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MKT 230: EXAM 1
Marketing |
The process of creating, distributing, promoting, and pricing goods, services, and ideas to facilitate satisfying exchange relationships with customers and develop and maintain favorable relationships with stakeholders in a dynamic environment. |
Marketing Mix |
Four Marketing elements-products, distribution, promotion, and pricing- that a firm can control to meet the needs of customers within its target markets |
Role of each mix variable |
-Product: Good service or idea
-Price: decisions that establish pricing objectives and policies
-Distribution: Make sure products are available in quantities desired.
- minimize costs: inventory & transportation & storage
-maintain inventory control
-create supplier system & manage transportation and storage systems
-Promotion: informing individuals/ groups about the organization and its products |
Focus of Marketing |
-Customers. |
Marketing Environment Force |
- 6 Forces: Economic, Political, Legal / regulatory, Technological, Socio-cultural, competitive |
Marketing Concept |
is a philosophy that an organization should try to provide products that satisfy customers’ needs through a coordinated set of activities that also allows the organization to achieve its goals. |
Value |
A customer’s subjective assessment of benefits relative to cost in determining the worth of a product. |
Marketing Management |
is the process of planning, organizing, implementing, and controlling marketing activities to facilitate exchanges effectively and efficiently. |
Strategic Planning |
is the process of establishing an organizational mission and formulating goals, corporate strategy, marketing objectives, marketing strategy, and marketing plan. |
Marketing Strategy |
is a plan of action for identifying and analyzing a target market and developing a marketing mix to meet the needs of that market. |
Marketing Plan |
is a written document that specifies the activities to be performed to implement and control the organization’s marketing activities. |
Marketing Planning |
The systematic process of assessing marketing opportunities and resources, determining marketing objectives, defining marketing strategies, and establishing guidelines for implementation and control of the marketing program. |
Marketing Objective |
is a statement of what is to be accomplished through marketing activities. |
Market Opportunities |
is a combination of circumstances and timing that permits an organization to take action to reach a particular target market.
|
Target Market Selection |
Most important decision a company makes in the strategic planning process.
· Decision is made by marketing managers
· It could make or break company |
Competitive Advantage |
is the result of a company matching a core competency to opportunities it has discovered in the marketplace. |
SWOT Analysis |
is an assessment of an organization’s strengths, weaknesses, opportunities, and threats. |
Customers |
are the purchasers of organizations’ products; the focal point of all marketing elements. |
External vs. Internal |
External Customers: The individuals who patronize a business
o The familiar definition of “customers”
· Internal Customers: The company’s employees
o For implementation to succeed, the needs of both groups of customers must be met |
CRM Customer Relationship Management |
-using information about customers to create marketing strategies that develop and sustain desirable customer relationships
· Involves gathering useful data at customer-contact points and analyzing it to better understand customers’ needs, desires and habits
· Requires a shift in thinking away from share of market to share of customer |
Customer Focus |
is focusing on share of customer requires recognizing that all customers have different needs and that not all customers weigh the value of a company equally.
· 80/20 rule- 80 percent of business profits come from 20 percent of customers |
Core competencies |
Things a company does extremely well, which sometimes give it an advantage over its competition |
Market |
is a group of individuals and/or organizations that have needs for products in a product class and have the ability, willingness, and authority to purchase those products. |
Market control factors/challenges
|
Information is required to control marketing activities is often unavailable or at a high cost.
· Time lag between marketing activities makes it hard to measure effectiveness. |
Environmental Scanning |
is the process of collecting information about forces in the marketing environment. |
Approaches to Environmental Forces |
1. Passive- is accepting as uncontrollable
2. Proactive- is attempting to influence/shape them) |
Competition |
Other organizations that market products that are similar to or can be substituted for a marketer's products in the same geographic area |
Brand Competitors |
Firms that market products with similar features and benefits to the same customers at similar prices |
Product Competitors |
Firms that compete in the same product class but market products with different features, benefits, and prices |
Generic Competitors |
Firms that provide very different products that solve the same problem or satisfy the same basic customer need |
Types of competition |
Monopoly
Oligopoly
Monopolistic Competition
Pure Competition |
Monopoly |
A competitive structure in which an organization offers a product that has no close substitutes, making that organization the sole source of supply |
Oligopoly |
A competitive structure in which a few sellers control the supply of a large proportion of a product |
Monopolistic Competition |
A competitive structure in which a firm has many potential competitors and tries to develop a marketing strategy to differentiate its product
|
Pure Competition |
A market structure characterized by an extremely large number of sellers, none strong enough to significantly influence price or supply |
Business Cycle Stages (4 Stages) |
A pattern of economic fluctuations that has four stages: prosperity, recession, depression, and recovery |
Prosperity |
A stage of the business cycle characterized by low unemployment and relatively high total income, which together ensure high buying power (provided the inflation rate stays low) |
Recession |
A stage of the business cycle during which unemployment rises and total buying power declines, stifling both consumer and business spending |
Depression |
A stage of the business cycle when unemployment is extremely high, wages are very low, total disposable income is at a minimum, and consumers lack confidence in the economy |
Recovery |
A stage of the business cycle in which the economy moves from recession or depression toward prosperity |
Disposable Income |
After-tax income |
Discretionary Income |
Disposable income available for spending and saving after an individual has purchased the basic necessities of food, clothing, and shelter |
FTC |
(Federal Trade Commission)-An agency that regulates a variety of business practices and curbs false advertising, misleading pricing, and deceptive packaging and labeling |
FDA |
Food and Drug Administration |
EPA |
Environmental Protection Agency |
Self-Regulation |
In an attempt to be good corporate citizens and prevent government intervention, some businesses try to regulate themselves. Though these programs are not a direct outgrowth of laws, many were established to stop or stall the development of laws and governmental regulatory groups that would regulate the associations' marketing practices. |
Impact of Technology |
Impact of TechnologyThe application of knowledge and tools to solve problems and perform tasks more efficiently
• Impacts of technology:
o Dynamic change
o Ability to reach customers
o Self-sustaining in nature; spurs more development
• Rapid technological growth and change are expected to continue |
Demographic-Diversity Trends |
Changes in a population’s demographic characteristics lead to changes in how people live and consume products
o Increasing market of retired Baby Boomers
o Generation Y
o Growing Hispanic/Latino market in the U.S.
