Principles of Marketing - Exam 1

Publics

any group that has an actual or potential interest in or impact on an organization's ability to achieve its objectives ±Financial publics ±Media publics ±Government publics ±Citizen-action publics ±Local publics ±General public ±Internal publics - Publics: P&G (Proctor and Gamble) has a long history of giving back to its local publics. The Tide Loads of Hope program brings "hope not just soap" in the form of free mobile laundry services to people in communities facing natural disasters.

The Four P's of Marketing

Product, Price, Place, Promotion

Suppliers

Provide the resources to produce goods and services Treat as partners to provide customer value - Suppliers: Giant furniture retailer IKEA doesn't just buy from its suppliers. It involves them deeply in the process of delivering the trendy but simple and affordable home furnishings to create a better everyday life for its customers.

Developing a Research Plan

Secondary data is information that already exists somewhere, having been collected for another purpose. Primary data is information collected for the specific purpose at hand

Economic Envrionment

Consumers adopted a new back-to-basics sensibility in their lifestyles and spending patterns. To serve the tastes of these more financially frugal buyers, companies like Target are emphasizing the "pay less" side of their value propositions.

Non Probability Sample

Convenience sample - The researcher selects the easiest population members from which to obtain information. Judgment sample - The researcher uses his or her judgment to select population members who are good prospects for accurate information. Quota sample - The researcher finds and interviews a prescribed number of people in each of several categories.

Sustainable Marketing

Corporate ethics and social responsibility have become important for every business

Relationship Building Blocks

Customer-perceived value -- The difference between total customer perceived benefits and customer cost Customer satisfaction -- The extent to which perceived performance matches a buyer's expectations Customer Satisfaction: Customer service champion L.L.Bean was founded on a philosophy of complete customer satisfaction. "If you are not 100% satisfied with one of our products, you may return it within one year of purchase for a refund."

Rapid Globalization

Managers around the world are taking both local and global views of the company's: °Industry °Competitors °Opportunities

exchange relationships.

Marketing actions try to create, maintain, and grow desirable _________________________

Value Delivery Network

made up of the company, suppliers, distributors, and ultimately customers who partner with each other to improve performance of the entire system.

Social Media

provide exciting opportunities to extend customer engagement and get people talking about a brand.

The Company

±Top management ±Finance ±Research and development (R&D) ±Information technology ±Purchasing ±Operations ±Human resources ±Accounting

Marketing Information and Today's "Big Data"

- Big data is the huge and complex data sets generated by today's sophisticated information generation, collection, storage, and analysis technologies - Big data comes from marketing research, internal transaction data, and real-time data flowing from its social media monitoring, connected devices, and other digital sources

Customer-Generated Marketing

- Brand exchanges created by consumers themselves. - Consumers are playing an increasing role in shaping brand experiences. -- Brand exchanges created by consumers themselves. Consumers are playing an increasing role in shaping brand experiences.

Problems with the Matrix Approach

- Difficulty in defining SBUs and measuring market share and growth - Time consuming - Expensive - Focus on current businesses, not future planning Over the years, ESPN has grown to become a huge and complex brand portfolio consisting of more than 50 different entities

Consumers "market" when they:

- search for products - interact with companies to obtain information - make purchases

Factors Influencing Consumer Behavior

1. Cultural 2. Social 3. Personal 4. Psychological

The Model of Buyer Behavior

1. The environment 2. Buyer's Black Box 3. Buyer Responses

Amazon Philosophy of Marketing

Amazon does much more than just sell goods online. It engages customers and creates satisfying customer experiences. "The thing that drives everything is creating genuine value for customers," says Amazon founder Jeff Bezos.

Big Data and AI

Brands can use big data to gain deep customer insights, personalize marketing offers, and improve customer engagements and service.

Market Planning—Parts of a Marketing Plan

Executive summary, marketing situation, threats and opportunities, objective and issues, marketing strategy, action programs, budgets, controls

Customer-Engagement Marketing

Fosters direct and continuous customer involvement in shaping brand conversations, experiences, and community. -- Engaging customers: Rather than using intrusive, hard-sell product pitches, Bark interacts with customers in humorous ways about their favorite mutual topic—"the weird dogs we live with and the funny things they do."

