Exam One

Question 1

What is marketing? How would you define it?

Answer 1

The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.

Question 2

Define exchange.

Answer 2

People giving something up in order to receive something else they would rather have.

Question 3

Define Customer Value:

Answer 3

The relationship between benefits and the sacrifice necessary to obtain those benefits

Question 4

Define Customer satisfaction:

Answer 4

Customers’ evaluation of a good or service in terms of whether it has met their needs and expectations

Question 5

What is strategic planning?

Answer 5

The managerial process of creating and maintaining a fit between the organizations objectives and resources and the evolving market opportunities.

Question 6

Strategic business Unit (SBU)

Answer 6

A subgroup of a single business of collection of related businesses within the larger organization.

Question 7

What exactly is “Marketing Myopia.”

Answer 7

Defining a business in terms of goods and services rather than in terms of the benefits customers seek.

Question 8

What is environmental scanning?

Answer 8

A collection and interpretation of information about forces, events, and relationships in the external environment that may affect the future of the organization, or the implementation of the marketing plan.

Question 9

What is environmental management?

Answer 9

When a company implements strategies that attempt to shape the external environment within which it operates.

Question 10

what is demography?

Answer 10

The study of people’s vital statistics, such as age, race and ethnicity, and location.

Question 11

What is purchasing power?

Answer 11

A comparison of income versus the relative cost of a standard set of goods and services in different geographic areas.

Question 12

Define Recession

Answer 12

A period of economic activity characterized by negative growth which reduces demand for goods and services.

Question 13

Define perception

Answer 13

The process by which people select, organize, and interpret stimuli into a meaningful and coherent picture.

Question 14

Motive

Answer 14

A driving force that cause a person to take action to satisfy specific needs.

Question 15

What is learning?

Answer 15

A process that creates change in behavior, immediate or expected through experience and practice.

Question 16

What is culture?`

Answer 16

The set a values, norms, attitudes, and other meaningful symbols that shape human behavior and the artifacts, or products of that behavior as they are transmitted from one generation to the next.

Question 17

Define Market

Answer 17

people or organizations with needs or wants and the ability and willingness to buy

Question 18

What is market segmentation?

Answer 18

The process of dividing a market into meaningful, relative similar and identifiable segments or groups

Question 19

Define Target Markets:

Answer 19

A group of people or organization for which an organization design, implements, and maintains and marketing mix intended to meet the needs of that group, resulting in mutually satisfying exchange.

Question 20

What does positioning mean in marketing?

Answer 20

Developing a specific marketing mix to influence potential customers’ overall perception of brand, product

Question 21

Define position:

Answer 21

The place a product brand or group of product occupies in consumers minds relative to competing offerings

Question 22

What is a market research problem?

Answer 22

determine what information is needed and how that information can be obtained efficiently and effectively

Question 23

Define market research?

Answer 23

the process for planning collecting and analyzing data relevant to a marketing decision.

Question 24

What is a measurement error?

Answer 24

An error that occurs when there is a difference between the inforamtion desired by the researcher and the information provide by the measurement

Question 25

What is a sampling error?

Answer 25

An error that occurs when a sample somehow does not represent the target population.

Question 26

Describe four marketing management philosophi

Answer 26

The role of marketing and the character of marketing activities within an organization are strongly influenced by the organization’s marketing philosophy and orientation. A production-oriented organization focuses on the internal capabilities of the firm rather than on the desires and needs of the marketplace. A sales orientation is based on the beliefs that people will buy more products and services if aggressive sales techniques are used and that high sales volumes produce high profits. A market-oriented organization focuses on satisfying customer wants and needs while meeting organizational objectives. A societal marketing orientation goes beyond a market orientation to include the preservation or enhancement of individuals’ and society’s long-term best interests.

Question 27

Talk about CUSTOMER RELATIONSHIP MANAGEMENT what is it?

Answer 27

Beyond knowing to whom they are directing their products or services, companies must also develop a deeper understanding of their customers. One way of doing this is through customer relationship management. Customer relationship management (CRM) is a company-wide business strategy designed to optimize profitability, revenue, and customer satisfaction by focusing on highly defined and precise customer groups. This is accomplished by organizing the company around customer segments, establishing and tracking customer interactions with the company, fostering customer-satisfying behaviors, and linking all processes of the company from its customers through its suppliers. The difference between CRM and traditional mass marketing can be compared to shooting a rifle versus a shotgun. Instead of scattering messages far and wide across the spectrum of mass media (the shotgun approach), CRM marketers now are homing in on ways to effectively communicate with each customer (the rifle approach).

