Marketing Fundamentals C712
Identifying Wants & Satisfying Needs (ch1)
1. Conduct market research to understand needs of potential customers (the market) 2. Select those needs that company can satisfy and also be profitable 3. Design Products (goods & services) to satisfy needs in the market
HOW marketing works - 6 steps (ch1)
1. Identify customers' needs in the market 2. Design products to meet those needs 3. Communicate about products to prospective buyers and potential customers 4. Ensure availability of products when and where they are wanted (supply/demand) 5. Price the goods and services 6. Follow-up through after-sale services (Reviews, feedback, surveys, support)
How technology addresses social concerns (ch. 3)
1. Industry 2. Educational institutions 3. Not-for-profit institutions 4. Federal government
Steps in the Personal Selling Process
1. Prospecting 2. Preapproach 3. Approach 4. Making the presentation 5. Overcoming objections 6. Closing the sale 7. Following up
Resources & International Economic Environment (ch. 3)
1. Resources are not unlimited - shortages result from several conditions, including political instability and lack of raw materials, component parts, or labor 2. De-marketing - Reducing consumer demand for a good or service to a level that the firm can supply 3. International Economic Environment *Marketers must monitor the economic environment of other nations *Politics in other countries affects the international economic environment as well
Consumer rights
1. The right to choose freely. 2. The right to be informed. 3. The right to be heard. 4. The right to be safe.
Marketing Mix (ch. 2)
4 Ps - (See Below) Marketing leaders decide how to best combine the Marketing Mix strategies to achieve objectives and develop it Target market customers. Blending 4 strategic elements to fit the needs and preferences in a specific target market.
4 Historical phases of Political-legal environment (ch. 3)
4 historical Phases 1. Late 19th-20th centuries - Antimonopoly 2. 1930s -Protecting competitors during Great Depression 3. Consumer Protection 4. Late 1970s - present - Industry deregulation
Political-legal (regulatory) environment (ch. 3)
Consists of laws and their interpretations that require firms to operate under competitive conditions and to protect consumer rights (Marketers should be aware of these major regulations that affect their companies activities)
Six Steps: Planning Processes (Firm & Marketing) (ch. 2)
Define firm's mission - What is the essential purpose that differentiates one company from another - Walmart: "Save money. Live better." Determine firm's Objectives (Marketing objectives = firm's objectives) - Guide the development of marketing objectives & plans - i.e generate x% profit, over next 24 months, add x # of locations Access firm's resources & Evaluate its environment (SWOT analysis) 1 .Analyze the firm's strength & weaknesses 2. Identify opportunities in the firm (internal) and marketplace (external) 3. Evaluate the environmental situation to include threats in the marketplace 4. Evaluate firm (internal) in relation to environmental effects like social media, which continues to impact communications Formulate Strategy - Select ways to satisfy target market using the marketing mix Implement strategy - Marketers put strategies into action through operating plan Monitor and Adapt strategies - Gather and review feedback. Additionally, monitor performance related to objectives being achieved and adapt strategies as needed
Description of eight universal functions. What are the three groupings of the 8 functions? Which functions fit into each grouping?
Exchange 1) Buying - Ensuring that the product offerings are available in sufficient quantities to meet customer demands 2) Selling - Using types of advertising, sales promotions, and personal selling to match products to customer needs Physical Distribution 3) Transporting - Moving products from their point of production to location (i.e., retailers) convenient for purchases 4) Storing - Warehousing products until needed for sales. Facilitating 5) Standardizing and grading - Ensuring that product offerings meet quality and quantity controls of size, weight, and other variables 6) Financing - Providing credit for channel members (wholesalers and retailers) and consumers. 7) Risk Taking - Dealing with uncertainty about future customer purchases. 8)Securing Marketing information -Collecting information about consumers, competitors, and channel members for use in making marketing decisions
Ch 2: Strategic Planning
The marketplace changes continually in response to changes in consumer tastes, expectations, technological developments, competitors' actions, economic trends, and political and legal events, AND product innovations, pressures from suppliers and distributors...As changes outside marketer's control, effective planning (by gathering reliable info) is necessary to anticipate changes. These planning activities provide a structure for a firm to use its unique strengths to capitalize on market opportunities.
