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
