Ch. 1

What percent do foundations donate in the US? What're 2 major foundations formed by business founders? What does marketing play a key role in supporting?

- 10% of all charitable contributions - Arthur M. Blank Family Fdtn & the Bill & Melinda Gates Fdtn - philanthropy

What're the 4 conditions that must exist in order for an exchange to take place?

- 2 or more individuals, groups, or organizations must participate & possess something of value that the other party desires - the exchange should provide a benefit or satisfaction to both parties involved in the transaction - each party must have confidence in the promise of the "something of value" held by the other - the parties to the exchange must meet expectations

What's a target market? What ethnic group are marketers becoming increasingly interested in? Why?

- A specific group of customers on whom an organization focuses its marketing efforts - Hispanic customers bc they make up 59 million of the population and a buying power of more than $1.5 trillion

What're stakeholders? What do they include?

- Constituents who have a "stake," or claim, in some aspect of a company's products, operations, markets, industry, and outcomes - customers, employees, investors, and shareholders, suppliers, governments, communities, competitors, etc

What's the focal point of all marketing activities? What do organizations have to define their products as?

- Customers - what they do to satisfy customers

What's the Sales Orientation? What did businesses view as the major means to increase profit? What did businesspeople believe the most important marketing activities were?

- In the first half of the 20th century competition increased & businesses realized they had to focus more on selling products to many buyers - sales - personal selling, advertising, and distribution

What does an idea consist of? What're examples?

- concepts, philosophies, images, and issues - marriage counselor gives ideas to spouses to improve their relationship; political parties, churches, & animal protection groups

What is marketing?

The process of creating, distributing, promoting, and pricing goods, services, and ideas to facilitate satisfying exchange relationships with customers and to develop and maintain favorable relationships with stakeholders in a dynamic environment

What's the production orientation?

The industrial revolution in the 2nd half of the 19th century saw mass production of products in a more efficient way when demands were strong

What's an example of a relationship between 2 parties?

Chick-fil-A and their loyal customers

What's promotion?

Communicating information that helps customers learn about the product and determine if it will satisfy their needs

Do marketing activities take place in a vacuum? What's the marketing environment? What are the effects of those forces like on the buyers and sellers? What can they create/generate?

- No - it includes competitive, economic, political, legal & regulatory, technological, and sociocultural forces surrounds the customer and affects the marketing mix - effects are dramatic and difficult to predict - create threats to marketers but can generate opportunities for new products & new methods of reaching customers

What's the importance of the distribution (place) variable? What's the world's largest fast food chain? What does the distribution variable deal with? What else might a marketing manager do?

- Products must be available at the right time and location to satisfy customers - subway - making products available in the quantities desired to as many target-market customers as possible - select intermediaries, establish & maintain inventory control procedures, & develop and manage transportation & storage systems

What does the product variable of the marketing mix deal with? What is a product? What's an example of each type of product?

- Researching customers' needs and wants & designing a product that satisfies them - A good, service, or an idea - Tangible product: sunglasses - Intangible product: e-commerce software

What's an example of a company that sees itself as being "in the business of humanity"? Is the marketing concept a 2nd definition of marketing? What organizational activities does the marketing concept affect? What does a firm that adopts the marketing concept satisfy?

- Starbucks - No, it's a philosophy guiding an organization's overall activities - production, finance, accounting, human resources, and marketing depts - customer objectives & its own objectives

What's SCM? What does it involve? What has it become very important to?

- Supply Chain Management - involves maintaining a flow of products through physical distribution activities (acquiring resources, inventory, and the interlinked networks) - the success of online marketers

How does marketing create value? What's the primary goal of a marketing manager? What's one company that's well-known for its implementation of the marketing mix? How?

- Through the marketing mix - to create and maintain the right mix of the 4 variables to satisfy customers' needs for a general product type - Amazon; they routinely engage in research and development to create new products such as its digital assistant, Echo

Can marketing activities occur occur without a transaction or sale? What's an example? What happens when an exchange occurs?

