Upgrade to remove ads
Only $35.99/year

Marketing CLEP

Terms in this set (211)

Marketing
the process of planning and executing the development, pricing, promotion, and distribution of goods and services to achieve organizational goals
Market
made up of all the people or organizations who want or need a product and have the willingness and ability to buy
Products
goods, services, ideas, places, or persons
Marketing Concept
a customer-oriented business philosophy that stresses customer satisfaction as the key to achieving organizational goals
Marketing Functions
Environmental Analysis
Consumer Analysis
Product Planning
Price Planning
Promotion Planning
Physical Distribution (Place) Planning
Marketing Mix
the combination of four variables that comprise an organization's marketing program: product, price, promotion, and physical distribution
Market Segmentation
the process of dividing the total market into distinct submarkets or groups based on similarities in their wants, needs, behaviors, or other characteristics
Market Segments
groups of customers who are similar to each other in a meaningful way and who will respond to a firm's marketing mix similarly
Target Market
one particular group of potential customers that the organization seeks to satisfy with a product.
Product Differentiation
when a product or brand is perceived as different from its competitors on any tangible or intangible characteristic
Product Positioning
the decisions involved in shaping the product's image in the customer's mind
Marketing Plan
the organization's statement of marketing strategy and the specification of the activities required to carry out the strategy
Situation Analysis
the company's relative strengths and weaknesses, as well as the opportunities and threats posed b its marketing environment
Marketing Environment
composed of two types of factors: those that the organization can control and those that it cannot control
Marketing Objective
the goals of the firm on both quantitative (sales, profit, market share) and qualitative(market leadership, corporate image) terms
Macroenvironmental Factors
external forces that impact all firms within an industry
Demographics or Demography
Economic Conditions
Competition
Social and Cultural Factors
Political and Legal Factors(Government)
Technological Factors
Microenvironmental Factors
external forces that impact each specific company uniquely
Suppliers
Marketing Inermediaries
Target Market
Marketing Strategy
the way in which the marketing mix is used to satisfy the needs of the target market and achieve organizational goals
Product/ Market Opportunity Matrix
the four fundamental alternative marketing strategies available to the firm.
Market Penetration.
Market Development.
Product Development.
Diversification.
Market Penetration Strategy
attempts to increase sales of the firm's existing products to its current markets
Market Development Strategy
attempts to increase sales by introducing existing products to new markets
Product Development Strategy
entails offering new products to the firm's current markets
Diversification Strategy
aims new products at new market
SWOT Matrix
a tool used to assess the potential value and fit of new opportunities
Strengths
competitive advantages or distinctive competencies that give the firm a superior ability to meet the need of its target markets
Weaknesses
limitations that a company might face in the development or implementation of a specific marketing strategy
Opportunities
favorable environmental conditions that could bring the firm rewards if exploited
Threats
competitive conditions or other barriers that might prevent the firm from reaching its goals
Boston Consulting Group Matrix
a framework that classifies each product or product line within a firm's "product portfolio"
Relative Market Share
Stars
generate large profits, but also consume substantial resources to finance their continued growth
Problem Child
(sometimes called a "question mark") does not provide great profits, but still require high levels of investment to maintain or increase market share
Cash Cows
generate large profits
Dogs
low profitability and little opportunity for sales growth
Differential Advantage
the unique qualities of product that encourage customer purchase and loyalty
Marketing Myopia
short sighted views of the needs of the company
Marketing Research
the systematic process of planning, collecting, analyzing, and communicating information that is relevant to making better marketing decisions
Situation Analysis examines
Economic environment
Technological developments
Social changes, changes in buying behavior
Legal and political developments
Size of the existing market and the potential market
Rate of market growth
Buyer behavior
Competitive Behavior
Market share trends
Strategy Development
questioned addressed by marketing research include:
What business should we be in?
How will we compete?
What are the goals for the business?
