Marketing 3343 > Murdock > Flashcards > Final Exam - Spring 2011

marketing

-the activity for creating, communicating, delivering, & exchanging offerings that benefit an organization, it's stakeholders, & society at large.

what does marketing create?

the awareness & perception of value for a product or service so that someone has the desire to acquire it.

4 things required for marketing to occur:

-2 or more parties w. unsatisfied needs

-a desire & ability to be satisfied

-a way for the parties to communicate

-something to exchange

target market

one or more specific groups of potential customers towards which an organization directs its marketing program

relationship marketing

hallmark of developing & maintaining effective customer relationships linking the organization to its individual customers, employees, suppliers, & other partners for their mutual long-term benefits.

customer value

the unique combination of benefits recieved by the targeted buyers that includes quality, convenience, on-time delivery, & both before-sale & after-sales service at a specific price.

The four P's that create customer value :

-product

-price

-promotion

-place

organization

legal entity of people who share a common mission

an organization's core values :

are the fundamental, passionate, & enduring principles that guide its conduct over time. they capture the firms heart & soul & serve to inspire its stakeholders.

mission

the statement of the organizations function in society, often identifying its cutomers, markets, products, & technologies

organizational culture

the set of values, ideas, attitudes, & norms of behavior that is learned & shared among the members of an organization

business

-describes the clear, broad, underlying industry or market sector of an organization's offerings.

-an organization looks at a set of organizations that sell similar business offerings--those in direct competition w. each other(ice cream business)

goals

statements of accomplishment of a task to be achieved, often by a specific time.

strategic marketing process

-an organization allocates its marketing mix resources to reach its target markets.

-planning

-implementation

-evaluation

SWOT analysis

-used to identify trends, analyze competitors, assess the organization itself, & research & present the prospective customers.
-strengths, opportunites, weaknesses, threats

SWOT analysis

taking stock of where the firm or product has been recently, where it is now, & where it is headed in terms of the organizations marketing plans & the external forces & trends affecting it.

environmental scanning

the process of continually requiring information on events occurring outside the organization to identify & interpret potential trends

-social

-economic

-technological

-competitive

-regulatory

multicultural marketing programs

-combinations of the marketing mix that reflect the unique attitudes, ancestry,communication preferences, & lifestyles of different races.

-in depth marketing research that allows an accurate understanding of each culture is essential

gross income

the total amount of money made in one year by a person, household, or family unit

disposable income

the money a consumer has left after paying taxes, to use for necessities such as food, housing, clothing, & transportation.

discretionary income

the money that remains after paying for taxes & necessities

competition

refers to the alternate firms that could provide a product to satisfy a specific market's needs.

pure competition

-large number of sellers

-similar products

-place is important

monopolistic competition

-large number of sellers

-unique but sbstitutable products

-pricing is important

oligopoly

-a few large competitors

-similar products

-promotion is key to achieve perceived product differentiation

monopoly

-single producer

-unique & unsubstitutable

-marketing mix is unimportant

regulation

consists of restrictions state & federal laws place on businesses w. regard to the conduct of their activities.

-exists to protect companies as well as consumers.

-ensures competition & fair business practices

for consumers, the focus of legislation is:

to protect them from unfair trade practices & ensure their safety

ethics

the moral principles & values that govern the actions & decisions of an individual or groups.

laws

society's values & standards which are enforceable in courts

four ways to classify marketing decisions according to ethical & legal relationships:

-ethical but illegal (insider trading)

-ethical & legal (company recall)

-unethical & illegal (limited disclosure)

-unethical but legal (telelmarketing)

factors that influence ethical marketing decisions

-societal culture & norms: ex-materialism vs. relationships

-business culture & industry practices: ex-bribes in eastern europe)

-corporate culture & expectation: ex-dress code changes

business culture

comprise the effective ruiles of the game, the boundaries between competitive & unethical behavior, & the codes of conduct in business dealings

corporate culture

set of values, ideas, & attitudes that is learned & shared among members of an organization

moral idealism

considers certain individual rights or duties as universal, regardless of the outcome

utalitarianism

focuses on the greatest good for the greatest number by assessing the costs & benefits of the consequences of ethical behavior

social responsibility

organizations are a part of a larger society & are accountable to that society for their actions

three componants of social responsibility:

-profit responsibility

-stakeholder responsibility

-societal responsibility

profit responsibility

companies have a simple duty; to maximize profits for their owners & stakeholders

stakeholder responsibility

focuses on the obligations an organization has to those who can effect the achievment of it's objectives (employees)

societal responsibility

obligations that organizations have to the preservation of the ecological environment & to the general public.

green marketing

efforts to produce, promote, & reclaim environmentally sensitive products

cause marketing

occurs when the charitable contributions of a firm are tied directly to the revenues produced through the promotion of one of its products (yoplait & breast cancer)

5 stages in the purchase decision process:

