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Marketing 3300 > Test 2 6-11 > Flashcards

Test 2 6-11 Flashcards

1
Q

What is marketing research?

A
  • Process of defining a marketing problem & opportunity
  • Systematically collecting & analyzing information & recommended actions
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2
Q

Challenges in doing good marketing research

A
  • How can marketing research determine if consumers will buy a product they have never seen & never thought of before?
  • How can marketing research obtain answers that people know but are reluctant to reveal?
  • How can marketing research help people accurately remember and report their interests, intentions, and purchases?
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3
Q

The 5-step process

A

Step 1: Define the problem

Step 2: Develop the research plan

Step 3: Collect relevant information

Step 4: Develop Findings

Step 5: Take Marketing Actions

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4
Q

Step 1: Define the Problem (most important step)

A

Set the research objective:

  • Exploratory research (provides ideas about a vague problem: interviews focus groups)
  • Descriptive research (trying to find the frequency in which something occurs or the extent of a relationship between 2 factors)
  • Casual research (tries to determine the extent to which the change in 1 factor changes another)
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5
Q

Step 1: Define the Problem (Lego example)

A

Lego Mindstorm EV3 (target: middle school boys)

Research objectives: Which of 2 designs to market?
- Whichever design kids could complete in less than 20 minutes

Potential marketing actions: Market design that kids complete in less than 20 minutes
- Did exploratory research (focus groups & interviews)

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6
Q

Step 2: Develop the research plan

A
  1. Specify constraints on the marketing research activity
  2. Identify the data needed for marketing actions
  3. Determine how to collect data
    - Concepts (ideas about products/services)
    - Methods (approaches that can be used to solve all or part of the problem)

Special methods vital to marketing are:
- Sampling (selecting people to ask questions)
- Statistical interference (generalizing the results from the sample to draw conclusion about the entire group)

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7
Q

Step 2: Develop the research plan (lego example)

A

Specify constraints
- Budge limitations (not cited)
- Time limitations (5 weeks)
- Restrictions on collection methods (10 teams of middle schoolers playing with 2 Mindstorm kits)

Identify data needed for marketing actions
- Identify parameters of study (stay focused): time it takes kids to build, engagement during time, students’ math skills?

Determine how to collect data
- Concepts: Developed new-product concept (LEGO group designers develop robots that uses color sensor, voice command)
- Methods: Observe behavior (more than 20 minutes? Frustrations?), ask questions (How long did it take you? Did you enjoy it? What is your favorite subject in school?)

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8
Q

Step 3: Collect relevant information

A
  1. Obtain secondary data (already exists)

Internal data:
- Inputs (budgets, financial statements, sales reports)
- Outputs (actual sales & communication with customers)

External Data:
-U.S. Census reports

  1. Obtain primary data (collected for current study)

Observational data:
- Mechanical methods (people meters, Nielsen media research)
- Personal methods (mystery shoppers, ethnographic research, kraft deli creations)
- Neuromarketing methods (technology used to measure brain activity & changes in physiological state, MRI, Campbell spoons)

Questionnaire data:
- Idea generation methods
- Idea evaluation methods (Questionnaires- likert scale, interviews, focus groups)

Other sources of data:
- Social media, panel & experiments, IT, IoT, Data mining

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9
Q

Step 4: Develop findings

A
  • Analyze the data
  • Present the findings (less misrepresentation)
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10
Q

Step 4: Develop findings (lego example)

A
  • Which design led to fastest build? Did kids mind the extra time to build? Was all data measured objectively?
  • Conclusion: Kids prefer design, present data in easily understand graphics, data is backup
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11
Q

Step 5: Take marketing action

A
  • Make action recommendations
  • Implement action recommendations
  • Evaluate results (evaluate the decision itself & the decision process used)
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12
Q

Step 5: Take marketing action (Sales forecasting techniques, trend extrapolation)

A

Sales forecast: total sales of an offering expected to sell within a specific time period