Gross Domestic Product (GDP) (ch. 3)
The sum total of the value of all the goods and services produced by a nation in a year
Utility (Ch.1)
The want-satisfying power of a product (goods, services and ideas)
Why is environmental scanning an important activity for Marketers? (Ch3)
This is important for marketers because trends represent significant opportunities or threats to the company. Ex. Consumer Product Safety Commission issued a recall of children's books due to choking and laceration hazards
How does market planning differ between managers and supervisors? (ch 2)
Top managers (Strategic Planning - Organization wide objectives; fundamental strategies; long-term plans; total budget), middle-level managers (Tactical planning - Quarterly and semiannual plans, business unit budgets, divisional policies and procedures), and supervisors (Operational planning - daily/weekly plans; unit budgets; departmental rules and procedures?)
Target Market (ch. 2)
Understanding your consumers - existing and potential consumers, Know consumers through market segmentation, including demographic, geographic and more. 1. Know consumers - population firm directs efforts and merchandise towards [Boeing markets mostly to Delta Airlines] 2. Diversity plays a critical role - Growing hispanic pop. in U.S.
How do organizations create utility? (ch.1)
Using both Production/marketing to design want-satisfying products. Marketer's role - Finding, learning what products are needed or wanted by the market.
What are the four strategies in the marketing mix? (ch. 2)
[How marketing activities are done] Product - Deciding and designing which goods or services to offer its markets (B2C, B2B) 1. Innovation and new product development 2. Brand names, trademarks, patents, and warranties (match positioning strategies) 3. Product design (features, advantages, benefits) 4. Packaging and warranty 5. Lifecycle of a product Price - Methods of setting profitable prices 1. Subject to governmental regulation and consumer opinion 2. A good pricing strategy * Offer price/quality value for customers * Strengthens firms' relationships with customers with its products Distribution (Place) - Consumers can find needed products at the right times, places and quantities 1. Distribution channels 2. Internet has opened new distribution channels in many industries 3. Transportation using different modes 4. Storage, warehousing, and inventory control 5. Customer service and order processing Promotional decisions by marketing leaders 1. All communication between sellers and buyers 2. Integrated Marketing Communication (IMC) 3. Firms Communicate with customers both: * Directly - by marketing and sales people *Indirectly - with ads and promotions.
Federal Trade Commission (FTC) (ch 3.)
a federal agency established in 1914 to - broad regulatory powers over marketing *Meant to investigate and Enforce laws regulating unfair business practices *To Enforce these laws FTC uses - consent/cease-and desist orders
Oligopoloy (ch.3)
a state of limited competition, in which a market is shared by a small number of producers or sellers. High start up costs which keep out new competitors.
Ch 17: What is Personal Selling
is the process of a seller's one-to-one promotional presentation to a buyer. The sales process is essentially interpersonal and is basic to any enterprise. Person selling is a primary component of a firm's promotional mix when one or more of the several well-defined factors are present: 1. Customers are geographically concentrated 2. Individual orders account for large amounts of revenue 3. The firm markets goods and services that are expensive, are technically complex, or require special handling 4. Trade-ins are involved 5. Products move through short channels 6. The firm markets to relatively few potential customers
Antitrust laws (ch. 3)
laws that prevent monopolies and promote competition and fairness (by prevent restraints on trade)
Inflation/Deflation (ch. 3)
the increase/decrease in prices resulting in the fall/rise of the purchasing value of currency Inflation - Devalues money by reducing the products it can buy through persistent price increases. Deflation - Can cause: A freefall in business profits Lower Returns on most investments Widespread job layoffs
Strategic Planning (ch. 2)
the managerial process of creating and maintaining a fit between the organization's objectives and resources and the evolving market opportunities (Strategies are plans to achieve objectives) • Determining an organization's primary objectives • Adopting courses of action that will achieve these objectives • Provides long-term direction for its decision makers
Tactical Planning (ch. 2)
the process of developing detailed, short-term statements about what is to be done, who is to do it, and how it is to be done (Tactics are plans to implement the strategies) • Guides the implementation of strategies • Addresses shorter-term actions
Social-cultural environment
the relationship between the marketer, society, and culture
Three types of competition marketers (ch3)
*Directly competitive products - similar products (Alternative suppliers - cell phone market - Verizon, AT&T, T-mobile) *Indirect - Easily substituted products - (fast food industry - pizza, chicken, hamburgers, tacos) *Purchasing power -Competition among all firms that compete for consumer's purchases - All firms compete for a limited number of money that consumers can or will spend (Buying a new car - Honda Accord might compete with a Norwegian Cruise Line cruise)
Other Regulatory Forces - in Political-legal Environment (ch. 3)
*The Food and Drug Administration? *Consumer interest groups and self regulatory orgs - who represent industries; attempts to set guidelines for responsible business conduct. *Groups that attempt to advance the rights of minorities, senior citizens, and other causes.
