Exam 2 Flashcards
Functional Brands
satisfy functional needs, example: wash clothes, relieve pain
differentiate from other brands by offering superior performance or superior economy.
• Connect with consumers by helping them achieve basic goals related to physical needs, such as food, shelter, health, safety
Relatively low involvement
What are consumer products?
A product purchased by the final consumers for personal consumption
Birkenstock, a German footwear company, manufactures and sells a variety of sandals and shoes noted for their footbed. All of the products offered by Birkenstock represent the company's: Product item Product line Product life cycle Product mix Agumented product
Product Mix
What are convenience products
Relatively inexpensive
Functional Brands
satisfy functional needs, example: wash clothes, relieve pain
differentiate from other brands by offering superior performance or superior economy.
• Connect with consumers by helping them achieve basic goals related to physical needs, such as food, shelter, health, safety
One of the challenges for department stores like Nordstrom is the potential for service variability—services depend on who provides them and when and where they are provided.
The marketing solutions for variability are:
Training and standardized processes
Demand estimation and hiring ahead of demand
Physical evidence and quality
Tangible cues and tangible evidence
Augmented services
Training and standardized processes
First moment of truth
3-7 seconds when the shopper notices an item on a store shelf
Perceptual maps show the judgments customers make regarding the performance of a brand’s features and benefits. Gap analysis extends the perceptual maps method by asking customers to make judgments regarding:
- Cultural differences among consumers
- The importance of a brand’s featurers and benefits to the buying decision
- Psychological differences among consumers
- The performance of competitive brands
- The performance of external forces in the environment
The importance of a brand’s featurers and benefits to the buying decision
Social media marketing may be more effective than traditional marketing communications channels because social media:
A) Offers greater flexibility of content and duration
B) Has credibility similar to word-of-mouth
C) Can build awareness and interest at a much lower cost
D) Both A and B
E) All of the above
E) All of the above
Which element of the marketing mix has the most profound influence on price? A. Product B. Promotion C. Place D. Presentation E. People
C. Place
Nestle promotes Kit Kat chocolate treat to the final consumers with the expectation that the final consumers will demand the product from retail stores. Then the retail stores will request Kit Kat from Nestle. This is an example of: Push strategy Pull strategy Physical strategy Preventive strategy Progressive strategy
Pull strategy
Advertising effectiveness is measured by:
a. The amount of humor and the level of entertainment
b. Brand legacy
c. Recall (remember the ad and the advertiser) and persuasion (remember the benefit)
e. Media buying
f. Push versus pull promotions
Recall (remember the ad and the advertiser) and persuasion (remember the benefit)
Which sales promotion method is best for building brand loyalty?
a. Value-added promotions
b. Price promotions
c. Trade promotions
d. Coupons
e. Interactive promotions
Value-added promotions
What is the key driver in engaging and converting potential customers using social media? Multiple media Relevant content Google AdWords Product blogs Short, precise messages
Relevant content
Facebook, Twitter, YouTube, product blogs, and Google AdWords all play different roles in achieving marketing objectives. For example, \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ is better for generating awareness and \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ is better for making direct sales. Facebook, Google AdWords Google AdWords, Twitter YouTube, Twitter Product blogs, Facebook Google AdWords, YouTube
Facebook, Google AdWords
Three objectives of advertising
Cognitive - build awareness
Affective - gain interest, liking
Behavioral - stimulate action
AIDA Model - attention, interest, desire, action
Social media services created a new vocabulary such as cost-per-click (CPC), click-through-rate, and cost-per-action (CPA). Because ads must generate enough interest to get a click and clicks must generate an action leading to a sale, the critical number is: CPM--cost per thousand impressions CPC--cost per click CPA--cost per action CPGW--cost per gross weight CCC--cost, cohort, connection
CPA–cost per action
A creative brief consists of:
Creative brief used to communicate advertising strategy to advertising agencies
- Brand legacy: Background information. Why are we communicating?
- Copy strategy: What is one thing we want to communicate to target audience? Main pain point? Key benefit? Reason to believe?
- Executional considerations - objective (cognitive, affect, behavioral), execution tone and style
- Key customer groups - who are they? Where are they?
- Key competitors - who are they?
