Chapter 2 Flashcards
we are living in the “___ __ __ ___”
“century of the consumer”
consumer analysis
the process of understanding consumer trends, global consumer markets, models to predict purchase and consumption patterns, and communication methods to reach target markets most effectively
strategy
a decisive allocation of resources (capital, technology, and product) in a particular direction
what is industrial demand created by?
consumer demand; therefore, B2C affects B2B
customer centricity
strategic commitment to focus every resource of the firm on serving and delighting profitable customers
what is the essence of customer centricity?
a vision/set of values/a belief that the future of the firm is embedded in consumers
the goal of a customer-centric company?
to provide customers with more value than its competitors
value
the difference between what consumers give up (time, money, etc) for a product and the benefits they receive
marketing strategy
the allocation of resources to develop and sell products and services that consumers will perceive to provide more value than competitive products or services
the process includes: market analysis, market segmentation, brand strategy, and implementation
market analysis
the process of analyzing changing consumer trends, current and potential competitors, company strengths and resources, and the technological, legal, and economic enviornments
consumer insight
an understanding of consumers’ expressed and unspoken needs and realities that affect how they make life, brand, and product choices. this concept combines fact (from research) with intuition, resulting in an insight that can lead to a new product, exiting product innovation, brand extension, or a revised communication plan.
market segmentation
process of identifying groups of people who behave in similar ways to each other, but somewhat differently than other groups
the opposite of market segmentation
market aggregation or mass marketing
market aggregation or mass marketing
when organizations choose to market and sell the same product or service to all consumers
affluence
consumers can afford products that are more customized to suit their individual tastes, needs, and lifestyles
consumer database
info on consumers needed to advertise to them
manufacturing technology
production processes can be computer controlled and tailored to smaller production runs without corresponding cost increases
multiple distribution channels
multiple methods of retailing, including direct sales and the internet, allow distribution to be close related to the needs and desires of specific segments
mass customization
customizing goods or services for individual customers in high volumes and at relatively low costs
making mass customization pay off in terms of value to the company requires what?
an understanding of what type of customization customers value the most, which varies in different situations
the ultimate goal of segmentation
increased customer satisfaction and profitability
criteria for choosing segments
measureability: the ability to obtain information about the size, nature, and behavior of a market segment
accessibility: (or reachability) the degree to which segments can be reached
substantiality: refers tot eh size of the market
congruity: how similar members within the segemtn exhibit behaviors or characteristics that correlate with consumption behavior
brand
a product or product line, store, or service with an identifiable set of benefits, wrapped in a recognizable personality, carrying with it a connection between product and customers
what does the development of brand equity require?
exellence with the functional and emotional elements of a brand
fucntional elements
performance, quality, price, reliability, and logistics
emotional elements
image, personality, style, and evoked feelings
brand promise
what customers can expect in exchange for their money
brand equity
–the difference in value created by a brand less than the cost of creating the brand
–the difference in profitability between firms with powerful brands and those with weak brands
brand personality
the reflection consumers see of themselves of think they will develop by using a brand
where is the brand equity of a firm protected?
in the Lanham Act, the Federal Trademark Registry, and other legislation
brand protection
by promising a certain outcome, brands reduce the risk to consumers that a product or service may not deliver as expected
7 R’s of the marketing mix
Research Rate Resources Reatiling Reliability Reward Relationship
basic steps in implementing CRM
- Identify all customers and the nature of contacts with them
- Identify which types of customers are most profitable (by sales or by profit contribution)
- Indentify and understand behaviors of the most profitable customers
- -how to encourage behaviors of the most profitable customers
- -how to encourage those behaviors among other segments of the customer base
- -how to cross-sell other products to customers - Manage contacts with most profitable customers
- Manage activities of the firm that will please the most profitable customers, including both strategies and tactics
cross-cultural analysis
the comparison of similarities and differences in behavioral and physical aspects of cultures
cultural empathy
the ability to understand the inner logic and coherence of other ways of life and refrain from judging other value systems
ethnography
describing and understanding consumer behavior by interviewing and observing consumers in real-world situations, can help analyze the subtle ways buyers and sellers interact in the marketplace and be useful in the business negotiation process