Question 28

What are the Elements of the marketing mix or 4Ps

Answer 28

product, price, place, promotion

Question 29

What are the elements of Product in the marketing mix?

Answer 29

The product includes not only the physical unit but also its package, warranty, after-sale service, brand name, company image, value, and many other factors.
Products can be tangible goods such as computers, ideas like those offered by a consultant, or services such as medical care. Products should also offer customer value.

Question 30

What are the elements of price in the marketing mix?

Answer 30

Price is what a buyer must give up in order to obtain a product. It is often the most flexible of the four Ps—the quickest element to change. Marketers can raise or lower prices more frequently and easily than they can change other marketing mix variables.

Question 31

What are the elements of place in the marketing mix?

Answer 31

Place, or distribution, strategies are concerned with making products available when and where customers want them. Would you rather buy a kiwi fruit at the 24-hour grocery store within walking distance or fly to Australia to pick your own? A part of this P—place—is physical distribution, which involves all the business activities concerned with storing and transporting raw materials or finished products.

Question 32

What are the elements of place in the marketing mix?

Answer 32

Promotion includes advertising, public relations, sales promotion, and personal selling. Promotion’s role in the marketing mix is to bring about mutually satisfying exchanges with target markets by informing, educating, persuading, and reminding them of the benefits of an organization or a product. A good promotion strategy, like using a beloved cartoon character such as SpongeBob SquarePants to sell gummy snacks, can dramatically increase sales.

Question 33

What is the Boston Consulting Group Matrix categories?

Answer 33

The portfolio matrix classifies each SBU by its present or forecast growth and market share. The underlying assumption is that market share and profitability are strongly linked.

Question 34

What is a star?

Answer 34

a fast-growing market leader. For example, the iPad is Apple’s current star. Star SBUs usually have large profits but need lots of cash to finance rapid growth.

Question 35

What is a cash cow?

Answer 35

SBU that generates more cash than it needs to maintain its market share. It is in a low-growth market, but the product has a dominant market share. Personal computers and laptops are categorized as cash cows in Exhibit 2.3. The basic strategy for a cash cow is to maintain market dominance by being the price leader and making technological improvements in the product.

Question 36

What is a problem child?

Answer 36

also called a question mark, shows rapid growth but poor profit margins. It has a low market share in a high-growth industry. Problem children need a great deal of cash. Without cash support, they eventually become dogs. The strategy options are to invest heavily to gain better market share, acquire competitors to get the necessary market share, or drop the SBU.

Question 37

What is a dog?

Answer 37

A dog has low growth potential and a small market share. Most dogs eventually leave the marketplace. In the computer manufacturer example, the mainframe computer has become a dog. Another example is BlackBerry’s smartphone line, which started out as a star for its manufacturer.

Question 38

What are characteristics of a strong marketing objective?

Answer 38

A marketing objective is a statement of what is to be accomplished through marketing activities.
A strong marketing objective for Purina might be: “To increase sales of Purina brand cat food between January 1, 2014 and December 31, 2014 by 15 percent, compared to 2012 sales of $300 million.”
Objectives must be consistent with and indicate the priorities of the organization. Specifically, objectives flow from the business mission statement to the rest of the marketing plan.

Question 39

What is a Niche competitive advantage

Answer 39

seeks to target and effectively serve a single segment of the market (see Chapter 8). For small companies with limited resources that potentially face giant competitors, niche targeting may be the only viable option. A market segment that has good growth potential but is not crucial to the success of major competitors is a good candidate for developing a niche strategy.

Question 40

Marketing to hispanics

Answer 40

According to surveys, Hispanics believe that the number one way they contribute to American society is through their commitment to family. Over three-fourths say that the traditional family is the main building block of a healthy community.Seventy-five percent of Hispanic men shop for food items at traditional grocery stores, making them the leading destination among Hispanic men for household food shopping. However, Hispanic fathers are more likely to purchase groceries at mass merchandisers, with seventy-one percent doing so, compared to sixty-three percent of Hispanic men without children.
Forty-four percent of Hispanic men bought a new product after first sampling it in a store, while forty-two percent made a purchase after a friend or family member recommended the product. Around a third of Hispanic men are more likely to be influenced by advertisements on Spanish-language television than advertisements on English-language television.

