Baylor MKT 3305 Tu Final

Marketing

creating, communicating, delivering, and exchanging offerings that have value for customers and society at large

Production

focuses on the internal capabilities of the firm rather than the desires/needs of the market

Sales

the belief that people will buy more goods if aggressive sales techniques are used and that high sales results in high profit

Societal

organization exists not only to satisfy customer wants and needs and meet objectives, but also to preserve and enhance individuals' and society's long-term best interests

Marketing Orientation

a sale does not depend on an aggressive sales force but rather on a customer's decision to purchase a product

Why do companies adopt marketing objectives?

Marketing objective is a statement of what is to be accomplished. Without objectives, there is no basis for measuring the success of marketing plan activities.

Characteristics of good marketing objectives

SMART goals: Realistic, Measurable, Time Specific, Compared to Benchmark

SWOT

why do people create them?- Performing a SWOT analysis allows firms to identify their competitive advantage

How are strengths different from opportunities, etc?

SWOT analysis

(internal) Strengths, Weaknesses, (external) Opportunities, Threats

Competitive Advantage

a set of unique features of a company and its products that are perceived by the target market as significant and superior to those of the competition

Cost competitive advantage- low price, maintain profit margins

Product/Service competitive advantage

unique/valuable something a company offers

Niche competitive advantage

target a small segment

Sustainable competitive advantage

cannot be copied

Ansoff's Strategic Opportunity Matrix

Market penetration, market development, product development, diversification

Market Penetration

increase market share among EXISTING customers

Market Development

NEW customers, existing products

Product Development

NEW products, existing customers

Diversification

new products, new market (double whammy)

Strategic Business Unit (SBU)

a subgroup of a single business or collection of related businesses within the larger organization. Has its own resources (accounting, engineering, manufacturing, and marketing) Independent plans of other SBUs.

Pyramid of Social Responsibility

a model that suggests corporate social responsibility is composed of economic, legal, ethical, and philanthropic responsibilities and that the firm's economic performance supports the entire structure.

What influences ethical decision making?

The extent of ethical problems the healthier the organization, the easier the decision. Top management's actions on ethics. Consequences. Social Consensus. Harmful Outcome. Length of time between the action and the onset of consequences shorter the better. Number of people affected

Green Marketing

the development and marketing of products designed to minimize negative effects on the physical environment or to improve the environment (ex. TOMS, Ben & Jerry's)

Cause-related marketing

"cause marketing" -the cooperative marketing efforts between a for-profit firm and a nonprofit organization; mutual benefit. Relationship, not a donation.

External Marketing Environment

allows the firm to plan for the future. Team performs environmental scanning. The goal in collecting information is to identify future opportunities and threats (SWOT)

Must examine

Current customers, consumer decision making, identify most valuable customers, the competition.

Target Market

a group of people for which an organization designs, implements, and maintains a marketing mix intended to meet the need of that group, resulting in mutual satisfying exchanges.

Factors within external environment

social and component lifestyles

Social

social change most difficult external variable. Attitudes, values, lifestyles.

Component Lifestyles

the practice of choosing goods/services that meet one's diverse needs and interests rather than conforming to a single, traditional style. A person is no longer defined by his profession. People are entitled to many hobbies and interests. Values, demographic, economic

Values

strongly held and enduring belief ('merica)

Demographic

age, race, ethnicity, location

Economic

consumer's income, inflation, and recession. Education=earning potential

Purchasing power

is income compared to relative cost of living

Technological

increased R&D

Competitive

the number of competitors a firm must face, the relative size of the competitors, and the degree of interdependence within the industry.

Global Marketing

marketing that targets markets throughout the world

Culture

common set of values shared by citizens that determines what is socially acceptable.

Multinational Corporation

a company that is heavily engaged in international trade, beyond exporting and importing. Moves resources across countries. (Ex. Caterpillar, General Electric)

Tariff

tax on goods entering a country. Makes it easier for domestic firms to compete. Raises a company's prices to buyers or reduce the profits of their competition.

Quota

a limit on the amount of a specific product that can enter a country. Protection from foreign competition

Methods of entering global markets

Export, licensing/franchising, contract-manufacturing, joint venture, direct investment

Export

Adv: Low risk Dis: Low Return

Licensing/franchising

Sell license to manufacture its product to someone in foreign country Adv: Revenue in royalties Dis: Can create a competitor in long run

Contract-manufacturing

private label manufacturing by a foreign company. Put your brand on a foreign product Adv: Not heavily involved, broaden global marketing base without investing in overseas equipment Dis: may switch to joint or direct after base is established, temporary

Joint venture

when a domestic firm buys part of a foreign company or joins with a foreign company to create a new entity. Adv: Quick, inexpensive Dis: Risky, high failure rate, disagreements between partnerships

Direct investment

active ownership of a foreign company or of overseas manufacturing or marketing facilities Adv: Greatest reward Dis: Greatest risk

Consumer Behavior Decision making process

need recognition, information search, evaluation of alternatives, purchase, post-purchase behavior

Need Recognition -imbalance between actual and desired states -Want-got gap

Information Search

internal and external information search

Internal Information Search

recalling past information from memory

External Information Search

seeking information in the outside environment. Non marketing and marketing

Nonmarketing

controlled -not associated with marketers promoting

Marketing-controlled

biased, based on promotions

Evaluation of Alternatives

pro/con list

Post purchase behavior

Cognitive dissonance- inner tension a consumer experiences after recognizing an inconsistency between behavior and values or opinions. Anxiety.

