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· Emphasis on satisfying broader needs of society (employees, stockholders, etc.) This is like market orientation but there is a little something more.
· Works best in a seller’s market when demand is greater than supply because it focuses on the most efficient ways to product and distribute products.
· Marketing didn’t play large role during production era because not a lot of competition was out there. Example) ford and model T cars
· Means that management views marketing as a sales function, or a way to move products out of warehouses so that inventories don’t pile up.
o Gained popularity during war
o Moved from production to sales era during great depression.
· Focus is on competitor intelligence. Learning and reacting to what the competition is doing.
· Satisfies customers needs and wants
· A management tool for evaluating a firm’s business mix and assessing the potential of an organization’s strategic business units.
· Helps management decide which of its current SBUs should receive more-or less-of the firm’s resources, and which of its SBUs are most consistent with the frim’s overall mission.
o SBUs with products that have a dominant market share in high-growth markets.
o Example.) Disney and pixar
o SBUs with a dominant market share in a low-growth-potential marketExample.) Disney theme parks
o SBUs with low market shares in fast-growth markets.
o Disney stores
o Small share of a slow growth market
o Disney and Miramax
· Product life cycle
§ Introducing a product. See a market need. Starts at low market share. Consistent with question mark.
§ Cash cow
o Advantages: respondents feel anonymous, low cost, good for ongoing research
o Disadvantage: long time to be returned, low rate of responses, inflexible, length, unclear if resondents understand question, unlclear who is responding
o Advantages: fast, high flexibility, limited interview follow up
o Disadvantage: misunderstanding, limited length, cant view material, cant survey houses without phones, screening called, do not call list
o Advantages: flexibility, long, help respondents understand question, take lots of time, use visuals
o Disadvantages: high cost, bias
§ Instantaneous collection, flexible, low cost, no bias, no restrictions, visuals
· Unclear who is responding, honesty, length, understanding question
· Process in which analysts sift through data to identify unique patterns of behavior among different customer groups.
· Analysts combine different databases to understand relationships among buying decisions, exposure to marketing messages, and in-store promotions.
· Undifferentiated targeting strategy
o Appealing to a broad spectrum of people
o Cheaper to develop one product or one advertising campaign than to choose several targets and create separate products or messages for each.
o Developing one or more products for each of several distinct customer groups and making sure these offerings are kept separate in the marketplace.
o Example.) Car brands that have different cars to cater to different markets (performance, luxury, gas friendly)
o Focusing a firm’s efforts on offering one or more products to a single segment.Example.) blacksocks.com sells only black socks to business men who need attire
o common in industrial contexts where a manufacturer often works with one or a few large clients and develops products that only these clients will use.
Decision making process
1. Problem Recognition
2. Information search
3. Evaluation of alternatives
4. Product choice
5. Post purchase evaluation
o Consumers do some work to make a decision but not a great deal. Example. Running shoes
o Low effort, such as deciding to purchase a box of cereal
o You don’t have any choice at all (need gas but one gas station)
· person who influences others’ attitudes or behaviors because they believe that he possesses expertise about the product
· existing S-R relationship “generalizes” to a new (similar) stimulus
o E.g., family brands and product-line extensions
o Companies do this so consumers will get the same positive reaction
o Dr. pepper and pip
· Split brain theory
· -Right and left sides of the brain specialize in the types of information we process
-Right - nonverbal, creative
-Left – rational
o Routine purchase ofitems that a B2B customer regularly needs.
o The buyer has purchased the same items many times before and routinely reorders them when supplies are low, often from the same suppliers.
o Example.) starbuck’s coffee cups
o Occurs when a firm decides to shop around for suppliers with better prices, quality, or delivery times.Used by business buyers to categorize a previous purchase that involves some change and that requires limited decision making
o urchase that is complex or risky and that requires extensive decision making.