  • Judgement of decision- maker (what you know from past sales)
  • Surveys of knowledgeable groups (ask sales force, buyers)
  • Statistical methods (trend extrapolation- extending a pattern observed in the past data to the future, assuming what happens in the past will occur in the future) Ex. City planning
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13
Q

In Marketing, STP stands for:

A

Segmentation, Targeting, Positioning (STP)

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14
Q

Market Segmentation

A

Involves aggregating prospective buyers into groups, or segments, that:

  • Have common needs
  • Respond similarly to a marketing action
  • Within each segments they have common needs and will respond similarly
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15
Q

Product Differentiation

A

Product differentiation:

  • Strategy of using different marketing mix activities (4 P’s) to help consumers perceive a product as being different and better than competing products
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16
Q

Link to the organization’s marketing mix

A
  1. Identify market needs
    - Benefits in terms of : product features, expense, quality, savings in time & convenience
  2. Link needs to actions
    - Take steps to segment & target markets
  3. Execute marketing program actions
    - A marketing mix in terms of: product, price, promotion, place (distribution)
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17
Q

Market-product grid

A

A framework to related the market segments of potential buyers to products offered or potential marketing actions

Ex. Pillow market (stomach, back, side sleepers)

Advantages:
- Determine target market segments to select
- Determine which product groupings to offer

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18
Q

When and How to Segment Markets

A

1 product multiple market segments
- Sports magazine, Harry Potter

Multiple products & multiple market segments
- Ford motor company (Lincoln, Aston Martin, Jaguar)
- Tiffany/ Walmart (Old Navy vs Banana Republic)

1 or mass customization (step ahead of BTO)
- Internet ordering (M&Ms)
- Build to Order (BTO): Apple iPhone

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19
Q

The Segmentation Tradeoff: Synergies vs. Cannibalization

A

Synergy: increased customer value found through performing organizational functions (marketing & manufacturing) more efficiently
- Coca-Cola Company (Sprite, Fanta, Dasani)

Cannibalization: when products “steal” from existing line
- Ann Taylor & LOFT

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20
Q

5 Steps in Segmenting a Market

A
  1. Group potential buyers into segments
  2. Group products to be sold into categories
  3. Develop a market product grid & estimate size of markets
  4. Select target markets
  5. Take marketing actions to reach target markets
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21
Q

Segmenting a market: Step 1: Grouping Buyers into segments

A
  • Simplicity & cost-effectiveness of segmenting (how easy?)
  • Potential for increased profit
  • Similarity of needs within potential segments
  • Difference of needs of buyers among segments
  • Potential of marketing actions to reach segments
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22
Q

Ways to segment consumer markets (4)

A
  • Geographic (Campbell’s nacho cheese)
  • Demographic (Campbell’s single serve, 50% of US households 1 or 2 people)
  • Psychographic (Lifestyle, you are where you live)
  • Behavioral: Product Features, Usage rate
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23
Q

80/20 Rule (Pareto Principle)

A
  • 80 % of sales comes from 20% of customers
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24
Q

Product Positioning

A

Place product occupies in consumers’ mind based on important attributes relative to competitor’s products

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25
Q

Product repositioning

A

Changing the place product occupies in consumer’s mind

  • Head to head positioning: competing direct with competitors or similar attributes in same market
  • Differentiation positioning: seeking a less competitive, smaller niche in which to locate a brand

Ex. Repositioning chocolate milk, mother energy, GoDaddy, JCPenny, Arm & Hammer Baking Soda, Starbucks in UK

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26
Q

Key to Repositioning a Product

A
  1. Identify the important attributes for a product/brand class
  2. Discover how target customers rate competing products/ brands with respect for these attributes
  3. Discover where the company’s product/ brand is on the minds of potential customers
  4. Respoition in the company’s product /brand in the minds of potential customers
27
Q

Perceptual map

A

A means of displaying in 2 dimension the location of products or brands in the minds of consumers to enable a manager to see how consumers perceive competing products or brands and then take marketing actions

28
Q

Product

A

A good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies consumers’ needs and is received in exchange for money or something else of value

29
Q

Goods: Durable and Nondurable

A

Have tangible attributes that a consumer 5 senses can perceive.

