Marketing Management Chapters: 5-8

Mass customization/customerization

Also called one to one marketing, a new marketing process whereby a company takes a product or service that is widely marketed and develops a system for customizing it to each customer's specifications

Scenario Planning

planning that involves "what if" questions to produce forecast of alternative outcomes based on different assumptions about advertising, spending, price levels, competitors actions, and other variables

Product Variants

product brands, different specific combinations of features within a specific product type

Solutions Buy

purchase situation in which the organization is buying a system that solves a specific problem (Integrated technologic solution)

Modified rebuys

purchasing situation faced by an organization in which something has changed since the last purchase (Computer for lab, purchases 3-5 years apart)

Straight rebuys

routine purchases made by an organization from the same supplier used in the past (Food products, napkins paper towels)

Buy Class

set of descriptor variables used in industrial marketing segmentation that is based on the newness of the purchasing situation

Parfitt-Collins model

simple market share forecasting model that uses an estimate of the eventual penetration rate, an estimate of the ultimate repeat rate, and an estimate of the relative product category usage rate buyers of the new brand to determine eventual market share

Organizational Characteristics External and Internal Influences on Purchasing Behavior

size of company making the purchase decision, its level of technology, and the internal reward system are examples of these characteristics

Cannibalization

the amount of sales for new element of a product line that is taken away from the existing element of the line

Position

the communication of the value proposition to the customer, which differentiates the product from competition in the mind of the prospect

Uncertainty Avoidance The effects of culture

the degree to which employees are threatened by ambiguity

Lead users

the first buyers if an innovation in industrial marketing situations; also called innovators

Primary Needs

the main strategic benefits that the product or service attempts to deliver

Market Structure Analysis

the marketing manager seeks to better understand who the competition is and thus define the market

Supply Chain

the organizations involved in the movement of raw materials and components that are part of a products production process

Cross-elasticity of demand

the percentage change in ones products sales caused by a percentage change in a marketing variable for another product

Identifying the need Organizational buying stages

-Recognition can be stimulated by low inventory or marketing communications. -Need recognition phase varies according to buy class. -Purchasing decisions are feature/ benefit driven.

Individualism vs. Collectivism The effects of culture

-degree of integration of individuals withing groups -Individual achievement is valued more in the former

Power Distance The effects of culture

-extent to which less powerful parties accept the existing distribution of power and the degree to which adherence to formal channels is maintained -High power distance societies tend to be less egalitarian

Industry

-group of products that are close substitutes to buyers -available to a common group of buyers -are distant substitutes for all products not included in the industry

Long-term Orientation The effects of culture

-time frame used -Short term involving more inclination toward consumption versus long-term with its interest in preserving status-based relationships and deferred gratification

Demographics Segmentation Variables

Company size, industry type, geographic location, number of employees

Product class/category

one particular product segment of a particular industry

Personal Characteristics Segmentation Variables

organizations attitudes toward risk might help you determine whether it is likely to be an early purchaser of new technology

Product line

Group of closely related products

Situational Factors Segmentation Variables

Include the customers delivery speed needs, order size needs, and particular use of the product

Environmental factors External and Internal Influences on Purchasing Behavior

Legal, cultural, political, economic, competitive, and other factors affect purchasing decisions

Chapter 6

Market Structure and Competitor Analysis

Vertical Marketing

Occurs when firms focus on an industry, often creating a separate set of distribution channels for industry.

Chapter 7

Marketing Decision Making

Organizational Marketing

Marketing a product or service to another organization

industrial marketing

Marketing a product or service to another organization

Chapter 8

New Product Development

Horizontal marketing

Occurs across industries, where needs and uses are similar.

Choiceboards

Online, interactive systems that allow individual customers to design their own products by choosing from an array of attributes, delivery options and prices

Buying center member characteristics External and Internal Influences on Purchasing Behavior

Participants in the decision-making process can differ in terms of education, motivation, personality, experience, and degree of risk taking

User Buying Roles

people actually using product

Purchasing approach Segmentation Variables

Segment could be defined based on customers who use a bidding process vs those who do not

Group characteristics External and Internal Influences on Purchasing Behavior

Size, authority, leadership, and group structure can influence the choice as well

Packaging

The design of the container for the product in which it is displayed in a retail environment

Femininity vs Masculinity The effects of culture

The division of social roles between men and women

Purchaser Buying Roles

person who actually authorizes payment

Chasm

The large gab that can exist between the early adopters of innovation and the early majority

Prisoners dilemma game

a particular form of competitive game in which neither participant wants to change his current strategy because if one does and the competitor matches, both will be worse off

Joint Space

a perceptual map that contains both brand spatial locations as well as consumer perceptions of their ideal brand

Co-creation

Using people outside of the organization to help develop new product ideas

New-to-the-world

a product that has not been marketed by any company previously

New-to-the-company

a product that has not been marketed by the company but has been marketed by another company

Original Equipment Manufacture (OEM)

a channel of distribution for technology based products; companies that purchase ingredients or components from manufactures (Hard disk drives)

Global Marketing

a generic term encompassing any marketing activities outside a company's home market; also a standardization of the strategies used to market a product around the world

Buying Center

a group of individuals collectively involved in a purchase decision

Product form competition

a level of competition in which only products or services of the same product type are considered

Product class or product category competition

a level of competition in which products or services that have similar features and provide the same function are considered

Generic Competition

a level of competition that includes all products or services that the customer views as fulfilling the need requiring satisfaction on a particular purchase or use occasion

Budget competition

a level of competition that includes any product, related or unrelated, that could be viewed as substitutable in a budget.

Product Line Strategy

a marketing strategy covering a set if related products

House of Quality

a matrix used in new product development that illustrates how customer needs and engineering characteristics influences one another

Brands

a name, term, sign, symbol, or design, intended to identify the goods and services of a seller and differentiate them from the competition

Product features

characteristics or attributes of a product or service

Product Design

combines art, science and technology to create tangible three-dimensional goods

Product Definition

concepts are translated into actual products for further testing based on interactions with customers

Multidimensional scaling (MDS)

developed perceptual maps based only on customer based judgments of brand similarity

Operating variables Segmentation Variables

dimensions of the customers operations such as what technologies the customer is currently using

Initiator Buying Roles

first recognizes need for product or service

Product types

group of products that are functional substitutes

Target Costing

ideal selling price is determined first, the feasibility of meeting that price is assessed, and costs are controlled in order to product the product that can be sold at the target price

Payoff Matrix

in game theory, a graphic depiction of the rewards or costs to each player for each possible combination of strategies

Nash Equilibrium

in game theory, the most common form of equilibrium, which involves a list of strategies, one for each player, with the property that no manager wants to change it strategy unilaterally

Influences Buying Roles

influence decision about what to be chose

Concept Development

making further refinements to a new product concept

Secondary Needs

more tactical needs associated with the primary perceptual benefit

Competitor Analysis

the strengths and weaknesses of competitors and their current and likely future strategies are examined

Tertiary Needs

type of customer need considered in a new product development; the operational needs related to the engineering aspect of actually making the product

Decider Buying Roles

ultimate authority for go/no-go choice

B-to-B (business-to-business marketing)

when a product or service is sold to an organization