Chapter 3: Study Guide Flashcards
Describe 3 generational cohorts.
- Baby boomers - born between 1946 and 1964; will all be 65+ by 2030; wealthiest generation in history; account for 50% of all consumer spending
- Gen X; born between 1965-1976; known as the baby bust cohort; well educated; collective net worth less than baby boomers.
- Gen Y; born between 1977 and 1994; often called the echo-boom cohort; subset of them is millennials
Why are companies developing multicultural marketing programs?
- the racial and ethnic diversity of the US is changing rapidly
- An accurate understanding of each group is essential for marketing efforts to be successful.
- Racial and ethnic groups tend to be concentrated in specific geographic regions.
How are important values like sustainability reflected in the marketplace today?
Many Americans desire and practice sustainability to preserve the environment.
These consumers are buying hybrid cars and energy-efficient light bulbs.
Consumers also prefer brands that have a link to social action.
Companies are responding to this consumer trend by using renewable energy and reducing packaging of their products.
What is the difference between a consumer’s disposable and discretionary income?
Disposable: the money a consumer has left over after paying taxes to use for necessities.
Discretionary: the money that remains after paying for taxes and necessities; usually spent on luxury items.
How does technology impact customer value?
- The cost of technology is plummeting, allowing consumers to assess the value of technology-based products on other dimensions.
- Technology provides value through the development of new products
- Technology has changed the way existing products are produced through recycling and precycling.
In pure competition there is a _____ number of sellers
large
The _____ Act was punitive towards monopolies, whereas the _____ act was preventative
Sherman Anti Trust; Clayton
The Federal Trad Commission monitors ______.
unfair business practices
How does the Better Business Bureau encourage companies to follow standards for commerce?
By using moral suasion to get members to comply with its standards; companies who wish to join the BBB must agree to these standards before they are allowed to display the BBB Accredited logo.
What rights are included in the Consumer Bill of Rights?
- The right to safety
- The right to be informed
- the right to choose
- the right to be heard
Economic espionage includes what kinds of activities?
- Trespassing
- Theft
- Fraud
- Misrepresentation
- Wiretapping
- Searching Competitor trash
- Violations of written and implicit employment agreements with non compete clauses
What is moral idealism?
The personal moral philosophy that considers the rights or duties as universal; regardless of outcome;
It is embodied in the Consumer Bill of Rights and favored by consumer interest groups.
What is social responsibility?
the organization is a part of a larger society and are accountable to that society for their actions.
Comprises three concepts
1. profit responsibility - maximizing profits for the owners and shareholders of the organization
2. stakeholder responsibility - focusing on the obligations organizations have to those who can effect the achievement of its objectives
3. societal responsibility - focusing on the obligations organizations have to preserve the ecological environment and the general public
Corporate culture refers to
the set of values, ideas, and attitudes that is learned and shared among the members of an organization.
____ is the generational cohort described as self-reliant, supportive of racial and ethnic diversity, better education than previous generations, and not prone to extravagance.
Generation X
What currently affects baby boomers, and thus those that market to them, in a significant way?
they are currently retiring or nearing retirement.
Technology is defined as
the inventions or innovations from applied science or engineering research.
The maker of Wrigley chewing gum funded a $10 million ad campaign aimed at getting African Americans to use doctors for regular healthcare maintenance instead of only when they are sick. This is an example of ____.
Societal responsibility
Lava.com is an Internet company that helps other organizations implement marketing strategies to aid them in dominating their industry. Lava’s advertising states, “We ignore the rules, and we let no obstacle stand in your company’s way—no matter how bold or impossible your idea may seem.” The company is composed of eighteen bright young Internet experts. They work in one large room, which also contains dartboards, a pool table, and a meditation center. If you were to walk into the office, it would be next to impossible to tell the company owners from its lowest-ranking employee. This best describes the Internet company’s ____.
Corporate culture
The personal moral philosophy of utilitarianism underlies the economic tenets of ____.
capitalism.
When compared with other generational cohorts, members of Generation Y are most likely to influence ______.
Communication and networking devices
Volkswagen opened a large plant in Chattanooga, TN, in 2011. Within a few years, VW spurred more than 12,400 direct and indirect jobs in the area. The carmaker generates income of over $600 million there annually and boosts state and local tax revenues by over $50 million a year. A huge expansion was announced in 2016 that would nearly double its operations in Tennessee. This example best illustrates ________ change that has impacted the people and businesses of Chattanooga.
an economic
Generation Y is sometimes referred to as
echo-boomers/baby boomlet
Environmental scanning
the process of continually acquiring information on events occurring outside the organization to identify and interpret potential trends.
Social forces
the demographic characteristics of the population and its culture
Demographics
describe a population according to selected characteristics like age, gender, ethnicity, income, and occupation.
Baby Boomers
include the generation of 76 million children born between 1946 and 1964
Generation X
includes the 50 million people born between 1965 and 1976. Also called the baby bust.
Generation Y
includes the 72 million Americans born between 1977 and 1994; also called the echo-boom or baby boomlet
Multicultural marketing
consists of combinations of the marketing mix that reflect the unique attitudes, ancestry, communication preferences, and lifestyles of different races.
Culture
consists of the set of values, ideas, and attitudes that are learned and shared among members of a group.
Economy
pertains to the income, expenditures, and resources that affect the cost of running a business and household
Technology
the inventions or innovations from applied science or engineering research
Marketspace
an information- and communication-based electronic exchange environment mostly occupied by sophisticated computer and telecommunication technologies and digitized offerings.
Competition
consists of the alternative firms that could provide a product to satisfy a specific market’s needs.
Regulation
consists of the restrictions state and federal laws place on business with regard to the conduct of its activities.
Consumerism
a grassroots movement started in the 1960s to increase the influence, power, and rights of consumers in dealing with institutions.
Self-regulation
an alternative to government control where an industry attempts to police itself.
Ethics
the moral principles and values that govern the actions and decisions of an individual or group.
Caveat emptor
the legal concept of “let the buyer beware” that was pervasive in the American business culture before the 1960s
Consumer Bill of Rights
a law that codified the ethics of exchange between buyers and sellers; includes the right to safety, to be informed, to choose, and to be heard.
Green marketing
consists of marketing efforts to produce, promote, and reclaim environmentally sensitive products.
Cause Marketing
occurs when the charitable contributions of a firm are tied directly to customer revenues and produced through the promotion of one of its products.
Moral idealism
a personal moral philosophy that considers certain individual rights or duties as universal, regardless of the outcome.
Utilitarianism
a personal moral philosophy that focuses on the “greatest good for the greatest number” by assessing the costs and benefits of the consequences of ethical behavior.
Economic espionage
the clandestine collection of trade secrets or proprietary information about a company’s competitors.
Code of ethics
a formal statement of ethical principles and rules of conduct
Social responsibility
the idea that organizations are part of a larger society and are accountable to that society for their actions.
Sustainable development
involves the conducting of business in a way that protects the natural environment while making economic progress
