Marketing Mid Term

Business Portfolio

collection of businesses and products that make up the company

Secondary Research

collection of data from second-hand sources Relevent Current Accurate Impartial

Market Development

company growth by identifying and developing new market segments for current company products

product development

company growth by offering modified or new products to current market segments

Introduction (Product Life Cycle)

company introduces product to the market. Sales slowly grow, and profits are non existent --> high distribution and promotion expense pioneer disadvantage - who is the winner: the 1st of 2nd entrant Leadership persistence is lower today than years ago it is difficult to regain leadership

Product Characteristics

complexity, compatibility, relative advantage, observability, trialability, communicability, price

cultural environment

consists of institutions and other forces that affect a society's basic values, perceptions, and behaviors core beliefs and values

complex buying behavior

consumer buying behavior in situations characterized by high consumer involvement in a purchase and significant perceived differences among brands

Dissonance-reducing buying behavior

consumer buying behavior in situations characterized by high involvement but few perceived differences among brands

habitual buying behavior

consumer buying behavior in situations characterized by low consumer involvement and few significant perceived brand differences

Variety-seeking buying behavior

consumer buying behavior in situations characterized by low consumer involvement but significant perceived brand differences

90% of all products fail

consumers are creatures of habit break barriers (crowded market)

Economic Factors

consumers income, purchasing power, inflation, recession

Which of the following is NOT an advantage of web-based surveys?

control over who respondents are We really do not have any control over who answers our online survey

Benefit of buying online

cost custs time efficiency b/w orders and delivery focus on strategies decisions rather than selling

sub-branding

creating a secondary brand within a main brand that can help differentiate a product line to a desired target group Kellogg's Rice Krispies Kellogg's Raisin Bran Honda Fid Honda CR-V

A society's basic values, perceptions, preferences, and behaviors are all part of its _______environment.

cultural

4C's

customer solution, customer cost, convenience, communication

Your colleague is confused about using the marketing research process, as he knows that something is wrong but he is not sure what specific causes to investigate. He seems to be having problems with ______

defining the problem and research objectives The issues is with defining what he needs to research, so it is about setting up the problem and objectives.

augmented product

delivery and credit, product support, warranty, after-sale service

Colgate toothpaste comes in 16 varieties, ranging fro Colgate Total to Colgate Kids Toothpaste. This statement discusses product ______.

depth

Marketing Planning

designing activities relating to marketing objectives and the changing marketing environment

marketing strategy development

designing an initial marketing strategy for a new product based on the product concept target market positioning objectives (linked to business analysis)

product development

developing the product concept into a physical product to ensure that the product idea can be turned into a workable market offering

Targeting Strategies

differentiated, concentrated, micromarketing or one-to-one, undifferentiated or mass marketing

If Under Armour, the successful maker of moisture-wicking shirts and shorts, considered introducing a line of Under Armour fitness equipment, the company would be considering

diversification

The adoption segments include: early majority, late majority, innovators, laggards and _____

early adopters

When ZIBA designers looking for ideas on how to craft a shower-cleaning tool spent 10 days in people's homes, watching consumers wash shower stalls, they were conducting _____ research.

ethnographic

The objective of ________research is to gather preliminary information that will help define the problem and suggest hypotheses.

exploratory

brand extension

extending an existing brand name to new product categories

The two strategies for product introductions discussed in the two Ted Talks this week are: "evaluation" and "exploration"

false The two strategies are "exploitation" and "exploration.

Impact on society

false wants and too much materialism, too few social goods, cultural pollution, too much political power (lobbying)

Fads

fashions that come quickly into public view, are adopted quickly and then decline fast. Successful companies can turn them into longer lasting brands (CROCS)

places

geographic locations Atlantic City Jersey Shore France

Harvesting

gradually reduce production or divest sell or shut it down completely

Differentiation

highlighting the distinctiveness of your product

Strategic Plan

identifies long-term directions for the organization

SWOT analysis

identifying internal strengths (S) and weaknesses (W) and also examining external opportunities (O) and threats (T)

Personal Influences

include lifestyle, personality, and economic status that marketers use to study buying behavior

industrial classification

industrial customers need different products depending on their business. material and parts (cotton, iron) Capital items (offices, elevators) supplies and services (paint, legal, cleaning)

Adopter Categorization

innovators 2.5% early adopters 13.5% early majority 34% late majority 34% laggards 16%

Commercialization

introducing a new product into the market. When to launch? Where to launch? Planned market rollout?

