Marketing Development Midterm

unsought products

Products purchased to solve a sudden problem, products of which customers are unaware, and products that people do not necessarily think of buying

Nutrition Labeling and Education Act (1990)

Prohibits exaggerated health claims; requires all processed foods to contain labels with nutritional information

Dodd-Frank Wall Street Reform and Consumer Protection Act (2010)

Promotes financial reform to increase accountability and transparency in the financial industry, protects consumers from deceptive financial practices, and establishes the Bureau of Consumer Financial Protection

info search

internal and external search

test marketing

limited introduction of a product in geographic areas chosen to represent the intended market - The aim is to determine the extent to which potential customers will buy the product; - Companies use test marketing to lessen the risk of product failure

concentrated marketing strategy

market segmentation strategy in which an organization targets a single market segment using one marketing mix (can have other segments); also called niche marketing; have other options, but choose to focus on one - common for luxury brands ex. Rolex watches, tesla automobiles

individuals, groups, or organizations with one or more similar characteristics that cause them to have similar product needs are classified

market segments

small businesses can use digital media to develop strategies to reach new markets and access inexpensive communication channels

true

brand recognition

A customer is aware that a brand exists and views the brand as an alternative purchase if their preferred brand is unavailable

reference groups

A group that a person identifies with so strongly that he or she adopts the values, attitudes, and behavior of group members; one of the five major groups of social influences; Types: membership, aspirational, disassociate

competition

Other organizations that market products that are similar to or can be substituted for a marketer's products in the same geographic area

testing marketing - step 6

A limited introduction of a product in geographic areas chosen to represent the intended market; •The aim is to determine the extent to which potential customers will buy the product •Companies use test marketing to lessen the risk of product failure

ethical issues and risk of digital marketing

How marketers use technology to gather information—both online and offline—raises numerous legal and ethical issues

disposable income

After-tax income

classifications of new products

An innovative product that has never been sold by any organization A modified product that existed previously A product that a given firm has not marketed previously, although similar products are available from other companies A product that is brought to one or more markets from another market (sometimes) means of enhancing its product mix and adding depth to a product line; fairly expensive and risky

podcasts

Audio or video files that can be downloaded from the internet with a subscription that automatically delivers new content to listening devices or personal computers; companies scan use to demonstrate how to use their products or understand certain features

which of the following companies would probably be MOST interested in tracking discretionary income levels?

BMW automobiles

product development - step 5

Determining if producing a product is technically feasible and cost-effective

product line extension

Development of a product that is closely related to existing products in the line but is designed specifically to meet different customer needs

Environmental Protection Agency (EPA)

Develops and enforces environmental protection standards and con-ducts research on the adverse effects of pollution

Do Not Call Implementation Act (2003)

Directs the FCC and FTC to coordinate so their rules are consistent regarding tele-marketing call practices including the Do Not Call Registry and other lists; in 2008, the FTC amended its rules and banned prerecorded sales pitches for all but a few cases

discretionary income

Disposable income available for spending and saving after an individual has purchased the basic necessities of food, clothing, and shelter

digital media

Electronic media that function using digital codes—media available via computers, cellular phones, smartphones, and other digital devices that have been released in recent years; allows marketers to gather information on their consumers—often more information than could be garnered through traditional marketing venues

Federal Trade Commission (FTC)

Enforces laws and guidelines regarding business practices; takes action to stop false and deceptive advertising, pricing, packaging, and labeling

Food and Drug Administration (FDA)

Enforces laws and regulations to prevent distribution of adulterated or misbranded foods, drugs, medical devices, cosmetics, veterinary products, and potentially hazardous consumer products

Consumer Product Safety Commission (CPSC)

Ensures compliance with the Consumer Product Safety Act; protects the public from unreasonable risk of injury from any consumer product not covered by other regulatory agencies

business analysis - step 4

Evaluating the potential impact of a product idea on the firm's sales, costs, and profits Break even analysis - gives you knowledge of how much you have to sell to make a profit

run-out

Exploits any strengths left in the product

Political forces are beyond the control of marketer, and so they can only react to them