Types of decision-making

level of involvement/effort. Routine, limited, extensive

Routine

consumers buy frequently purchased, low-cost goods and services, requires little search and decision time

Limited

requires a moderate amount of time for gathering information and deliberating about an unfamiliar brand in a familiar product category. Previous product experience but unfamiliar with brands. Sold out of Colgate toothpaste.

Extensive

most complex. Used when buying an unfamiliar product, requires a lot of research

Business Marketing

B2B is more geographically concentrated, Larger purchase quantities, Fewer customers, Professional, Complex Negotiating, Personal selling, Shorter channel for distribution, especially with B2B online exchange

Consumer Marketing

is more spread out, Smaller, More customers, Personal, Simple negotiations, Advertising, Goes through wholesalers, retailer

Market Segmentation

dividing up a market into meaningful, similar segments or groups. The purpose of market segmentation is to enable the marketer to tailor marketing mixes to meet the needs of one or more specific segments.

Why is market segmentation important?

Enables marketers to identify groups of customers with similar needs and to analyze the characteristics and buying behavior of the groups. Provides marketers with information to help them design marketing mixes specifically tailored. Segmentation is consistent with the marketing concept of satisfying customer wants and needs while meeting the organization's objectives

Criteria for segmentation

when does it make sense? Substantiality- large enough. Identifiable and measurable- data. Accessibility- must be able to reach members. Responsiveness.

Bases for Segmenting

geographic, demographic, psychographic

Demographic

age, gender, income, background, family life cycle

Psychographic

personality, motives, lifestyles, geodemographics (neighborhoods)

Positioning

developing a specific marketing mix to influence potential customers' overall perception of a brand, product line, or organization in general. Choosing which segment to target (Ex. KFC associates with fast-food fried chicken)

Repositioning

changing consumers' perceptions of a brand in relation to competing brands. Correct mistakes or sustain growth in slow markets. (Ex. Hiring PR company to reposition watches as a fashion accessory)

Marketing Research

links the consumer, customer, and public to the market through information. Provides decision makers with data on the effectiveness of the current marketing mix and insights for necessary changes.

Why do market research?

improves quality of decision making, helps trace problems, can help firms serve their customers Functional Roles. Descriptive, diagnostic, predictive

Descriptive

gathering facts (historical sales numbers)

Diagnostic

explaining data (impact on sales based on package changes)

Predictive

"what if" questions (predict results of a planned marketing decision)

Primary data

collected for first time, used for solving the particular problem under investigation

Secondary data

data previously collected for any purpose other than the one at hand

Types of survey research

in-home personal, mall intercept interview, computer personal, computer send-interview, phone, mail panel, executive interviews, focus groups

In-home personal interviews

expensive

Mall Intercept Interviews -hard to get represented sample, but you can clarify questions

Computer-assisted personal interview

interviewer asks questions and records onto computer

Computer-assisted self-interviewing

person is asked to take a survey on the computer

Central-location Phone interviews

low cost but few responses

Mail panel surveys

low cost, anonymous, but low response rates

Executive Interviews

interviewing businessmen in their offices

Focus Groups

7-10 people group discussion

Sample

a subset from a larger population

Universe

the population from which a sample will be drawn. Must be defined before choosing a sample. Must represent all people of interest.

Product Cannibalization

(page 154, ch. 8) a situation that occurs when sales of a new product cut into sales of a firm's existing products (ex. Apple's iPad mini became more popular than the regular iPad)

Classification of consumer products: convenience, shopping, specialty, unsought

Convenience

inexpensive, little effort (ex. Candy, soda, dry cleaning)

Shopping

fewer stores, compare brands. homogeneous and heterogeneous

Homogeneous

basically similar, lowest price wins

Heterogeneous

essentially different, universities, furniture

Specialty

Extensive search, reluctant to settle for substitutes (Branding)

Unsought

unknown product not actively seeking (insurance)

Product item

a specific version of a product that can be designated. Campbell's Chicken Noodle Soup

Product Line

a group of closely related product items Campbell's Soups

Product Mix

all products that an organization sells Campbell's (frozen foods, soups, drinks, etc)