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Marketing Exam 1
Ch.1 & 2
Terms in this set (89)
Marketing is a set of
institutions, and processes for creating, capturing, communicating, delivering and exchanging offerings that have value for customers, clients, partners and society at large.
Understanding the marketplace and consumers needs and wants it is fundamental to?
the trade of things of value between the buyer and the seller so that each is better off as a result
The essence of marketing is
creating something valuable that is also valuable to the customer
What is an organizational functions that is a set of processes for creating, capturing, communicating and delivering value to customers for managing customer relationships in ways the benefit the organization and stakeholders?
Marketing mix contains ?
The 4 p's
The 4 P's are? What value do each create?
promotion (communicating), product (creating), place (delivering) & price (capturing)
Product: Creating Value by?
developing a variety of offerings, including goods, services, and ideas to satisfy consumer needs.
items that you can physically touch.
ex: nike shoes, bud-wiser, an iPad
intangible customer benefits that are produced by people or machines and cannot be separated from producer. Based on the experience the customer gains.
ex: buying hotels rooms, insurance, air fare
concepts, opinions and philosophies; intellectual concepts such as these can be marketed.
ex: groups promoting bicycle safety to schools with a primary market: children
Marketing is about _____ customers needs and wants?
Satisfaction for customers/consumers means?
expectations are met
Customers form expectations from?
word of mouth, similar promotions etc.
Customer delight is?
customers expectations are exceeded. ex: survey to see how producer did
Loyal-ness to a customer provides marketers with 2 types of ____? What two?
data. Feedback & Complaints
Marketers take advantage of feedback because?
it helps determine where to direct attention to
Marketers take advantage of complaints to?
improve and makes customers more loyal by pointing out the good customers from the bad
Price: Capturing Value
refers to everything the buyer gives up--money, time, energy in exchange for the product. Marketers must determine the price of a product carefully on the basis of the potential buyers belief about its value
ex: buying airline tickets; the time you buy it, coach or class?
Place: Delivering the value proposition
represents all the activities needed to get the product to the right customer when they want it.
ex: skiers have to get to vail or Breckenridge to ski. But the effort to link multiple resorts, which make it easier for consumers to access multiple slopes, restaurants, represents an attempt to improve delivery on this aspect of marketing.
Place more commonly deals with retailing marketing channel management which is?
set of approached and techniques that firms employ to efficiently and effectively integrate suppliers, manufactures, warehouses, stores and other firms involved in the transaction
ex: self serving frozen yogurt
Promotion: Communicating the Value Proposition
promotion is a communication by a marketer that informs, persuades and reminds potential buyers about a product or service to influence their opinions and elicit a response
ex: social and mobile marketing considers how Fbook communicates its value by encouraging networks of users and businesses beyond its site.
Marketing can be preformed by both?
individuals and organizations
The process by which businesses sell to consumers is known as
B2C (business to consumer) marketing
The process of selling merchandise or services from one business to another is called
B2B (business to business) marketing
Consumers sell to other consumers is
C2C consumer to consumer marketing
Marketing impacts various
stakeholders. Manufactures sell merchandise to retailers, but the retailers have to convince manufactures to sell them.
ex: supply chain partners, societies at large
Marketing impacts also
societies at large
ex: Got Milk? add. Its aimed at different target segments.
Marketing helps create
Production orientated era
all about product innovation, not about satisfying the needs or wants of individual consumers.
Sales oriented era
manufactures had to capacity to produce more than customers wanted or were able to buy. This overproduction turned into sales oriented and they depended on heavy doses of personal selling and advertising
Market oriented era
when manufactures and retailers began focus on what consumers wanted and needed before they designed or made it or attempted to sell their products or services. During this period firms discovered marketing
Value based marketing era
took the market oriented era and then giving their customers greater value than their competitors.
reflects the relationship of benefits to costs or what you get for what you give.
In marketing context, customers seek a
fair return in goods and or services for their hard earned money and scarce time.
A creative way to provide to customers to engage in
Value cocreation allows for customers to
act as collaborators to create the product or service.
ex: Nike allowing their customers to custom design their sneakers.
