BUS-M 300 : EXAM 1
124 Cards in this Set
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What is marketing?
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the activity for creating, communicating, delivering, and exchanging offerings that benefit customers, the organization, its stockholders and society at large
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Marketing focuses on ___ and ___ consumer needs
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discovering and satisfying
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what four factors are needed for marketing to occur?
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1) two or more parties with unsatisfied needs
2) desire and ability on their part to have their needs satisfied
3) a way for the parties to communicate
4) something to exchange
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an organization cant satisfy the needs of al consumer so it must focus on one or more subgroups, which are its
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target market
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What are the four marketing mix elements that make up the organizations marketing program? (the four Ps)
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1) product
2) price
3) place
4) place
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what are environmental forces in marketing?
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the uncontrollable forces that affect a marketing decision. They consist of social, economic, technological, competitive, and regulatory forces
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What are the two characteristics between ultimate consumers and organizational buyers?
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1) UC are the people who use the products and services purchased for a household
2) OB are those manufacturers, wholesalers, retailers, and government agencies that buy products and services for their own use or for resale
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What internal groups shape the marketing department and vice versa
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1) senior management
2) research and development department
3) manufacturing department
4) finance department
5) Information Systems department
6) Human Resources department
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What external groups and forces shape the marketing department and vice versa
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1) Other organizations (alliances)
2) suppliers (partnerships)
3) customers (relationships)
4) shareholders (ownership)
5) environmental forces
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How is the marketing department organized?
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through two tasks
1) discover consumer needs through extensive research
2) satisfy those needs by successfully implementing a marketing program possessing the right combination of the marketing mix; the four Ps
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What are the three business functions of customer value creation (CVC)?
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1. Product Development Management
2. Customer Relationship Management
3. Supply Chain Management
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What is product development management (PDM) responsible for?
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1) the design and implementation of new products/services and the management of existing products
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what is customer relationship management responsible for?
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1) customer attraction and retention
2) communication of imformation to customers,
3) the development of customer relationships
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what is supply chain management responsible for?
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1) the selection and management of suppliers, the distribution channel, and channel pricing
2) create customer value
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market orientation
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1) focusing organizational efforts to collect and use information about customers' needs to create customer value
2) creates more brand loyal customers
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Selling concept
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1) focus is on product quality and availability
2) desired outcome is profit via sales
3) a benefit is that the company profits are generated by moving product
4) company doesn't put much value on consumer
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Marketing Concept
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1) customer focused
2) listening and acting on customer needs
3) striving to build long term relationship with the customer
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services marketing
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building sales and profit for a service company like a dry cleaner, a dentist, a lawyer, or an airline
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place marketing
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attracting people to a particular place
ie: Wander Indiana
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idea marketing
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cultivating support for an idea
ie: term limitations, a new interstate, bi-lingual education
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organizational marketing
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cultivating support for an organization:
ie: unions, universities
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event marketing
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building interest in an event like a rock concert or an art
auction.
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person marketing
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building interest in a candidate or a celebrity
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what is consumer behavior?
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actions a person takes in purchasing and using product services
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what are the five stages of the consumer behavior model?
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1) problem recognition: perceiving a need
2) information seek: seeking information
3) alternative evaluation: assessing value
4) purchase decision: buying value
5) post-purchase behavior: realizing value
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correlation between involvement and decision
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as the involvement (or risk) increases, the number of steps followed in the decision making process increases
ie: a car buyer will follow all steps in decision making process because there is a lot of money and time that will be put into their purchase. High risk = high involvement. So…
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evoked set
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brands actually considered during a choice process
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evaluative criteria
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dimensions used during step 2
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consideration set
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group of brands that are considered
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brand-loyalty
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repeated purchasing based on a conscious decision to continue buying a specific brand
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How does an evoked set help consumers?
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It allows them to compare products and make decisions based on their wants and needs
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How does an evoked set help marketers?
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It helps them understand their competitors
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Why are evoked sets important
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It creates brand loyalty
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What two quesions must be answered during a purchasing decision
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1) what to buy?
2) when to buy?