- Yes - You may see an ad for a fridge but never buy the fridge - products are traded for other products or for financial resources

What is marketing necessary to advance? What enables businesses of all sizes to reach buyers worldwide? What does studying the market allow us to understand? What does information technology help marketers do? What has enabled marketers & consumers to forge new relationships that challenge how the traditional marketing-mix variables are implemented?

- a global economy - social media & the internet - the importance of marketing to customers, organizations, & our economy - understand & satisfy more customers than ever before - the global spread of mobile devices

What's green marketing? What improves overall business performance? What percent of all civilian workers in the US perform marketing activities? What type of job position remains the most attractive when unemployment is high? Which job position is the most secure?

- a strategic process involving stakeholder assessment to create meaningful long-term relationships with customers while supporting the natural environment - market orientation combined with social responsibility - 25-33% - sales positions - marketing positions

What does the promotion variable relate to? What can it do? What're examples of sales promotions?

- activities used to inform and persuade to create a desired response - increase public awareness of the organization and of new or existing products - ex: coupons, online discount codes, etc

What do customer benefits include? What's an example? What're customer costs? What're examples?

- anything a buyer receives in an exchange - ex: Motel 6 offers the minimum amenities and the Ritz-Carlton provides every amenity imaginable for their guests - anything a buyer must give up to obtain the benefits the product provides - ex: monetary cost, time, effort, & risk

What must marketers do before they can develop an appropriate marketing mix? What might that consist of?

- collect in-depth, up-to-date information about customer needs - may consist of age, income, ethnicity, gender, & educational level

What shapes the decision-making environment for controllable variables?

- competitive forces - economic conditions - political forces - laws & regulations - technology - sociocultural forces

What does the customer expect to gain? What does a marketer expect to gain?

- customer expects to gain a reward or benefit greater than the costs incurred in a marketing transaction - marketer expects to gain something of value in return (usually the price charged for the product)

What does the price variable refer to? Why is price a critical component of the marketing mix? What type of tool is price used as? What can that lead to?

- decisions and actions associated with pricing objectives and policies and actual product prices - customers are concerned about the value obtained in an exchange - a competitive tool that could lead to price wars

What must marketers do to maintain an assortment of products that helps an organization achieve its goals?

- develop new products - modify existing ones - eliminate products that no longer satisfy enough buyers or that yield unacceptable profits

What may prevent a manager from adjusting prices frequently or significantly?

- economic conditions - competitive structure - government regulations

What engagement has been found to increase financial performance? What's crucial to the long-term growth of an organization and its products? Who are considered to be core stakeholders in developing a marketing strategy?

- engaging in marketing activities, & being proactive & responsive to stakeholder concerns - developing and maintaining favorable relations with stakeholders - customers & competitors

Why is marketing so interesting & challenging? What can happen because the forces are closely interrelated? What do changes in the marketing environment produce?

- environment forces can fluctuate quickly & dramatically - changes in one may cause changes in others - uncertainty for marketers & may hurt marketing efforts, but they also create opportunities

What's the sharing economy? What else is it known as? What's an example? What's big data?

- firms specializing in peer-to-peer services are using independent contractors to provide services - "gig economy" - ex: Lyft - massive data files that can be obtained from both structured & unstructured databases

What does managing customer relationships require? What's CLV? What does a CLV represent?

- identifying patterns of buying behavior & using that info to focus on the most promising & profitable customers - Customer lifetime value: predicts the net value for the future relationship with the customer - an intangible asset to a marketer that can be augmented by addressing the customer's varying needs & preferences at diff stages in their relationship with the firm

What is value an important element of? What is value? How do consumers develop a concept of value? What's the trade-off seen from a company's perspective?

- managing long-term customer relationships & implementing the marketing concept - a customer's subjective assessment of benefits relative to costs in determining the worth of a product - through the integration of their perceptions of product quality and financial sacrifice - increasing the value offered to a customer & maximizing the profits from a transaction

What does the success of our economic system depend on? What's a part of strategic planning & implementation of marketing activities? What is trust built on?

- marketers whose values promote trust & cooperative relationships - social responsibility & ethical conduct - ethical conduct

What does about half 1/2 of a buyer's dollar go towards? What do marketing costs have an impact on? What do nonprofit organizations employ marketing activities for? What's the business function responsible for creating revenue to sustain the operations of the organization & to provide financial returns to investors? What drives business success & customers loyalty?

