49 terms

Marketing Final

STUDY
PLAY

Terms in this set (...)

What are the key characteristics of e-marketing?
1) Addressability: You can identify individual consumers pre-purchase
(i.e., you have information about them and can address them directly)
2) Interactivity: Consumers can express their needs, wants, and feedback
directly to the firm in response to its marketing communications.
3) Accessibility: Consumers have the ability to obtain massive amounts of
information digitally.
4) Connectivity: Consumers can interact easily (i.e., are connected) with
marketers and other consumers
5) Control: Consumers can regulate the information they view.
Why could interactive digital maketing communications be particularly effective?
Targeting: Can more easily find and focus on your key segmant(s).
Thanks: Consumers may actually appreciate receiving relevant messages targeted to them.
Time: Messages and responses can be transmitted and shared almost instantaneously
Two-way street: Consumers engaged in external search can and will seek out your message
Tons of data: Response to marketing messages can be used for primary reserach.
Contagious (viral): messages can go "viral" if relevant or fun enough for users to share.
Trust: Consumers generally trust messages more if they come from other consumers.
What does IMC mean and why it it so important to a business?
Integrated marketing communication (IMC) is an approach to brand communications where the different modes work together to create a seamless experience for the customer and are presented with a similar tone and style that reinforces the brand's core message. Its goal is to make all aspects of marketing communication such as advertising, sales promotion, public relations direct marketing, online communications and social media work together as a unified force, rather than permitting each to work in isolation, which maximizes their cost effectiveness.