False

elements of successful segmentation

Hetero: if not, waste of resources; Divisible: there has to be some characteristic we use to segment - we'll talk about this - is it age? Is it lifestyle? Fit people?; Forecast and compare; we have to cover our costs of the different mixes; Reach - sometimes there are legal, social, distribution constraints. ex. In an underdeveloped country, not everyone may have internet access, so e-commerce won't work or there isn't the infrastructure for physical distribution

disruptive innovation

Identifies old technologies that can be exploited in new ways or develops new business models to give customers more than they've come to expect from current products in a specific market ex. Netflix put blockbuster out of business

speciality products

Items with unique characteristics that buyers are willing to expend considerable effort to obtain

break down approach

Measuring company sales potential based on a general economic forecast for a specific period and the market potential derived from it

build up approach

Measuring company sales potential by estimating how much of a product a potential buyer in a specific geographic area will purchase in a given period, multiplying the estimate by the number of potential buyers, and adding the totals of all the geographic areas considered

Digital Millennium Copyright Act (1996)

Refined copyright laws to protect digital versions of copyrighted materials, including music and movies

commercialization - step 7

Refining and finalizing plans and budgets for full-scale manufacturing and marketing of a product; product enters the market - usually in rollout

Federal Communications Commission (FCC)

Regulates communication by wire, radio, and television in interstate and foreign commerce

Federal Power Commission (FPC)

Regulates rates and sales of natural gas producers, thereby affecting the supply and price of gas available to consumers; also regulates whole-sale rates for electricity and gas, pipeline construction, and U.S. imports and exports of natural gas and electricity

Children's Online Privacy Protection Act (2000)

Regulates the collection of personally identifiable information (name, address, email address, hobbies, interests, or information collected through cookies) online from children under age 13

Bureau of Consumer Financial Protection

Regulates the offering and provision of consumer financial products and serves to protect consumers from deceptive financial practices

idea generation - step 1

Seeking product ideas to achieve organizational objectives

screening - step 2

Selecting the ideas with the greatest potential for further review

pros of digital media strategy

Target markets more precisely and reach markets that were previously inaccessible; forms relationships w a variety of people; easily reach people and provide feedback, shopping through insta, and Facebook; - Monitoring or "social listening" is is essential to maintaining competitive advantages

connectivity

The ability for consumers to be connected with marketers along with other consumers ex. Mary Kay offers users the opportunity to sign up for MyMK, a system that connects customers with beauty consultants and allows them to develop their own personalized space.

interactivity

The ability of customers to express their needs and wants directly to the firm in response to its marketing communications ex. Texas Instruments interacts with its customers on its Facebook page by answering concerns and posting updates

addressability

The ability of the marketer to identify Customers before they make a purchase ex. Amazon installs cookies on a user's computer that allow the company to identify the user when he or she returns to the website.

brand equity

The added value delivered by the brand over the functional benefits or book value of the product, service, or company; brand values leads to brand equity

product life cycle stages

Typical pattern of a successful product; As a product moves through each cycle, the strategies relating to competition, pricing, distribution, promotion, and market information must be evaluated and possibly adjusted; introduction, growth, maturity, decline ch 11, slides 54-57

family packaging

Using similar packaging for all of a firm's products or packaging that has one common design element (consistency)

blogs

Web based journals (short for "weblogs") in which writers editorialize and interact with other internet users; - Blogs can represent a potent threat to corporations as well as an opportunity due to the amount of consumer control; - Companies can use blogs to answer consumer concerns, defend their corporate reputations, build enthusiasm, and develop customer relationships; key platform if you're serious about content marketing

oligopoly

a competitive structure in which a few sellers control the supply of a large proportion of a product

product line

a group of closely related product items viewed as a unit because of marketing, technical, or end-use considerations ex. Nike doesn't sell one kind of shoe, they have a line of athletic shoes

traditional marketing

any form of marketing that uses offline media to reach an audience

accessibility

any form of marketing that uses offline media to reach an audience ex. Google can use web searches done through its search engine to learn about customer interests.