Marketing firms become more value driven by focusing on four activities (1)
share information about their customers and competitors across their own organization and even with other firms, such as manufactures and transportation companies that help them get their product or service to the marketplace.
ex: Jcrew collects purchase information and research customer trends to determine what their customers will want to wear for the next few weeks, while the logisticians in charge of getting merchandise to the stores use the same info to appropriate merchandise to individual stores. This is a critical success factor
Marketing firms become more value driven by focusing on four activities (2)
strive to balance customers benefits and costs
They use customer data to find opportunities to better satisfy their customers needs and keep costs down and develop long term loyalties
ex: ikea (allows for customers to assemble furniture themselves)
Marketing firms become more value driven by focusing on four activities (3)
concentrate on building relationships with customers
focusing on the lifetime profitability of the relationship and not just how much money is made each time.
ex: apple making new innovations compatible with the company across all their electronic needs.
Marketing firms become more value driven by focusing on four activities (4)
take advantage of new technologies and connect with their customers using social media
customers who tend to download or use apps for restaurants or stores tend to be more loyal customers.
CRM Customer Relationship Management
business philosophy and set of strategies, programs and systems that focus on identifying and building loyalty among the firms most valued customers.
The importance of marketing is that it can be four things
entrepreneurial, expands a global presence, pervasive across channel members, enriches society.
Such groups or firms that make and deliver a given set of goods and services are known as
supply chain or marketing channel. They provide career opportunities to marketing professionals.
ex: Levi jeans and their close relationship with its major retailers.
people who organize and operate and assume the risk of a business venture.
Marketing strategy identifies three things (1)
firms target market
Marketing strategy identifies three things (2)
related marketing mix-- & four P's
Marketing strategy identifies three things (3)
bases on which a firm plans to build a sustainable competitive advantage
A sustainable competitive advantage is an
-advantage over the competition that is not easily copied
-benefit that a marketer can offer beyond competition
- can be maintained for a long period of time
- cant be remade
-focuses on retaining loyal customers & excellent customer service
achieved through efficient operations and excellent supply chain and human resource management
ex: Walmart and amazon, Netflix (becoming dominant is the movie renting industry)
- strong relationships with suppliers
- get customers what they want, when they want it, at a lower price than their competitors
having products with high perceived value and effective branding positioning
-constantly reinforcing the brand image through merchandise service and promotion
-ex: Top global brands; Google. Coca Cola, Disney, Apple
having a good physical location and internet presence
-difficult to maintain
-easiest to replicate
-Starbucks being literally everywhere
Marketing plan is a written document that is
composed of analysis of the current marketing situation, opportunities and threats for the firm, marketing objectives and strategy specified in terms of the Four P's, action programs, and projected pro-forma (and other financial statements).
The three major phases of the marketing plan are?
planning, implementation and control
Customer loyalty consists of
-viewing customers with a lifetime value perspective
- developing a clear and precise positioning strategy
-create an emotional attachment through loyalty programs
Customer service can help build a sustainable advantage by
by offering good customer service it can earn a good service reputation and can sustain this advantage for a long period of time.
Planning phase consists of steps 1 & 2
-business mission and objective
-SWOT (strengths, weaknesses, opportunities and threats)
Implementation phase consists of 3 & 4
- implementing marketing mix (4 p's)
this is the marketing strategy
Control phase consists of step 5
-evaluating performance using marketing metrics
-ideas, aspirations of corporation
-stakeholders, investors, employees
-they should include: values of company and describe what they want to become when they "grow up"
-most critical group: shareholders
- diversification attempt
Market oriented vs. Product oriented mission statement?