· A more diverse customer base means marketing practices must be modified and diversified to meet changing needs |
Social Responsibility |
An organization's obligation to maximize its positive impact and minimize its negative impact on society |
Social Responsibility Types |
Economic
Legal
Ethical
Philanthropic |
Economic (Social Responsibility) |
-Be Profitable
The foundation upon which all others rest |
Legal (Social Responsibility) |
-Obey the Law
Law is society's codification of right and wrong
Play by the rules of the game |
Ethical (Social Responsibility) |
-Be Ethical
Obligation to do what is right, just and fair
Avoid Harm |
Philanthropic (Social Responsibility) |
-Be a good corporate citizen
Contribute resources to the community; improve quality of life |
Corporate Philanthropy Types |
Cause-Related Marketing
Strategic Philanthropy |
Cause-Related Marketing |
is the practice of linking products to a particular social cause on an ongoing or short-term basis. |
Strategic Philanthropy |
is the synergistic use of organizational core competencies and resources to address key stakeholders’ interest and achieve both organization and social benefits. |
Social Responsibility Issues |
Sustainability
Green Marketing |
Sustainability |
is the potential for the long-term well-being of the natural environment, including all biological entities, as well as the interaction among nature and individuals, organizations and business strategies. |
Green Marketing |
is a strategic process involving stakeholder assessment to create meaningful long-term relationships with customers while maintaining, supporting and enhancing the natural environment. |
Community Relations |
is Individual communities expect marketers to make philanthropic contributions to civic projects and institutions and to be “good corporate citizens.” |
Marketing Ethics |
is principles and standards that define acceptable marketing conduct as determined by various stakeholders.
• The most basic of these standards have been codified into laws
|
Codes of Conduct |
are formalized rules and standards that describe what the company expects of its employees. |
Market Research |
The systematic design, collection, interpretation and reporting of information to help marketers solve specific marketing problems or take advantage of marketing opportunities |
Market Research Importance/ Benefits |
• Facilitates strategic planning
• Assesses opportunities/threats
• Ascertains potential for success
• Helps determine feasibility of a strategy
• Improves marketer’s ability to make decisions
|
Market Research Process / Steps |
1. Locating and defining issues or problems
2. Designing the research project
3. Collecting data
4. Interpreting research findings
5. Reporting research findings
|
Market Research Validity |
is a condition existing when a research method measures what it is supposed to measure |
Market Research Reliability |
is a condition existing when a research technique produces almost identical results in repeated trials |
Market Research Sampling Formats |
• Probability Sampling
• Non-probability Sampling |
Probability Sampling |
is sampling technique in which every element in the population being studied has a known chance of being selected for study
o Random Sampling
o Stratified Sampling
|
Random Sampling |
- A type of probability sampling in which all units in a population have an equal chance of appearing in a sample
|
Stratified Sampling |
- A type of probability sampling in which the population is divided into groups according to a common attribute; a random sample is then chosen within each group |
Non-probability Sampling |
- Sampling technique in which there is no way to calculate the likelihood that a specific element of the population being studied will be chosen
o Quota Sampling |
Quota Sampling |
- A sampling technique in which researchers divide the population into groups and then arbitrarily choose participants from each group |
Market Research Data Types / Sources |
• Primary Data
• Secondary Data |
Primary Data |
- Is observed, recorded, or collected directly from respondents and collected to address a specific problem that cannot be answered by secondary data alone
o Population
o Sample
o Sampling |
Population |
- is all the elements, units, or individuals of interest to researchers for a specific study |
Sampling |
- is the process of selecting representative units from a total population |
Sample |
- is a limited number of units chosen to represent the characteristics of the population |
Secondary Data |
- Is compiled both inside and outside the organization and for some purpose other than the current investigation
o Government sources
o Trade Associations and Shows
o Magazines, Newspapers, Video, Audio News Programming
o Corporate Information
|
Market Research Survey Types |
• Mail
• Telephone
• Online
• Personal Interview Surveys |
Mail Survey |
o Respondents answer questionnaires through the mail
|
Telephone Survey |
o Respondents’ answers are recorded by interviewer on the phone |
Online Survey |
o Respondents answer questionnaire via e-mail or website