Question 41

Approaches to stimulating innovation

Answer 41

Companies attempting to innovate often limit their searches to areas they are already familiar with. This can help lead to incremental progress but rarely leads to a dramatic breakthrough.

Question 42

What is a building scenarios?

Answer 42

Some firms use teams of writers to imagine detailed opportunities and threats for their companies, partners, and collaborators in future markets.

Question 43

Enlisting the Web:

Answer 43

A few companies have created Web sites that act as literal marketplaces of ideas where they can go to look for help with scientific and business challenges.

Question 44

Talking to Early Adopters:

Answer 44

Early adopters tend to be innovators themselves. They are risk takers and look for new things or wish for something better to help in daily tasks at home and work.

Question 45

Using Marketing Research:

Answer 45

Firms find out what customers like and dislike about their products and competitors’ products.

Question 46

Creating an Innovative Environment:

Answer 46

Companies let employees know that they have the “freedom to fail.” They create intranets to encourage sharing ideas. Most importantly, top management must lead by example to create an atmosphere where innovation is encouraged and rewarded.

Question 47

Catering to Entrepreneurs:

Answer 47

Policies that reserve blocks of time for scientists or engineers to explore their own ideas have worked well at some companies. At 3M, scientists can spend fifteen percent of their time on projects they dream up themselves—a freedom that led to the development of the yellow Post-It note. Google is well known in the tech industry for its “20% time” policy, which grants employees a day a week to follow their entrepreneurial passions.*

Question 48

What is the Consumer decision process?

Answer 48

(1) need recognition,
(2) information search,
(3) evaluation of alternatives,
(4) purchase, and
(5) postpurchase behavior.

Question 49

What is Need Recognition

Answer 49

Need recognition is the result of an imbalance between actual and desired states. The imbalance arouses and activates the consumer decision-making process. A want is the recognition of an unfulfilled need and a product that will satisfy it. For example, have you ever gotten blisters from an old running shoe and realized you needed new shoes?

Question 50

What is a information search

Answer 50

After recognizing a need or want, consumers search for information about the various alternatives available to satisfy it. For example, you know you are interested in seeing a movie, but you are not sure what to see. So you visit the Rotten Tomatoes Web site to see what is getting great reviews by both critics and your peers on Facebook. This is a type of information search, which can occur internally, externally, or both.

Question 51

What is a Evaluation of Alternatives and Purchase?

Answer 51

After getting information and constructing an evoked set of alternative products, the consumer is ready to make a decision. A consumer will use the information stored in memory and obtained from outside sources to develop a set of criteria. Recent research has shown that exposure to certain cues in your everyday environment can affect decision criteria and purchase. For example, when NASA landed the Pathfinder spacecraft on Mars, it captured media attention worldwide.

Question 52

Define purchase for consumer decision making process

Answer 52

TO BUY OR NOT TO BUY
Ultimately, the consumer has to decide whether to buy or not buy. Specifically, consumers must decide:
Whether to buy
When to buy
What to buy (product type and brand)
Where to buy (type of retailer, specific retailer, online or in store)
How to pay

Question 53

What is an information search?

Answer 53

After recognizing a need or want, consumers search for information about the various alternatives available to satisfy it. For example, you know you are interested in seeing a movie, but you are not sure what to see.

Question 54

What is an internal search?

Answer 54

An internal information search, the person recalls information stored in the memory. This stored information stems largely from previous experience with a product.

Question 55

What is an external search?

Answer 55

an external information search seeks information in the outside environment. There are two basic types of external information sources: nonmarketing-controlled and marketing-controlled.

Question 56

What is the post purchase process?

Answer 56

• Post-Purchase Behavior
  
  • Determine satisfaction
  • Cognitive Dissonance - Inner tension that a consumer experiences after recognizing an inconsistency between behavior and values or opinions
    
    • This is like second guessing yourself
  • feed back to cognitive
    
    • Cognitive Dissonance
      
      • Consumers can reduce dissonance by:
        - Seeking information that reinforces positive ideas about the purcahse
        - avoiding information that contradicts the purchase decision
        - revoking the original decision by returning the product
      • Marketing managers can reduce dissonance through communication service and guarantees

Question 57

What is the sub types of an info search?

