General concepts Flashcards
What are the four P’s?
Product
Place
Promotion
Price
What is customer analysis analogous to?
Marketing research
What are the basic assumptions of a market with demand-side focus?
Firms have a set of resources available for providing offers that can satisfy customer demand
The better it satisfies customer demand, the more sales it will generate
What is the consequence of a demand-side focused market?
For a firm to excel, it needs to know who the customers are and what they want
What is the ‘marketing concept’?
That the customer who determines what a business is. What the customer thinks s/he is buying, and what s/he considers value is decisive.
What are the five questions that guide (customer) market analysis?
What does the market buy? Why does it buy? Who buys? How do they buy? Where? When? How much does the market buy?
What are the three stages of a good?
Production
Exchange
Use/Consumption
What is benefit in use?
The actual value derived from a product or service in the context in which it is being used
Who can be seen as involved in the purchasing process?
An organization Initiator Influencer Decider Buyer User
What are the five steps in the decision-making process?
Need/problem recognition Information search Evaluation of alternatives Purchase decision Post-purchase evaluation
How can you define market potential?
The total market reachable by tour product/service
What are the five sources of untapped demand?
Awareness Availability Ability to use Benefit deficiency Affordability
What is industry analysis?
Identifying and analyzing networks and other factors influencing the dynamic of a company’s position in the market
Name Porter’s five forces
Threat of new entry Supplier bargaining power Customer bargaining power Substitutes Competition (Industry rivalry)
Which factors contribute to competition and rivalry within an industry?
Low concentration/equal players Slow growth High fixed costs Lack of differentiation Capacity growth in large increments Homogeneous competitors High strategic stakes Barriers to exit
Which factors defer new entry?
All barriers to entry Economies of scale Product differentiation Capital requirements Switching costs Access to distribution channels Cost disadvantages independent of scale Government policy
How can one deal with potential substitutes?
Put a ceiling on prices
Price-performance tradeoffs
Focus on production function
What are some danger signals to watch out for when looking at potential substitutes?
Substitutes with improving price/performance ratio
Substitutes in high-profit industries
When do suppliers possess power?
If their industry is more concentrated than yours
The products are unique, differentiated, or involve switching costs
There are no real substitutes
There is threat of forward integration
You are an unimportant customer
When does the buyer possess power?
The industry is concentrated or purchases large volumes
The products are standardized or undifferentiated
The products represent a significant share of costs
Risk of backward integration
Your product is unimportant
Your product does not save money for the buyer
What is an exchange relationship?
A pattern of interactions and the mutual shaping of behavior over time between a seller and a buyer
What are the main reasons that firms have relationships?
Increased productivity Reduced uncertainty Resource access Information Innovation
How can one easily define efficiency for a company?
Producing things the right way
By asking: how much product X can one produce from a given amount of inputs?
How can one easily define effectiveness of a company?
Producing the right things
By asking: how can we produce value for our customers?
Define positive connectedness
When exchange in one relation leads to exchange in others
Define negative connectedness
When exchange in one relation reduces exchange in others
What is the ARA model?
A network model consisting of
Actors control and depend on resources
Resources are linked together by activities
Activities are performed through the knowledge and skills of actors
What is the difference between informal and formal bonds?
Informal bonds are characterized by intangible exchanges. Trust Commitment Knowledge Experience Personal relations Formal bonds are characterized by their tangible nature, often in the form of written documents Contracts Warranties Ownership Certifications Joint ventures
What characterizes resources?
Includes objects, artifacts, money, people
Controlled by actors
Needed to perform and used in activities
Heterogeneous. Value and properties depend on the context in which they are used
Availability and control over a resource can vary
What characterizes activities?
They are performed by actors They transform resources They conduct exchanges (transfer resources) Linked in chains or cycles Can be routinized
Define resource ties
What brings resources together to activate them and create value
What are some examples of resource ties?
Product interfaces Synergies Interferences Standards Adaptations
Name the three types of network connections
Actor bonds
Resource ties
Activity links
What do actors typically do?
Interact
Establish exchange relationships
Control resources
Perform activities
What is the role of resources?
Used and transformed to something of use through activities