Sustainable Competitive Advantage
an enduring differential advantage held over competitors by offering buyers superior value either through lower prices or other elements of the marketing mix
Marketing Plan Development
focus on how the elements of the marketing mix can be most effectively used
Monitoring the Performance
plans following implementation may require the collection of either qualitative or quantitative information
Marketing Research Process
Step 1: Define the Research Objective
Step 2: Determine Research Type
Step 3: Determine Research Approach
Step 4: Select Data Collection Method
Step 5: Analyze the Results
Step 6: Report the Findings
Research Design
the plan for collecting and analyzing data
Sampling
the process of gathering data from a selected subgroup (sample) chosen from the population of interest
Probability samples
select persons from the designated population at random
Non-probability samples
nonrandom samples
Sample size
size of the sample group
Primary Data
information collected specifically for the current research study
Secondary Data
information that has already been collected for reasons not directly related to the current study
Survey Research
means of systematically acquiring information from individuals by communicating directly with them
Focus Group
in-person data collection procedure in which the interviewer meets with five to ten persons at the same time
Observation
unobtrusive data collection procedure
Experimental Research
compares the impact of marketing variables on individuals' responses in a controlled setting
Simulation
a technique that utilizes computer-based programs to assess the impact of alternative marketing strategies
Marketing Information System
made up of the people equipment and procedures to gather, sort, analyze, evaluate, and distribute accurate information to marketing decision makers.
Forecasting
estimating the demand for a brand or product category
Short-term forecasts
typically predict sales for the next month or quarter and are used for production scheduling and evaluating the impact of short-term promotions
Medium-term forecasts
typically done annually and provide input to annual marketing plan review and revision
Long-term forecasts
typically done for a five-year period and play a significant role in strategic planning
Personal Demographics
the identifiable characteristics of individuals and groups of people
Geographic Demographics
the identifiable characteristics of towns, cities, states, regions, and countries
Behavior Dimensions
include purchase occasion, user status, and brand loyalty
Psychographics
refer to factors that influence consumers' patterns of living or lifestyle
Hetrogeneous
when a product is too diverse to be treated as a single target market
Segmenting
the process in which
1. segmentation variables are chosen and market is divided along these dimensions
2. profile the resulting segments
Market Targeting
the phase after the segmentation process is completed when each resulting segment is evaluated in terms of its attractiveness for the firm
Single-Variable Segmentation
one segmentation variable (seldomly used)
Multi-Variable Segmentation
two or more segmentation variables
Single-segment
the decision to focus on one segment as a target market also know as concentration strategy
Multiple Segmentation Strategy
the choice to pursue more than one target market with corresponding marketing mixes also know as differentiated marketing
Undifferentiated Marketing
treating the total potential market as a whole- one vast target market also know as mass marketing
Involvement
the primary determinant of how consumers reach purchase decisions
High Involvement
product is perceived to be personally important
product is relatively expensive or high-priced
consumer lacks relevant information about the product
risks associated with making a bad decision are high
product offers potentially great benefits to the buyer
Low Involvement
product is frequently purchased by consumer
product is relatively low-priced
High Involvement Decision-Making
Need or Problem Recognition, Search for Relevant Information, Identification and Evaluation of Alternatives, Purchase Decision, Post Purchase Behavior
Cognitive Dissonance
the state of mental anxiety that can be caused by a consumer's uncertainty about a purchase
Low Involvement Decision-Making
Need or Problem Recognition, Purchase Decision, Post Purchase Behavior
Customer Types
includes manufactures, wholesalers, retailers, government agencies, and nonprofit institutions
Customer Size
the purchasing power of buyers rather than the number of buyers
Buying Situation
characterized as one of three types New-Task Buying, Straight Rebuy, Modified Rebuy
New Task Buying
the most complex of the three buy classes, the task requires greater effort in gathering information and evaluating alternatives.