Answer 57

• External information search
  
  • Seek information in outside environment
    
    • Two Typles
      
      • Non marketing - controlled - suggestions from friends - online reviews - non marketing control hold more weight
      • Market controlled - ads - signs
  • Less Information
    
    • less risk / more knowledgable / more product experience / low level of interest / confidence in decision

Question 58

What are the types of buying decision?

Answer 58

• Routine Cost behavior
  
  • i.e buying something like bread
  • a price choice that you don’t need to put a lot of thought into
• Limited Cost Behavior
  
  • Buying something like a phone
  • put more effort into the decision
• Extensive
  
  • Something like buying a house
    
    • Car
    • schooling
  • Something where you will go through the whole buying process
• Involvement - The amount of time and effort a buyer invest in the search evaluation and decision processes of consumer behavior

Question 59

What is perceptual mapping?

Answer 59

A means of displaying or graphing, in two or more dimensions, the location of products, brands, or groups of products in customers’ minds.

Question 60

What is selective attention?

Answer 60

It has been estimated that the average person may be exposed to over 1,500 ads or brand communications a day. Because a person cannot possibly attend to all of these stimuli will be screened out-a process called selective attention. Selective attention means that marketers have to work hard to attract consumers notice. The real challenge is to explain which stimuli people will notice. Here are some findings:

Question 61

What is selective distortion?

Answer 61

Even noticed stimuli do not always come across in the way the senders intended. Selective distortion is the tendency to interpret information in a way that will fit our preconceptions. Consumers will often distort information to be consistent with prior brand and product beliefs.

Question 62

What is selective retention?

Answer 62

People will fail to register much information to which they are exposed in memory, but tend to retain information that supports their attitudes and beliefs. Because of selective retention, we are likely to remember good points about a product we like and forget good points about competing product. Selective retention again works to the advantage of strong brands. It also explains why marketers need to use repetition in sending messages to their target market to make sure their message is not overlooked.

Question 63

What is Subliminal Perception?

Answer 63

The selective perception mechanisms require active engagement and thought by consumers. A topic that has fascinated armchair marketers for ages is subliminal perception. The argument is that marketers embed covert, subliminal messages in ads or packages. Consumers are not consciously aware of these messages, but yet they affect their behavior. Although it is clear many subtle subconscious effects can exist with consumer processing no evidence supports the notion that marketers can systematically control consumers at that level.

Question 64

What are the are/what are the different types of references groups?

Answer 64

• Direct Face to Face
  
  • Primary Member ship informal groups - Family
  • secondary large formal Groups
• Indirect - Nonmembership
  
  • Aspirational group that someone would like to join
  • Non aspiration group with which someone wants to avoid being identified

Question 65

Bases for segmenting consumer markets

Answer 65

The choice of segmentation bases is crucial because an inappropriate segmentation strategy may lead to lost sales and missed profit opportunities. The key is to identify bases that will produce substantial, measurable, and accessible segments that exhibit different response patterns to marketing mixes.

Question 66

What is geographic segmentation?

Answer 66

segmenting markets by region of a country or the world, market size, market density, or climate. Market density means the number of people within a unit of land, such as a census tract.

Question 67

What is demographic segmentation?

Answer 67

Demographics - number one way to segment

• Age
  
  • Clothing: i.e forever 21 , gap, gap kids, banana republic, old navy
  • i.e
• Gender
  
  • Women - pink it and shrink it
  • Treat women as sophisticated consumers who value quality and functionality over appearance
  • Men are stupid and proud of it
  • question a mans masculinity
  • dress up ordinary products as industrial power tools
  • turn regular foods flavors and smells into beer and brats
  • Treat men as sophisticated consumers capable of making smart choices
• Income
  
  • Ferrari
  • Mensware house
  • Target goes for higher income
• Ethnicity
  
  • hair products
  • beauty industry
  • Oklay has asian fit sunglasses
• Family Life Cycle
  
  • retirement communities for empty nesters
  • Cars

Question 68

What is psychographic segmentation?