-problem recognition

-information search

-alternative evaluation

-purchase decision

-postpurchase behavior

problem recognition

perceiving a difference beetween a persons actual & ideal situations big enough to trigger a decision; perceiving a need

information search

internal & external search for information, data, or value in making a decision

alternative evaluation

assessing & comparing value

purchase decision

buying value

postpurchase decision

value in consumption or use; cognitive dissonance

extended problem solving

-each of the 5 purchase decision stages is used including considerable time & effort in the external information search

-exists in high-involvement purchase decisions (car)

limited problem solving

-consumers typically seek some information or rely on a friend to help them evaluate alternatives

-purchase situations in which the customer has little time or effort to spend

-(toaster, going to the movies)

routine problem solving

-little effort seeking external information & evaluating alternatives

-low priced, frequently purchased items

-(milk, toothpaste, bread)

organizational buyers

-manufacturers, wholesalers, retailers, & government agencies that buy goods & services for their own use or for resale.

-buying objectives vary depending on the type of organization & its purpose.

-industrial

-reseller

-government

industrial firms

-reprocess a product or service they buy before selling it again to the next buyer

-(bakery)

resellers

-wholesalers & retailers that buy physical products & resell them again without any reprocessing

-(grocery store)

government units

the federal, state, & local agencies that buy goods & services for the constituents they serve.

new buy

the organization is a first-time buyer of the product

straight re-buy

a reorder of an existing product or service from the list of acceptable suppliers

modified re-buy

involves a change in the product specifications, price, delivery schedule, or supplier. (reorder in a new size)

values

personally or socially preferable modes of conduct or states of existence that tend to persist over time

customs

what is considered normal & expected about the way people do things in a specific country

cultural symbols

-things that represent ideas & concepts

-play an important role in cross-cultural analysis because different cultures attach different meanings to things

cross-cultural analysis

the study of similarities & differences among consumers in one or more nations or societies

semiotics

field of study that examines the correspondance between symbols & their roles in the assignment of meaning for people

cultural ethnocentricity

-belief that one's culture is superior to anothers

-impediment to global marketing

organizations typically enter the market in one of four ways:

-exporting

-licensing

-joint venture

-direct investment

exporting

-producing goods in 1 country & selling them in another

-allows a company to make the least # of changes in terms of its product, organization, & even its corporate goals

-provides less local employment for host countries (downside)

licensing

-a company offers the right to a trademark, patent, trade secret, or other similarly valued items of intellectual property in return for a royalty or fee.

-franchising is a form of this

joint venture

when a foreign company & a local firm invest together to create a local business

direct investment

-entails a domestic firm actually investing in & owning a foreign subsidiary or division

-biggest commitment a company can make when entering the global market

secondary data

-facts & figures that have already been recorded before the project at hand

-internal & external

primary data

facts & figures that are newly collected for the project

-observational

-questionaire

experiments

observational data

facts & figures obtained by watching, either mechanically or in person, how people actually behave

questioniare data

facts & figures obtained by asking people about their attitudes, awareness, intentions & behaviors

market segmentation

aggregating prospective buyers into groups that have common needs & will respond similarly to a marketing action

product differentiation

involves a firm using different marketing mix activities, such as product features & advertising, to help consumers perceive the product as being different & better than the competing products

1 product & multiple market segments

when a company produces only a single product or service & attempts to sell it to 2 or more markets (magazines)

multiple products & multiple market segments

companies produce different lines of a product each targeted to a different market. -(two-tier marketing strategy)

"segments of one" or mass customization

tailoring goods or services to the tastes of individual customers on a high volume scale

geographic segmentation

segmentation based on where prospective customers live or work.

demographics segmentation

segmentation based on some objective physical, measurable, or other classification attribute of prospective buyers.

psychographic segmentation

segmentation based on some subjective mental of emotional attributes, aspirations, or needs of prospective buyers.

behavioral segmentation

segmentation based on some observable actions or attitudes by prospective customers, such as where they buy, what benefits they seek, how frequently they buy, and why they buy.

product positioning

the place a product occupies in consumers minds on important attributes relative to competitive products

product repositioning

changing the place a product occupies in a consumers mind relative to competitive products

head-to-head positioning

involves competing directly with competitors on similar product attributes in the same target market

differentiation positioning

-involves seeking a less competitive, smaller market niche in which to locate a brand.

-reduces cannibalization

product

good, service, or idea consisting of a bundle of tangible & intangible attributes that a seller needs & is received in exchange for money or something else of value

product item

specific product that has a unique brand, size or price

product line

group of product or service items that are closley related because they sitisfy a class of needs, are used together, are sold to the same customer group, are distributed through the same outlets, or fall within a given price range.

product mix

consists of all the product lines offered by an organization

consumer products

products purchased by the ultimate consumer

business products

products purchased by organizations to assist in providing other products for resale.