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Why is maslow's heirarchy of needs important
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it helps marketers understand how we buy products and services
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Who are innovators
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1) high educated and more influential consumers
2) thinkers, achievers, experiencers
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who are survivors?
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1) less educated and less influential consumers
2) believers, strivers, makers
3) more brand loyal
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What kind of consumers believe in ideals?
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1) thinkers + believers
2) principal oriented
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What kinds of consumers believe in achievement?
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1) achievement + strivers
2) status oriented
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What kind of consumers believe in self-expression
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1) experiencers + makers
2) action oriented
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Why is VALS psychographic segments important?
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1) It describes how consumers buy based on lifestyle
2) branding is everything except the product and vals help companies brand their product to particular consumers
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Situational influences on consumer decisions
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1) the physical environment (the atmosphere)
2) time: is a consumer time impoverished?
3) antecedent: a consumer's mood or amount of cash on hand
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culture
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the values, beliefs, customs, and tastes valued by a group of people
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subculture
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- group members within a society whose members share a distinctive set of beliefs, characteristics, or experiences
- religious groups
- racial / ethnic groups
- regional groups
- ie: African Americans spend more on children's clothes than any other racial/ethnic culture
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social class
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- refers t the overall rank of people in a society
- measured by: occupation, income, education, & wealth
- common tastes in clothing, decorating styles, & leisure activities
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reference groups
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- people that have a significant effect on an individual's evaluations, aspirations, or behavior
- can cause conformity where a person changes as a reaction to real or imagined group pressure
- some of the strongest pressures come from our gender role
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opinion leader
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- a person who influences others' attitudes or behaviors
- they are valuable sources of information because they are
-knowledgable about a product or category
-first to buy new products
-hold signifcant status in consumer lives
- celebrities are opinion leaders
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risks that concern buyers
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1) performance risk: the brand may break down
2) Financial Risk: the buyer may lose money, pay too much, or miss buying something else
3) Physical risk: the product may be harmful to the user's health, it may cause injury
4) Social risk: friends, relatives, or s/o may not approve of th…
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Ways Marketers reduce risk
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1) guarantees
2) liberal return policies
3) store displays
4) testimonials
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what is the FIRST stage in the consumer purchase decision?
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problem recognition - perceiving a need
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The brands a consumer considers buying out of the set of brands in a product class of which the consumer is aware of is called the ____
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consideration set
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what is the term for post-purchase anxiety?
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cognitive dissonance
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What three attitude change approaches are most common? Change ________. Changes _______, Add _________
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1) beliefs about the extent to which brand has certain attributes
2) the perceived importance of these attributes
3) (add) new attributes to the product
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lifestyle
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a mode of living that is identified by how important people spend their time and resources, what they consider important in the environment, and what they think of themselves and the world around them
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What are two primary forms of personal influence?
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1) opinion leadership
2) word of mouth
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Marketers are concerned with which types of reference groups?
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1) associative groups
2) aspirational groups
3) dissociative groups
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word of mouth
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the influencing of people (friends, family, and colleagues) during conversations
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associative groups
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a group that a person actually belongs to
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aspiration groups
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a group that people wish to be a member of or identify with
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dissociative group
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a group that people wish to maintain a distance from because of difference in values or behaviors
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the main goal of a ___ is to develop and maintain long-term customer relationships
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marketing concept
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A ____ is one or more specific groups or potential consumers toward which an organization directs it's marketing program
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target market
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which of the following do marketers consider to be part of the marketing mix?
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B. place, product, promotion, price
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a type of marketing that is designed to build interest in a candidate or a celebrity is known as _______.
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person marketing
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When a consumer use step 2 (information seek) in decision making process model to make decisions about a frequently purchased product, they are using a(n)
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external search
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You know about many restaurants in Bloomington but you only consider 2-3 options before making your final decision on where to eat out with friends. These 2-3 options are known as your
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evoked set
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A celebrity spokesperson is known as a what?
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opinion leader
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Which of the following is NOT a type of risk that concerns buyers?
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Health risks
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Which segment of the pyramid do marketers focus on?
