Brainscape's Knowledge GenomeTM


Top Flashcards (Certified)
All Flashcards

MKTG 376 > MKTG 376 Test 3 > Flashcards

MKTG 376 Test 3 Flashcards

1
Q

Market Share

A

one of the fundamental measures used in marketing. Measures the sales of a brand or product relative to the overall size of the market.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Market Share Formula

A

Revenues = Unites Sold x Price

Units Sold = Revenues/Price

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Unit Market Share Formula

A

Unit Sales for Brand / Total Market Unit Sales

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Revenue Market Share Formula

A

Sales Revenue for Brand / Total Market Sales Revenue

in percentages (multiply by 100)

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Why is Market Share important?

A

is an indicator of how a brand is doing relative to the competition. Includes:

  • customer’s assessment of brand’s value proposition
  • advertising
  • distribution
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Why might a company have a higher price relative to the competition?

A

they have a higher revenue market share than unit market share.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

How do unit sales have an impact of unit costs?

A

higher volumes of production lead to lower production costs relative to competition

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Market Definition

A

in terms of geography, demographic, channel, time periods, etc.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Why do we need to define the market?

A 
Kellogg's Example:
Are we defining 
-all brands of corn flakes
-all types of cereals 
-all breakfast foods
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Year-on-year Percentage Growth

A

Growth % = Year 2 Sales - Year 1 Sales / Year 1 Sales

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Relative Market Share

A

indexes a firm’s or brand’s market share against its leading competitor.

Provides managers with a measure to compare the relative market positions of their brands across markets.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Relative Market Share Formula

A

Brand’s Market Share ($ or Units) / Largest Competitor’s Market Share ($ or units)

Brand Sales / Largest Competitor Sales

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Relative Market Share Value Greater than 1

A

when the brand under consideration is the market leader

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

Relative Market Share Value Less than 1

A

when the brand under consideration is not the market leader

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Relative Market Share Metric

A

popularized in 1960s by Boston Consulting Group (BCG), where relative market share is a surrogate for competitive strength

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Market Growth Rate

A

market attractiveness and potential

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

BCG Matrix

A

a portfolio planning model

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

Stars

A

High Market Share & High Growth Rate

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Cash Cows

A

High Market Share & Low Growth Rate

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Question Marks

A

Low Market Share & High Growth Rate

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Dogs

A

Low Market Share & Low Growth Rate

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

BCG Growth-Share Matrix

A
  • Assumes that increasing relative market share will result in cash generation
  • Assumes that growing markets requires investment in assets, therefore consumption of cash
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Dogs Investment

A

little or no potential, divest

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

Question Marks Investment

A

rapidly growing, consume cash; but have low share, do not generate cash. Needs careful analysis