4 types of consumer products:

-convenience products

-shopping products

-specialty products

-unsought products

convenience products

items that the consumer purchases frequently, conveniently, & with a minimum of shopping effort

shopping products

items for which the consumer compares several alternatives on criteria such as price, quality, or style.

specialty products

items that the consumer makes a special effort to search out & buy

unsought products

items that the consumer does not know about or knows about but does not initially want

2 kinds of business products:

-components

-support products

components

items that become a part of the final product

support products

-items used to assist in producing other goods & services

-includes installations, accessory equipment, & industrial services

successful new product launches must have :

-a precise protocol

-significant points of difference

-good timing

-satisfaction of consumer needs

-market attractiveness

-high product quality

-skilled execution of the marketing mix

-economic access to buyers

four stages of the product life cycle

-introduction

-growth

-maturity

-decline

introduction stage of product life cycle

-sales grow slowly

-minimal profits

-marketing objective is to gain awareness

growth stage of product life cycle

-rapid increases in sales

-competition appears

-profit peaks

-changes appear

-marketing objective is to stress differentiation

maturity stage of product life cycle

-sales slow

-competitors begin to leave

-marketing objective is to maintain brand loyalty

decline stage of product life cycle

-sales drop

-marketing objective is harvesting or deletion

diffusion of innovation

-concept explaining that a product diffuses, or spreads through a population.

-not all consumers rush out to buy a product in the introductory stage.

-the life cycle curve indicates most sales occur after a product has been on the market for some time.

branding

a marketing decision in which an organization uses a name, design, phrase, symbols, or combination of these to identify its products & distinguish them from those of competitors

brand name

any word, device, or combination of these used to distinguish a seller's goods & services

trade name

a commercial, legal name under which a company does business

brand equity

the added value a brand name gives to a product beyond the functional benefits provided

brand personality

a set of human characteristics associated with a brand name

brand licensing

a contractual agreement whereby one company (licensor) allows its brand name or trademark to be used with products or services offered by another company (licensee) for a royalty fee.

multi-product branding strategy

branding strategy in which a company uses one name for all its products in a product class

multi-branding strategy

branding strategy in which a company gives each product a distinct name

private branding strategy

branding strategy in which a company manufactures products but sells them under the brand name of the wholesaler or retailer

the 4 I's of services

-intangibility

-inconsistency

-inseparability

-inventory

break-even analysis

technique that analyzes the relationship between total revenue & total cost to determine profitability at various levels of output

break even point

occurs when total revenue & total cost are equal

= (FC) / (P - UVC)

pricing approaches

-demand oriented

-cost oriented

-profit oriented

-competition oriented

skimming pricing

setting the highest initial price

penetration

setting a low initial price

prestige pricing

setting a high price so that the quality or status-conscious customers will be attracted to the product & buy it

price lining

a firm prices a line of products at a number of different price points

odd-even pricing

setting prices a few dollars or cents under an even number

target pricing

estimate price that the ultimate consumer will be willing to pay, then work backward through markups to determine what price they can charge wholesalers for the product

bundle pricing

the marketing of two or more products in a single package price

yield management pricing

charging different prices to maximize revenue for a set amount of capacity at any given time

standard markup pricing

adding a fixed percentage to the cost of all items in a specific product class (high volume products usually have smaller markups)

cost plus pricing

-summing the total unit cost of providing a product or service & adding a specific amount, such as a percentage of cost or fixed fees, to arrive at the final price

-most common for business products

experience curve pricing

holds that the unit cost of many products & services declines by by 10-30% each time a firm's experience at producing & selling them doubles

target profit pricing

firm sets an annual target of a specific dollar volume of profit

customary pricing

used for some products where tradition, a standardized channel of distribution, or other competitive factors dictate the price (vending machines)

above-at-or below market pricing

marketers will deliberately choose one of these strategies to price a product when they have a subjective feel for the competitors' or markets' price

loss-leader pricing

deliberately selling a product below the customary price to attract attention to it; tries to attract customers so they will buy the other products as well

marketing channel

individuals & firms involved in the process of making a product or service available for use or consumption by consumers or industrial users

indirect marketing channel

involves the use of intermediaries who perform 3 special functions:

-transactional

-logistical

-facilitating

transactional functions

intermediary function that includes buying, selling, & risk taking

logistical functions

intermediary function that includes assorting, storing, sorting, & transporting

facilitating function

intermediary function that involves financing, grading, & marketing information/research

supply chain

a sequence of firms that perform activities to create & deliver a product or service to the ultimate consumers or industrial users

supply chain management

the integration & organization of information & logistics activities across firms in a supply chain for the purpose of creating & delivering products & services that provide value to the ultimate consumer

logistics

involves those activities that focus on getting the right amount of products to the right place at the right time at the lowest possible cost

logistics management

the practice of organizing the cost-effective flow of raw materials, in-process inventory, finished goods, & related information from the point of origin to point of consumption to satisfy customer requirements

4 key logistics functions in a supply chain:

-transportation

-warehousing & materials handling

-order processing

-inventory management

Final Exam - Spring 2011

Marketing 3343 with Murdock at Texas State University-San Marcos

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