Probability Sample

Simple random sample - Every member of the population has a known and equal chance of selection. Stratified random sample - The population is divided into mutually exclusive groups (such as age groups), and random samples are drawn from each group. Cluster (area) sample - The population is divided into mutually exclusive groups (such as blocks), and the researcher draws a sample of the groups to interview.

Designing the Business Portfolio

Strategic business units can be a ±Company division ±Product line within a division ±Single product or brand

Societal Marketing

The company's marketing decisions should consider consumers' wants, the company's requirements, consumers' long-run interests, and society's long-run interests.

Mobile Marketing

Using mobile channels to stimulate immediate buying, make shopping easier, and enrich the brand experience.

Integrated marketing program

a comprehensive plan that communicates and delivers intended value

Market Segment

a group of consumers who respond in a similar way to a given set of marketing efforts.

Portfolio analysis

a major activity in strategic planning whereby management evaluates the products and businesses that make up the company.

Marketing

a process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return -- ___________ is all around you, in good old traditional forms and in a host of new forms, from websites and mobile apps to online videos and social media.

Value Chain

a series of departments that carry out value creating activities to design, produce, market, deliver, and support a firm's products. - Walmart's ability to help you "Save Money. Live Better." by offering the right products at lower prices depends on the contributions of people in all of the company's departments.

Differentiation

begins the positioning process.

Customer Relationship Groups

butterflies, true friends, strangers, barnacles

Consumer Buyer Behavior

buying behavior of final consumers—individuals and households that buy goods and services for personal consumption.

Internal Databases

collections of consumer and market information obtained from data sources within the company network. -- Through skillful customer database development and use, Stitch Fix has built high levels of customer satisfaction and loyalty.

Cultural Environment

consists of institutions and other forces that affect a society's basic values, perceptions, and behaviors - Core beliefs and values are persistent and are passed on from parents to children and are reinforced by schools, churches, businesses, and government. - Secondary beliefs and values are more open to change and include people's views of themselves, others, organizations, society, nature, and the universe.

Environmental Sustainability

developing strategies and practices that create a world economy that the planet can support indefinitely - The natural environment: Walmart has emerged in recent years as the world's super "eco-nanny" through its own sustainability practices and its impact on the actions of its huge network of suppliers.

Marketing Intermediaries

firms that help the company to promote, sell, and distribute its goods to final buyers - Partnering with intermediaries: Coca-Cola provides its retail partners with much more than just soft drinks. It also pledges powerful marketing support

Customer Insights

fresh marketing information-based understandings of customers and the marketplace that become the basis for creating customer value, engagement, and relationships. -- To gain deep customer insights, P&G employs a wide range of marketing research approaches—from traditional large-scale surveys and small-scale focus groups to real-time social media listening, mobile surveys, and big data analytics.

Net Return

from a marketing investment divided by the costs of the marketing investment -- Measurement of the profits generated by investments in marketing activities

Survey Research

gathering primary data by asking people questions about their knowledge, attitudes, preferences, and buying behavior.

Experimental Research

gathering primary data by selecting matched groups of subjects, giving them different treatments, controlling related factors, and checking for differences in group responses.

Subcultures

groups of people within a culture with shared value systems based on common life experiences and situations -- Targeting Hispanic consumers: Nestle's DiGiorno brand worked with Twitter's U.S. Hispanics team and the NFL to create a football campaign with Spanish tweets.

Not-for-profit marketing

growing, as sound marketing can help organizations attract membership, funds, and support.

Demands

human wants that are backed by buying power.

Demographic Trends

include changing age and family structures, geographic population shifts, educational characteristics, and population diversity

marketing environment

includes the actors and forces outside marketing that affect marketing management's ability to build and maintain successful relationships with target customers.

Observational Research

involves gathering primary data by observing relevant people, actions, and situations.

Demographic Environment

involves people, and people make up markets

Ethnographic Research

involves sending trained observers to watch and interact with consumers in their natural environment -- Under Intuit's "follow me home" program, teams of Intuit employees visit customers in their homes or offices to watch them use the company's products in real life.

Partner Relationship Management

involves working closely with partners in other company departments and outside the company to jointly bring greater value to customers.

Consumer Markets

made up of all the individuals and households that buy or acquire goods and services for personal consumption.