Answer 68

market segmentation on the basis of the following psychographic segmentation variables:

Question 69

What is optimizers

Answer 69

Optimizers consider numerous suppliers (both familiar and unfamiliar), solicit bids, and study all proposals carefully before selecting one.

Question 70

What is satisfiers?

Answer 70

Satisfiers contact familiar suppliers and place the order with the first one to satisfy product and delivery requirements.

Question 71

What is perceptual mapping?

Answer 71

a means of displaying or graphing, in two or more dimensions, the location of products, brands, or groups of products in customers’ minds. For example, Saks Incorporated, the department store chain, stumbled in sales when it tried to attract a younger core customer. To recover, Saks invested in research to determine its core customers in its fifty-four stores across the country.

Question 72

What is primary data?

Answer 72

Information collected for the first time. Used for saving the particular problem under investigation.

Question 73

What is secondary data?

Answer 73

data previously collected for any purpose other than the one at hand. Secondary information originating within the company includes documents such as annual reports, reports to stockholders, product testing results perhaps made available to the news media, and house periodicals composed by the company’s personnel for communication to employees, customers, or others. Often, this information is incorporated into a company’s internal database.

Question 74

What are the sampling procedures?

Answer 74

• Probablitiy
  
  • simple random sample
  • stratified sample
  • cluster sample
• Non probability
  
  • Conveicne
  • judgemtn
  • quota

Question 75

Describe Techniques for gathering primary research

Answer 75

Gathering primary data can be expensive; costs can range from a few thousand dollars for a limited survey to several million for a nationwide study. For instance, a nationwide, fifteen-minute telephone interview with 1,000 adult males can cost $50,000 or more for everything, including a data analysis and report. Because primary data gathering is so expensive, many firms do not bother to conduct in-person interviews.

Question 76

What are different forms of survey research?

Answer 76

• In-home interviews
• Mall intercept interviews
• telephone interviews
• Mail surveys
• Executive interviews
• focus groups

Question 77

How do you gather data?

Answer 77

survey, observation, ethnographic, virtual shopping, experiments

Question 78

What is an ethnographic

Answer 78

or the study of human behavior in its natural context, involves observation of behavior and physical setting. Ethnographers directly observe the population they are studying.

Question 79

Advantages of Internet Surveys

Answer 79

Rapid Development, Real-Time Reporting
Dramatically Reduced Costs
Personalized Questions and Data
Improved Respondent Participation
Contact with the Hard-to-Reach

Question 80

Forms of surveys online

Answer 80

Google Consumer Surveys
Web Survey Systems
Online Panel Providers

Question 81

What are the characteristics of Generation X.

Answer 81

• Generation X
  • Born between 1965 and 1978
  • Population of 50 Million
  • Independent resilient adaptable cautious and skeptical
  • Gen Xers face a 59 percent decline in net worth from 2005 to 2010
  • Hers spend 62 percent more on housing 50 percent more on apparel and 27 percent more on entertainment
  • This is a very independent generation
  • The MTV Generation
    
    • the TV was the baby sitter
  • The most cynical generation
    
    • People believe this is the case because they grew up around tv advertisements on TV
  • The capable generation

Question 82

What are the characteristics of Millennials

Answer 82

• Generation y / Millennials
  • Born between 1979 and 1994
  • Surpassed population of baby boomers
  • Two Stages
    
    • those born in 1994 are just entering young adulthood
    • Those born in 1979 have established careers and starting family
  • purchasing power of $200 billion annually
  • Marketers reach us throw online resources like Facebook
  • very short attention span
    
    • always being distracted
  • We want stuff that is nice but don’t want to pay for it
  • We Wanting it now
  • The trophy generation / get gold star for everything

Question 83

What is a SWOT analysis and how does it work? How is SWOT used to make strategic decisions in an organization?

Answer 83

the firm should identify its internal strengths (S) and weaknesses (W) and also examine external opportunities (O) and threats (T).