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Stars Investment
generate and consume large amounts of cash; will become cash cow when growth slows
26
Cash Cows Investment
mature market, generate more cash than they consume; fund other units such as question marks
27
Market Concentration
the degree to which a relatively small number of firms accounts for a large proportion of the market
28
3 Firm Concentration Ratio
sum of the market shares of the leading 3 competitors in a market
29
4 Firm Concentration Ratio
sum of the market shares of the leading 4 competitors in a market
30
Herfindahl Index
a market concentration metric derived by adding the squares of the individual market shares of all players in the market
31
What is used to decide if a merger is good for competition in a market place?
the Justice Department uses the Herfindahl-Hirschman Index to decide whether it is good
32
HHI under 1,000
considered a competitive market
33
HHI between 1,000-1,800
The Justice Department is likely to scrutinize a merger
34
HHI over 1,800
the Justice Department is almost certain to reject the approval of the merger
35
Market Penetration (Category)
the number of people who buy a specific brand or a category of goods at least ONCE in a given period, divided by the size of the relevant market population
36
Market Penetration (formula)
customers who purchased a product in the category/total population
37
Brand Penetration (formula)
Customers who purchased the brand/Total Population
38
Should a manager seek sales growth by acquiring new customers or seek growth by 'stealing' customers from competitors?
Growing the market by getting new customers (who have never used) is easier than stealing from competitors.
39
What happens if market penetration is high?
it is harder to grow the market
40
Market Share (formula)
brand sales/total sales
41
Category Development Index (CDI)
Category sales ($ or units) in a specified segment compared to sales of the category in the entire market, usually on a per-capita basis.
42
Category Development Index (CDI) (formula)
(Category unit sales in segment/Population in segment) / (Total category unit sales)/(Total population)
43
Brand Development Index (BDI)
Brand sales ($ or units) in a specified segment compared to sales of brand in entire market, usually on a per-capita basis
44
Brand Development Index (BDI) (formula)
(brand sales in segment)/(population in segment)/(total brand sales)/(total population)
45
Purpose of BDI and CDI
help identify strong and weak segments (such as demographic or geographic) for a brand or category
46
Revenue is often called...
"top line"
47
Income or Profit is often called...
"bottom line"
48
Basic Income Statement
Revenue-Costs = Income
49
How to increase revenue?
Increase prices | Increase sales of units
50
Distribution Channel
a set of interdependent organizations involved in the process of making a product or service available for use of consumption by the consumer or business user.
51
What is the $ Margin?
Margin=profit | Desired $ margin + cost to produce = Selling Price
52
What is the % Margin
Desired $ Margin % + Cost to Produce % = Selling Price %
53
Manufacturer % Profit Margin
Selling Price - Cost = Profit Margin / Selling Price = profit
54
Desired Margin
usually manufacturers, resellers, etc. know their costs and need to figure out what they want/need
55
Selling Price =
Cost/(1-% Margin)
56
Manufacturer's cost to produce is $50. Manufacturer wants 60% margin. What is selling price?
$50/(1-.6)=$125
57
Manufacturer's cost to produce is $50. Manufacturer wants 60% margin. Retailer bought it for $125. Retailer wants 20% margin. What is selling price?
$125/(1-.2)=$156.25
58
The selling price from manufacturer is $160. the margin is 33%. What is the manufacturer's cost?
=Manufacturer SP * (1-margin%) | $160*.67=$107.25
59
``` Retailer sells the wine to consumers for $18 a bottle. Channel margins % are as follows. What is the cost to the manufacturer? Retailer-33% Distributor-25% Importer-33% Manufacturer-50% ```
$18*(1-.67)=12.06 $12.06*(1-.25)=$9.05 $9.05*(1-.33)=$6.07 $6.07*(1-.50)=$3.00
60
$ Unit Margin
Selling Price - Cost
61
% unit margin
Selling Price - Cost / Selling Price
62
Selling Price
Cost / (1- %margin)
63
% Margin for multiple channels
Average Margin % = margin1+margin2+margin3 / total of units
64
Total Sales =
total costs/total revenue
65
Total Margin $ =
Total Revenue - Total Costs
66
Total Margin % =
Total Margin $ / Total Revenue
67
Mark-Up =
Cost * (1+margin%) (decimal)
68
A retailer buys t-shirts for $10 and sells them at 50% mark-up
Selling price = $10*1.50=$15
69
Total Costs
Total variable costs + Total fixed costs
70
Profits
Total revenues - Total Costs
71
Total contribution
Total revenues - Total variable costs
72
$ Unit Contribution margin
Selling price per unit - variable costs per unit
73
% Unit Contribution margin
$ contribution margin/selling pricer per unit
74
Total variable costs
Unit variable costs * Units Sold
75
Break Even Point
Total Costs = Total Revenue
76
Unit Break-even =
Fixed Costs / Unit contribution
77
BE (units) =
Fixed Costs/(SP-VC)
78
BE ($) =
FC / ((SP-VC)/(SP))
79
Target Volume in Units =
(Fixed Costs + Profit Objective) / (SP-VC)
80
Dollar Break-even =
(Fixed Costs + Profit Objective / ((SP-VC)/SP))

MKTG 376 (2 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2025 Bold Learning Solutions. Terms and Conditions