IMC is becoming more significant in marketing practice because of the reduced cost effectiveness of mass media and media fragmentation. As consumers spend more time online and on mobile devices all exposures of the brand need to tie together so they are more likely to be remembered. Increasingly the strategies of brands cannot be understood by looking solely at their advertising. Instead they can be understood by seeing how all aspects of their communications ecosystem work together and in particular how communications are personalized for each customer and react in real time, as in a conversation.
What is the key benefit from IMC?!
By creating consistent messages and themes across the promotion side of the 4P's, consumers develop a stronger feeling about what you're about (and less likely to get confused). If there is not a clear message of what the brand is, consumers will get confused and the affects are: (1) low brand equity; (2) low brand advocacy (think of word of mouth); (3) decrease in sales. Think of this as chaos..
What is a consistent message in IMC?!
The same logo, colors, and although the messages may be different, the theme around the messages are the same and convey the brand promise or value proposition. In other words, why the consumer benefits from the brand and why they would want to purchase the product/service.
What is e-marketing?
is the use of digital, interactive (two-way communication) electronic media to promote to consumers
Where does IMC take place in the strategy and marketing mix?
IMC is "mostly" in Positioning and Promotion.
What is promotion within IMC?
Promotion: Communication designed to inform and persuade a target audience toward favorable views and behavior toward a company and/or its product(s).
‣ A promotional strategy tends to work best when its
communications are integrated (i.e., send a consistent message).
What are the components in IMC?
1) Source (comapny, Individual but not to be confused with consumer).
2) Coded Message: (advertising, PR, sales promo, sales pitch, word-of-mouth)
3) Communications Channel (print media, websites, TV/Radio, social media, word-of-mouth
4) Decoded Message: How the message is interpreted or MISinterpreted.
5) Receiver/Audience: In B2C (business to consumer) individual to consumer; B2B (business to business) business to representitive of the business (consumer).
6) Feedback: Purchase data, other research data (e.g. awareness, loyalty); face-to-face response); Reviews, comments, ect.
How can the AIDA model help with developing your IMC and marketing mix?
AIDA model can help marketers think about what they are trying to accomplish. This could be AWARENESS, INTEREST, DESIRE, ACTION.
Can you accomplish every part in AIDA in one campaign?!
NO! You've got lots of tools for marketing communication (ads, salespromotions, etc.). Know which ones you (and your firm) are best at using.
❖ Choose the communications tools that best fit your marketing objectives (Know your objectives! Make them "SMART"!)
❖ Don't just use everything you can for every goal you have!
❖ Be specific about why you're using the tools you're using - it will help you justify your marketing expenses.
Otherwise, you could just bebasing your decisions off intuition again...
How to factor your ROI?! (How do you evaluate how the marketing campaign went)?
One of the big challenges marketers face
is being able to prove that they earned
their paycheck.
❖ Documenting your steps through this
process can help you make your case
❖ ...as can having clear marketing
objectives that are specific and
measurable (again, SMART)
❖ And of course, if it didn't go so well, you
have something to revisit
What is distrubuting?
"Place" essentially means "distribution".
It refers to putting the product where consumers can access it - and the steps in the process of getting it there.
Are communication channels the same as marketing channels?!
NO! Communication channels refer to the medium used to send out a message. The ways in which
marketing communications are transmitted (print ads, TV, personal sales, etc.).
Whereas Marketing Channels (aka distribution channels): the set of actions and people that direct the flow of products from producers to consumers.
• In other words, marketing channels dictate how products flow through the supply chain
What is a resonable analogy for marketing channels?
A reasonable analogy for marketing channels: digital map
directions with multiple routes
❖ You know where you are (what your product is and where it's produced)
❖ You know where you're going
(which consumers you need to
get the product to)
❖ You have to choose the best way
to get there given the situation
❖ Roads = various steps in the chain
(agents, wholesalers, retailers, etc.)
What is distribution?
Distribution is part physical, part conceptual:
❖ Physical distribution: How do products physically get there? ("we've got
to move these microwave ovens / custom kitchen delivery!")
❖ Conceptual issues: How intense should our market coverage be?
• intensive distribution: use every outlet available so consumers can reach it
anywhere (especially useful for convenience products like batteries, Coca Cola)
• selective distribution: only available in certain outlets (especially useful for
shopping products like TVs, coffee makers, mattresses)
• exclusive distribution: uses only one outlet in a relatively large geographic area
(especially useful for infrequent [IKEA] or high-end purchases [Porsche])
What is supply chain management?!
Supply chain management "emphasizes the close cooperation and comprehensive interorganizational management to integrate the logistical operations of different firms in the channel."
What are logistics?
Logistics is the "planning,implementing and controlling the
physical flows of materials and final goods from points
of origin to points of use to meet customers' needs at a
profit."
Are distribution channels static or dynamic?!
DYNAMIC! Distribution Channels are ALWAYS changing. Think of Apple. You can buy an I pad at the Apple Store, Best Buy, on-line, and at Micro Center (a computer store in St. Louis Park) and other select computer stores. Target was just added to include more Apple products as well! I'm sure the list goes on, but you get the point of how distribution channels are changing.
What is the ultimate goal of centralized exchange?
to maximize efficiency...always look for the efficient one.
(A question producer's ask) should I use an intermediator? So what is an intermediator and how do you answer this question?
An intermediator is a wholesaler. The answer to this question depends on the product and the self life of the product. Think of perishable goods v. Twinkies (a long shelf life) and how that relates to how one would determine using an intermediator.
Another key factor is specialized needs:

The company that developed the product has a lack
expertise of producing the product; lack economies of
scale

Intermediaries can: spread high fixed costs
over large quantities of diverse products and
achieve economies of scope and economies of
scale.
What do primary channel members assume?!
They take title, possession and assume risk. Examples are:
Manufactures, Wholesalers, and Retailers.
Do facilitating channel members perform the same duties as primary channel members?! If so, what is the key difference between them?!
KEY DIFFERENCE: facilitating channel members DO NOT take TITLE (ownership). But the make the marketing process easier by specializing in certain marketing activities. Examples are:
Agents/brokers
* Advertising
agencies
* Transporters
* Public
warehouses
* Information/communication
firms
* Insurers
* Financial
institutions
What three function do do marketing channel intermediaries perform?
(1) transactional function: Buying, selling, and Rich taking by assuming business risks in the ownership of inventory that can become obsolete or deteriorate.
(2) logistical function: assorting, storing, sorting, and transporting
(3) facilitating function: financing, inspecting, marketing information and research.
see figure 12-2 in Marketing Channels and Supply Chain handout by Jon Seltzer
What is a conventional marketing channel
A conventional marketing channel is one in which each
member is loosely aligned with the other members.
Each channel member operates independently of
the other channel members. This results in a push
strategy where each channel member focuses its
efforts on the member they sell to rather than focusing on
the end consumer.
What is the difference between "push" and "pull" strategies?
The business terms push and pull originated in logistic and supply chain management, but are also widely used in marketing. Wal-Mart is an example of a company that uses the push vs. pull strategy.