Product Life Cycle

introduction, growth, maturity, decline

B-2-B market

is much bigger and involves more dollars than the B-2-C market

Marcoenvironment

larger societal forces that affect that microenvironment, including demographic, economic, natural, technological, political, and cultural forces

Political Environment

laws, government agencies, and pressure groups that influence and limit various organizations and individuals in a given society

Risk of buying online

less loyalty and erosion of long term relationships security & privacy concerns

Brand Development

line extensions, brand extensions, multibrands, new brands

ways of lengthening product line

line stretching line filling

strong brands

long-lasting can be anything know who they are constantly invent and reinvent are emotional tell us a story, which never ends are relevant

Stimuli (in buyer behavior)

marketing product price place promotion

Descriptive Research

marketing research to better describe marketing problems, situations, or markets, such as the market potential for a product or the demographics and attitudes of consumers Large scale - generalizable in probability samples

The four stages of product life cycles are: introduction, growth, decline and ______

maturity

Effective Segmentation

measurable, accessible, substantial, differentiable, actionable

psychological factors

motivation, perception, learning, beliefs and attitudes

multibrands

new brand name, existing product category

new brands

new brand name, new product category

Jane Klein always knows about the trendiest fashions. She actively shares her knowledge with a wide group of friends and colleagues about where to shop for cutting-edge fashion at great deals, and her advice is often followed. Jane is an example of____

opinion leader

Buying Decision Making Process

organizational influences (buying organization) individual influences (buying center)

Other Types of Products

organizational marketing (corporate branding) person marketing (personal branding) place marketing ideas (social marketing)

New Products

original product improvements product modifications new brands

Growth (Product Life Cycle)

period of rapid market acceptance and increasing profits improve quality add new models enter new segments shift from awareness goals to preference and loyalty communications lower prices or add lower priced versions to expand to new markets

Decline (Product Life Cycle)

period when sales fall and profits drop Decide whether to revitalize or kill the brand decide whether to "harvest" the brand

Disadvantaged Customers

poor service credit card & loans (high interest) insurances (doesn't cover much) Healthcare

Defensive market share strategy

position defense - I am the leader Flank Defense - P&G Gain/Cheer are defending Tide Preemptive defense - attacking competitors in other areas Counteroffensive Defense - Apple vs Samsung Lawsuits Mobile Defense - expanding to new territories Contraction defense - cutting down unsuccessful brands

Businessweek/ Interbrand Corp

projects 5 years of earnings and sales for the brand, deducts operating costs, taxes, and a charge for capital used to arrive at intangible earnings 1. must be publicly traded 2. 1/3 of revenues from outside of US 3. Must be a market-facing company

Influences on Consumer Behavior

psychological, personal, social, cultural

potential product

refers to what may remain to be done, that is, what is possible

Factors influencing product adoption

relative advantage compatibility complexity divisibility communicability

experiences

represent what buying the product or service will do for the customer

Idea Screening

screening new product ideas to spot good ones and drop poor ones as soon as possible

Which form of data below can usually be obtained more quickly and at a lower cost than the others?

secondary

Types of Buying Situations

straight rebuy, modified rebuy, new task

pure tangible good

such as soap, toothpaste, or salt - no services accompany the product

Concept Development and Testing

testing new product concepts with groups of target consumers Product Concept is a detailed idea stated in meaninful consumer ters

Core Customer Value

the basic problem solving benefits that customers are seeking

business buyer behavior

the buying behavior of organizations that buy goods and services for use in the production of other products and services that are sold, rented, or supplied to others

relative advantage

the degree to which a consumer perceives that a new product provides superior benefits

complexity

the degree to which consumers find a new product or its use difficult to understand