Straight Rebuy
process used to purchase inexpensive, low-risk products, in most instances previous purchases are simply reordered to replace depleted inventory, alternative products or suppliers are not typically considered or evaluated
Modified Rebuy
process used when the purchase situation is less complex than new-task buying and more involved that a straight rebuy, some information is required to reach decisions and a limited number of alternatives may be evaluated
Buyers
individuals who identify suppliers, arrange terms of sale, and carry out the purchasing procedures
Users
people within the firm who will use the product
Influencers
those individuals who establish product requirements and specifications based on their technical expertise or authority within the organization
Gatekeepers
people within the organization who control the flow of relevant purchase-related information
Deciders
the individuals who makes the final purchase decision
Buying Center
entity comprised of all the people who participate in or influence the decision-making process
Consumer Products
products that are targeted toward individuals and household for final consumption
Industrial Products
products typically purchased for resale, operational needs, or use in further production
Convenience Goods
goods purchased frequently and with minimum of shopping effort (low involvement decision-making)
Shopping Goods
good for which consumers typically make price-quality comparisons at several stores before buying (high involvement decision-making)
Speciality Goods
goods for which buyers have strong brand loyalty
Unsought Goods
good that has no demand
Raw Material, Component Materials, and Fabricated Parts
goods used in the production of finished goods or become part of them
Accessory Equipment and Installations
capital good that are used in the production process
Operating Supplies
low-cost items that aid in the production process
Services
tasks performed by one individual or firm for another, usually intangible, perishable, frequently inseparable
Tangible Product
consists of features that can be precisely specified (e.g., color, size, weight)
Product Line
a group or set of closely related items
Product Mix
all of the product lines offered at a specific firm
New Product Opportunities
stem from modification of existing products or the development of wholly new product innovations
Idea Generation
the process of searching for new product opportunities
Brainstorming
a small group technique that encourages participants to voice creatives ideas on a specified topic
Product Screening
the phase in which potential products are sorted relative to their strengths and weaknesses
Concept Testing
potential customers for the new product are asked to evaluate the concept
Business Analysis
a detailed evaluation of the concept's commercial feasibility, criteria examined at this stage include product costs, competitors' strengths in relevant markets, projected market demand, needed investment, and potential profitability
Product Development
the stage at which viable ideas are first produced in tangible form and the initial marketing strategy is created
Test Marketing
provides a series of commercial experiments to test the acceptance of the product and the appropriateness of the proposed marketing strategy.
Commercialization
marks the start of full-scale production and the implementation of the complete marketing plan
Product Adoption Process
describes the stages that consumers go through in learning about new products
Product Adoption
takes place when the buyer decides to continue using the product regularly
Diffusion Process
the typical rate of adoption exhibited by consumers in response to new products
Innovators
the first to buy a new product, 3% of the relevant market, younger, more affluent
Early Adopters
the next to buy behind innovators, 13% of the relevant market, locally oriented, well respected within their communities, opinion leaders who influence others' buying patterns
Early Majority
34% of the target market, slightly above average in both social and economic standing, influenced by advertising and sales people as well as early adopters
Late Majority
34% of the market, more resistant to change and risk taking than previous groups, middle aged or older and somewhat less well of than average socioeconomic terms
Laggards
16% of the market and are the last to buy, tend to be price conscious, low income consumers, by the time this group purchases the product it has reached the maturity stage of the product life cycle
Ideal Points
consumers' perception of the perfect bundle or combination of attributes
Mix Expansion
provides the firm with new opportunities for growth
Contracting
reducing
Wide Product Mix
a diversification strategy, enables the firm to meet several different types of customers need
Deep Product Mix
focuses the firm's resources on a smaller number of product lines, enables the firm to target several segments within the same market
Product Life Cycle
describes a pattern of changes that is characteristic of most products from their inception to the their eventual departure from the market (introduction, growth, maturity, and decline)
