MARK 3000 Principles of Marketing - Final Exam Review

A collection of flashcards based on key concepts and terms from the MARK 3000 Principles of Marketing lecture notes.

What are the 4 P’s of the marketing mix

The 4 P's of the marketing mix are Product, Price, Place, and Promotion, which are crucial elements in marketing strategy.

What does the product in the market mix involve

Creating value by developing goods, services, and ideas to satisfy customer needs

What does price in the marketing mix involve

Capturing value; everything a buyer gives up (money, time, effort, comfort) in exchange for the product

What does Place in the marketing mix involve

Delivering value; the marketing processes necessary to get the product to the right consumer at the right time

What does promotion in the marketing mix involve

Communicating value; informing, persuading, and reminding potential buyer to influence their purchase decisions

Sustainable competitive advantage

an advantage over competition that is not easily copied and can be maintained over a long period of time

Customer Excellence

Achieved when a firm develops strategies for retaining loyal customers and provides outstanding customer service

Operational Excellence

Achieved through efficient operations, excellent supply chain management, and strong relationships with suppliers

Product Excellence

Achieved by developing superior and innovative products with high perceived value enhanced by effective branding and positioning

Locational Excellence

Achieved by having a dominant physical and/or online presence, making it easy for consumers to access products and services

SWOT Strengths

Characteristics of the business that give it a competitive advantage

SWOT Weaknesses

Characteristics of the business that give it a competitive disadvantage

SWOT Opportunities

Elements in the environment that could improve performance

SWOT Threats

Elements in the environment that could endanger performance

Market Penetration

Existing goods or services in current markets

Market Development

Existing goods or services in new markets

Product Development

New goods or services in current markets

Growth Strategies

New goods or services in new markets

Immediate Marketing Environment

Consumers are directly influenced by the actions of their immediate environment: • The capabilities of the company • The company’s competitors • The company’s corporate partners • The physical environment in which the consumer lives

Functional Needs

the basic requirements or performance of a product or service

Psychological Needs

the emotional needs or personal gratification associated with a product or service

Performance Risk

The perceived danger inherent in a poorly performing product or service

Financial Risk

Associated with a monetary outlay and includes the initial cost of the purchase as well as the costs of using the item or service

Social Risk

Involves the fears that consumers suffer when they worry others might not regard their purchases positively

Physiological Risk

Refers to the fear of an actual harm should the product not perform properly

Psychological Risk

Risks associated with the way people will feel if the product or service does not convey the right self-image

Compensatory decision rules

assume the consumer, when evaluating alternatives, weighs characteristics against each other, such that good characteristics compensate for bad

Non-Compensatory decision rules

consumers choose a product or service based on one characteristic, regardless of the values of other attributes

Demographic Segmentation

groups consumers according to easily measured, objective characteristics such as age, gender, income, and education

Geographic Segmentation

organizes customers into groups based on where they live

Loyalty Segmentation

creates a group repeat customers

Segment Evaluation Identifiable

who is within their market to be able to design products or services to meet their need

Segment Evaluation Substantial

If a market segment is too small or has limited buying power, it won’t generate sufficient profits

Segment Evaluation Reachable

Does the consumer must know that the product or service exists? • Do they understand what it can do for him or her? • Do they recognize how to buy it?

Segment Evaluation Responsive

Will our offering uniquely meet this consumer need? • If a firm cannot provide products and services to the segment, it shouldn’t be targeted

Segment Evaluation Profitable

firms need to assess potential profitability of each segment, both current and future • Key questions: • What’s the current or future market growth rate? • How competitive is the market? • Are there significant costs to access the market

Secondary Data

Collected prior to the start of the research project • Sourced both internally and externally • Gaps identified can be addressed with primary data Pro: Readily accessible Con: May not be specific or timely enough to meet the firm’s research objectives

Primary Data

Collected to address specific research needs through methods such as focus groups, in-depth interviews, surveys, etc. • Sample chosen to represent target customers Pro: Designed to specifically address research questions Con: Expensive and time consuming

Quantitative Research

involves structured responses that can be statistically tested to confirm insights and hypotheses • Quantitative research methods include: Surveys and Experiments

Qualitative Research

uses broad, open-ended questions to understand the phenomenon of interest • Qualitative research methods include: Observations, Interviews, and Focus Groups

Product Complexity Actual Product

Quality, Brand name, Packaging, features

Product Complexity Associated Services

Financing, Warranty, and Support

Product Mix Breadth

Number of different product lines within a product mix

Product Mix Depth

Number of different offerings within a product line

National Brands

owned and managed by manufacturer

Private Label Brands

retail or store brands, are products developed by and sold by retailers

Diffusion of Innovation

the process by which the use of an innovation spreads throughout a market grou

Innovators

1st in the Innovation Adaption Curve (2.5% market share)

Early Adopters

2nd in the Innovation Adaption Curve (13.5% market share)

Early Majority

3rd in the Innovation Adaption Curve (34% market share)