A push-pull system in business describes the movement of a product or information between two subjects. On markets the consumers usually "pull" the goods or information they demand for their needs, while the offerers or suppliers "pushes" them toward the consumers. In logistic chains or supply chains the stages are operating normally both in push- and pull-manner. Push production is based on forecast demand and pull production is based on actual or consumed demand. The interface between these stages is called the push-pull boundary or decoupling point.

Another meaning of the push strategy in marketing can be found in the communication between seller and buyer. Depending on the medium used, the communication can be either interactive or non-interactive. For example, if the seller makes his promotion by television or radio, it's not possible for the buyer to interact with. On the other hand, if the communication is made by phone or internet, the buyer has possibilities to interact with the seller. In the first case information is just "pushed" toward the buyer, while in the second case it is possible for the buyer to demand the needed information according to their requirements.

In a marketing "pull" system, the consumer requests the product and "pulls" it through the delivery channel. An example of this is the car manufacturing company Ford Australia. Ford Australia only produces cars when they have been ordered by the customers.
What are vertical marketing systems (VMS)?!
is one in which the main members of a distribution channel—producer, wholesaler, and retailer—work together as a unified group in order to meet consumer needs. In conventional marketing systems, producers, wholesalers, and retailers are separate businesses that are all trying to maximize their profits. When the effort of one channel member to maximize profits comes at the expense of other members, conflicts can arise that reduce profits for the entire channel. To address this problem, more and more companies are forming vertical marketing systems.

Vertical marketing systems can take several forms. In a corporate VMS, one member of the distribution channel owns the other members. Although they are owned jointly, each company in the chain continues to perform a separate task. In an administered VMS, one member of the channel is large and powerful enough to coordinate the activities of the other members without an ownership stake. Finally, a contractual VMS consists of independent firms joined together by contract for their mutual benefit. One type of contractual VMS is a retailer cooperative, in which a group of retailers buy from a jointly owned wholesaler. Another type of contractual VMS is a franchise organization, in which a producer licenses a wholesaler to distribute its products.

The concept behind vertical marketing systems is similar to vertical integration. In vertical integration, a company expands its operations by assuming the activities of the next link in the chain of distribution. For example, an auto parts supplier might practice forward integration by purchasing a retail outlet to sell its products. Similarly, the auto parts supplier might practice backward integration by purchasing a steel plant to obtain the raw materials needed to manufacture its products.
What is corporate VMS?
One way of getting a channel to work better is by having one company own several levels of the channel If a manufacturer takes over a retailer, you have a corporate VMS. In some industries, the channel of distribution is fully (vertically) integrated. One company owns all the stages of production and distribution.
What is a contractual VMS?
includes wholesaler sponsored voluntary groups, retailer-onwed coopreratives and franchise organizations.
What is an Administered VMS?
is similar to a conventional marketing channel except one
of the channel members uses the principles of inter-‐organizational management to become a channel captain
without a contract. Administered systems are usually
initiated by manufacturers. Some concessions manufacturers offer are liberal return allowances, display
materials for in-‐store use, advertising allowances,
sales training programs, extended dating(i.e., extra days
of free credit to pay for merchandise) and free goods
(i.e., buy 10 cases, get one free, sometimes called a
trade discount).
Examples include, Good Year dealers, Pepsi and
Black and Decker.
What is disintermediation?
it's changing channel organizaion where producers elminate traditional intermediaries. In other words, remove the middle man.
What is reintermediation?
When a product and services are added. Adding the middle man.
What are the thre types of distribution?
(1) Intensive, e.g., Coke (soft drink) where you can buy anywhere. competition is a big factor that drives this decision of distribution.
(2) Exclusive, e.g., Caterpillar (tractor) can only buy at a Caterpillar store. In MN, only one location in Burnsville.
(3) Selective, e.g., cannoe paddles are sold in select stores and not in all retail stores.
Why use one method of distribution over another?
You select the marketing channel that FITS your marketing objective! What is the most efficient?
What are the steps for effective advertising?
1) Identify and analyze target audience
2) define advertising objectives
3) create advertising platform
Make them SMART (specific, measurable, attainable, relevant, time-bound).
4) determine advertising appropiation (ad budget) $$$$
5) develop media plan
(KEY POINT, must people forget steps 2-5 and go from target audience to creating the ads!) Think of Dryel!
6) create advertising message
7) execute campaign
8) evaluate advertising effectiveness
What is PR?
• a broad set of communication efforts intended to create and maintain favorable relationships between its stakeholders
• stakeholders = customers, employees, suppliers, the media,
potential investors... pretty much anyone deemed to be relevant
Is PR just really free advertising since PR and advertising is the same thing?
NO! PR is a press release or some kind of statement to maintain favorable relationships to a wide audience. Advertising is a specfic message like the AIDA model, to a specfic audience, to either create brand awareness or some kind of call to action.
What is reach?
Touches
Cost per touch
Use of technology
What is relevance?
Touches
"Relevance is simply using insights based on data to craft targeted messaging that makes every piece of content in every channel speak to each recipient."
Cost per touch
Use of technology
How do we caculate profit?
profit = total revenue - total costs
total revenue = price x quantity sold
Is pricing just based on the numbers of going above the "break even point"?
NO!
What is helpful in determing the price of a product or service that involves market reserach?
WTP is the maximum amount a person would be willing to pay, sacrifice or exchange in order to receive a good or to avoid something undesired, such as pollution.