o Crowdsourcing calls for taking tasks usually performed by a marketer or researcher and outsourcing them to a potential market through an open call for ideas
|
Personal Interview Surveys |
o Participants respond to survey questions face-to-face |
Marketing Information Systems |
is a framework for managing and structuring information gathered regularly from sources inside and outside the organization. |
Marketing Information Systems Purpose |
Is to provide a continuous flow of information about prices, advertising expense, sales, competition, and distribution expenses. |
Marketing Information Systems Importance |
- its provides important information for a company in an increasingly competitive market. |
Corporate Culture; Executive Leadership |
The interaction between _____ and _____ helps determine the ethical value system of the firm. |
Individual Factors |
When Shawna attempts to resolve ethical conflicts in her daily life, she bases her decisions on her own values. This influence on the ethical decision-making process is called-
individual factors.
|
Strategic Philanthropy |
A synergistic use of businesses' core competencies to address stakeholders' interests and achieve both organizational and social benefits is known as
|
Ethical responsibility |
Silk Soymilk's use of organic, non-genetically modified soybeans in its organic soy milk products is an example of |
Forming a hypothesis |
Research design means developing a plan for obtaining the necessary market information. When a researcher forms an informed guess or assumption about a certain problem, he or she is |
Defining the problem or research issue |
The first step in the marketing research process is |
Stratified |
When a population is divided into distinct groups based on some particular characteristic and a probability sample is taken from each group, this exemplifies _________ sampling. |
Online Databases |
External sources of secondary data include trade associations, periodicals, government publications, unpublished sources, and
b. focus groups.
c. exploratory research.
d. personal interviews.
e. experimental research.
f. online databases. |
Widespread throughout business and nonprofit organizations |
The use of marketing research is
a) limited strictly to large corporations.
b) limited to for-profit businesses of all sizes.
c) controlled by the federal government.
d) widespread throughout business and nonprofit organizations.
e) carefully monitored by each state's trade agencies. |
target market |
Coca-Cola is aiming its Diet Coke Plus (with vitamins and minerals) at health-conscious customers. These health-conscious customers represent Coke's
a. audience.
b. sales alternative.
c. business group.
d. target market.
e. focus group. |
Information |
Customer relationship management (CRM) focuses on using _______ about customers to create marketing strategies that develop and sustain desirable customer relationships.
a. internal communication
b. information
c. purchasing power insights
d. marketing mix knowledge
e. implementation knowledge
|
Relationship marketing |
Marketers use the term “_________” to describe establishing long-term, mutually satisfying buyer-seller relationships.
a. relationship marketing
b. customer service
c. marketing management
d. exchange
e. utility |
Organizing |
Developing the internal structure of a firm's marketing unit relates to which of the following marketing management activities?
a. Marketing control
b. Implementation
c. Organizing
d. Planning
e. Managing
|
Mission statement |
A long-term view, or vision, of what an organization wants to become is called
a. vision statement.
b. purpose statement.
c. mission statement.
d. marketing plan.
e. strategic vision. |
Internal Marketing |
______ refers to the coordination of internal exchanges between the organization and its employees to better achieve successful external exchanges between the organization and its customers.
a. Internal management
b. Internal leadership
c. Empowerment
d. Internal marketing
e. Total quality management
|
Dogs |
Products that have a relatively low market share and low prospects for growth are considered by the Boston Consulting Group to be
a. dogs.
b. cash cows.
c. stars.
d. cash contributors.
e. question marks. |
Environmental Scanning and Analysis |
To monitor changes in the marketing environment effectively, marketers must engage in
a) environmental scanning and analysis.
b) economic scanning
c) self-regulatory analysis
d) marketing research analysis
e) information collecting
|
Dynamics |
The rapid adoption of the use of the Internet has resulted in rapid changes such as the increase of distance learning. These effects of technology are collectively known as |
Brand |
Although all types of competition will affect Specialty Motors' marketing performance, it will be most concerned about _____ competitors. |
Collecting; Assessing |
Environmental scanning means ___________ information about the marketing environment, whereas environmental analysis is concerned with ___________ this information.
a. assessing; collecting
b. assessing; interpreting
c. collecting; assessing
d. interpreting; observing
e. gathering; observing |