MAR 301 1st EditionExam # 1 Study GuideGENERAL CONCEPTS Marketing Concept: to find effective and efficient means of making the firm do what serves the interest of the customer – is an outside in job not inside out.Main objective: to listen to customers, identify their needs, and marshal the resources of the organization to provide products and services that create value for them. (Also creates value for our shareholders) - Means of production are responsive to customer needs. Efficient markets:o Supply matches demand o Prices match value delivered o Inventories are available in correct volumes o Goods and services are distributed efficiently o Consumers are well informed about choices available How does it relate to Sales, advertising, other functions? What is the role of marketing and MisconceptionsGoes beyond simple exchanges: build long-term customer relationships  create customer value, maintain customer satisfaction, and connect with customers on an emotional (“lifetime value of the customer”)4P’s: Product, promotion, price, and place5C’s: Customers, competitors, company (competencies) Collaborators, Context Product Orientation: firms focus on the product itself and how to produce it most efficiently - They bring to market goods and services they are convinced are best for customers - Marketing myopia: shortsighted railroads, Hollywood, dry cleaners, grocery stores Sales Orientation: focus their efforts on doing whatever is necessary to persuade customers to buy. Still pervasive today. “Marketing representatives” Customer Orientation: success will come to firms that best understand the perceptions, needs, and wants of its customers and satisfies them through the design, communication, pricing, and delivery of competitively viable offerings. Instead of trying to change the customer to fit what the firm has to offer, instead change the firm to fit the customer needsTHE MARKETING STRATEGIC PLANNING PROCESS- Planning phase: o Identify the business mission o Analyze the situation: market environment SWOT (set business objectives)- Marketing Strategy and Implementation Phase o Identify Opportunities  Segmentation, targeting, positioning o Implement Marketing Mix Product, price, place, promotion - Control Phaseo Evaluate performance using market metrics THE PRODUCT LIFE CYCLE (can differ with market)Introduction growth  maturity  declinePORTFOLIO MODEL (Method to manage the product portfolio) - Companies use matrix to determine strategic options for growthBoston Consulting Group MatrixMarket Growth RateHigh Launch/Introduce LowHigh LowHarvest/ DivestRelative Market ShareMarket penetration: (low risk)increase sales of existing products to existing marketsProduct development: ( risky) don’t know whether it’ll ever come to market) Market Development:(risky) Introduce existing products to new marketsDiversification: (high risk) emphasize both new products and new markets to achieve growth CONSUMER BEHAVIOR Understanding Consumer Customer owns behavior: perceive a fit between product and a need. Ability to actManager owns understanding: what of customer behavior, why of customer behavior, how to translate what and why into decisions and actions Influences on and of Consumer BehaviorPerception and message encoding, cognitive processes, affect and emotion, beliefs and attitudes, social and cultural influences  CONSUMER  searches for info, makes choices, forms preferences - Consumer Research – market strategy – marketing mixMODELS for decision makingAIDA: - Attention (awareness and information gathering)- Interest (Deliberation/ attitude formation)- Desire - ActionHierarchy of Effects- Awareness (Recall and recognition) - Beliefs- Attitude / persuasion- Intention - Behavior (trail or repeat)5 steps decision making process (influenced by culture, situation, and psychological factors)1. Need recognition 2. Information search3. Evaluation of alternatives4. Purchase 5. Post-purchase behavior B2B MARKETING (Business to Business) Types of Business products- Raw materials - Processed materials- Component parts- Major equipment - Accessory equipment- Supplies - Business services Players in B2B- Producers: Mfrs, OEMS- Resellers: wholesalers marketing reps, retailers- Other businesses: that need to buy materials, machinery or other equipment. Even computers inorder to do business- Governments: federal, state, county, etc.- Institutions: civic clubs, churches, colleges, unionsThe link between B2B & B2C : multiplier effect, small changes in consumer demand can produce major changes in business demand Nature of b2b marketing - Informative intensive (highly structured decision making, can be political focus is on justification)- Highly involved customers- Focus on the ‘Total Value Proposition’ (encompassing product features, lifecycle costs of operation service assistance, replacement costs)- Performance guarantees often required - Demand is derived from the demand for consumer products- Demand fluctuates more than demand for consumer products - Demand for one item affects demand for other related products (joint demand)- B2B buyers are less price