Exam 3 Flashcards
Core competency
Special skill set
Unique product, personnel
Guerrilla Marketing
A unique, inexpensive form of advertising
Four objectives of guerrilla marketing plan
Pinpoint target market
Determine customers wants through market research
Analyze competitive advantage and build marketing strategy around them
Create marketing mix
Individualized marketing
One to one marketing
Gathering individual customers and developing a marketing plan designed specifically to appeal to them
Relationship marketing
Involves developing, maintaining, and managing long term relationships with customers so that they will keep coming back to make repeat purchases
Guerrilla marketing principles
Don’t just sell: entertain
Focus on the customer
Customers are 5x more likely to leave because of poor service than for quality or price
94% of dissatisfied customers never complain but will not return
How to focus on the customer
Fix the problem fast
Encourage customer complaints
Commitment to superior customer service
Retain existing customers
70% of a company’s sales come from existing customers
Because 20% of a company’s customers account for 80% of its sales
Repeat customers…
Spend 67% more than new customers
What is quality?
Above consumers expectations and needs
Total quality management
Quality not just in the product/service itself, but in every aspect of the business
The quality process
Define Measure Analysis Improve Control (Repeat process)
Quality is different depending on where you go
Americans define quality….
Reliability Durability Ease of use Known brand Low price
Customer astonishment
Listen to customers
Set standards
Measure performance
Hire the right employees
Emphasis on speed
Speeding new products to the market
The marketing mix
Product
Place
Price
Promotion
Stages in the product life cycle
Intro Growth and acceptance Maturity and competition (most profit) Market saturation Product decline stage
Distribution marketing mix
Place
Unique selling proposition
A key customer benefit of a product or service that answers the critical question that every customer asks: what’s in it for me?
6 sentence advertising strategy
- Purpose
- What can it offer to customers
- Benefits
- Target market
- Response from target market
- Image
Publicity
Ant commercial news covered by the media that boosts sales– business does not pay
Personal selling
The personal contact between sales personnel and potential customers resulting from sales efforts (form of advertising)
Advertising
Any sales presentation that is non-personal in nature and is paid for by an identified sponsor
Top salespeople…
Are enthusiastic and alert to opportunities
Are experts in the products or services they sell
Audience
The number of paid subscribers a particular medium attracts
Reach
The total number of people exposed to an ad at least once in a period of time
Frequency
The average number of times a person is exposed to an ad in that same time period
Point of purchase
Stuff you but in the check out line
Email advertising
Make the subject line short
Email advertising spam
71%
Opt in opt out emails
Companies purchase email addresses that and “opted out” because they then know that the accounts are active account
Advertising media options
Know good and bad of each media * look at slide*
Preparing an advertising budget
What is affordable
Match competitors advertising expenditures
Percentage of sales: past sales, forecasted sales
Objective and task
Factors affecting price
Product or service costs Market forces Sales volume Credit terms and purchase discounts Desired image
Three pricing forces
Image
Competition
Value
Pricing
Sends signals to customers about quality and value
Competition
Consider competitors pricing and location
Avoid price wars
Value– three reference points
Price paid in the past
Prices competitors charge
Company’s cost
Revolutionary products
Transform an industry
Evolutionary products
Make improvements to products that are already on the market
Me- too products
Allow the company merely to keep up with competitors
Introducing a new product: three goals
Get the product accepted
Maintain market share as competition grows
Earn a profit
Introducing a new product: three strategies
Penetration
Skimming
Life cycle pricing
Pricing for retailers
Dollar markup = retail price - cost of merchandise
Break even selling price
Quantity produced
Credit cards in USA
144 million
Average person has how many credit cards?
4
Credit card merchant fees
Transaction fees
Equipment fees
Hold backs and chargebacks
Global deals
More people are involved
Companies plus banks
Why go global?
Offset sales declines in the domestic market
Global business segments
North America is not the biggest
As Asia companies grow online, their percentage will grow even more
Domestic joint ventures
Two or more US companies form an alliance for the propose of exporting their goods and services abroad
Foreign joint venture
A domestic firm forms an alliance with a company in the target nation
Exporting
Twice as many companies are able to export than those that do because of language barriers and money (exchange rate) barriers
FOB
Free on board
Letter of credit
The two companies go to banks who make the deal so no one loses out on anything
FOB
If shipment gets lost its on the shipping company
Barriers to trade
Help local economy
Tariffs
Taxes a government imposed on goods and services imported into that country
Sugar
Quotas
Limits on the amount of a product imported into a county
Only so many allowed
Embargoes
Total bans on imports of certain products
Cuban cigars
Why barriers?
Politics
Dumping
Selling large quantities of a product in a foreign country below its cost to gain market share
China sells their steal at lower prices than it costs them so that the U.S. market becomes dependent on them
Political barriers
Rules, regulations and risks
Business barriers
Business practices and laws
Cultural barriers
Differing languages, philosophies, traditions, and accepting business practices
International trade agreements
North American free trade agreement
Created a single free trade zone with the U.S., Canada, and Mexico