· A practice in which firms outsource marketing activities (such as selecting an ad) to a community in users
· Example.) Lays flavor contest
· The business buying process of obtaining outside vendors to provide goods or services that otherwise might be supplied in-house
· Anything tangible/intangible that, through exchange process, satisfies consumer/business customer needs.You want to create products that provide benefits sought by consumers. Products are viewed by marketers as bundle of attributes that includes packaging, brand name, benefits, and features
o High involvement
o Long term benefits (cars, appliances)
o Low involvement
o Short term benefits (newspaper, food)
o Frequently purchased, little effort
o Low priced
o Time effort in selection
o Moderately brand loyal
o Comparison shop
o Limited problem solving
o Clothing, appliances, services
o Goods or services for which a consumer has little awareness or interest until a need arises
o Example.) retirement plans for college students
· Process by which a consumer or business customer begins to buy and use a new good, service, or idea.
o Make up the first 2.5 percent of adopters
o First segment of population to adopt a new product
o 13.5 percent of adopters
o those who adopt an innovation early in the diffusion process, but after the innovators
o those whose adoption of a new product signals a general acceptance of the innovation
o 16 percent of adopters
o last consumers to adopt a product
o he adopters who are willing to try new products when there is little or no risk associated with the purchase, when the purchase becomes necessity, or when there is social pressure to purchase
o The first stage of the product life cycle in which slow growth follows the introduction of a new product in the marketplace
o Get first time buyers to try the new product
o The second stage in the product life cycle, during which consumers accept the product and sales rapidly increase.Goal to encourage brand loyalty by convincing the market that this brand is superior to others
o The third and longest stage in the product life cycle, during which sales peak and profit margins narrow.
o The final stage in the product life cycle, during which sales decrease as customer needs change.
· Brand’s value over and above the value of the generic version of the product
· The value of a brand to an organization
· Promotes customer loyalty because consumers know its superior to the competition
o The characteristics of a service that means customers can’t see, touch, or smell good service
o The characteristic of a service that makes it impossible to store for later sale or consumption
o Hotel rooms example, priceline
o The characteristic of a service that means that it is impossible to separate the production of a service from the consumption of that service
o Example.) restaurant
o The characteristics of a service that means that even the same service performed by the same individual for the same customer can vary.
o Example.) NFL players game by game
· Price is value customers give up (exchange) to obtain desired product.
· Payment may be in form of:
§ Service or goods (bartering),
· Anything else that has value to other party.
· Technique for marketers to examine relationship between cost and price
· Helps determine what sales volume the company must reach at a given price before it will completely cover its total costs and past which it will begin to turn profit
· Allows marketers to identify how many units of a product they will have to sell at a given price to exceed the break-even point and be profitable.
o The practice of setting a limited number of different specific prices, called price points, for items in a product line.
o Example.) camera prices 100, 200, 300
o Charge each customer the highest price that customer was willing to pay.
· The pricing policy of setting prices very low or even below cost to attract customers into a store.
· Do it to build store traffic and sales volume
· Talk about product that is very low prices but when they get there you don’t even have the product to offer, but when person get’s there salespeople convince people to buy higher priced item
illegal for not having product
· Company sets a very low price for the purpose of driving competition out of business
o Competitors making the same product jointly determine what they each will charge
· Communication elements that the marketer controls
· Include: advertising, sales promotion, public relations, personal selling, direct marketing
§ Most commons top down technique, promotion budget is based on last year’s sales or on estimates for the present year’s sales.
§ Match whatever competitors spend.
o Allocation of the promotion budget based on identifying promotion goals and allocating enough money to accomplish them.
· The firm first defines the specific communication goals it hopes to achieve, then tries to figure out what kind of promotional efforts it will take to meet the goal.
· Marketing activity in which a firm “ambushes” consumers with promotional content in places they are not expecting to encounter this kind of activity
o Company wants to move its products by convincing channel members to offer them and entice their customers to select these items. Pushes them through the channel.
o The default is to collect information unless the consumer takes an affirmative action to prevent the collection of date…No consent required; everything is “pre-checked”
o Requires an affirmative action by the consumer to allow collection and use of consumer information…Consent required; consumer chooses
o Word-of-mouth communication that customers view as authentic.
o Everyday people helping their marketing efforts when they share their opinions with their friends and neighbors.
o Marketing activities that aim to increase brand awareness or sales by consumers passing a message along to other consumers.
o Example.) “sent from my iphone”
o Excessibe publicity
o Trust buzz more than hype
o A way of advertising your products so that people do not realize that you are trying to make them buy something
§ Successful social network marketing resembles a conversation with your customers
§ Consumers grow tired of the “sales pitch”
§ Be present in their community
§ Just because you say something does not mean people are interested
§ Give them relevant dialogue
§ Listen before engaging customer
o Likelihood of Recommendation (0-10)
o Share of Promoters (9-10)
o Passives (7-8)
o Share of Detractors (0-6)
o Difference is Net Promoter score
§ %Strong Promoters
§ -%All Detractors
§ = Net Promoter Score, %
o High profitability and low influence
o High profitability and high influence
o Low profitability and low influence
o Low profitability and high influence
· Process of planning, implementing, and controlling the personal selling function.