A transaction occurs when the willingness to pay exceeds the market pricetype of need satisfied by product (plus felt strength of this need)
• substitutability of product
• opportunity costs
• available discretionary income
• other personality, psychological, and cultural factors
• what else? what affects your WTP for something?
What are the 6 steps in pricing?
1) develop pricing objectives
2) asses target market's price evaluation
3) evaluate competitors' prices
4) select bases for pricing
5) select pricing strategy
6) set price
Is price the ONLY concern consumers have when they consider buying a product or service?
Price is usually considered, but it's not always the top issue. It becomes obvious as you start to think about it.
❖ Consumers who are predominantly price-sensitive will be attracted to the
least expensive alternative.
❖ Value-sensitive consumers mentally factor quality into the equation,
essentially estimating a quality-to-price ratio.
❖ Time-sensitive consumers may pay a premium for convenience.
❖ The purchase situation also affect price evaluations. How much would
you pay for a Bud Light at a liquor store? How about at a Vikings game?
What happens when you assume the target market is only concerned about price when you set your price?
By assuming your target market is predominantly pricesensitive, you may be leaving money on the table.
What are the 4 most common pricing bases:
Cost-Plus Pricing: add up all your costs and add a specified $ amount on top of it (guarantees you x amount of profit):
❖ Markup Pricing: add up all your costs and add a specified %
of the costs on top of it. 20% markup on $200 cost = $40
❖ Demand-Based Pricing: prices go up when demand is high,
and they go down when demand is low (e.g., airline tickets)
❖ Competition-Based Pricing: keep prices below, above, or
same as competitors (e.g., airline tickets - again!)
Select
What is differential pricing?
Negotiated pricing (let's make a deal)
• Secondary market pricing (different target market pays less)
• Discounting (we call it "having a sale") - periodic vs. random
What is New Product Pricing and the two strategies within this model to determine the price?
specific base prices for early in life cycle:
• Price skimming (meet max WTP for consumers who want it bad)
• Penetration pricing (set low price to speed market penetration)
What is psychological pricing and strategies within this model to determine the price?
Psychological Pricing: using what we know about consumer behavior to make the price feel more attractive.
Reference pricing (make the price look better by comparison to something nearby)
• Bundle pricing (offer multiple items together at a lower price than if they were bought separately - the "deal" can lead people to buy things they otherwise wouldn't have bought)
• Multiple-unit pricing (the more you buy, the more you save!)
YOU MIGHT ALSO LIKE...
STUDY GUIDE