Introduction (Product Life Cycle)
stage of the PLC that corresponds to the commercialization of a new product, the rate of new product failures during this stage remain high, sales increase steadily throughout but profits remain negative, innovators are the initial buyers of the product, very little direct competition
Growth (Product Life Cycle)
stage of the PLC that is marked by the point at which profitability becomes positive, sales growth continues at an increasing rate, new firms enter the market
Maturity (Product Life Cycle)
stage of the PLC that is characterized by slowing sales, industry sales level off as the market becomes saturated, consumer demand peaks, price competition is greater, total industry profits decrease
Decline (Product Life Cycle)
stage of the PLC where industry sales decline, many firms leave the market, industry profits continue to decline, remaining firm exit the market
Brand
a name or symbol that is used to identify the products of a specific firm
Manufacturer Brands
created by product manufacturers, also called "National Brands"
Dealer Brands
created by intermediaries (e.g., retailers), also called "Private Brands"
Characteristics of Good Brand Names
suggests something about the product's benefits
short and simple
easy to spell, read, and pronounce
pleasant sounding
distinctive and memorable
appropriate to new products that may be added to the line at a later date
legally available for use
Five Levels of Brand Familiarity
Brand Insistence
Brand Preference
Brand Recognition
Brand Non-Recognition
Brand Rejection
Brand Insistence
when consumers are absolutely brand loyal and will accept no substitutes
Brand Preference
target consumers will usually choose one specific brand over others
Brand Recognition
when consumers remember the brand name
Brand Non-Recognition
consumers do not recall the brand name
Brand Rejection
when consumers recognize, but refuse to buy, specific brands
Family Brand
used when the same brand is applied to several products, most appropriate when all of the products are of comparable type and quality
Individual Brand
when there is significant variation in product type and quality
Licensed Brand
a well-established brand name that other sellers pay to use
Trademarks
brand names, marks, or characters used to identify products
Primary Functions of Product Packaging
Protection, Promotion, and Information
Inseparability
the fact that the service cannot be separated from the person providing it.
Perishable
cannot be inventoried, returned, or resold
Accumulation
the process of assembling and pooling relatively small individual shipments so that they can be transported more economically
Sorting
the process of separating goods by quality, color, or size
Assorting
the process of acquiring a wide variety of merchandise to meet the diverse preferences of consumers
Direct Channels
the movement of goods from the producer to the final consumer without using independent intermediaries or "middlemen"
Indirect Channels
the movement of goods with the cooperation and assistance of independent intermediaries
Channel Width
the number of independent members at one level of the distribution channel (e.g., producer, wholesaler, retailer, final consumer)
Channel length
the number of levels used to create a distribution channel
Intensive Distribution Strategy
when a firm sells through every potential outlet that will reach its target market
Selective Distribution Strategy
when a firm will sell through many, but not all, potential wholesalers and retailers
Exclusive Distribution Strategy
when a firm limits the number of outlets employed to one or two intermediaries within each market
Contractual Arrangements
written mutual agreements, enforceable by law, between two or more parties that something shall be done by one or both
Vertical Integration
the process of acquiring firms that operate at different channel levels
Horizontal Integration
the process of acquiring firms that operate at the same channel level
Multiple Channels
when a firm develops two or more separate and distinct distribution channels
Channel Control
the ability to influence the actions of other channel members
Channel Conflict
when disagreements arise between members over channel practices and policies
Pushing Strategy examples
Sales Promotions, Personal Selling, and Advertising of the Product
Pulling Strategy
generates consumer demand for the product as a means of securing support within the channel, initially directed toward the final consumer, most appropriate for new products seeking to gain access to an existing channel
Total-Cost Concept
minimizing costs and satisfying customer demands can represent conflicting objectives
Distribution Center
a type of warehouse planned in relation to specific markets
Suboptimization
cost-reducing actions in one distribution function that increase the overall cost of other distribution functions
Customer Service Standard
different customers requiring different levels of service
Order Processing
the receipt and transmission of sales order information
Electronic Data Interchange (EDI)