· What management expects the sales force to accomplish and when.
· Terriroty structure
o Sales terriroty- each salesperson is responsible for a set group of customers. This structure allows salespeople to have in depth understanding of customers and their needs through frequent contact, both business and personal.
o minimize travel and other field expenses to allot territories. Defines structure according to how many customers reside in a given area.
· based solely on a percentage of sales the person closes.
· Intrinsic and extrinsic employee motivation
· Intrinsic will increase satisfaction
· Extrinsic will minimize dissatisfaction.
· a salesperson who processes transactions the customer initiates.
· stimulate clients to buy. A salesperson who promotes the firm and tries to stimulate demand for a product but does not actually complete a sale.
· Hard sell approach
· Focuses on making an immediate sale with little concern for developing a long-term relationship with the customer.
· Process by which a salesperson secures, develops, and maintains long-term relationships with profitable customers.
What is Public Relations?
· attempts to influence the way consumers, stockholders, and other publics feel about companies, brands, politicians, celebrities, or not for profit organizations.
· PR messages are more credible than if the same information appeared in paid advertisements.
· Introducing new products to manufacturers
· Introducing new products to consumers
· Influencing government legislation
· Enhancing image of city, region, or country
· Calling attention to firm’s involvement with community
What is IMC?
· A strategic business process that marketers use to plan, develop, execute, and evaluate coordinated, measurable, persuasive bran communication programs over time to targeted audiences.
· All the activities necessary to turn raw materials into a good or service and put it in the hands of the consumer or business customer.
· The management of flows among firms in the supply chain to maximize total profitability
· A practice in which a company contracts with a specialist firm to handle all or part of its supply chain operations.
What is a channel of distribution?
· The series of firms or individuals that facilitates the movement of a product from the producer to the final customer.
o Firms that sell their own product
o Mom and pa bakery
o Includes more than one channel intermediaries (middle men)
· Consumer channels
o Allows the producer to serve its customers better and at a lower price than is possible if it included a retailer
· B2B channels
o Facilitate flow of goods from a producer to an organizational or business customer. My be direct or indirect
· Provide number of logisticsor physical distribution functions
· Create efficiencies
o Breaking bulk, create assortment
· Transportation and storage
· Facilitating fucntions
o Offering credit to buyers
· Communication and transactional functions
· A fee paid in exchange for agreeing to place a manufacturer’s products on a retailer’s valuable shelf space
· Dominant firm that controls the channel
· When it has the ability to control resources
Conventional marketing system
· A multi level distribution channel in which channel members work independently of one another
Horizontal marketing system
· Firms work together for common purpose
o Product tags with tiny chips containing information about the item’s content, origin, destination
o Just in time
o Inventory management and purchasing process that manufacturers and resllers use to reduce inventory to very low levels and ensure that deliveries from suppiers arrive only when needed.
- strategic decision on what products to carry
- want to sell products that meets the needs of your market
- often referred to in terms of breadth and depth
o Opposite of ethnocentrism
o Management operates under the assumption that every country is different; the company develops country-specific strategies
§ Company operates differently in each host country based on that situation
§ 100% adaption
o Decisions are decentralized
· Regiocentric Orientation
o Region becomes the relevant geographic unit (rather than by country)
o Management orientation is geared to developing an integrated regional strategy
§ European Union
o Decisions are decentralized per region
· Ethnocentric Orientation
o Home country is the focus; associated with attitudes of national arrogance and supremacy
o Management focus is to do in host countries what is done in the home country
o “my product can be sold everywhere without adaption.”
· Geocentric Orientation
o Entire world is viewed as potential market
o Managerial goal is to develop integrated world market strategies:
§ Global companies serve world markets from a single country and tend to retain association with a headquarters country
§ Transnational companies serve global markets and acquire resources globally; blurring of national identity
· Is a certain currency over/under- valued compared to another?
· A country’s currency would be overvalued if the Big Mac price (converted to dollars) is higher (lower) than the US price
· Assumption is that the Big Mac in any country should equal the price of the Big Mac in the Us after being concerted to a dollar price
measures overall influence on a scale of 1-100
-True reach: size of engaged audience(followers) -Amplification: likelihood of generating actions
-Network: how influential your audience is
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