Ch 18 & 19 Pricing Concepts & Strategies
A price = exchange value of a good or service. The process of determining a profitable but justifiable price depends on a variety of factors, both internal and external to the firm. Marketers use price-quality relationships & firms other marketing mix strategies to pick a products price. Lots of dynamic variables can shift response from customers
What is the definition of marketing? (ch1)
Activity, set of institutions and processes for: 1) Creating, communicating, delivering, and exchanging offerings 2) Managing customer relationships in ways that have value for customers, clients, partners and society at large.
Technology (ch. 3)
An application of knowledge based on discoveries in science, inventions, and innovations to marketing. Technology leads to: 1. New Products 2. Improvements in existing products 3. Better customer service 4. Reduced prices
What is planning? (ch. 2)
Anticipating future events and conditions and determining the best way to achieve organizational objective 1. Continuous process that includes -Identify objectives, Determine the actions through which a firm can attain those objectives 2. Creates a blueprint for everyone in the organization Strategic Window - Requires analysis of: Environmental conditions; Firm's capabilities (current & projected) - can reconcile Environmental with firms capabilities
The business cycle during a Global Economic Crisis (ch. 3)
Business cycles take a severe turn and affect consumers and businesses across the globe. Marketers must reevaluate their strategies and concentrate on their most promising products.
List of eight Universal Functions of Marketing. (ch.1)
Buying, Selling, Transporting, Storing, Standardizing & grading, Financing, Risk taking, Securing Marketing Info
Define first mover and second mover strategies Give two advantages or disadvantages for each. (ch. 2)
First mover strategy - The company first to offer a product in a marketplace will be the long-term market winner Second Mover Strategy - Observing the innovations of 1st movers and then improving on them to gain advantage in the marketplace
Marketing Planning (ch. 2)
Implementing planning activities devoted to achieving marketing objectives (many virtual/internet activities) - centers on relationship marketing ( long-term, cost-effective associations with key customers and suppliers for mutual benefit)
Income (ch. 3)
Influences consumer buying power Marketers focus on discretionary income, the amount of money people have to spend after buying necessities.
competitive environment (ch3)
Interactive process that occurs in the market place among various competing companies.
Ch 4 - Social Media
The how and why of social media use by consumers *why important to marketers *how affects consumer buying decisions *ways that consumers and businesses use social media *Identify the elements of a social media marketing plan
Environmental scanning (ch3)
It's collecting external marketing environment info to identify and interpret potential trends.
Monopoly (Ch.3)
Market structure (market share) in which a single seller dominates trade in a good or service for which buyers can find no close substitutes.
Why do marketers monitor the technical environment (ch. 3)
Marketers monitor new technology to gain a competitive edge and to enhance customer service * VoIP (voice over Internet protocol - A phone connection through a personal computer with any type of broadband Internet connection * Internet Protocol Multimedia Subsystem (IMS) will offer new opportunities to marketers
Ch 1 : Marketing basics
Marketers must constantly look for these things with customers * To create loyalty *build long-term relationships *Anticipate their needs & satisfy them with innovative goods and services Marketers are expected to do this ^ faster and better than the competition.
