investing self in objects - Collections

sum self

Steps in IMC 1) Identify _____ audience - Database marketing helps at this step 2) Establish Communication _______ 3) Marketing budget - different techniques - Top Down: % of ___, competitive parity - Bottom Up: ____ on objectives - Push (move product to customer through channels) - Pull (create desire among customers) 4) Design the ________ mix - ___ Objectives: Attention, Interest, Desire, Action 5) Evaluate effectiveness of communication

target objectives sales based promotional AIDA

evaluate segments, decide which to go after

targeting

Criteria for Successful _____ >Sizable - Large _____ to justify its own marketing mix >Identifiable and Measurable - Easier to predict and anticipate - Products wont be out of date quickly >______ - Must be able to reach segment with marketing mix >Responsive - The segment responds differently than another segments - If not, then no need to develop unique marketing mix >In line with company's goals and resources - A company may not want to go after all segments

targeting enough accessible

Branding: Name, ___, symbol or any other unique element of product that (a) identifies one's product, and (b) sets it apart from the competition

term

CRM (Customer Relationship Management) >A systematic tracking of consumers' preferences and behaviors over ____ in order to tailor the value proposition as closely as possible to each individual's unique wants and needs >Allows ____ to talk to individual customers and adjust elements of marketing ______ in light of how each customer reacts >Use computers, software, databases, and the internet to capture information at each "touch point" between customers and companies, to allow better customer care >CRM _____ that customers are relationship partners, with each partner learning from the other every other time they interact.

time firms programs proposes

Step 3 Pricing Product/Service - Determine Costs >______ costs - Production costs associated with material, parts, labor - Vary depending on # of units produced >___ costs - Costs that dont change as a function of production - Rent, executive salaries, heating - Average ___ cost = (total ___ costs / # units) >____ costs - ______ and _____ costs combined

variable fixed total

Segmentation ______ is: Dimensions that divide the market into fairly homogenous groups, each with its own needs and wants

variables

Consumer Brand Relationships >Contemporary ___ commended with Fournier (1998) >Escalas & Bettman (2003) empirically demonstrated that _____ form connections with brands >Once a ____ relationship is formed, norms are expected >Consumers are affected when transgression occur in brand relationships

view consumers

Product Mix - Increase ____ of product mix

width