Generational Marketing

marketing to members of a generation, who tend to share the same outlook and priorities

Marketing Myopia

paying more attention to the specific products than to the benefits and experiences produced

Marketing Information System

refers to the people and procedures dedicated to assessing information needs, developing the needed information, and helping decision makers to use the information to generate and validate actionable customer and market insights.

Market offerings

some combination of products, services, information, or experiences offered to a market to satisfy a need or want.

Needs

states of felt deprivation.

SWOT Analysis

strengths, weaknesses, opportunities, threats

Exchange

the act of obtaining a desired object from someone by offering something in return. -- Ex: Staying close to customers: Airbnb's CEO Brian Chesky and co-founder Joe Gebbia regularly stay at the company's host locations, helping them shape new customer solutions based on real user experiences.

Microenvironment

the actors close to the company that affect its ability to serve its customers - the company, suppliers, marketing intermediaries, customer markets, competitors, and publics

Market Positioning

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

Marketing Management

the art and science of choosing target markets and building profitable relationships with them. - What customers will we serve (target market)? - How can we best serve these customers (value proposition)?

The business portfolio

the collection of businesses and products that make up the company.

Market segmentation

the division of a market into distinct groups of buyers who have different needs, characteristics, or behaviors and who might require separate products or marketing mixes.

Wants

the form human needs take as they are shaped by culture and individual personality.

Macroenvironment

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

Marketing strategy

the marketing logic by which the company hopes to create customer value and achieve profitable customer relationships.

Mission Statement

the organization's purpose; what it wants to accomplish in the larger environment. - CVS Health's overall mission is to be a "pharmacy innovation company," one that is "helping people on their way to better health." Its marketing strategies and programs must support this mission.

Customer Relationship Management

the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction.

Natural Environment

the physical environment and the natural resources that are needed as inputs by marketers or that are affected by marketing activities

Share of Customer

the portion of the customer's purchasing that a company gets in its product categories.

Strategic Planning

the process of developing and maintaining a strategic fit between the organization's goals and capabilities, and its changing marketing opportunities

Market Targeting

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

Market

the set of actual and potential buyers.

Culture

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

Value proposition

the set of benefits or values it promises to deliver to customers to satisfy their needs - Ex: Sonos positions its Sonos One with Amazon Alexa as "The smart speaker for music lovers." It gives you all the advantages of Alexa but with high-quality Sonos sound.

Marketing Mix

the set of controllable, tactical marketing tools—product, price, place, and promotion—that the firm blends to produce the response it wants in the target market.

Competitive Marketing Intelligence

the systematic collection and analysis of publicly available information about consumers, competitors, and developments in the marketing environment. -- Mastercard's digital intelligence command center—called the Conversation Suite—monitors, analyzes, and responds in real time to millions of brand-related conversations across 43 markets and 26 languages around the world.

Marketing Research

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

Customer Equity

the total combined customer lifetime values of all of the company's customers. -- Managing customer equity: To increase customer equity, Cadillac is making the classic car cool again among younger buyers. For example, says GM, "Cadillac will lead the company to an all-electric future."

Customer Lifetime Value

the value of the entire stream of purchases that the customer would make over a lifetime of patronage. -- Customer lifetime value: To keep customers coming back, Stew Leonard's has created the "Disneyland of dairy stores." Rule #1—The customer is always right. Rule #2—If the customer is ever wrong, reread Rule #1.

Marketing Implementation

turning marketing strategies and plans into marketing actions to accomplish strategic marketing objectives Addresses who, where, when, and how

Downsizing

when a company must prune, harvest, or divest businesses that are unprofitable or that no longer fit the strategy.

Customers form expectations about the value and satisfaction of market offerings.

°Satisfied customers buy again °Dissatisfied customers switch to competitors

Political and Social Environment

±Increased emphasis on ethics and socially responsible actions ±Cause-related marketing - Cause-related marketing: Ben & Jerry's three-part "linked prosperity" mission drives it to make fantastic ice cream (product mission), manage the company for sustainable financial growth (economic mission), and use the company "in innovative ways to make the world a better place" (social mission). Both Ben & Jerry's and its products are "Made of Something Better."

Technological Environment

±Most dramatic force in changing the marketplace ±New products, opportunities ±Concern for the safety of new products - Marketing technology: Disney takes full advantage of digital technology in creating magical customer experiences at its Walt Disney World Resort.

Demography

•the study of human populations—size, density, location, age, gender, race, occupation, and other statistics.