Exam 1 Flashcards
Marketing’s Role
Create value for the firm’s chose customer, meet customer’s functional and emotional needs.
Marketing Mix, 4 P’s
Product, Price, Place, Promotion
Corporate Strategy
What business should we be in?
Cash Cow
Market leader, slow growth, generates more cash than it needs.
Dog
Low market share, slow growth
Star
Market leader, fast growth
Question Mark
Low market share, fast growth
SWOT Analysis
Strengths, weaknesses (internal)
Opportunities, threats (external)
Market Penetration
Increase market share among existing customers
Product Development
Creating new products for existing customers
Market Development
Attracting new customers to existing products
Diversification
Introduce new products into new markets
Marketing Strategy
Addresses a specific target market with a cohesive marketing mix of product, price, promotion and place
Production Orientation
If you build it, they will come
Sales Orientation
Sell, sell, sell!
Market Orientation
Deliver superior customer value
Societal Orientation
Preserve and enhance society
Value
Benefits - costs
Customer Acquisition
Acquire customers profitably, less upfront investment, higher-value customers, eliminate unprofitable acquisition activities
Sales per customer
Increase share of customer, generate add-on sales, partner with other firms
Margin
Increase price, shift mix toward higher margin, terminate unprofitable customers
Customer retention
Eliminate root causes, recover customers, develop loyalty initiatives
Demographics
Characteristics of a population: age, gender, ethnicity, income, occupation
Gen Y Cohort
60 million people, $200 billion/year purchasing power
Gen X Cohort
40 million people, $1 trillion purchasing power
Uncontrollable variables
Social, economic, technological, competitive, regulatory factors
Social change with the greatest effect on Marketing
The phenomenon of working women
Gross Income
Total amount in one year
Disposable Income
Money left after taxes for necessities
Discretionary Income
Money left after taxes and necessities to use on recreation
Social Factors
Generational cohorts, demographics
Economic Factors
Income, expenditures, and resources that affect the cost of running a business
Regulatory Factors
State and federal laws
Exporting
Selling goods produced in the company’s home country
Licensing
Agreement with a licensee in the foreign market. The licensee buys the right to use the company’s manufacturing process, trademark, patent, or other items of value.
Joint Venture
A company joins investors in a foreign market to create a local business, ownership is shared
Direct Investment
Developing foreign-based manufacturing or assembly facilities
Glocal
Go global, act local
Dumping
The pricing of goods at less than their cost of production or less than the price in the home market.
Distribution
Seller -> channels between nations -> channels within nations -> customer
Ethics
The moral principles and values that govern the actions and decisions of an individual or group.
The Fraud Triangle
Opportunity, pressure, rationalization
Social Responsibility
Organizations are a part of a larger society and are accountable to that society for their actions.
Sustainability
Organizations will focus on the world’s social problems and view them as opportunities to build profits and help the world.
Green Marketing
The development and marketing of products designed to minimize negative effects on the environment.
USP - Unique selling proposition
For [target market] the [name of product] is
[single most important claim] among all
[competitive frame] because [single most important support]
Why do market research?
Illuminate customers’ needs
Marketing = Art + Science
Relying on the “art” (the golden gut) without reference to the “science” (marketing research) can lead to disaster.
When to not do market research
If the cost of a wrong assumption is less than the cost of research
Causality and Correlation
Causality does lead to correlation (typically). However, correlation does not lead to causality.
Marketing Research Process
Define problem, design research project, collect data, analyze data, take action
Secondary Data
Data previously collected for any purpose other than the one at hand.
Market Research
Information about a specific market
Marketing Research
Information about how to effectively design, promote, position, distribute, and price products for a given market
The Nature of Consumer Behavior
People are not all the same - person variability. People make choices depending on their situation - situation variability
Buying center
Users, influencers, deciders, buyers, gatekeepers
Problem recognition
Discrepancy between actual and desired state
Information Search
Internal and external search, as well as problem solving
Problem solving continuum
Routine, limited, and extensive problem solving
Evaluation of alternatives
What drives purchasing decisions?
Buying from the heart not the mind
People make decisions and are motivated to take actions based on an attribute-consequence-values schema.
Purchase
When, where, how, how much
Consumer Behavior Process
Problem recognition, information search, evaluation of alternatives, purchase, post-purchase evaluation
Delight
Perception > expectation
Satisfaction
Perception = expectation
Dissatisfaction
Perception < expectation
Factors influencing consumer behavior
Social, individual, cultural, psychological
Cultural factors
Exert the broadest and deepest influence on consumer behavior.
Selective attention
Screen out information
Selective distortion
Interpret information to support belief
Selective retention
Remember good/bad points