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self-actualization
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Marketing research
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1) the process of defining a marketing problem and opportunity
2) systematically collecting and analyzing information (data), and recommending actions
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Why conduct marketing research
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1) it is impossible to sell products or services that customers do not want
2) learning what customers want, ad how to present it attractively, drives the need for marketing research.
3) REDUCES RISK FOR THE FIRM
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5 steps to marketing research
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1) define the problem (which can take the longest but is vital for success)
2) develop the research plan
3) collect relevant information
4) develop findings
5) take marketing actions
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Exploratory research
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1) not designed to provide conclusions, but to investigate or explore possible problems or opportunities
2) not looking for an answer, look to understand what is going on
3) often qualitative in nature and can take a variety of forms
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Descriptive research
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1) uses date to describe, show or summarize information about something specific
2) can be used to draw conclusion ONLY about the exact persons in the study
3) they can be used further in inferential statistics to draw "educated guesses" about how a larger population may behave
4) ofte…
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types of exploratory research
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1) consumer interviews
2) ethnography
3) focus groups
4) case studies
5) projective techniques
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types of descriptive research
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1) personal observation: researcher observes traffic counts in a department store
2) unobtrusive measures: a researches examines public records to find information
3) mechanical observation: optical scanners in a grocery store
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causal research
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1) it is experiment based and used to determine an actual cause and effect relationship
ie: observing the effects of an advertisement on brain activity
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Techniques that attempt to understand cause - and- effect relationships
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1) experiments: tests in a controlled environment
2) field studies: test in the "real world"
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three things data must have
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1) validity: did research measure what it intended to measure
2) reliability: are the research techniques free of errors
3) representativeness: is the group measured similar to the population?
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Why was the "New Coke" bomb in the 1980 unsuccessful?
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1) taste test did not produce valid results
2) group represented were not coke drinkers
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random sampling
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1) ensures that bias is not is not introduced into the study
ie: randomly calling participants
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convenience sampling
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1) least expensive & less time consuming
2) surveying students from kirkwood
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quota sampling
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1) dividing samples into categories and studying a select few from each
2) taking 100 freshmen, 100 sophomores, 100 juniors, 100 seniors
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secondary data
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facts and figures already recorded prior to the project
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internal data (inside the firm)
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- inputs (budgets, financial statements, sales call reports)
- outcomes (actual sales and customer communication)
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external data (outside the firm)
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- US census reports
- trade association studies
- business periodicals
- internet-based reports
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What are the subcategories of secondary data
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1) internal data
2) external data
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primary information
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facts and figures newly collected for the project
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what are the sub-types of primary
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1) observational data
2) questionnaire data
3) other sources of data (like social media, panels, and experiments
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observational data
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1) watching people
2) mechanical methods
3) neuro-marketing methods
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questionnaire data
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1) idea generation methods
2) idea evaluation methods
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Benefits of secondary data
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1) low cost
2) less effort expended in process
3) less time taken
4) sometimes more accurate than primary data
5) some information can be obtained ONLY from secondary data
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Limitations to secondary data
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1) may be originally collected for some other purpose
2) not control over data collection
3) may not be reported in required form
4) may not be very accurate or is outdated
5) may not meet data requirements
6) a number of assumptions have been made
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Benefits to primary data
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1) more control over the data collection, thus greater certainty that the information was not poorly collected by others
2) more current to today
3) may be more applicable to a company's specific question
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limitations to primary data
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1) high cost
2) can be inconvenient and time intense in terms of collecting data
3) can be less accurate than secondary, especially if the researcher influenced people who participate in the study
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Marketing Information System
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1) continuously gathers, sorts, analyzes, and distributes relevant and timely marketing information to its managers
2) the goal is to make sense of data
3) marketing information includes internal and external data
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why is important to forecast sale?
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a sales forecast builds the budget for the company
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what are constraints, as they apply to developing a research plan?
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the restrictions placed on potential solutions to a problem, such as time and money. These set the parameters for the research plan - due dates, budget, etc.