allows a company to integrate order processing, production, inventory planning, and transportation into a single system
Materials Handling
the physical handling of goods in both warehouse and transportation functions
Unit Loading
the grouping of boxes on a pallet or skid
Containerization
the process of consolidating many items into one container
Warehousing
the process of designing and operating facilities for both storing, sorting, and dispatching goods
Types of Warehouses
Private and Public Warehouses
Distribution Centers
Bonded Storage
Order Leadtime
the average length of time between the customer placing an order and receiving it
Reorder Point
the inventory level at which new orders need to be placed to avoid a stockout
Stockout
a shortage of product resulting from carrying too few in inventory
Usage Rate
the rate at which inventory is sold per time period
Safety Stock
the amount of extra inventory kept on hand to avoid stockouts
Economic Order Quantity (EOQ)
the order size that minimizes the total cost of ordering and carrying inventory
Just-In-Time (JIT)
making products and materials available just as needed for production or resale
Transportation Modes
the means of moving goods from one location to another
Megacarriers
freight transport companies that provide several shipment modes
Intermodal Transportation
two or more transportation modes used in combination
Freight Forwarders
specialized agencies that provide alternate forms of transportation coordination
Wholesaling
all of the activities related to the resale of products to organizational buyers, other wholesalers, retailers
Manufacturer Wholesaling
when the product's producer performs the wholesaling functions
Merchant Wholesalers
independent firms that take title and possession of the products they sell
Full Service Merchant Wholesalers
perform the complete range of wholesaling functions
Limited Service Merchant Wholesalers
may not provide merchandising or market research assistance
Rack Jobbers
full-service merchant wholesalers that provide the display racks used to merchandise the product
Drop Shippers
limited-service merchant wholesalers that buy products from manufacturers and arrange for the delivery to retailers
Derived Demand
Business demand that ultimately comes from the demand for consumer goods.
Agents
independent wholesalers that do not take title of the products they handle
Brokers
act as temporary wholesalers, bring buyers and sellers together a facilitate the transaction process
Retailing
all activities involved in selling, renting, and providing products and services to ultimate consumers for personal, family, or household use
Corporate Chains
comprised of several (usually 10 or more) stores that are owned and managed by the same firm. They are typically standardized with respect to product lines, merchandising, and operational policies.
Vertical Marketing Systems
This type of marketing system includes the producer, wholesaler(s), and retailer(s) acting as a unified system.
Independent Stores
Single retail units that are not affiliated with a corporate chain or cooperative. They tend to have higher prices than affiliated stores, less market power, and rely more heavily on customer services for a competitive edge.
Franchise System
a specific type of VMS where the parent company provides franchisees with the legal right to use company trademarks, the franchisor may also provide franchisees with assistance in site selection, personnel training, inventory management, and promotional strategy.
Non-store Retailing
retail transactions that occur outside of traditional store setting, techniques include direct selling, direct marketing, and vending sales
Retail Store Location
function of target market, location of competitors and site costs. Location options include planned shoppig centers, unplanned business/shopping districts and isolated store locators
Store's Atmosphere
comprised of characteristics that contribute to consumers' general impression of the store, includes the exterior appearance, interior design, product display, and store layout
Scrambled Merchandising
offering several unrelated product lines in a single store
Wheel of Retailing
an evolutionary process by which stores that feature low prices gradually upgrade until they no longer appeal to price-sensitive shoppers and are replaced by a new generation of leaner, low-price competitors
Direct Marketing
direct connections with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships
Promotion Mix
elements that contribute to the firm's overall communications program, includes advertising, personal selling, publicity, public relations, and sales promotions
Integrated Marketing Communications
refers to the concept of planning a comprehensive program that coordinates all promotional activities
Who is the target market?
What are the objectives?
When should the promotions be run?
Which media should be used?
Promotion Objectives
to inform both intermediaries and end-users about new products, persuade buyers to buy the products, reminds buyers about the availability of very well-established products
Students also viewed