Ch 3. Marketing Environments
Marketers: Set goals to meet the concerns of customers, employees, shareholders and members of the general public. Decision makers need to consider the influence of the external environment with variables of the marketing mix -These five forces or conditions can be Economic factors, demographic, cultural, or social trends, political/legal regulations, technology changes, & price/availability of natural resources. These forces provide the frame of reference within which all marketing decisions are made. *To develop & modify marketing plans and strategies *Allows Marketers to analyze the market environment and learn to anticipate & plan for change by scanning and monitoring the conditions of the marketplace.
Competitive Strategy (ch3)
Methods through which a firm deals with its competitive environment Questions to ask 1. Should we compete? - depends on firms resources, objectives, and expected profit potential 2. In what markets should we compete? - Requires marketers to acknowledge their firm's limited resources 3. How should we compete? - Requires marketers to make (4Ps Marketing Mix) decisions that give the firm a competitive advantage 4. Time-based competition
How might marketers make the most of shifts in the social-cultural environment?
Must be sensitive to demographic shifts and changing values - to do this must increase importance of cultural diversity * Ex. Univision & Telemundo face growing competition in Spanish-language television programming
Cyperspace (ch. 3)
Newest Regulatory Frontier *Fed/Stat Regulators investigating ways to police the internet and Online services *Privacy and child protection issues = difficult enforcement challenge
Business Cycle (ch. 3)
Pattern of stages in the level of economic activity Stages in the Business Cycle Prosperity -Consumer spending is brisk; growth in service sector Recession - Consumers focus on basic, functional products Depression - Consumer spending sinks to its lowest level Recovery - Consumer purchasing power increases
Unemployment (Ch. 3)
Portion of people in the economy (workforce 16-64) actively seeking work but do not have jobs. * Rises during recession and declines during recovery and prosperity
What is the purpose for doing a SWOT analysis? Internal, External factors (ch. 2)
Purpose Based on situational analysis, firm conducts a SWOT (a tool to assists planners) to analyze their Strengths, Weaknesses (internal), and compare with marketplace Opportunities, and threats (External)
Consumerism
Social force within the environment that aids and protects the consumer by exerting legal, moral, and economic pressures on business and government.
What are the Porter's Five Forces? How might these factors affect a firm's overall marketing strategy? (ch. 2)
Stressed importance threats to the firm's success, including possible severity threats. Recommends analyzing all threats in the market. Know the competitors and potential competitors, including their positions in the market 1. Threats of new entrants 2. Bargaining power of buyers 3. Bargaining power of suppliers 4. Threat of substitute products 5. Rivalry among competitors
Identify the two basic elements of a marketing strategy. (ch. 2)
Target Market Marketing Mix
Describe an industry or film that you think might be able to weather an economic downturn and explain why - (ch. 3)
Tech Companies
Marketing Environment (ch3)
The environmental factors that surround the customer and impact a firm's marking mix and provide a framework for all marketing activities. The five environmental factors include: The competitive, economic, political, legal and regulatory, technological, and sociocultural forces.
Economic Environment (ch. 3)
economic factors that affect consumer purchasing power, spending patterns, and marketing strategies
Technological Environment (ch 3.)
forces that create new technologies, creating new product and market opportunities
Identify the four types of utility, and give an example of each. (ch.1)
o Form - (Production) - Conversion of raw materials and components into finished goods and services - i.e Dinner at a restaurant, Samsung Galaxy Phone, Levi Jeans o Time - (Marketing) - Availability of goods and services when consumers want them - i.e. Dental appointment; digital photographs; 1-800 PetMeds guarantee, UPS Next Day Air Delivery o Place - (Marketing) - Availability of goods and services at convenient locations -i.e Technicians available at an auto repair facility; onsite day care; banks in grocery stores o Ownership (Possession) - (Marketing) - Ability to transfer title to goods or services from marketer to buyer - i.e. Retail sales (in exchange for currency, credit or debit payments)
Four types of market structure
perfect competition, monopolistic competition, oligopoly, monopoly
Robinson-Patman Act
prevents unfair price discrimination by ensuring that the seller offer the same price terms to customers at a given level of trade 1937 - Amended federal anti-trust laws so as to outlaw "price discrimination," whereby companies create a monopolistic network of related suppliers and vendors who give each other more favorable prices than they do others. How does this affect pricing decisions...
time-based competition (ch3)
strategy of developing and distributing goods and services more quickly than competitors