Divisibility

the degree to which the 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

customer-based brand equity

the differential effect that brand knowledge has on consumer response to the marketing of that brand

compatibility

the extent to which a new product is consistent with existing cultural values, customs, and practices

Test Marketing

the limited introduction of a product and a marketing program to determine the reactions of potential customers in a market situation Standard test markets (actual towns and cities) Controlled test markets (you pay a fee to selected retailers) Simulated test markets (conducted in shopping labs)

Marketing ROI

the net return from a marketing investment divided by the costs of the marketing investment

Brand Valuation

the process of estimating the total financial value of a brand

brand valuation

the process of estimating the total financial value of a brand

Market Targeting

the process of evaluating each market segment's attractiveness and selecting one or more segments to enter

Benefits Sought

the process of grouping customers into market segments according to the benefits they seek from the product

Natural Factors

the quality and/or quantity of land or raw materials.

Usage Rate

the quantity consumed or patronage (store visits) during a specific period

Marketing Research

the systematic design, collection, analysis, and reporting of data relevant to a specific marketing situation facing an organization

idea generation

the systematic search for new product ideas Internal Brainstorming External idea sources (customers, competitors, suppliers)

line extension

the use of the same brand name within the same product line and represents an increase in a product line's depth

Market Implementation

turning marketing strategies and plans into marketing actions to accomplish strategic marketing objectives

______are consumer products that the consumer either does not know about or knows about but does not normally think about buying. These products require a lot of advertising, personal selling, and other marketing efforts.

unsought products

product line length

up-selling (basic vs luxury model of any car) cross-selling (selling GPS system with car) protection against competition

Participants in the Business Buying Process

users, influencers, buyers, deciders, gatekeepers

Cultural Influences

values shifts subculture (ethnicity) social class

product mix

width (# of different product lines) length (# of items within product lines) depth (# of versions of each product in a line) consistency - how close product lines are in their end use

primary data

you collect data yourself for your problem Observation Ethnography Survey Experiment Interviews Focus Groups

Which of the following is NOT a market-oriented mission statement?

"to sell tools and home repair items" This mission statement does not project any "value" to customers; it is product-oriented, not market-oriented. All other statement project a certain value to customers.

Maslow's Hierarchy of Needs

(level 1 bottom) Physiological Needs, (level 2) Safety and Security, (level 3) Relationships, Love and Affection, (level 4) Self Esteem, (level 5 top) Self Actualization

nature of the buying unit (business markets)

-Business purchases involve more decision participants -Business buying involves a more professional purchasing effort

Branding Strategies

-Multiproduct branding strategy -Multibranding strategy -Private branding strategy -Mixed branding strategy

Primary Data Collection Methods

-mailed surveys -telephone surveys - online (email) surveys - face to face surveys

Strategic Plan process

1) define the company mission 2) setting company objectives and goals 3) designing the business portfolio: how much support to give each SBU 4) planning and marketing/functional strategies

Buyer Decision of New Products

1. Awareness 2. Interest 3. Evaluation 4. Adoption

consumer adoption process

1. Awareness 2. Interest 3. Evaluation 4. Trial 5. Adoption

Marketing Objectives and Goals

1. Business Objectives 2. marketing Objectives Sales Profits Market Share

Types of Buying Decision Behavior

1. Complex buying behavior 2. Dissonance-reducing buying behavior 3. Habitual buying behavior 4. Variety-seeking buying behavior

Influences on Adoption

1. Consumer Innovativeness 2. Product Characteristics

Marketing Research Process

1. Defining the problem and research objectives 2. Developing the research plan for collecting information 3. Implementing the research plan - collecting and analyzing the data 4. Interpreting and reporting the findings

Buyer Decision Process

1. Need recognition 2. Information search 3. Evaluation of alternatives 4. Purchase decision 5. Post-purchase behavior

expanding demand

1. New Customers (georgraphically, psychographically (DD for brewing at home) 2. Greater Usage Rate - drink more DD Coffee 3. Additional usage of the brand - coffee in energy shots/ice cream 4. New ways to use the brand - DD K-cups

