Marketing Concepts, STP, and Consumer Behavior Flashcards

Vocabulary flashcards covering core concepts, business eras, competition levels, segmentation bases, targeting scenarios, positioning frameworks, the Calyx Flowers case, and consumer behavior theories.

Marketing

The art and science of creating value by designing and managing successful exchanges.

Production Era

A business era lasting from the 1800s to 1930s characterized by scarce goods, consumer focus on low prices, and an operational mandate to cut costs.

Product Era

A business era from the 1910s to 1950s marked by increased market competition and a primary strategic focus on designing technically superior products.

Sales Era

A business era spanning the 1920s to 1960s where the focus shifted to sellers aiming to sell more of what the company made, a strategy that stops working after initial execution.

Marketing Concept Era

A business era from the 1960s to 1990s centered on meeting consumer needs and wants better than competitors, highlighted by General Electric's 1952 annual report.

Customer Relationship Era

A business era running from the 1980s to the present that places the consumer at the center using customer data, Customer Relationship Management (CRM), experience design, and social responsibility.

Functional Needs

Practical, utilitarian benefits provided by a product that are objective, rational, and performance-driven, such as quality, reliability, and durability.

Emotional Needs

Subjective, personal, and experience-based benefits relating to psychological, social, or identity-driven fulfillment, such as a feeling of belonging or freedom.

Stated Need

A need that a customer explicitly recognizes and is able to express clearly.

Latent Need

A need that a customer possesses but may not yet recognize or be capable of articulating.

Product Form Competition

A level of competition occurring between products belonging to the exact same product type.

Product Class/Category Competition

A level of competition between products with similar features that satisfy the same basic functional or concrete consumer need.

Generic Competition

A level of competition between products that consumers view as fulfilling the same underlying emotional or abstract need.

Budget Competition

A level of competition among any products that require and consume the same customer resources, such as money or time.

Segmentation

The process of dividing a broad market into distinct subsets of consumers who share common needs and perceive, use, and buy a product similarly.

Demographic Segmentation

A market segmentation approach that groups consumers using population characteristics such as age, gender, education, income, occupation, and family life stage.

Geographic Segmentation

A market segmentation method that groups consumers by location attributes including region, metro size, population density, and climate.

Psychographic Segmentation

A market segmentation technique that groups consumers based on psychological traits such as lifestyle, personality, values, attitudes, and habits.

Behavioral Segmentation

A market segmentation method that groups consumers by observable actions such as purchase history, usage rate, brand loyalty, channel preference, and price sensitivity.

Benefit Segmentation

A market segmentation approach based on the assumption that the specific benefits sought by consumers represent the underlying reasons for true market segments.

80-20 Rule

A marketing principle stating that the top 20% of a company's clients or customers generate 80% of its overall profit.

Targeting

The process of evaluating the attractiveness of market segments and choosing one or more target segments on which to focus marketing efforts.

Shotgun Targeting

A broad targeting scenario where marketing efforts reach a wide population, including many consumers who are unlikely to buy the product.

Oversegmentation

A narrow targeting scenario where the defined target market is excessively restrictive, missing out on viable potential customers.

Sniper Targeting

An ideal targeting scenario where the operational marketing focus aligns precisely with the group of consumers who are likely to purchase the product.

Positioning

The act of framing a company's image and offering in target consumers' minds so that it occupies a distinct and valued place relative to competitors.

Frame of Reference

The competitive category or reference class that a brand belongs to, establishing how it competes to fulfill target customer needs.

Points-of-Parity (POP)

Shared attributes or benefits among competing brands that establish category membership and a baseline frame of reference.

Points-of-Difference (POD)

Unique attributes or benefits that set a brand apart from competitors and provide its specific value proposition.

Perceptual Map

A graphical marketing research tool that plots brand perceptions and consumer wants on the same set of attributes to visualize market positioning.

Vermont Teddy Bear Company

A gift delivery enterprise founded in 1981 operating four business units: BearGram, PajamaGram, TastyGram, and Calyx Flowers.

Calyx Flowers

A floral delivery subsidiary acquired in 2003 by Vermont Teddy Bear Company (formerly Calyx & Corolla) that ships fresh flowers directly from premier growers via express delivery.

Consumer Decision-Making Process

A five-stage framework outlining how consumers make purchases: Problem Recognition, Information Search, Evaluation of Alternatives, Purchase Decision, and Post-Purchase Behavior.

Involvement

The degree of personal importance, risk, or interest a consumer associates with a purchase decision, which determines the depth of information search and alternative evaluation.

Heuristics

Mental shortcuts or rules of thumb used by consumers to simplify decisions and balance effort against accuracy.

Reference Price

An internal or external price benchmark used by consumers to evaluate observed prices, determining willingness to pay, satisfaction, and product choice.

Anchoring Effect

A cognitive phenomenon where initial information encountered exerts a disproportionately heavy influence on subsequent decisions and price evaluations.

Prospect Theory Value Function

A behavioral economic model established by Dr. Daniel Kahneman demonstrating that values are evaluated relative to a reference point, losses loom larger than gains, and marginal value decreases as gains or losses grow.

Framing Effects

Cognitive biases where consumer choices and evaluations are altered by the context or presentation mode in which options are presented.