Marketing Midterm 1

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marketing

creating, distributing, promoting && pricing goods, services, & ideas. maintain favorable relationships w/ stakeholders

marketing mix

product, pricing, distribution, promotion
SATISFIES A SPECIFIC TARGET MARKET

Product

good, service, or idea.
creating & modifying brand names

Distribution

must be available at the right time and in convenient locations. inventory control procedures, transportation, etc
ex: subways in strip malls & in walmart

promotion

activities to inform others about the organization and its products. can educate on political and social issues or sustain interest in an extremely old product (soap)

price

high prices can be used to estb premium image, used as competitive tool

value

customer's subjective assessment of benefits relative to costs in determining worth of a product
customer value = customer benefits - customer costs
subjective, some may value convenience, others cheapness

nonmonetary costs

time * effort a customer spends to find & purchase desired product.
also, risk! (can reduce w/ warranties, 100% satisfaction guaranteed)

exchange

provision/transfer of goods for sth of value
should create & maintain satisfying rel.ships

marketing environment

competitive, economic, political, legal, tech., etc. forces that SURROUND the customer & AFFECT the marketing mix. can produce uncertainty & opport
ex: obesity = more diet products

marketing concept

satisfy a customer's NEEDS rather than not pursue opports
ex: pandora and itunes, vs cd players...
should also consider l-t needs of society (SUVs vs electric cars)

market orientation

organization-wide commitment to research & respond to customer needs
must create information system to find their needs (ex: amazon survived the dot-com b/c they understood customer wants)

relationship marketing

estb l-t, mutually satisfying buyer-seller relationships. customer loyalty

80/20 rule

CLV (customer lifetime value)
80% of profits comes from 20% of customers
some customers who need a lot of hand-holding or return things too often may be too expensive to retain

corporate strategy

means for utilizing resources in marketing, production, finance, R&D, HR to reach co's goals.
focus on corp culture, competition, differentiation, diversification
Ex: Barnes & Noble took advantage of opportunity when borders declared bankruptcy. invited them to shop at B&N

strategic business unit (SBU)

division, product line, other profit center w/in parent co.
each sell a distinct set of products

market

group of individuals/organiz that have ability, willingness, & authority to purchase these products

cash cows

indicate overall health & size of co

resources

goodwill, reputation, brand name, etc

core competencies

things a co does extremely well

strategic windows

TEMPORARY periods of optinal fit b/w market & the capabilities of a co

competitive advantage

matching a core competency to an opport in the marketplace

SWOT

strengths, weaknesses, opps, threats
p40

1st mover advantage

an innovative co. that can achieve L-T competitive advantages by being 1st in marketplace
rep as pioneer, period of time w/o rivals, HIGH COSTS, can estb patents fast!

late-mover advantage

can learn from 1st mover mistakes, reverse engineer, lower cost
face stronger competition...

selecting target market

must be chosen before adapting marketing mix to meet customer needs.
ex: toyota yaris

marketing mix decisions

consistency (w/ corp strategy) & flexibility (to adapt when markets change).

sustainable competitive advantage

an advantage the competition cannot copy

centralized organization

top-lvl managers delegate little authority to lower lvls

decentralized organization

decision-making authority is delegated as far down chain as possible

performance standard

EXPECTED lvl of performance which actual performance can be compared w/

sales analysis

analyze sales to evaluate firm's performance

marketing cost analysis

analyze costs to determine what is associated w/ specific marketing efforts

environmental scanning

collecting info abt forces in marketing environment
political action, technology can shape environ.
co's can control environm to an EXTENT

environmental analysis

assessing & interpreting info gathered from environ. scanning

competition

other co's that market products which can be substituted for your products in the same geographic area

brand competitors

co's that market products w/ similar features, benefits to same customers at similar P
diet coke vs diet pepsi
this is what MOST competitors concentrate on

product competitors

compete in same product class, markets products w/ diff features, benefits, P
iced tea vs coke

generic competitors

provide very diff products that satisfy the same BASIC customer needs
tap water vs coke

total budget competitors

co's that compete for the LIMITED financial resources of the same customers
gum vs coke

monopoly

co offers a product w/ no close substitutes, only source of the S
tolerated b/c of the huge financial resources needed to develop them (ex: water utility)

oligopoly

few sellers control a HUGE proportion of the product

monopolistic competition

many potential competitors and tries to DIFFERENTIATE their product

pure competition

EXTREMELY large # of sellers, none can signif. influence P or S
commodities market?

monitoring the competition

understand how other co's strategize & how their strategies affect OUR strategies
(ex: when Delta lowers P, so do other co's)

economic conditions

changes in economy affected by S&D, buying power, willingness to spend, consumer expenditure lvls, intensity of competitors

business cycle

prosperity, recession, depression, recovery

prosperity

low unemployment & relatively high ttl income, high buying power

recession

unemployment rises & ttl buying power declines
(ex: consumers move to Dollar General)

depression

unemployment EXTREMELY high, wages low, disposable income = minimum, consumers lack confidence in economy

recovery

economy moves FROM recession/depression TOWARD prosperity
(ex: difficult to tell how prosperous & how fast economy will recover)

buying power

$, good, services that can be traded in an exchange

disposable income

AFTER -TAX INCOME

discretionary income

income available AFTER basic necessities bought

credit

spend future income now
increases CURRENT buying power at the expense of FUTURE buying power

wealth

accum. of past income, fin. resources, natural resources

willingness to spend

inclination to buy b/c of expected satisfaction from product
factors include future employment, income, P, family sizes, economic conditions

political forces

polotical officials ok w/ particular firms/industries create/enforce fewer laws!! marketer's job to influence them

procompetitive laws

preserve competition, end antitrade practices, Sherman Antitrust Act
(ex: wachovia manipulated bidding process for contracts)

consumer protection

congress passed laws to disclose info on goods
(ex: cigs, furs, cars, beer)

FTC

federal trade commission, regulates false adverts, misleading P, deceptive packages

Better Business Bureau

self-regulatory, warns consumers through newspapers if firm lies

technology

satisfy physio needs
negatives: accidents, privacy invasion, health risks

sociocultural forces

influences in society & its culture that changes attitudes, beliefs, norms, lifestyles

demographics

# singles rising, more diverse new baby boom, birth rate is declining, more immigration, baby boomers getting older

consumerism

organized efforts to protect consumer rights

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