Consumer Buying Decision Process

1. Problem recognition 2. Information search 3. Evaluation of alternatives 4. Purchase 5. Post-purchase evaluation

Levels of Products and Services

1. core benefit 2. actual product 3. augmented product 4. Potential Product

Product Decisions (individual Product decisions)

1. product attributes (quality, features, style & design) 2. branding 3. packaging 4. labeling 5. product support services

Boston Consulting Group (BCG) growth-share matrix

A corporate planning tool in which the corporation is viewed as a portfolio of business units, which are represented graphically along relative market share (horizontal axis) and speed of market growth (vertical axis). SBUs are plotted into four categories (dog, cash cow, star, and question mark), each of which warrants a different investment strategy.

Maturity (Product Life Cycle)

A period of slowdown in sales growth because the product has achieved acceptance by most potential buyers. Profits level off or decline because of increased marketing outlays to defend the product against competition. watch out for new entrants modify products to stay relevant modify marketing communications to stay relevant

New Product Development Process

A seven-phase process for introducing products: idea generation, screening, concept testing, business analysis, product development, test-marketing, and commercialization

impact on other businesses

Acquisitions of competitors Marketing practices that create barriers to entry Unfair competitive marketing practices

Proactive response to marketing environment

Aggressive actions to affect forces in the environment

Product

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

Product Classification

Associate the product with a particular category of products. consumer industrial

Growth Strategies

Building your market share Developing committed customers and stakeholders Building a powerful brand Innovating new products, services, and experiences International expansion Acquisitions, mergers, and alliances Building an outstanding reputation for social responsibility Partnering with government and NGOs

Loyalty Status

Buyers can be divided into groups according to their degree of loyalty

Issues in Marketing Research

CRM and Data Warehouses (too much info, data mining) Non-Profits and small business (small research budgets, secondary research) International Marketing Research (sampling difficulties, contact restrictions) Ethics in Research (intrusion on consumer privacy, consumer apathy)

A fad cannot become a successful brand.

Companies can use fads to build successful brands.

Corporate (umbrella branding)

Companies use their company brand as an umbrella brand across their entire range of products Heinz, GE, Samsung

Buying online

Company set their own buying sites create extranets with key suppliers

Business Actions: 5 Principles

Consumer-oriented marketing Customer-value marketing Innovative Marketing Sense of Mission Marketing Societal Marketing

Regulation of Marketing Activities

Consumerism Environmentalism

consumer classification

Convenience (frequent, minimal buying effort) Shopping (infrequent, substantial buying effort) Specialty (unique product or market features) Unsought (avoided by consumers) - a lot of communication and a lot of money

Customer Measures

Customer Aquisition Customer retention Customer lifetime value

societal marketing

Deficient products (low Benefits, low immed satisf) Pleasing Products (low, high) Salutary (high, low) Desirable (high, high)

Problems with Matrix Approaches

Difficulty in defining SBUs and measuring market share and growth Time consuming Expensive Focus on current businesses, not future planning

Market Oriented Statement

Disney - we create fantasies Facebook - we connect people around the world and help them s hare improtant live moments

Product Oriented Statement

Disney - we run theme parks, Faceook - we are online social network

When consumers are highly involved with the purchase of an expensive, infrequent, or risky purchase but see little difference among brands, they most likely undertake_____

Dissonance-reducing Buyer Behavior

Diversity

Ethnic, Sexual Orientation, People with Disabilities

Blake is in the process of buying a new car. He is highly involved in the purchase and perceives significant differences among his three favorite models. Blake's next step is most likely to be _____

Evaluation of Alternatives

The more complex your innovation, the easier it is to promote it to consumers for adoption.

False

LaGRande Florists segments markets into groups of nonusers, ex-users, potential users, first-time users, and regular users of its flowers. The firm uses usage rate as its segmentation approach.