Advertising effectiveness is measured by:
The amount of humor and the level of entertainment
Brand legacy
Recall (remember the ad and the advertiser) and persuasion (remember the benefit)
Media buying
Push versus pull promotions
Recall (remember the ad and the advertiser) and persuasion (remember the benefit)
Which sales promotion method is best for building brand loyalty? Value-added promotions Price promotions Trade promotions Coupons Interactive promotions
Value-added promotions
Market segmentation is the process of grouping customers into relatively homogeneous sets or segments such that customers within a segment are similar to one another in:
- Age and psychographics
- Family and cultural situations
- Their frequency of purchase
- Geographic location
- The way they respond to the marketing effort directed torward them
The way they respond to the marketing effort directed torward them
Sociologist Everett Rogers created five categories of product adopters based on time to adopt new products and services. What name (and percent of population) did Rogers use to classify adopters who are the first to try new ideas, usually have more money and education than the general population, as well as a higher-than-average tolerance for risk? Innovators (2.5%) Early adopters (13.5%) Early majority (34%) Late majority (34%) Laggards (16%)
Innovators (2.5%)
Determinants of salesperson performance
Aptitude - native abilities and enduring personal traits relevant to job performance
Personal characteristics - physical traits, family background, education, work and sales exp.
SKILL LEVEL - learned proficiencies at performing job activities
Role perceptions - perceptions of job demands and the expectations of role partners
Motivation - desire to expand effort on specific job activities
Organizational/environmental factors - territory potential, company’s competitive strength
Considering a product’s competitive angle, _______________ is about finding significant pain points that are personally relevant to the target audience while _______________ is about demonstrating product-solving benefits.
Need to Believe, Reason to Believe
Reason to Believe, Dominate Situations
Dominate Situations, Quantifiable Support
Quantifiable Support, Unique Product Claim
Unique Product Claim, Need to Believe
Need to Believe, Reason to Believe
Southwest Airlines faces the service challenge of perishability because the airline cannot save seats from an empty afternoon flight for a full flight in the evening. To overcome this service challenge, Southwest:
Buys more airplanes from Boeing and Airbus
Attempts to manage fluctuating demand or seeks to match supply with changing demand
Provides more training for frontline employees
Hires “Fox” employees to handle problems quickly
Changes the physical environment of the airport gate to provide tangible cues
Attempts to manage fluctuating demand or seeks to match supply with changing demand
The marketing mix for services includes the 4P’s of marketing (product, price, place, and promotion), plus:
Processes, physical environments, and potential customers
People, perishability, and personality
Political environment, physical environment, and personal environment
People, process, and physical environment
People, politics, and psychology
People, process, and physical environment
Compared to product marketing, services marketing poses unique challenges for marketing managers because unlike products, services are:
Intangible, insparable, variable, and perishable
Difficult to price
Unique and engaging
Part of the human resources function of the firm
Both high and low involvement
Intangible, insparable, variable, and perishable
Which determinant of service quality shows the strongest influence on customers’ perceptions of service quality?
Reliability Assurance Tangibles Empathy Responsiveness
Reliability
Why dosen’t “me too” positioning work as a value positioning strategy?
- The positioning approach does not give consumers a reason to change
- Competitors are just too difficult to copy
- Competitors may have lower cost structures
- Imitation is the sincerest form of flattery
- Customers want consistency among competitors
The positioning approach does not give consumers a reason to change
With cost-plus pricing, the firm knows its costs, but not much about customers and competitors. So marketing managers simply add a margin to the cost of the product to determine price. The added amount is generally the margin needed to make the return demanded by upper management or investors. The trouble with cost-plus pricing is that:
A. Competitors may copy the price
B. Product costs are irrelevant to buyers
C. Substitute products may have the same price
D. Promotion strategies may alter the outcome
E. The break-even volume is difficult to calculate
B. Product costs are irrelevant to buyers
Product positioning is:
- A careful analysis of cross tabulations
- Shelf size and location in major retail chains–grocery and department stores
- Geographic segmentation, often within major metropolitan and suburban areas
- The place a product occupies in the target customers’ minds
- What marketers do to a product
The place a product occupies in the target customers’ minds
The range of possible prices, where sellers have incentive to sell and buyers have incentive to purchase, is:
A. The average of all reference prices, competitor prices, and substitute prices
B. Based on marketing efforts minus reference and competitor prices
C. Where demand equals profit
D. Above the buyer’s perceived value and bellow the seller’s cost of goods sold
E. Above the seller’s cost of goods sold and below the buyer’s perceived value
E. Above the Seller’s cost of goods sold and below the buyer’s perceived value
Reference price is an important concept in pricing strategy. ______________ is what everyone else is paying for the product and _______________ is what you think you should pay, given your past experience and the buying situation.