- marketing costs - the economy & the standard of living for consumers - to create, distribute, promote, & price programs that benefit specific segments of society - marketing - innovation in operations & products

What're the 4 marketing mix variables? Are they controllable or uncontrollable? Why?

- product - distribution (place) - promotion - price - they're controllable bc they can be modified

According to the marketing concept, what should an organization try to provide? What's the major focus of the marketing concept? What does an organization do to implement the marketing concept? What 4 things does the concept focus on?

- products that satisfy customers' needs through a coordinated set of activities that also allows the organization to achieve its goals - customer satisfaction - determine what buyers want & use that info to develop satisfying products - customer analysis, competitor analysis, integration of firm's resources, & generate long-term profits

What does the overall objectives of a business usually relate to? How can an organization best achieve these objectives? What 3 time periods has marketing gone through?

- profits, market share, sales, or all 3 - by being customer-oriented - production, sales, & market orientation

What should marketing activities attempt to create/maintain? How do you maintain an exchange relationship? In a customer relationship what is critical for the firm? What happens when a customer lacks trust in the relationship?

- satisfying exchange relationships - buyers must be satisfied with the good, service, or idea obtained & sellers must be satisfied with the financial reward or something else of value received - repeat purchases - they search for alternative organizations or products

What's a service? What're examples?

- the application of human and mechanical efforts to people or objects to provide intangible benefits to customers - air travel, education, insurance, banking, health care, day care

What's another way marketing creates value through? What're exchanges? What may be involved in a marketing exchange? Who do we assume will expect to gain a reward in excess of the costs incurred?

- the building of stakeholder relationships - the provision or transfer of goods, services, or ideas in return for something of value - any product - individuals & organizations

How can a company reduce time and effort? How can they reduce risk?

- they can increase product availability making it more convenient for buyers to purchase the firm's products - offer good basic warranties or extended warranties for additional charges, or to offer a 100% satisfaction guarantee

What does the ability to identify individual customers allow marketers to do? What does the emphasis of "share of market" change to? What's the 80/20 rule? What's the goal of the rule?

- they can shift their focus from targeting groups of similar customers to increasing their share of an individual customer's purchases - "share of customer" - 80% of business profits come from 20% of customers - to estimate the CLV

Why do firms frequently fail to attract customers with what they have to offer? What's the marketing concept?

- they define their business as "making a product" rather than "helping potential customers to satisfy their needs and wants" - a managerial philosophy than an organization should try to satisfy customers' needs through a coordinated set of activities that also allows the organization to achieve its goals

What does the customer develop through the buyer-seller interaction? How does the marketer deliver?

- they develop expectations about the seller's future behavior - delivers of promises made

What 3 ways do the forces of the marketing environment affect a marketer's ability to facilitate value-driven marketing exchanges?

- they influence customers by affecting their lifestyles, standards of living, & preferences for needs & products - they can determine whether and how a marketing manager can perform certain marketing activities - environmental forces may shape a marketing manager's decisions and actions by influencing buyers' reactions to the firm's marketing mix

What type of managers are important in developing and carrying out a market orientation? What're 6 values required by organizations striving to become more market oriented? What should a market orientation recognize the need to do?

- top, marketing, non-marketing managers , & customers - trust, openness, honoring promises, respect, collaboration, & listening - create specific types of value-creating capabilities that enhance organizational performance

Can services be a product? Give examples

- yes - ex: health care, entertainment, sports, hospitality, & tourism

What's the Market Orientation?

An organization-wide commitment to researching & responding to customer needs in order to determine what customers want & then producing those products instead of producing products first & trying to persuade ppl they need them in the 1950s

What does SAP do?

Operates in the digital marketplace and monitors every consumer's needs, preferences, and reactions to adjust its marketing mix

What's the most flexible variable in the marketing mix?

Price

What's the marketing mix?

The 4 activities, product, price, place, promotion, that a firm can control to meet the needs of customers within its target market

What's the essence of marketing?

To develop satisfying exchanges from which both customers and marketers benefit