False Usage rate would divide users into heavy, medium and light users. This is relationship-based segmentation.

Mass marketing is becoming a marketing principle of the 21st century.

False Customization and niche marketing are major principles in the 21st century.

The microenvironment consists of larger societal forces that affect a company, such as demographic, economic, political, and cultural forces.

False Microenvironment refers to factors close to the company, such as suppliers, customers and competitors.

Millennials comprise the most commercially influential group in America today.

False The most commercially influential group is still baby boomers as they have the most properties, assets and incomes.

The major concern with online ordering in b-2-b settings is how expensive they are.

False The major concerns are security/privacy and eroding relationships.

You should try and improve product quality during the introduction stage of a product life cycle.

False You should work on quality during the growth stage.

B-2-B Market Structure

Fewer but larger buyers Georgraphically concentrated B-2-B demand is derived from B-2-C Demand Demand is inelastic (no increased demand even if we decrease price) Demand is fluctuating

Segmentation

Georgraphic Demographic (Age, Gender, Income) Psychographic Behavioral

Impact on individual consumers

High prices Deceptive practices High-pressure selling Shoddy, harmful, or unsafe products Planned and perceived obsolescence (tech companies) Poor service to disadvantaged consumers

Social Impacts of marketing

Individual - higher prices Deceptive Practices - Illegal but hard to prove

One of Dr. Albrech's dental assistants told the dentist he should buy a machine that would sterilize his tools without using any water because water tends to cause the tools to rust over time. In terms of the buying unit, the dental assistant had the role of ____

Influencer

Consumer Innovativeness

Innovators (2.5%) Early Adopters (13.5%) Early Majority (34%) Late Majority (34%) Laggards (16%)

In SWOT analysis, which of the following would be considered a strength?

Internal resources Strengths are always internal and come from "within" a company.

Baby Boomers

Largest segment to economic growth

Acme, Inc. has slightly modified its productions processes of its widgets and gadgets in order to tap into the Eastern European market. Acme is following a ____strategy.

Market Development

Which of the following is the process of dividing a market into distinct groups of buyers with different needs, characteristics, and behaviors?

Market Segmentation

User status

Markets can be segmented into nonusers, ex-users, potential users, first-time users, and regular users.

Decision Process (business Markets)

More complex buying decisions buying process is more formalized buyers and sellers develop long-term relationships

Young and Rubicam's brand valuation index uses four categories of brands: new, leadership, eroding and ____

Niche

Four Categories of branding

Niche/momentum (high relevance/low esteem) - Lenovo, Crocs, Lindt Leadership (high/high) - Tylenol, Toyota, GE Declining (low relevance, high esteem) - Gerber, BoA, H&R Block New (low/low) - Second life, kayak.com, Flickr

People

Paris Hilton Donald Trump Kardashians celebrity appeal

The Jay Group hires better employees than the competition by conducting lengthy searches and interviews. Management also trains employees much better than competitors do. The Jay Group has gained a strong competitive advantage through which type of differentiation?

People It is all about their employees, i.e., people.

"Explore California" campaign can be considered an advertising campaign for a _____product.

Place

Microenvironment influences

The company and culture suppliers intermediaries (raw material & Product) Customers Competitors Public (media investors governement internet)

Marketing Control

The process of measuring and evaluating the results of marketing strategies and plans and taking corrective action to ensure that objectives are achieved

Which is an example of a sub-brand name?

Toyota Sienna

Bombay Gifts divides its markets into units of nations, regions, and cities. The company uses geographic segmentation.

True

Brand valuation measures brand equity in financial units, such as dollars.

True

Branding can add value to a product.

True

Conjoint analysis focuses on assessing effectiveness of new product introductions.

True

Today's technological environment changes more rapidly than core cultural beliefs do.

True Core cultural beliefs do not change rapidly.

Harvesting means that you shut down production of your product slowly.

True .You are cutting down production in increments over time.

Apple iPhone is likely to take position defense against competitors.

True Apple is the leader in the smartphone category and are likely to take position defense.

