unit 4 - chapter 1 Flashcards
1
Q
Which value-related processes are there in marketing according to Webster?
A
- Value-defining processes – for example, through research and insight, which will define the features the target audience will require of a mobile phone.
- Value-developing processes – for example, through new product development (NPD) processes, which will identify new technological solutions to the target market requirements.
- Value-delivering process – for example, through establishing a distributor network, which adds value to the product through increased convenience and availability.
2
Q
What are the elements of marketing mix?
A
- Product – the core benefits and features that the consumer receives, including packaging, branding and additional services
- Price – typically the money paid for the product (also barter).
- Place (or distribution) – the means by which the product is made available to the customer (intermediaries/direct delivery)
- Promotion – how the product is communicated to customers through a range of media (personal selling, advertising etc).
- Fifth P - people
3
Q
What is the four C classification proposed by Lauterborn?
A
- customer needs and wants (product)
- cost to the user (price)
- convenience (place)
- communication (promotion). more customer-focused, may be more relevant to discussions of not-for-profit or social marketing
4
Q
What demographic approaches are there to segmenting consumer markets?
A
- Age e.g., children’s books
- Family size/family life cycle e.g., size and nature of housing
- Gender e.g., types of cosmetic products
- Income/occupation e.g., financial products – savings, shares
- Race/religion e.g., foodstuffs and cooking appliances
5
Q
What psychographic approaches are there to segmenting consumer markets?
A
- Personality e.g., leisure activities involving risk such as white-water rafting
- Motivation e.g., household furnishings purchased for functional or esteem value
- Life style e.g., the arts – museums, theatres
6
Q
What geographic approaches are there to segmenting consumer markets?
A
- Country/region e.g., sports and other leisure activities
- Urban or rural area e.g., transport
- Climate e.g., clothing
7
Q
What behavioural approaches are there to segmenting consumer markets?
A
- Product usage (volume and frequency of purchase) e.g., packaged goods
- Benefits sought e.g., speed vs. ‘quality’ of restaurant meals
- Attitudes e.g., towards the environment and recycling behaviour
8
Q
Example of market segmentation from Dibb and Simkin (rice)
A
- Lazy Lisas – more prone to resting than cooking: ready-meals and take-aways preferable to cooking full meals from scratch
- Hedonistic Helens – more interested in doing right for the planet or ‘their causes’ than cooking, which is not a priority Favourable to Fairtrade
- Proper Paulas – cooking matters and self-confident in their abilities
- Reticent Ritas – reluctant to try anything new, be it recipes, ingredients, cooking styles, meal occasions or retail outlets
- Busy Belindas – women with little time to cook, as it interferes with socialising and out-of-home leisure pursuits.
9
Q
How can you classify approaches to the segmentation of organisational/B2B markets?
A
Geographic –
- location of the organisation/head office;
- local versus global firms
Business demographics –
- size (small and medium enterprises or large corporations);
- age (start-up or established); organisational form (sole trader, partnership, company);
- sector (public/private sector);
- nature of business (agriculture, manufacturing, service, etc.). .
Behavioural characteristics –
- for example, current or potential clients; competitors’ customers;
- value and volume of purchase; frequency of purchase;
- nature of product use (e.g., in the manufacturing process). .
Decision-making process –
- who makes and influences purchasing decisions;
- number of individuals involved;
- speed of process. .
Personal characteristics of decision-makers – for example,
- age,
- experience,
- attitudes towards risk and loyalty to supplier; negotiation style.
10
Q
What are quality criteria for selecting market segments?
A
- Homogeneous – so that individuals are likely to respond to marketing stimuli in similar ways.
- Accessible – the market segment can be reached by existing or potential communication and distribution channels and services. .
- Measurable – the size of the audience can be established.
- Actionable – this refers to the resources of the organisation and the ability to reach and influence the audience,
- Viable/substantial – commercial marketers will consider segments that are profitable and sustainable. Social and not-for-profit marketers must assess whether segments will fulfil the programme objectives and justify the resources allocated to them.
- Ethical – Programmes, particularly those delivered by governmental agencies, may be criticised for directing resources towards some groups and not others (banks criticised for not installing ATMs in deprived areas).
11
Q
What is Dibb and Simkin advice on selecting target markets?
A
How many segments should be targeted?
- (organisation’s corporate strategy,
- developments in the market,
- its basis for competing,
- the available product portfolio,
- available resources,
- current financial performance,
- stakeholder requirements,
- brand standing,
- customers’ perceptions and expectations, plus the activities of competitors)
Which segments should be targeted?
- (careful assessment of the attractiveness to the organisation of the available segment options)
12
Q
what is an undifferentiated strategy?
A
Offering a single product/service concept to most of the market, across different market segments. -
- if the differences in customer needs and buying behaviour are fairly minor. -
- organisation has insufficient resources to target the segments separately
- poor understanding of segmentation benefits.
little evidence to support its use -
- product or service may fail to satisfy customers’ needs;
- marketing programmes will be too broad to appeal.
13
Q
what is a single segment strategy?
A
- developing a single product or service offering to appeal to a carefully defined group of customers.
- For organisations with limited resources, the advantages are that all efforts can be focused on developing expertise in one area.
- Risks - should the chosen segment decline, the corporation’s prospects and financial worth will decline. (fax machines, photo development)
14
Q
what is a multi-segment strategy?
A
- targeting a different product or service concept at each of a number of segments.
- advantage - risk is broadly spread (Mars), should one segment decline, Mars can more readily reallocate resources elsewhere.
- For corporations with limited resources, the difficulty is that costs of targeting and sustaining the different target markets can be high
15
Q
According to Dibb and Simkin, how do you assess market attractiveness?
A
- . An organisation’s resources – how costly will it be to target the segment and does the organisation have sufficient resources to do so? .
- Existing market share – does the organisation have existing market share in this market and is the segment synergistic with its other activities? .
- Production and scale economies – are there likely to be any production and scale economies?
- Product expertise – does the organisation have the required product expertise or relevant experience which can be developed? .
- Customer needs – how readily can the needs of the customer be met and how stable might these be over time? .
- Segment size, structure and growth – how big is the segment, how is it made up, and how might it develop in the future? .
- Competitive environment – what is the level and nature of the competition now and what might it be in the future? .
- Market trends and the marketing environment – what issues in the marketing environment might positively or negatively affect the segment’s potential? .
- Profitability/returns – what is the likely profitability from the segment and what market share gains and other returns might be possible?
16
Q
What are key customer behaviours according to Zeithaml?
A
- Product adoption/purchase – may include the purchase of a product, such as a new bank account, or the adoption of a behaviour, such as making donations to a charity. .
- Repeat purchase – loyalty .
- Switching behaviours – leaving one organisation or behaviour (new bank account, junk instead of healthy food) .
- Word-of-mouth behaviours .
- Complaining behaviour
17
Q
According to Kotler and Armstrong, what are the determinants of consumer behaviour?
A
- psychological (beliefs, attitudes and motivations.)
- personal, social (reference groups, family, roles and status)
- cultural factors