A. Internal reference price; external reference price
B. External reference price; internal reference price
C. Referral reference price; accepted reference price
D. High reference price; low reference price
E. Personal reference price; relevant range reference price
B. External reference price; internal reference price
Which pricing strategy is used when marketers set a relatively high price to obtain high margins at the expense of sales quantity, then lower the price over time? Price skimming Price penetration Promotional pricing Cost-plus pricing Competitive pricing
Price Skimming
Channel members (intermediaries) make the selling of products more efficient by:
a. Maximizing the number of contacts necessary between producers and consumers
b. Identifying target markets
c. Reducing manufacturing costs
d. Reducing the number of contacts between producers and consumers
e. Eliminating inventory costs
Reducing the number of contacts between producers and consumers
Candy bars such as “Snickers” are best sold using which type of distribution?
a. Intensive distribution
b. Selective distribution
c. Exclusive distribution
d. Dual distribution
e. Minimized distribution
intensive distribution
Cabela’s consciously designs retail space to orchestrate various dimension of the store—layout, color, sounds, and signage—to appeal to consumers’ emotions and encourage buying. This is called:
a. Atmospherics
b. Wheel of retailing
c. Location, location, location
d. Retail control
e. Sales promotion
Atmospherics
Second moment of truth
- when consumers use the product
- every usage experience is a change to delight customers
Retail positioning (product line breadth and line depth)
Product assortment: the breadth and depth of the product line
- product line breadth: number of different product lines
- product line depth: number of products within a line
Why do companies promote?
Companies promote to communicate value to their chosen customers
- increase demand (shift to the right) - more ppl want the product
- make demand more inelastic - consumers become less price sensitive
Promotion mix importance
Consumer goods
- Advertising
- Sales promotion
- Personal selling
- Direct marketing
- public relations
Business goods
- Personal selling
- Sales promotion
- Direct marketing
- Advertising
- Public relations
Push vs. pull strategy
Push:
Producer - Intermediaries - end users
Pull:
Producer - end users - intermediaries
Advertising
Paid placement of announcements and persuasive messages to inform, gain liking/interest, and/or stimulate action
Three objectives of advertising
Cognitive - build awareness
Affective - gain interest, liking
Behavioral - stimulate action
AIDA Model - attention, interest, desire, action
What is the question we are asking when we consider segmentation?
Who could we exchange with?
What is market segmentation?
The process of grouping customers into relatively
homogeneous sets such that customers within a
segment are similar to one another in the way they
respond to the marketing effort directed at them.
What is the criteria for effective segmentation?
Measurable-Individuals can be assigned to a segment and counted.
Accessible-Individuals in the segment can be reached through the company’s promotion/distribution channels.
Durable-Segment membership is relatively constant.
Substantial-Segment is large enough to make products profitable.
Unique Needs-Needs are homogeneous within segments and heterogeneous across segments.
What are the different ways to segment in order from most used to most useful?
Geographic, Demographic, Psychographic, Behavioral
Procter & Gamble (makers of Crest and Covergirl) focuses on winning the first moment-of-truth in retail stores, that is, the first three to seven seconds it takes shoppers to make up their minds which product to take from the retailer’s shelf. To do this, P&G marketing managers focus on:
a. CPM–cost per thousand impressions
b. Discount stores
c. Big box stores
d. Intensive distribution
e. In-store advertising and packaging
In-store advertising and packaging
Channel members can affect customer value by: Reducing non-price costs a. Improving image b. Delivering service c. Enhancing the product d. All of the above e. None of the above
All of the above
Apple’s stores are clean, offer multiple displays, and there are a multitude of helpful employees available. These attributes are examples of. Presentation and Personnel Promotion and Presentation Price and Promotion Price and Personnel Promotion and Personnel
Presentation and Personnel
What are the two important points in the Person by Situation Segmentation Matrix?
- People are not all the same–person variability
2. People make choices depending on the situation–situation variability
Judging good ads from bad ads
Three rules:
product obvious, advertiser obvious, benefit obvious
A creative brief consists of:
Creative brief used to communicate advertising strategy to advertising agencies
- Brand legacy: Background information. Why are we communicating?
- Copy strategy: What is one thing we want to communicate to target audience? Main pain point? Key benefit? Reason to believe?
- Executional considerations - objective (cognitive, affect, behavioral), execution tone and style
- Key customer groups - who are they? Where are they?
- Key competitors - who are they?
Professor Swenson just published a new book, “Guest Speaker Etiquette.” He plans to sell this book through Barnes and Noble. This is an example of Direct to Consumer Strategy Push and Pull Strategy Mixed Marketing Strategy Indirect Intermediary Strategy Manufacturer Strategy
Indirect Intermediary Strategy
Nestle promotes Kit Kat chocolate treat to the final consumers with the expectation that the final consumers will demand the product from retail stores. Then the retail stores will request Kit Kat from Nestle. This is an example of:
a. Push strategy
b. Pull strategy
c. Physical strategy
d. Preventive strategy
e. Progressive strategy
Pull strategy