Nondurable goods: Consumed (food, fuel)
- Easily substitutable: remind consumers of existence
- If durability is 3 years or less

Durable goods: Lasts (Cars, phones)
- More attention to purchase decision

30
Q

Services

A

intangible activities or benefits that an organization provides to satisfy consumers’ needs in exchange for money or something else of value

31
Q

Consumer products (B2C)

A

Purchased by ultimate consumer

4 Types of Consumer Products:

Convenience: purchased frequently, conveniently, minimum of shopping effort
- Toothpaste

Shopping: consumer compares several alternatives (Price, quality, style)
- PC

Speciality: consumer makes special effort to seek out & buy
- Rolex, Tesla

Unsought: consumer doesn’t know about or initially want
- Life insurance, cemetery plot

32
Q

Business Products (B2B)

A
  • Purchased by organization to use themselves or sell to other organizations to resale
  • Derived demand (Battery for car)
33
Q

7 reason why new products fail

A
  1. Insignificance point of difference
    - General Mills: Fingos (still thought of them as cereal to add milk)
  2. Don’t satisfy customer needs
    - Car market in Japan (US car markets didn’t offer right-side drive cars), LifeSaver’s Soda
  3. No economical access
    - Thirsty Dog/ Thirsty Cat (Shelf space $ too high for initial sales)
  4. Bad timing
    - Microsoft Zune player (missed market after iPod & other MP3 players)
  5. Poor product quality
    - Xbox 360, IPad 2, Window 8, Samsung Note 7
  6. Poor execution of 4 P’s
    - Promotion (Garlic Cake)
    - Placement (11 year old driving drunk news article with Red Stripes (beer) ad)
    - Pricing (JC Penny increasing price)
  7. Inconsistent with Brand Identity
34
Q

7 stages of the new product process

A
  1. Strategy Development: defines the role for a new product in terms of firm’s overall objectives
  2. Idea Generation: Developing a pool of concepts for new products
  3. Screening & Evaluation: Internally & externally evaluate new products to eliminate those that warrant no further effort, don’t meet corporate objectives
  4. Business Analysis: Specifies features of the product
  5. Development: Paper into prototype
  6. Market Testing: Actual products to prospective customers
  7. Commercialization: Release the product
35
Q
  1. Strategy Development:
A

defines the role for a new product in terms of firm’s overall objectives
SWOT Analysis
- Environmental Screening

36
Q
  1. Idea Generation:
A

Developing a pool of concepts for new products
- Customers, suppliers, employees, Research & Development (R&D), Competitive Products,
- Smaller firms, Universities
- Crowdsourcing (involves generating insights leading to actions based on ideas from massive #s of people)

37
Q
  1. Screening & Evaluation:
A

Internally & externally evaluate new products to eliminate those that warrant no further effort, don’t meet corporate objectives
- Internal Approach (firm’s employees evaluate): Customer Experience Management (within firm)
- External approach (concept tests): preliminary testing of new product ideas with consumers

38
Q
  1. Business Analysis:
A

Specifies features of the product
- Resources needed to create prototype projects, financial projection (including cannibalization analyses), marketing mix (lots of # crunching)

39
Q
  1. Development:
A

Paper into prototype
- Demonstrable, producible product; service delivery expectations; safety tests

40
Q
  1. Market Testing:
A

Actual products to prospective customers
- Test marketing (test in representative cities)
- Simulated test markets (limited tests)

41
Q
  1. Commercialization
A
  • Regional rollouts, cater to early adapters, speed: time to market
  • Slotting fees, penalties
42
Q

Stages of Product Life Cycle (PLC)

A
  1. Introduction Stage
    - Skimming & Penetration Pricing
  2. Growth Stage
    - Rapid increase in sales
  3. Maturity State
    - Slowing of total industry sales
  4. Decline Stage
    - Deletion & Harvesting
43
Q

Introduction stage of product life cycle

A

Distribution
- Must get new channels establish

Pricing
- Skimming (price high to make up for R&D cost)
- Penetration pricing (price low for initial period)