The buying center is NOT a fixed unit within an organization.

True There is no formal organization around the buying unit.

The demand in B-2-B settings is inelastic.

True You are not going to get more orders by decreasing demand.

A business marketer normally deals with far fewer buyers than the consumer marketer.

True You sell more products but to fewer buyers.

Reactive response to marketing environment

Watching and reacting to forces in the environment

Apple example

Width - 6 different product lines Length - 5 items within the mac product line depth - 3 versions of macbook in laptop line consistency - how close product line are in their end use

Positioning statement

a brief statement that articulates how the marketer would like the target market to envision a product relative to the competition

market Penetration

a marketing strategy that tries to increase market share among existing customers

Conjoint Analysis

a method for deriving the utility values that consumers attach to varying levels of a product's attributes. Three package designs Three prices Organic Certification (one or two) Five difference Flavors

brand

a name, term, symbol, design, or combination thereof that identifies a seller's products and differentiates them from competitors' products sum total of consumers perceptions and feeling about the product's attributes and how they perform, about the brand name and what it stands for, and about the company associated with the brand

Sampling Plan

a plan that specifies a sample size, the time between successive samples, and decision rules that determine when action should be taken

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

Diversification

a strategy of increasing sales by introducing new products into new markets

Causal Research

a technique that attempts to understand cause-and-effect relationships large scale

Occasional Segmentation

a type of behavioral segmentation based on when a product or service is purchased or consumed

line filling

adding more items within the present range of the line (new models or varieties of an existing product)

line stretching

adding new products beyond the current product range (phones, computers, mp3 players, tablets)

Demographic Differences

age, poverty level, geographic, education, diversity and household composition

Segmentation

allocating customers into different groups based on certain characteristics

Young and Rubicam Brand Asset Valuator

an instrument that uses a set of scales to measure differentiation, relevance, esteem, and knowledge 1Energized differentiation/relevance 2esteem/knowledge

Quantitative Research

analyzing and interpreting numeric data (graphs)

Qualitative Research

analyzing and interpreting textual information (interviews, focus groups, social media)

The third level of a product that product planners must consider is a(n) ____that offers additional consumer services and benefits.

augmented

actual product

brand name, quality level, packaging, design, features

A hickory rocking chair, handmade by an Amish woodcarver in Lancaster, PA from locally grown wood is an example of a(n) ____

Specialty Product It is a specialty product because it would appeal only to a niche segment of consumers who are interested in handmade wood products rather than mass merchandise.

individual brand strategy

Strategy in which there is a unique name for each major product or product line Nature Valley Bisquick Gold Medal All General Mills

Some consumer worry that they are affected by marketing messages without even knowing it. They are concerned about ____advertising.

Subliminal

Family is one of the ______factors that influence consumer behavior.

Social

Interbrand corporation does NOT include _____brands in its valuation.

Privately owned

B-2-B Buying Process

Problem recognition General need descriiption Product specification & Value Analysis Supplier Research Proposal solicitation Supplier selection Order-routine specification Performance Review

In the four P's of marketing mix, design, packaging, services, and variety all fall under the category of ____

Product

Differentiation Strategy

Product (Mercedes) Service (Charles Schwab) Channel (Esurance) People (Disney) Image (Nike)

Product Line Decisions

Product Line Length ways of lengthening

Marketing Mix

Product, Price, Place, Promotion

Technological Factors

Progressive vs invasive fast speed & Product life cycles Practicality & Affordability Issues

Focus group interviewing is a _______research tool for gaining insights into consumer thoughts and feelings.

Qualitative Focus groups rely on analyses of words and conversations; it is qualitative.

social influence

REference groups (opinion leaders, buzz marketing, social networking) Family Roles and Status

Which of the following is NOT a quality of successful brands?

Rational

Exploratory Research

Research conducted to gather more information about a problem or to make a tentative hypothesis more specific small scale - can not generalize

Perception and Marketing Strategy

Selective attention selective distortion selective retention subliminal advertising

pure services

Services provided to consumers without the involvement of any tangible product