-market> value expected by customer
SWOT Analysis what are internal and what are external
- strengths and weaknesses are internal
-opportunities and threats are external
ex: Nike page 38
Identifying & evaluating opportunities using STP
-consumers who respond similarly to a firms marketing efforts
-the process of dividing the market into groups of customers with different needs wants or characteristics who therefor might appreciate products or services geared for them
-info about your customers that you can group
ex: some might shop online, some research online, some look for entertainment
ex: income, race, gender sets people apart
ex: Hertz marketing the fast sports car to single people & couples wanting to have fun
-strategizing to your different segment groups
-evaluating each segments attractiveness and decides which to pursue
ex: Coke targets to men through Coke Zero and to women through Diet Coke cause men dont like to be associated with diets
-determining how to position within those segments
- defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what products does or represents in comparison with competing products
ex: ex: Starbucks using a variety of methods including geography ( e.g. college campuses, shopping strips, business districts) benefits (drinkers of caffeinated versus decaffeinated products )
Implementing Marketing Mix and Allocate Resources
this is where the 4 p's come for each product or service on the basis of what they believe their target markets will value.
Product value creation
-include services, constitute the first of the four p's
- developing products and services that customers perceive as valuable enough to buy.
-Dyson fans being a valuable alternative because they have not changed significantly changed since the early 1900s
Price Value Capture
-firms must charge a price that the customer perceives as giving them a good value for the product they receive
- influences revenue
- if a price is too high, it wont generate much volume
-if a price is too low, it might result in lower than optimal margins and profits
Place Value Delivery
-make the product or service readily accessible when the customer wants it
-ex: HomePlus in South Korea (virtual grocery stores, delivery groceries to doorstep)
Promotion and Value Communication
-communicate the value of offerings or the value of proposition to customers through a variety of media including tv, radio, magazine, social media.
ex: Groupon, LivingSocial (Whole Foods $20 off deal)
Evaluating Performance using Marketing Metrics
-evaluating the results of the strategy and implementation program
- makes it possible to compare results across regions
- can help determine why or why not the firm did not achieve goals
- relies heavily on market share> my market share compared to the industry
-measuring system that quantifies trend, dynamic, or characteristic.
- explain why things happen and also project the future
all projects company has done
Market growth rate is based off?
historical sales ex: avg. of past 10 years of sales measures your growth rate, but this approach isn't the best because it doesn't predict what will happen in the future. It is only a historical reference and not projection.
- the avg. describes fluctuations.
allocates resources according to which products are expected to be the most profitable for the firms future
Strategic business unit (SBU) or product line
level of the firm though managers also can use it to analyze brands or even individual item ex: goodyear
the percentage of a market account
used to establish the products strength in particular market
-usually discussed in units, revenue and sales
Relative market share
used in this application because it provides managers with products relative strength, compared with that of the largest firms industry
Market growth rate
annual rate of growth of the specific market in which the product competes. measures how attractive the particular market is
occur in high growth markets and are high market share products require heavy investment in promotions and new production facilities to fuel their rapid growth
- heavy users of resources to heavy generators of resources become cash cows
low growth markets but are high market share products
- products have already recieved heavy investements to develop their high market share they have excess resources
ex: the iPod (market shrank)
appear in high growth markets but have relatively low market shares
-managerially intensive products in that they require significant resources to maintain potentially increasing their market share
ex: iPad experiencing high growth rate but is experiencing increasing competition
low growth markets and have relatively low market shares
-not designed for stardom
usually phased out unless they are needed to complement or boost the sales of another product for competitive purposes
ex: iMac (growth rate is slow and has a small relative market) mainly for graphic designers, but apple shouldnt get rid of imac because it would leave a gapping hole in its portfolio and hurt its brand image as a computer company
Strategic planning is not sequential
the planning processes can move back and forth among these steps
Growth strategies are products and services that are both
current and new
Market penetration strategy
employs the existing marketing mix focuses and forces the firms efforts on existing customers
- easiest and most straight forward
-the more you promote and advertise the better purchase frequency
ex: MTV's Yoostar for Xbox that can allow gamers to watch MTV shows and also upload game scores to fbook and twitter
Market development strategy
employs existing marketing offerings to reach new market segments domestic or international
- risker approach especially if your use international expansion
-have to deal with different government regulations, cultural traditions ect.
ex: MTV is international spreading music and trends (fashion, food etc.) globally
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