Question 84

More on SWOT:

Answer 84

When examining internal strengths and weaknesses, the marketing manager should focus on organizational resources such as production costs, marketing skills, financial resources, company or brand image, employee capabilities, and available technology. For example, when Dell’s stock fell sharply throughout the mid-2010s, management needed to examine strengths and weaknesses in the company and its competition. Dell had a $6 billion server business (strength), but the shrinking PC market accounted for a significant 24 percent of sales (weakness). Competitors like IBM and Hewlett-Packard (HP) were moving heavily into software and consulting, so to avoid them, Dell moved into the enterprise IT and services market. The shift was not enough to offset poor sales in other areas, however, and in 2013, the company entered buyout talks with private investors such as Blackstone and company founder Michael S. Dell.* Another issue to consider in this section of the marketing plan is the historical background of the firm—its sales and profit history.
When examining external opportunities and threats, marketing managers must analyze aspects of the marketing environment. This process is called environmental scanning—the collection and interpretation of information about forces, events, and relationships in the external environment that may affect the future of the organization or the implementation of the marketing plan. Environmental scanning helps identify market opportunities and threats and provides guidelines for the design of marketing strategy. Increasing competition from overseas firms and the fast growth of digital technology essentially ended Kodak’s consumer film business. After emerging from bankruptcy, Kodak has repositioned the firm as a smaller, business-to-business company that offers commercial printing and digital imaging services.* The six most often studied macroenvironmental forces are social, demographic, economic, technological, political and legal, and competitive. These forces are examined in detail in Chapter 4.

Question 85

3. Be able to explain cognitive dissonance, what causes it to occur, and how marketers can reduce it.

Answer 85

For example, suppose Angelika is looking to purchase an e-reader. After evaluating her options, she has decided to purchase an iPad, even though it is much more expensive than other dedicated e-readers. Prior to choosing the iPad, Angelika may experience inner tension or anxiety because she is worried that the current top-of-the-line technology, which costs much more than the middle-of-the-line technology, will be obsolete in a couple months. That feeling of dissonance arises as her worries over obsolescence battle her practical nature, which is focused on the lower cost of a NOOK HD and its adequate—but less fancy—technology.
Consumers try to reduce dissonance by justifying their decision. They may seek new information that reinforces positive ideas about the purchase, avoid information that contradicts their decision, or revoke the original decision by returning the product. In some instances, people deliberately seek contrary information in order to refute it and reduce dissonance. Dissatisfied customers sometimes rely on word of mouth to reduce cognitive dissonance by letting friends and family know they are displeased.
Marketing managers can help reduce dissonance through effective communication with purchasers. For example, a customer service manager may slip a note inside the package congratulating the buyer on making a wise decision. Postpurchase letters sent by manufacturers and dissonance-reducing statements in instruction booklets may help customers feel at ease with their purchase. Advertising that displays the product’s superiority over competing brands or guarantees can also help relieve the possible dissonance of someone who has already bought the product. Apple’s Genius Bar and customer service will ease cognitive dissonance for purchasers of an iPad because they know that the company is there to support them.

Question 86

4. Understand the three alternative targeting strategies

Answer 86

undifferentiated, concentrated, multisegment

Question 87

What is undifferentiated strategy?

Answer 87

An undifferentiated targeting strategy is used when a company decides to communicate the benefits of its product by sending the same promotional message to everyone. For an undifferentiated strategy to be successful, the company’s product must be readily available and affordable and must provide the same benefits to all consumers. Very few companies with consumer products meet these criteria. However, very large companies…

Question 88

What is Concentrated strategy?

Answer 88

An organization that adopts a concentration strategy gains an advantage by being able to analyze the needs and wants of only one segment and then focusing all its efforts on that segment.
Concentrated targeting is particularly effective for small companies with limited resources as it does not require the use of mass production, mass distribution, and mass advertising.
Since the company has focused all their efforts on one market (essentially putting all their eggs in one basket), the firm is at risk for failing if demand decreases.

Source: Boundless. “Concentrated Targeting.” Boundless Marketing. Boundless, 21 Jul. 2015. Retrieved 22 Feb. 2016 from https://www.boundless.com/marketing/textbooks/boundless-marketing-textbook/consumer-marketing-4/identification-of-target-markets-37/concentrated-targeting-190-609/

Question 89

What is Multi-segment strategy?

Answer 89

Multi-segment marketing is a departure from the tradition of finding a target market and dedicating your small business to serving it. Multi-segment marketing is aimed at the market as a whole in an attempt to maximize your reach and generate as many sales as possible.