problem recognition occurs when a consumer

becomes aware that there is a difference beter a desired state and actual condition

self regulartory forces

better business bureau (BBB) and the national advertising review board (NARB)

cognitive dissonance

buyer's doubts shortly after purchase about whether the decision was the right one or buyers remorse ex. customer may attempt to return the product or may seek out positive information, such as reviews, to justify choosing it - usually w/ expensive items

internal search

buyers search their memories for information about products that might solve their problem ex. brands that a consumer first recalls from memory reflect his or her top of mind awareness - need leggings, go to lulu

external search

buyers seek information from sources other than their memories ex. personal contacts, online sources: social, google, reviews, independent sources: gov reports, media, publications (consumer reports) - make sure product or company shows in search results (search engine optimizations - SEO)

social media monitoring

can shop through social media (facebook, insta)

monopoly

competitive structure in which an organization offers a product that has no close substitutes, making that organization the sole source of supply

product mix

composite, or total, group of products that an organization makes available to customers ex. Nike doesn't just sell shoes, they have shirts, shorts, head bands, sports bottles •Width of product mix - The number of product lines a company offers •Depth of product mix - The average number of different products in each product line

when marketers are comprised of people with differing product needs, the marketing manager should use a _________ strategy.

concentrated or differentiated targeting

when shopping for detergent, Dyl looks at Arm & Hammer, Gain, Method, and Cheer and choose the one that is on sale. These four brands make up his ________ set

consideration

evaluation of alternatives

consideration set and evaluative criteria

Milton Bradley/Parker Brothers are producers of many board games, such as Monopoly, Battleship, Yahtzee, and Clue. The company has posted online cash rewards for consumer reviews of its games. In doing so, Milton Bradley/Parker Brothers is striving to utilize

consumer generated marketing

a light bulb can be all of the following except

consumer product if it is used to light the office of the board of director

which of the following statements does NOT apply to convenience goods

consumers are brand loyal to convenience products and are not likely to substitute other brands

control

customer's ability to regulate the Information they view as well as the rate and exposure to that information ex. Consumers use Kayak.com to discover the best travel deals

brand royalty

customer's favorable attitude toward a specific brand types: brand recognition, brand preference, brand insistence

a product line includes a group of closely related product items that are considered to be a unit because of marketing, technical or end-use consideration

true

advertising used in decline stage may prolong the life of the product

true

bread is usually a convenience product

true

quality modifications

dependability and durability

Coca-cola offers a line a soft drink that includes coke, diet coke, coke zero, sprite, and fanta. The drinks BEST illustrates Coca-Cola's product mix

depth

framing

describing the alternatives and their attributes in a certain manner; or can make a characteristic seem more important to a consumer and facilitate its recall from memory; can be about how you word things;

Volkswagen markets its Atlas SUV to large families, its CC to those wanting a sports coupe, and its Jetta to young singles. What targeting approach is Volkswagen using?

differentiated

heterogeneous marketers

diverse needs for products in a specific product class

digital marketing can be viewed as a new distribution channel that helps businesses increase efficiency

true

brand competitors

firms that market products with similar features and benefits to the same customers at similar prices ex. scott vs bounty - both paper towels but different brands

generic competitors

firms that provide very different products that solve the same problem or satisfy the same basic customer need ex. rental car vs public transportation, or Bayer vs aspirin

Alex is getting ready for her wedding. She is obsessed with buying the perfect wedding dress. Her involvement with the dress is an example of enduring involvement

false

Buyers want to exert only minimal effort to obtain shopping products

false

KLM engages with its customers by answering their questions and posting updates. This is an example of accessibility

false

an information search, once completed, should identify for the buyer the one brand that he or she views as the best alternative

false

earned media is the use of traditional print and broadcast advertising as well advertising on social networks

false

limited decision making is used when purchasing frequently bought, low cost items needing very little decision effort

false

the original marketing strategy should not be altered in any way as a product travels through the stages of the product life cycle because consumers can becomes confused

