Marketing Study Guide Part 1

Question 1

Definition of Marketing

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

What is the main concept of marketing?

Answer 2

entails processes that focus on delivering value and benefits to customers, not just selling goods and services

Question 3

What does marketing help create?

Answer 3

value

Question 4

Define and describe the exchange that occurs when sellers ad buyers meet

Answer 4

at least two parties
each party has something of value (to the other party)
each party can communicate and deliver value
each party is free to accept or reject the exchange offer
each party wants to deal with the other party
exchange may not take place even if conditions are met
an agreement must be reached
marketing occurs even if exchange does not take place

Question 5

4 P’s of Marketing

Answer 5

Product, price, place and promotion

Question 6

Product

Answer 6

goods-items that you physically touch

services- intangible benefits, may include the experience

Question 7

Price

Answer 7

everything the buyer gives up - including money, time energy - in exchange for the product

Question 8

Place

Answer 8

getting the product to the right customer; supply chain management

Question 9

Promotion

Answer 9

communicating a product’s value to customers

Question 10

What is an example of a Business 2 Business transaction?

Answer 10

manufacturer to retailer

Question 11

Example of a Business 2 Consumer transaction?

Answer 11

retailer to customer

Question 12

What is the definition of value?

Answer 12

the relationship of benefits to costs, what the consumer gets for what they give

Question 13

What is the difference between transactional and relational customer relationships?

Answer 13

Transactional- each transaction is a separate event, prior knowledge is not important (McDonald’s)
Relational: buyers and sellers establish long-term relationship (5-star hotel)

Question 14

What does CRM stand for? How is it useful?

Answer 14

Customer relationship management: database used to gather and track customer data points

Question 15

What is the definition of marketing strategy?

Answer 15

a firm’s target market, marketing mix, and the method of obtaining a sustainable competitive advantage

Question 16

What is a sustainable competitive advantage?

Answer 16

something that a company can persistently do better than its competitors

Question 17

Three macro strategies for developing customer value

Answer 17

Operational excellence, customer intimacy and product leadership

Question 18

Operational excellence

Answer 18

performance is good enough
lower costs
increase convenience
obtain reliability
become easy to use
Tradeoffs- lower performance, lower customization, lower level of service

Question 19

Customer intimacy

Answer 19

performance is just right
high level of customization
high levels of service
offers a complete solution
access to a wide selection
feeling of an experience
tradeoffs: high costs, somewhat lower performance

Question 20

Product leadership

Answer 20

performance is never good enough
access to high performance (latest technologies)
linked with aesthetics and style
portray sophistication
tradeoffs: higher costs, lower customization

Question 21

How does a company survive as a product leader? Customer intimacy company? Operationally excellent company?

Answer 21

Product leader: product development lifecycle, always create new product life cycles, “fencing”-gentle, combatants are well protected

Customer intimacy: share of wallet strategy, “capture” a customer, then get all their money, and “boxing”-can get hurt, but ref and gloves

Operational excellence: volume strategy, “street fight”-dirty and ugly

Question 22

Marketing plan

Answer 22

analysis of the current marketing situation, opportunities and threats for the firm, marketing objectives and strategy (the 4 P’s), action programs, and methods of evaluation

Question 23

What are the three phases of the marketing plan?

Answer 23

Planning phase: define the mission and vision of the business, evaluate the situation both inside and outside of the organization

Implementation phase: identify and evaluate different opportunities, using: segmentation, targeting, positioning and the 4 P’s

Control Phase: evaluating the performance of the marketing strategy using marketing metrics

Question 24

What is a mission statement? Why is it important for a company to develop a strong mission statement?

Answer 24

it is a broad description of a firm’s objectives and the scope of activities it plans to undertake
It’s important to develop one so that they can communicate their goals to a customer searching for a product

Question 25

List and define the components of SWOT analysis. Which are inward focused? Outward focused?

Answer 25

Strengths: (internal/inward focused) what your firm does well Weaknesses: (internal/inward focused) where you are vulnerable, what you don't do well Opportunities: (external/outward focused) possibilities not yet realized Threats: (external/outward focused) things you can't control, but must be aware of

Question 26

Segmentation

Answer 26

consumers who respond similarly to a firm's marketing efforts "the who (will you target)"

Question 27

Targeting

Answer 27

evaluating each segment's attractiveness and deciding which to pursue "the how (will you target them)"

Question 28

Positioning

Answer 28

the process of defining the marketing mix variables (4 P's) so that target customers have a clear, distinctive, desirable understanding of what the product does or represents in comparison with competing products "the where (in the consumer's mind)"

Question 29

Define and provide an example of strategic business units

Answer 29

a division of the firm that can be managed and operated somewhat independently from other divisions and may have a different mission or objectives; different categories of product in a store; athletic clothes vs. bedding

Question 30

Market share

Answer 30

the percentage of a market accounted for by a specific entity, used to establish the product's strength in a particular market (firm's total sales/entire market total sales)

Question 31

Relative Market Share

Answer 31

provides managers with a product's relative strength compared with that of the largest firm in the industry

Question 32

Market Growth Rate

Answer 32

the annual rate of growth of the specific market in which the product competes

Question 33

4 Categories of the BCG product portfolio analysis

Answer 33

Stars: occur in high-growth markets and are high market share products, often require heavy resource investment; as market growth slows, stars become cash cows Cash cows: occur in low-growth market but are high market share products; have excess resources that can be spun off to other products Question marks: appear in high-growth markets but have relatively low market shares, require significant efforts to maintain and increase market share; do you increase investment, or move onto something else? Dogs: are in low-growth markets and have relatively low market shares; may generate enough resources to sustain themselves, but should be phased out as they will never become 'stars'

Question 34

List and define four growth strategies

Answer 34

Market Penetration strategies: employs the existing marketing mix and focuses the firm's efforts on existing customers Market development strategy: employs the existing marketing offering to reach new market segments Product development strategy: offering a new product or service to a firm's current target market Diversification strategy: a firm introduces a new product or service to a market segment that it does not currently serve

Question 35

List, define and provide examples of the 4 E's in social media

Answer 35

Excite: offer must be relevant to its targeted customer; relevancy can be achieved by providing personalized offers (customers who bought this item also bought) Educate: sells the product's value proposition and offered benefits; explains why the customer should want to purchase/use the product, how it can offer more value than competing products (Starbucks app highlights the importance of convenience - no need to carry cash, get rewards and find new locations) Experience: provide information about a firm's goods and services; stimulating real experiences; Mini Cooper allows you to design your car without entering the dealership by selecting details and then request financing and a test drive Engage: the previous 3 E's go into engage; action, loyalty, and commitment; positively engaged consumers lead to more profitability (20-40% more purchases); engagement can also backfire

Question 36

Hits

Answer 36

total requests for a page

Question 37

Page Views

Answer 37

the number of times any page gets viewed by any visitor

Question 38

Bounce rate

Answer 38

the % of times a visitor leaves the site almost immediately

Question 39

Click Paths

Answer 39

shows how users proceed through the information

Question 40

Conversion Rates

Answer 40

what % of visitors or potential customers acts - e.g., buying, clicking, donating

Question 41

Keyword Analysis

Answer 41

used to determine what keywords people use to search on the internet for products and services

Question 42

Define corporate social responsibility

Answer 42

voluntary actions taken by a company to address the ethical, social and the environmental impacts of its business operations and the concerns of its stakeholders