Ch12 Flashcards
marketing
organizational function and a set of processes for creating, communicating, and delivering value to customers, and for managing customer relationships to benefit the organization and its stakeholders
marketing concept
idea that a whole firm is directed toward serving present and potential customers at a profit
value
relative comparison of a product’s benefits versus its costs
utility
ability of a product to satisfy a human want or need
four types of utility provided by marketing
form (design), time (provide products when customers want them), place (provide products where customers will want them), possession (transferring product ownership to customers by setting selling prices, setting terms for customer credit payments, and providing ownership documents)
consumer goods
physical products purchased by consumers for personal use
industrial goods
physical products purchased by companies to produce other products
services
products with non-physical features, such as information, expertise, or an activity that can be purchased
relationship marketing
marketing strategy that emphasizes building lasting relationships with customers and suppliers
customer relationship management
organized methods that a firm uses to build better information connections with clients, so that stronger company-client relationships are developed
factors affecting marketing
political-legal environment, socio-cultural environment, technological environment, economic environment, competitive environment
three types of competition
substitute product, brand competition, international competition
substitute product
competing product that can fulfill the same need
brand competition
competitive marketing that appeals to consumer perceptions of benefits of products offered by particular companies
international competition
matches products of domestic marketers against those of foreign competitors
marketing manager
manager who plans and implements marketing activities that result in the transfer of products from producer to consumer
marketing plan
detailed strategy for focusing marketing efforts on consumers’ needs and wants
marketing mix
combination of product, pricing, promotion, and place strategies used to market products
product
good, service, or idea that fills consumers’ needs and wants
product differentiation
creating a product feature or product image that differs from existing products
pricing
process of determining the best price at which to sell a product
place (distribution)
part of marketing concerned with getting products from producers to consumers (warehousing, inventory control, etc)
promotion
aspect of marketing concerned with the most effective technique for communicating info about products
integrated marketing strategy
strategy that blends the four ps (promotion, place, pricing, and product differentiation) to ensure their compatibility with one another and with the company’s non-marketing activities
target market
group of ppl who have similar needs and can be expected to show interest in the same products
market segmentation
process of dividing a market into categories of customer types
product positioning
process of fixing, adapting, and communicating the nature of a product
five most important variables for market segments
geographic (countries, neighbourhoods, etc), demographic (age, gender, etc), geo-demographic, psychographic (consumer characteristics such as lifestyles, opinions, interests), behavioural (consumer knowledge, use, or response to a product – loyalty status, usage rate, benefits sought)
market research
study of what buyers need and how best to meet those needs
research steps: study situation, select research method, collect data, analyze, and make report
secondary data
info already available to market researchers from previous research by the firm or other agencies
primary data
info developed thru new research by the firm
research methods
observation, survey, focus groups, and experimentation
observation
market research technique involving viewing or otherwise monitoring consumer buying patterns
survey
market research technique based on questioning a representative sample of consumers about purchasing attitudes and practices
focus groups
market research technique involving a small group of ppl brought together and allowed to discuss selected issues in depth
experimentation
market research technique where the reactions of similar ppl are compared under different circumstances
consumer behaviour
the study of the decision process by which ppl buy and consume products
four major influences on consumer behaviour
psychological (person’s attitudes, motivations, etc)
personal (lifestyle, personality, economic status)
social (family, friends, opinion leaders)
cultural (culture, subculture, social class)
brand loyalty
pattern of regular consumer purchasing based on satisfaction with a product’s performance
stages of consumer buying process
problem need/recognition, info seeking, evaluation of alternatives, purchase decision, postpurchase evaluation
rational motives
reasons for purchasing a product that are based on a logical evaluation of product attributes (cost, quality, usefulness)
emotional motives
reasons for purchasing a product that are based on non-objective factors (aesthetics, imitation of others, etc)
business marketing
involves organizational or commercial markets in three B2B categories: industrial, reseller, and government/institutional markets
industrial market
organizational market consisting of firms that buy goods that are either converted into products or used during production
reseller market
organizational market consisting of intermediaries that buy and resell finished goods
institutional market
organizational market consisting of non-government organizations (churches, museums, hospitals, etc) that also use supplies and equipment as well as legal, accounting, and transportation services
differences between organizational buyers and individual consumers
- industrial buyers purchase large quantities and are professional, specialized, and well-informed
- industrial buyers can negotiate purchase terms and arrange formal contract
- relationship btwn buyer and seller is longer for organizational buyers
product features
tangible and intangible qualities that a company builds into its products
value package
product marketed as a bundle of value-adding attributes, including reasonable cost
classificiations of consumer products
convenience good/service: low-cost good or service purchased and consumed rapidly and regularly
shopping good/service: moderately expensive, infrequently purchased good or service
specialty good/service: expensive, rarely purchased good or service
classification of organizational products
production item: industrial product purchased and used directly in the production process that makes other goods/service
expense item: product purchased and consumed within a year by firms producing other products
capital item: expensive, long-lasting, infrequently purchased product
product mix
group of products that a firm makes available for sale
product line
group of products that function in a similar manner or are sold to the same customer group who will use them in similar ways
speed to market
strategy of introducing new products to respond quickly to customer market changes
seven-step development process
- product ideas (brainstorm)
- screening
- concept testing (solicit customer input)
- business analysis (comparing cost and benefit of product)
- prototype development
- product testing and test marketing
- commercialization
product life cycle
series of stages in a product’s commercial life
stages of product life cycle
- introduction: product goes to marketplace. Lots of promotional cost and focus on making ppl aware. no profit
- growth. sales climb rapidly and some profit. other companies make imitations. lots of promotion to build brand preference over competition
- maturity. sales start to slow. highest profit level early in this stage, competition forces price-cutting, more advertising, and lower profit. end of this stage, sales start to fall
- decline. sales and profits continue to fall as new products take away sales. firms end or reduce promotional support. sometimes let product linger for profit
ways to prolong product life cycle
product extension, product adaptation, reintroduction
product extension
process of marketing an existing, unmodified product globally
product adaptation
process of modifying a product to have greater appeal in foreign markets
reintroduction
process of reviving, for new markets, products that are becoming obsolete in older ones
branding
process of using symbols to communicate the qualities of a product made by a particular producer
brand equity
the added value a brand name provides to a product beyond its basic functional benefits
product placement
promotional tactic for brand exposure in which characters in television, film, music, magazines, or video games use a real product with its brand visible to viewers
buzz marketing
marketing that relies on word-of-mouth
viral marketing
buzz that relies on social networking on the internet to spread info
corporate blog
blogs run by major corporations for public relations, branding, and otherwise spreading messages that stimulate chat about products
national brands
products that are produced and distributed by the manufacturer across an entire country
licensed brands
selling the limited rights to another company to use a brand name on a product
private brand
products promoted by and carrying a name associated with the retailer or wholesaleer, not the manufacturer
generic brand
products sold under the general category name rather than a specific company name
packaging
physical container in which a product is sold, advertised, or protected
label
part of a product’s packaging that identifies the product’s name and contents and sometimes its benefits
Consumer Packaging and Labelling Act
federal law that provides comprehensive rules for the packaging and labelling of products