false

total budget

firms that compete for the limited financial resources of the same customer ex. want to go on a vacation - debating spending money on booking a nicer hotel or a nicer rental car, hotel is competing against rental car (where you put your money)

product competitors

firms that compete in the same product class but market products with different features, benefits, and prices ex. water vs soda - both in beverage company but not the same thing

maslows heigharchy of needs

five levels of needs that humans seek to satisfy, from most to least important Physiological needs - Requirements for survival such as food, water, sex, clothing, and shelter Safety needs - Include security and freedom from physical and emotional pain and suffering Social needs - Human requirements for love and affection and a sense of belonging - drives a lot of visible behavior - lots of cool stuff on status consumption Esteem needs - Requirements of respect and recognition from others as well as self-esteem, a sense of one's own worth - ditto Self-actualization needs - Peoples need to grow and develop and to become all they are capable of becoming

consideration set

group of brands within a product category that a buyer views as alternatives for possible purchase

cons of digital media strategy

hate speech, customers don't like they're getting tracked or info spread, censorship, customers can take advantage of situations and you can loose control (mountain dew campaign)

buying forces

how much people can afford to spend; based on income, credit, and wealth (accumulated savings, investments, pensions); changes in general economic conditions/factors affect buying power

lifestyles

how time spent, beliefs, income, encompasses activities, interests, and opinions; geodemographic segmentation is based on this

new product development

idea generation; idea screening; concept development & testing; market strategy/business analysis; product development; marketing testing; marketing entry/commercialization

environmental scanning process

identify environmental factors & trends -> impact on markets & marketing activities -> does it create an opportunity or does it pose a threat -> decide how to take advantage or decide how to minimize

target market selection process

identify the appropriate targeting strategy -> determine which segmentation variables to use -> develop market segmentation profiles -> evaluate relevant market segments -> select specific target markets

attitude

individual's enduring evaluation of feelings about and behavioral tendencies toward an object or idea (also called sentiment) - cognitive, affective, behavioral ch 7 slide 29

Nike manufactures athletic shoes, shorts, shirts, and a variety of other athletic products. these products make up Nike's product

mix

consumer buying behavior process

need recognition -> info search -> evaluation of alternatives - purchase -> reaction

customer's involvement levels in the buying process

need recognition, evaluation of alternatives, purchase, reaction individual's degree of interest in a product and the importance of the product for that person ex. high involvement is cars or homes low involvement is

in time of economic prosperity all is well, in times of recession/depression it is...

not well

evaluative criteria

objective and subjective product characteristics that are important to a buyer ex. different evaluation strategies: satisficing, lexicographic rule - what kind of car you get

Three primary methods of collecting information for environmental scanning are

observation, secondary secondary sources and marketing research

problem recognition

occurs when a buyer becomes aware of a gap between a desired state and an actual condition; first step of the consumer buyer decision process

regulatory agencies

only work through and enforces regulations

quality

overall characteristics of a product that allow it to perform as expected in satisfying customer needs; two dimensions: - Level of quality - The amount of quality a product processes - Consistency of quality - The degree to which a product has the same level of quality over time; part of product differentiation

Uses of Packaging and Strategy of Packaging in the Marketing Mix

packaging considerations: cost, regulations, consistency, promotional role, needs of retailers, environmental responsibility

self-concept

perception or view of oneself, closely linked to personality - one of the six psychological influences; individuals develop and alter their self-concepts based on an interaction between psychological and social dimensions

situational purchase influences

physical and social surroundings, time, purchase reason, buyer's mood, and condition

political forces

political, legal, and regulatory forces of the marketing environment are closely interrelated; legislation is enacted, legal decisions are interpreted by courts, regulatory agencies are created and operated, for the most part, by elected or appointed officials

sales forecast

prediction of future sales over a specific period of time ex. how much will we sell in the next 12 months? How much will we sell in each region of the US?