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What is the difference between secondary and primary data
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Secondary data are facts and figures that have already been recorded prior to the project at hand, whereas primary data are the facts and figures newly collected for the project
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which type of survey provides the greatest flexibility for asking probing questions: mail, telephone, or personal interview
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personal interview
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what is the difference between a panel and an experiment?
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1) a panel is a sample of consumers or stores from which researchers take a series of measurements.
2) An experiment involves obtaining data by manipulating factors under tightly controlled conditions to test for cause and effect,
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Sales force composite approach
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1) ask sales reps to forecast sales for their area
Advantage: they have their finger on the pulse in the market
disadvantage: they are under pressure to perform well
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Buyer Surveys
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1) ask consumers or firms about their intentions to buy
advantage: find out what consumers are really thinking in the market place
disadvantage: buyer tends to fill out survey's quickly and often not accurate
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Manager Survey
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1) ask the firm's managers to forecast for their area
advantage: they have a macro view of the market or are likely to see trends
disadvantage: they are under pressure to perform well
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Moving Averages Model (MAM)
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1) take past actual sales divides by the number of years
2) APE = (Actual Sales - Forecasted Sales)/(Actual Sales)
3) you need to find APE before
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ESM
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- a(actual sales)+(1- a)(forecasted sales)
- the closer alpha is to one, the more recent the year you need to use
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marketing segmentation
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the process of dividing the total market for a product into several relatively homogeneous groups using factors such as demographics, psychographics, and geography
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segmentation can help increase the effectiveness of
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promotion
- product
- pricing
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to be effective, a segment must meet the following four criteria
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1) measurable
2) reachable
3) profitable
4) relevant
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five steps to segmenting and targeting markets
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1) form potential buyers into segments
2) form products to be sold into groups
3) develop a market product grid and estimated size markets
4) select target markets
5) take marketing action to reach target markets
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Bases for segmentation
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1) geography
2) demographics
3)lifestyle variables: goal is to make emotional and visual links to segment
4) usage segmentation: dividing a population into groups based on purchase frequency and usage level
5) benefit segmentation: dividing a population into groups based on the benefi…
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Why is it important to form products to be sold into groups?
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A firm's products must be grouped into meaningful categories so consumers can relate to them
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What four things need to be considered when a company pick it's target market?
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1) market size
2) expected growth
3) competitive position
4) cost of reaching the segment
5) compatibility with the organization's objective and resources
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undifferentiated marketing or mass marketing
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firms produce only one product or product line and market it in the same manner to all consumers
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differentiated marketing
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a strategy where numerous products are offered to different segments through differential use of the 4Ps.
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concentrated or niche marketing
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a strategy most often used by small firms that directs firm's efforts toward serving an very small segment
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customized or "one to one" marketing
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1) an extreme version of differentiated marketing where the company strives to meet the needs of very small segment by customizing their products or marketing to fits the customers' needs
2) it has arisen due to the availability of more detailed data on customers. Typically only large …
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positioning
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1) the place the product occupies in the consumers' minds relative to competing products
2) it's a perception that may or may not be based on reality. It is designed to achieve a competitive advantage for the product for that segment
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Perception map
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1) it can help a company identify where their product is in relationship to other products
2) it may uncover voids in the market
3) if a company feels its product is being crowded in consumer minds it can reposition the product by identifying new ways consumer can associate with the pro…
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Market segmentation involves aggregating prospective buyers into groups that have two key characteristics. What are they?
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1) share common needs
2) will respond similarly to a marketing action
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In terms of market segments and products, what are the three market segmentation strategies
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1) one product and multiple market segments
2) multiple products and multiple market segments
3) mass customization
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The process of segmenting and targeting markets is bridge between which two marketing activities
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identifying the market needs and executing the marketing program
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What is the difference between demographic and behavioral bases of market segmentation
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1) demographic segmentation is based on some objective physical, measurable, or other defined classification attribute of prospective customers.
2) behavioral segmentation is based on some observable action or attitude by prospective customers -- such as what they buy, what benefits they…
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what are some criteria to decide which segments to choose for targets?
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1) market size
2) expected growth
3) competitive position
4) cost of reaching the segment
5) compatibility with organizations objectives and resources
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Study Guide