MRKT Unit 2 Key Terms and Concepts

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This contains the key terms and concepts in the notes for MRKT 341 Chapt 5-8

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70 Terms

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consumer buyer behavior
the buying behavior of final customers
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consumer market
all individuals and households that buy goods and services for personal consumption
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opinion leader
exerts social influence on people in the reference group because of special skills, knowledge, personality, etc.
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social networks
online social communities where people exchange information and opinions (ex. Instagram)
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perception
the process by which people select, organize and interpret information to form a meaningful picture of the world
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learning
changes in individuals behavior arising from experience
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need recognition
first stage of buyer decision process; customer recognizes a problem or need
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info search
second stage of the buyer decision process; customer is motivated to search for more information
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alternative evaluation
third stage of the buyer decision process; the customer uses information to compare brands in the choice set
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purchase decision
fourth stage of the buyer decision process; the customer purchases the product/service
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post purchase behavior
fifth stage of the buyer decision process; consumer take further action based on their satisfaction or dissatisfaction
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cognitive dissonance
buyer discomfort caused by post purchase conflict
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customer journey
sum of ongoing experiences consumers have with a brand that affect their buying behavior, engagement, and brand advocacy over time
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high involvement
takes more time to plan, more decisions need to be made, usually more expensive; ex) dream vacation
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low involvement
inexpensive, few attributes, and short purchase decision time; ex) can of beans
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prospect theory
losses loom larger than gains; ex) a product that is marketed to work 95% of the time will attract more buyers than a product that is marketed to fail 5% of the time
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anchoring
consumers use reference points when making judgements
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Why is consumer behavior important?
Allows marketers to understand, appreciate and predict/influence potential customers
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Factors that influence consumer purchase decisions/buying behavior
personal, situational, psychological, and social
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How do marketers use the levels of customer involvement to make business descions?
To determine how to sell the product to customers; For instance, it would take more convincing for a customer to buy their dream vacation compared to a can of beans. So more money would need to be put into ads for the dream vacation.
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Stages of the consumer buying process
1) Need recognition

2) Information search

3) Evaluation of alternatives

4) Purchase decision

5) Post Purchase Behavior
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reciprocity theory
people feel obliged to give back to others; ex) if the server provides the table with a mint along with the bill, their tip will most likely increase
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scarcity theory
people feel the need to get their share before the product is all gone; ex) toilet paper at the beginning of COVID
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likeability theory
people prefer to say yes to people they like; ex) if the author of a book includes a personal message, you’ll be more likely to recommend the book and maybe buy more copies to give out to people
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consensus theory
people will look to the behavior of others to determine their own actions; ex) if you go into an empty drive thru, you’ll likely see cars enter in behind you
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Why do marketers use segmentation?
To determine who the market is and how to sell the product so it’s appealing to their target market
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segmentation
dividing a market into distinct groups of buyers who have different needs, characteristics, or behaviors and who might require separate marketing strategies or mixes
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target market
a set of buyers who share common needs that a company decided to serve
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What are characteristics of a great target market?
size/growth, structural attraction, and skills/strength
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How do marketers segment a market?

1. Understand the benefits the customers seek
2. Partition the market and develop prototypical customer profiles based on those benefits
3. Find observable variables that discriminate among the benefit segments
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Categories of the Segmentation Library
benefits sought, behavioral, demographic, geographic, psychographic, and business to business
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Benefits sought segments
dividing the market into segments according to different benefits that the customer seeks from the product
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geographic segments
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demographic segments
dividing the market into segments according to observable variables like age, gender, religion, etc.
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psychographic segments
divides the market into segments according to personality and lifestyle
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behavioral segments
divides the market according to usage, occasion, user status, usage rate or loyalty status
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postioning
arranging the market offering to occupy a clear, distinctive and desirable place relative to competing products in the minds of target consumers
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positioning statement
To (target segment and need) our (brand) is (concept) that (point of difference); summarizes company/brand positioning
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value proposition
the full positioning of a brand - the full mix of benefits on which it is positioned
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competitive advantage
gained by offering greater customer value either by having lower prices or providing more benefits that justify higher prices
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mass marketing
undifferentiated; whole market in one offer
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niche marketing
concentrated; large share of one or a few segments
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micromarketing
tailoring products and marketing programs to the needs and wants of specific individuals and local customer segments; local and individual marketing
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local marketing
form of micro-marketing that tailors to cities, neighborhoods and even specific stores
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What is a differentiated offering?
What a company does to make their product/service unique and better than competing offerings
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Why does great marketing need differentiation?
It gives the customer a reason to buy the offering over all other offerings
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product
anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need
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service
activity, benefit, or satisfaction offered for sale that is essentially intangible and does not result in the ownership if anything
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core value
basic benefits gained from buying the product/service
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actual product
the features the product/service offers
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augmented product
peripherals for the product; ex) warranty, delivery, manual, etc
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consumer product
bought by the final consumer for personal consumption
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convenience product
bought frequently, immediately, and with minimal comparison and buying effort
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shopping product
product that is usually compared on attributes like suitability, quality, price and style
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specialty product
unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort
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service intangibility
services cannot be seen, tasted, felt, heard, or smelled before they are bought
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service inconsistency
a.k.a. variability; ex) Shawn Mendes’ concerts vary from night to night
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service inventory
the services perish
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brand equity
differential effect that knowing the brand name has on customer response to the product or it’s marketing
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brand value
total financial value of a brand
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private label
a brand created and owned by the reseller of the product; ex) Cheerios
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co-branding
practice of using an established brand names of two different companies on the same product
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line extension
extending an existing brand name to new forms, colors, sizes, ingredients, or flavors of an existing product category
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category extension
applying an existing brand name to a new product in a different product category; a.k.a. brand extension
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new product development cycle
introduction → growth → maturity → decline
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introduction (PDC)
new product is first distributed and made available for purchase
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growth (PDC)
sales start climbing quickly
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maturity (PDC)
sales growth slows or levels off
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decline (PDC)
sales fade away
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7Ps
product, price, place, promotion, people, process, physical space and productivity