pro-competitive legislation

preserves competition (to avoid a monopoly)

legal and regulartory forces

pro-competitive legislation, consume protection legislation, regulatory agencies, self-regulatory forces

environmental analysis

process of assessing and interpreting the information gathered through environmental scanning; looking for trends and patterns, interpret why these things occur, predict what will happen next

environmental scanning

process of collecting information about forces in the marketing environment and developing a strategic plan to deal with them; observation step

consumer protection legislation

protects consumers

to meet federal gas milage regulations, Ford has developed aluminum vehicle bodies that are light enough to help conserve fuel. what kind of response is this to environmental forces?

reactive

concept testing

seeking a sample of potential buyers' responses to a product idea

which of the following statements about self-regulatory is false

self regulatory guidelines are usually stricter than governmental regulatory programs

national advertising review board (NARB)

self-regulatory unit that considers challenges to issues raised about an advertisement

aesthetic modifications

sensory appeal of a product

Mario is an avid collector of MLB memorabilia. He greatly desires to own the "special" bat that earned the slugger Sammy Sosa a seven-game suspension due to its illegal contents. This is an example of a _______ products

specialty

economic prosperity

stage of the business cycle characterized by low unemployment and relatively high total income, which together ensure high buying power (provided the inflation rate stays low)

recovery

stage of the business cycle during which the economy moves from recession or depression toward prosperity

recession

stage of the business cycle during which unemployment rises and total buying power declines, stifling both consumer and business spending

Conditions of Market Segments

step 1: select segmentation variables step 2: develop market segmentation profiles step 3: evaluate relevant market segments (sales, competitive assessment) step 4: select specific target market(s) step 5: identify the targeting strategy

lifestyle analysis focuses on people's activities, intertes, and opinions.

true

e-marketing

strategic process of distributing, promoting, and pricing products, and discovering the desires of customers using digital media and digital marketing; types: distributing, promoting, pricing, marketing

undifferentiated marketing strategy

strategy in which an organization designs a single marketing mix and directs it at the entire market for a particular product; the product is widely consumed by the population; also called mass marketing; Effective for homogeneous markets (just means the same needs): everyone is using the product for the same thing, so really one segment with one MM ex. baking soda, sugar

differentiated marketing strategy

strategy in which an organization targets two or more segments by developing a marketing mix for each segment; most common ex. apple phones, lulu yoga gear

better business bureau (BBB)

system of nongovernmental, independent, local regulatory agencies supported by local businesses that helps settle problems between customers and specific business firms

co-branding

the marketing of a product or service under two or more brand names

homogenous markets

the same needs ex. everyone is using the product for the same thing

aestheic

the sensory appeal of a product; ex. colors and designs part of product differentiation

consumers are changing ______ and consumption behaviors to fit with emerging technologies and trends

their information searches

one of the biggest mistakes a marketer can make when engaging in digital marketing is to

treat it like a traditional marketing channel

Jay was flying to Greece for vacation when he realized he forgot his sunglasses. He purchased some at an airport shop even though they were more expensive than she would normally have paid. Jay was influenced by situational influences.

true

Lena is an award-winning fiction writer. She works out of her apartment and recently purchases a new desk in which to store her manuscripts and for use when typing up stories for publication. Lena is part of the business marketing for the desk manufacturer.

true

a market is a group of people who, as individuals, have needs for products in product class and have the ability, willingness, and authority to purchase such products.

true

a marketer's use of framing can make a product characteristic seems more important to a consumer and can facilitate its recall from memory

true

monitoring the competitive environment guides marketers in developing competitive advantages

true

wiki

type of software that creates an interface that enables users to add or edit the content of some types of websites; internal employee website

online marketing

use google (internet) or social media, emails, to market

functional modifications

versatility, effectiveness, convenience, or safety

perception

we select, organize, and interpret information to produce meaning; ex: allegations have come out about wayfair and trafficking children - now we may perceive wayfair as "bad" - not saying I think they are or aren't; a psychological influence

brand value breakdowns

•Brand value = brand identification + brand differentiation brand knowledge Brand value = brand awareness + brand (positive) associations brand knowledge Brand value = brand knowledge

shopping products

•Items for which buyers are willing to expend considerable effort in planning and making purchases

convenience products

•Relatively inexpensive, frequently purchased items for which buyers exert minimal purchasing effort