Exam 1 (Marketing 220)

Marketing 220 Exam 1 on September 2, 2025.

Marketing

The process of creating, distributing, promoting, and pricing goods and ideas to facilitate satisfying exchange relationships with customers. and to develop and maintain favorable relationships with stakeholders, in a dynamic environment.

Markting Mix

1. Product

2. Price

3. Promotion

4. Distribution

Customer needs

What’s in the center of marketing mix?

Goods, services, and ideas.

Product equals what?

Good

A physical entity you can touch.

Service

Application of human or mechanical effort to provide intangible benefits.

Idea

Concepts, philosphies, images, or issues with the main goal to change/reinforce attitudes.

1. Two or more parties with something of value.

2. Each party possesses something of value that the other party desires.

3. Each party must be willing to give up something of value to receive something of value.

4. Exchange must meet expectations.

What are conditions for a successful exchange?

1. It is used in all organizations.

2. It’s important to businesses.

3. It fuels our global economy by expanding internationally.

4. The knowledge of it enhances consumer awareness.

5. It costs consumers a sizable portion of buyers’ dollars.

Why is marking important to our global economy?

The Marketing Concept

A philosophy that states that organizations should provide products that guide how you do your marketing activity by satisfying customer needs and allowing organizations to achieve their goals.

Production Era of the Marketing Concept

Industrial Revolution to mid-1920’s.

Sales Era of the Marketing Concept

Took place in the 1950’s that consisted of door to door sales, but no one cared what you wanted to buy, they just wanted to sell.

Marketing Era of the Marketing Concept

Taking place during the present time.

Relationship Marketing Era

A new era in the Marketing Concept that is establishing long-term, mutually satisfying buyer-seller relationships.

Marketing Strategy

1. Target market selection.

2. Marketing mix development.

3. Influence of the environment.

Competitive

Other organizations that market products that are similar to, or can be substituted for, a marketer’s products, in the same geographic area.

1. Monopoly

2. Oligopoly

3. Monopolistic Competition

4. Pure Competition

What are the types of competitive environments?

Monopoly

Only one competitor that has many barriers to enter the market and almost no substitutes of products.

Oligopoly

Few competitors control the whole market with some barriers to enter and varied products.

Monopolistic Competition

Many competitors with few barriers to enter into the market and many different products that could be substituted.

Pure Competition

Unlimited number of competitors with no barriers to enter into the market and a homogenous (identical) product, easy to substitute.

Business Cycle

A pattern of economic fluctuations that has 4 stages.

Expansion

Low unemployment and high total income.

Recession

Rising unemployment and declining total income.

Depression

Consumers are only buying necessities.

Recovery

Employment is improving and income is high.

Buying Power

The number of resources, such as money, goods, and services, that are available to make purchases.

1. Income

2. Credit

3. Wealth

What are the 3 resources of buying power?

Willingness to Spend

An inclination to buy because of expected satisfaction from a prodcut.

1. It’s less likely they will enact laws to hurt your compnay.

2. They play a key role in gaining access to foreing markets.

Why should businesses maintain favorable relationships with politicians?

Pro-Competitive Legislation

Laws designed to preserve competition.

Consumer Protection Legislation

Laws that deal with consumer safety, hazardous materials, information disclosure, ect.

Federal Regulatory Agencies

Federal Trade Commission (FTC), the “marketing police”.

Technological

The application of knowledge and tools to solve problems and perform tasks more efficiently.

Socio-Cultural

Demographic diversity and characteristics of consumers.

Markets

Group of individuals or organizations that have needs for products in a product class.

Consumer Market

A group of customers who buy products and services for the personal use or for sharing with others.

Organizational or Business-to-Business Market

Organizations purchasing products to resell for a profit, to use in the organization, or to produce other products.

1. Need

2. Ability to purchase (money).

3. Willingness

4. Authority

What are requirements to be a viable market?

1. Identify the appropriate targeting strategy.

2. Determine which segmentation variables to use.

3. Develop market segment profiles.

4. Evaluate relevant market segments.

5. Select specific target markets.

What are the 5 Steps in the Target Market Selection Process?

Undifferentiated Strategy

Organization (Selling) —> Single Marketing Mix —> Target Market

Undifferentiated Strategy

Which strategy is pretty much nonexistent in the United States because there aren’t enough single marketed products?

Concentrated Strategy (through Market Segmentation)

Organization —> Single Marketing Mix —> Target Market

Concentrated Strategy

Which strategy do you need to find a subgroup to concentrate on?

Differentiated Strategy (through Market Segmentation)

Organization with multiple marketing mixes and multiple target markets.

Differentiated Strategy through Market Segmentation

Which strategy is the most used in the United States?

1. Demographic

2. Geographic

3. Behavioristic (Usage)

What are the segmentation variables?

Market Potential

The maximum volume of sales that could be available to all companies in each industry over a specific period.

Company Sales Potential

The maximum percentage of market potential that an individual firm within an industry can expect to capture for a specific product.

Target Market

A specific group of customers on whom an organization focuses its marketing efforts.

Market Segmentation

The process of dividing a broad consumer or business market into subgroups based on common characteristics.