Marketing 2101 Exam 1 Key Terms Chapter 1 1 Customer lifetime value the value of the entire stream of purchases a customer makes over a lifetime of patronage 2 Customer perceived value the customer s evaluation of the difference between all the benefits and all the costs of marketing offer relative to those of competing offers 3 Customer relationship management CRM managing detailed information about individual customers and carefully managing customer touch points to maximize customer loyalty 4 Customer satisfaction the extent to which a product s perceived performance matches the buyer s expectations 5 Demands human wants that are backed by buying power 6 Exchange the act of obtaining a desired object from someone by offering something in return 7 Industry a group of sellers or providers of a similar product or service 8 Market the set of all actual and potential buyers of a product or service 9 Marketing the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return 10 Marketing Concept a philosophy in which achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions better than competitors do 11 Marketing Management the art and science of choosing target markets and building profitable relationships with them 12 Marketing Myopia the mistake of paying more attention to the specific products a company offers than to the benefits and experiences produced by these products 13 Market Offerings some combination of products services information or experiences offered to a market to satisfy a need or want 14 Needs states of deprivation 15 Product Concept a detailed version of the new product idea stated in meaningful consumer terms the idea that consumers will favor products that offer the most quality performance and features therefore the organization should devote its energy to making continuous product improvements 16 Production Concept the idea that consumers will favor products that are available and highly affordable therefore the organization should focus on improving production and distribution efficiency 17 Selling Concept the idea that consumers will not buy enough of the firm s products unless the firm undertakes a large scale selling and promotion effort 18 Societal Marketing Concept the idea that a company s marketing decisions should consider consumers wants the company s requirements consumers long run interests and society s long run interests 19 Wants the form human needs take as they are shaped by culture and individual personality Chapter 2 dog question mark the company 1 Boston Consulting Group created the growth share matrix star cash cow 2 Business portfolio the collection of businesses and products that make up 3 Diversification company growth through starting up or acquiring businesses outside the company s current products and markets 4 Divesting to reduce 5 Downsizing reduce size in some way 6 Growth share Matrix a portfolio planning method that evaluates a company s SBU s in terms of market growth rate and relative market share 7 Market Development company growth by identifying and developing new market segments for current company products 8 Market Penetration company growth by increasing sales of current products to current market segments without changing the product 9 Marketing Mix the set of tactical marketing tools product price place promotion that the firm blends to produce the response it wants in the largest market 10 Marketing strategy the marketing logic by which the company hopes to create customer value and achieve profitable customer relationships 11 Mission statement a statement of the organization s purpose what it wants to accomplish in the larger environment 12 Portfolio Analysis the process by which management evaluates the products and businesses that make up the company 13 Product Development company growth by offering modified or new products to current market segments developing the product concept into a physical product to ensure that the product idea can be turned into a workable market offering 14 Product market expansion grid a portfolio planning tool for identifying company growth opportunities through market penetration market development product development or diversification 15 Strategic planning the process of developing and maintaining a strategic fit between the organization s goals and capabilities and its changing marketing opportunities 16 Value delivery network a network composed of the company suppliers distributers and ultimately customers who partner with each other to improve the performance of the entire system in delivering customer value Chapter 3 1 Baby boomers the 78 million people born during the years following WW 2 and lasting until 1964 2 Cultural Environment institutions and other forces that affect society s basic values perceptions preferences and behaviors 3 Demography demographics the study of human populations in terms of size destiny location age gender race occupation and other situations 4 Economic Environment economic factors that affect consumer purchasing power and spending patterns 5 Generation X the 49 million people born between 1965 and 1976 in the birth dearth following the baby boom 6 Macroenvironment the major external and uncontrollable factors that influence an organizations decision making and affect its performance and strategies 7 Marketing environment the actors and forces outside marketing that affect marketing managements ability to build and maintain successful relationships with target customers 8 Marketing Intermediaries firms that help the company to promote sell and distribute its goods to final buyers 9 Microenvironment the actors close to the company that affect its ability to service its customers the company suppliers marketing intermediaries customer markets competitors and publics 10 Millennial Generation Y the 83 million children of the baby boomers born between 1977 and 2000 11 Natural Environment the physical environment and the natural resources that are needed as inputs by marketers or that are affected by marketing activities 12 Political Environment laws government agencies and pressure groups that influence and limit various organizations and individuals in a given society 13 Suppliers a party that supplies goods or services 14 Technological environment external factors in technology that impact business