44
Q

Growth Stage of Product Life Cycle (PLC)

A
  • Rapid increase in sales
  • More competitors
  • Aggressive pricing
  • Brand Awareness
45
Q

Maturity Stage of Product Life Cycle (PLC)

A
  • Slowing of total industry sales
  • Marginal competitors leave market
  • Fewer new buyers

Marketing focus: hold market share, find new buyers, product differentiation

46
Q

Deletion Stage of Product Life Cycle (PLC)

A

Deletion (EOL)
- Get out of market

Harvesting
- Keep producing but one’s promote
- Customer goodwill

47
Q

Typical curve of SLC

A

Typical PLC curve goes up during growth, peaks at maturity, then decline

48
Q

4 Aspects of Product Life Cycle (PLC)

A

-Length (varies among products, industries)

  • Shape (High-learning, fashion, fad)
  • Level (Class & form)
  • Consumers (How consumers adapt to new products)
49
Q

Length of Product Life Cycle

A
  • Consumer products (shorter life cycle)
  • Business products (longer life cycle)

Technology impacts PLC; Mass communication affects PLC

50
Q

High-learning product

A
  • Significant customer education required
  • Extended introduction period
51
Q

Fashion Product

A

Difficult to predict life cycle

  • can ebb & flow
  • Length of cycles: months to decades
52
Q

Fad Product

A

Rapid introduction; rapid decline

  • short life cycle
    -companies must be adaptable (need balance of products)
53
Q

Diffusion of innovation (How quickie consumers adopt)

A
  1. Innovators (2.5%)
  2. Early adopters (13.5 %)
  3. Early majority (34%)
  4. Late majority (34%)
  5. Laggards (16%)
54
Q

Barriers to diffusion of innovation

A
  1. Usage barrier
    - product not compatible with habits (Netflix, Peapod)
  2. Value barrier
    - Consumer perceives no real values in repackaged product (Uncrustables)
  3. Risk barrier
    - Psychical, economic, social
    - Fear that purchase can case setback, buyer uncertain about cost/performance
  4. Psychological barrier
    - Cultural differences or image (US women adopt slowly, US men adopt slower)
55
Q

Managing the pls (molding the product, mod the mkt, repos the prod

A
  • Product manager
  • Modifying the product
  • Modifying the market
  • repositioning the product
56
Q

Modifying the product

A

Increases value to consumers

Ex. Pantene added vitamins to shampoo

57
Q

Modifying the market

A

Company tries to increase consumption by finding new users and new market segments for its brands

Ex. Harley Davison, Chocolate milk, Arm & Hammer Baking soda

58
Q

Reposition the product

A

Changing the place product occupies in consumer’s mind

Ex. St. Joseph, Quaker, Cheerios

59
Q

Brand Name (Trade Name)

A

Word, device used to distinguish a seller’s good/services

Qualities of a good brand name:

  1. Suggest product benefits
  2. Memorable, distinctive, positive
  3. Fit company or brand image
  4. Have no legal restriction (us-to.gov, them “TM”)
  5. Simple & emotional
60
Q

Brand personality

A

a set of human characteristics associated with a brand name

61
Q

Brand equity

A

The added value that a brand name gives to a product beyond the functional benefits provided

  • Created by marketing programs that forge strong, favorable, unique customer experience with brand
  • Customers are willing to pay higher prices for brand equity
62
Q

Branding strategies

A
  1. Multiproduct
    - One name for all products in a class (GE, Sony, Microsoft)
  2. Multibranding
    - Each product has a distinct name (P&G -> Tide…)
  3. Private branding
    - Company sells under brand name of Wholesaler/ retailer; product created by 3rd party manufacturer (Sears, Walmart)
    - Cost effective way to produce
  4. Mixed branding
    - Firm markets products under its own name & a reseller
63
Q

Customer value brought packaging

A

Communications
- What’s in it/when/how to use
- Recipes

Functionality
- Storage, squeeze bottles

Perception
- Shape, color, graphic help distinguish from other brands

Marketing 3300 (2 decks)

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