Principles of Marketing Exam 1 Flashcards
AMA definition of marketing
activity or set of institutions or processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners and society
the marketing mix
product, price, place, and promotion strategies
exchange
the process by which some transfer of value occurs between a buyer and seller
types of competition
monopoly, oligopoly, monopolistic competition, perfect competition
market
all the customers and potentials who share a common need that can be satisfied by a specific product, who have the resources to exchange for it, who are willing to make the exchange, and who have the authority to make the exchange
marketplace
any location or medium used to conduct an exchange
form utility
benefit marketing provides by transforming raw materials into finished products
place utility
the benefit marketing provides by making products avaialble when and where the customers want them
time utility
the benefit marketing provides by storing products until they are needed
possession utility
the benefit marketing provides by allowing the consumer to own use and enjoy the product
production era
consumers have to take whatever is available, marketing plays a relatively insignificant role
sales ear
when product availability exceeds demand in a buyers market. Management views marketing as a sales function, or a way to move products out of warehouses so that inventories dont pile up. Businesses engage in the hard sell in which salespeople aggressively push their wares
relationship era
firms have a customer orientation that satisfies customers needs and wants
triple bottom line era
business emphasizes the need to maximize the three components of financial, social, and environmental bottom lines
world trade
the flow of goods and services among different countries - the value of all the exports and imports of the worlds nations
global levels of economic development
- least developed country - economic base is often agricultural
- developing countries - economy shifts emphasis from agriculture to industry
- Developed countries - offer wide range of opportunities for international marketers
Macroenvironment
overall structure of the industry
types of competition
monopoly, oligopoly, monopolistic competition, perfect competition
market entry strategies for going global
exporting, licensing agreement, franchising, strategic alliances, direct investment (firm expands internationally through ownership)
straight extension
firm offers the same product in both domestic and foreign markets
product adaptation
firm offers similar but modified product in foreign markets
product invention
firm develops a new product for foreign markets
backward invention
firm develops a less advanced product to serve the needs of people living in countries without electricity or other elements of a developed infrastructure
ethics approaches
utilitarian approach, rights approach, fairness or justice approach, common good approach, virtue approach
three levels of business planning
strategic, functional, and operational
strategic planning
done by top level corporate management:
1. define the mission
2. evaluate the internal and external environment
3. set organizational or SBU objectives
4. establish the business portfolio
5. develop growth strategies
functional planning
done by top functional level, management such as the firms chief marketing officer:
1. perform a situation analysis
2. set marketing objectives
3. develop marketing strategies
4. implement marketing strategies
5. monitor and control marketing strategies
operational planning
done by supervisory managers:
1. develop action plans to implement the marketing plan
2. use marketing metrics to monitor how the plan is working
portfolio analysis
assess the growth potential for a firms SBUs and product lines
BCG Stars
high market growth rate, high relative market share
BCG question marks
high market growth rate, low relative market share
BCG cash cows
low market growth rate, high relative market share
BCG dogs
low market growth rate, low relative market share
market penetration strategy
seek to increase sales of existing products to existing markets
product development strategy
create growth by selling new products in existing markets
market development strategy
introduce existing products to a new market
diversification strategy
emphasize both new products and new markets to achieve growth
product strategies
design, packaging, branding, etc
pricing strategies
determines how much firm charges for a product
promotional strategies
how marketers communicate a products value proposition to the target market
distribution strategies
outline when, how, and where the firm will make the product available to targeted customers
Return on Marketing Investment (ROMI)
revenue generated by investment in a given marketing program divided by the cost of the program at a given level of risk
internal company data
information generated within the company to produce reports on sales and marketing activities
marketing intelligence
gathered via monitoring of everyday data sources, observations, discussions with sales reps
marketing research
refers to the process of collecting, analyzing, and interpreting data about customers, rivals, and the business environment
acquired databases
externally sourced databases can be sued to collect a variety of information (non-competing businesses, government databases)
MDSS system
MIS data and marketing manager/decision maker using interactive software as the input to statistical and modeling software and the information needed for decision making is the output
secondary research
internal sources and external sources
internal sources
company reports, previous company research, salesperson feedback
external sources
published research, trade organizations, syndicated research, government sources
primary research
exploratory, descriptive, and causal research
exploratory research
qualitative in nature, good for gaining better understanding of problem, customer interviews, focus groups, projective techniques, case studies, and enographies
descriptive research
systematically investigate marketing problem, results expressed in quantitative terms, cross sectional, longitudinal
causal research
attempts to identify cause and effect - independent and dependent variables, laboratory research, field studies
raw data
raw unorganized facts
primary data
refers to data collected by the firm to address a specific question
market research process
- define the research problem
- determine the research design
- choose the method to collect primary data
- design the sample
- collect the data
- analyze and interpret the data
- prepare the research report
predictive technology
uses shopping patterns of large numbers of people to determine which products are likely to be purchased if others are
bounce rate
measure of how many visitors come to a page on a website and leave without viewing any other pages
probability sampling
simple random sampling, systematic random sampling, stratified random sampling
non probability sampling
convenience sampling
customer relationship management
systematic tracking of consumers preferences and behaviors over time in order to tailor individualized value propositions
lifetime value
how much profit a firm will make on a customer
big data
describes the exponential growth of structured and unstructured data
Brand Association Map (BAM)
analyzes customer conversations on the internet and plots phrases used - the closer a word appears to the center of the map the stronger the correlation or association - the proximity of the words to each other indicates correlation
click through rate
(click throughs / impressions) x 100
conversion rate
of goal achievements / # of website visitors
cost per order
advertising costs / orders
