MGM 301 1st EditionExam # 1 Study Guide Lectures: 1-13Lecture 1: (August 27th)Creating Customer Relationships and ValueWho are advertising’s top 5 Marketers of the century? What is marketing and customer value? Explain the exchange process.Top 5 “Marketers of the Century”:5. Nike4. Anheuser Bush (Budweiser) 3. Coca-Cola: has the largest brand equity value of the firm minus value of tangible assets (equipment, trucks, etc.)2. McDonald’s: targeted the “tweens” and encouraged them to go there with friends. They attempted to build life-long relationships with their customers. They used transformational advertising, which tried to transform the idea of McDonald’s just being a place to go and get a hamburger and turn it into a place where friends and families gather. They faltered in the ‘80s because of changing social trends. People were realizing the health risks of fast food at this time. They also had a hard time creating new products and store cleanliness began to decline. They made their comeback with “Hamburger University” which increased the quality of the stores and launched new ad campaigns.1. Proctor & Gamble: they use multiple branding (multiple brands and brand names for different products) vs the traditional family branding (using the same name or brand on everything). They also sponsored TV soap operas and spent a ton of money in advertising. They pioneered brand management, which is a strategy of how to run a company. In this, a brand manager is assigned to control one brand and that it is, so you have multiple brand managers. They also had a big Internet presence and have a big commitment to consumer research understanding who your customers are. What is marketing?- Marketing is the activity of creating, communication, delivering, and exchanging offerings that benefit the organization, its stakeholders, and society at large. In order to do this, you must discover the needs and wants of prospective buyers in order to satisfy them. o A need occurs when a person feels deprived of basic necessities such as food, clothing, and sheltero A want is a need that is shaped by a person’s knowledge, culture, and personality- Customer Value: o The unique combinations of benefits received by targeted buyers that includes quality, price, convenience, on-time delivery and both before-sale and after-sale service at a specific price.o Since a firm cannot be all things to all people, many decide to deliver outstanding customer value with one of three value strategies: best price, best product, or best serviceThe Exchange Process:o Exchange is the trade of things of value between buyers and sellers so that each is better off after the trade.o Diminishing marginal utility is the idea that when the value of something begins to decrease,you make a trade so that you can end up better off.o Ex: If a person is really hungry, the value of a hamburger is really high to them. After the first one you eat, the value is still relatively high, but not as high because you have already consumed one. As you continue to eat more, the value tends to flatten out and your marginal utility tends to decrease, so you may want to trade your hamburger for a soda, which would make you better off. Lecture 2 (September 3rd) What is the marketing mix? What is a marketing program and STP marketing? Explain the evolution of market orientation.What is the marketing mix?- Company must develop a complete marketing program to reach consumers by using a combination of 4 elements:o Product: a good, service, or idea to satisfy the consumer’s needso Price: what is exchanged for the producto Promotion: a means of communication between the seller and buyero Place: a means of getting the product to the consumer- All elements of the Marketing Mix- these are the 4 controllable factors that can be used by the marketing manager to solve a marketing problem- Environmental factors- the factors marketing managers cannot control which consist of social, economic, technological, competitive, and regulatory forces. These may serve as brakes or accelerators on marketing, sometimes expanding an organization’s marketing opportunities and at other times restricting them.What is a marketing program?-Marketing program- a plan that integrates the marketing mix to provide a good, service, or idea to prospective buyers- Also make note of market share, which is the ratio of sales revenue of the firm to the total sales revenue of all firms in the industry, including the firm itself. What is STP Marketing?- Segmentation: relatively homogenous groups of prospective buyers that have commonneeds and will respond similarly to marketing action- Targeting- PositioningThe Evolution of the Market Orientation-Production era- the early years of the US up until the 1920s; good were scarce and buyers were willing to accept virtually any goods that were available and make do with them -Sales era- 1920s to 1960s; manufacturers found they could produce more goods than buyers could consume and competition grew-Marketing concept era- the idea that an organization should strive to satisfy the needs of consumers while also trying to achieve the organization’s goalso Marketing orientation- focusing efforts on continuously collecting information about customers’ needs, sharing this information across departments, and using it to create customer value-Customer relationship era- 1980s-present; advent of social networking to connect companies with their customerso Customer relationship marketing- the process of identifying prospective buyers, understanding them intimately, and developing favorable long-term perceptions of the organization and its offerings so that buyers will choose them in the marketplaceo Customer experience- the internal response that customers have to all aspects of an organization and its