Late Majority

4th in the Innovation Adaption Curve (34% market share)

Laggards

5th and last in the Innovation Adaption Curve (16% market share)

Product Life Cycle

The stages that products move through as they enter, get established in, and ultimately leave the marketplace

Development

1st phase of product life cycle, low revenue and negative profit

Introduction

2nd phase of product life cycle, revenues are growing but profits are still negative

Growth

3rd phase of product life cycle, fastest revenue growth and profits become positive

Maturity

4th phase of product life cycle, highest revenues, peak then slow decrease in profits

Decline

5th and last phase of product life cycle, revenues and profit drop off fast

Service

any intangible offering that involves a deed, performance, or effort that cannot be physically possessed

Intangible

The most fundamental difference between a product and a service. Services cannot be touched, tasted, or seen like a pure product can • Instead, consumers must use cues to judge the quality of a service

Inseparable

Services are produced and consumed at the same time. After a provider has completed the service, it cannot be modified or undone • Firms can lower this perceived risk by offering guarantees or warranties

Heterogenous

the inherent variability in the service’s quality because of that service being performed by humans • The more humans are integral to the delivery of a service, the more likely there is to be heterogeneity

Perishable

they cannot be stored or stockpiled for use in the future • A seat on an airplane or in a restaurant that goes unsold cannot be reclaimed or sold at a later time • Perishability of services creates unique challenges for firms in terms of managing supply and demand

Distributive fairness

a customer’s perception of the benefits he or she received compared with the costs or los

Procedural fairness

the perceived fairness of the process used to resolve them

Demand Curve

As price increases, demand decreases

Complementary Products

a product that adds value to another good or service when they are consumed together • Demand for complementary products are positively correlated, meaning they move up and down together (Hot dogs and buns)

Substitute Products

a product that serves the same purpose as another good or service for consumers • Demand for substitute products are inversely related, meaning when one goes up the other goes down. (Uber and lyft)

Variable Costs

are costs that vary based on the volume of goods or services being produced (labor and materials)

Fixed Costs

costs that remain at a consistent level regardless of the volume of goods or services being produce. (rent, utilities, and equipment)

Sender

Origin of the message (the firm). (Chick-fil-a)

Transmitter

Marketing department of agency partner

Channel

Medium transmitting the message (ESPN)

Reciever

Consumer target who sees or hears message

Awareness

(Think) the customer’s ability to recognize or recall a brand of retailer, product, or service

Interest

(Think/Feel) messages must persuade consumers that the product worth further investigatio

Desire

After the firm has piqued the interest of its target market, the goal of subsequent messages should move the consumer from “I like it” to “I want it,

Action

(Do) The ultimate goal of any form of communications is to drive the receiver to purchase

Aided Recall

refers to a consumer’s recognition of a brand after the name is presented to them. “Are you familiar with the store Publix?

Top-of-Mind Awareness

indicates a higher level of awareness in which a consumer mentions a specific brand of product or service before all others. “Name a grocery store.” “Publix.

Lift

incremental increase in sales, during the time of the campaign

Product-focused advertisements

inform, persuade, or remind consumers about a product or service

Institutional advertisements

promote a company, corporation, business, or institution to improve or enhance public perception

Public service advertisements (PSAs)

are designed to raise awareness of public welfare issues

Informational appeals

are more cognitive and persuade using rational thought, helping consumers make purchase decisions by offering factual information

Emotional Appeals

persuade by triggering an emotional response rather than offering rational arguments and focus on feelings about the self

advertising

Promote products and services, Full control over message and

placement, Paid media, Seen as less credible, One-way communication, Expense driven by media buying, Short-term campaigns

Public Relations

Build and maintain a public image, Limited control (media may alter or

reject the message), Earned media (news, social buzz, etc), Seen as more credible, Two-way communication, Typically lower cost, but time-intensive, Long-term reputation management

Personal Selling

the two-way flow of communication between a buyer(s) and a seller, designed to influence the buyer’s purchase decision

Generate and Qualify Leads

1st step of personal selling, generate a list of potential customers and assess whether or not they are worth pursuing

Pre-Approach

2nd step of personal selling, occurs prior to meeting the customer for the first time and serves as an extension of the qualification process, You never get a second chance to make a first impression,” so salespeople prepare accordingly

Sales presentation & overcoming reservations

3rd step of personal selling, The salesperson should warm up the potential client by getting to know them, establishing rapport, and increasing their interest in the details of the presentation, A good salesperson can predict where reservations are likely to arise and prepare an appropriate counter argument

Closing the sale

4th step of personal selling, obtaining a commitment from the customer to make a purchase

Follow-Up

5th step of personal selling, ensuring that customers are satisfied with their purchase

Financial Rewards

their salary, commission, bonus, or contest prizes

Non-financial rewards

recognition from peers and management, merchandise premiums, free trips or additional vacation time

Direct Marketing Channel

there are no intermediaries between the buyer and seller

Indirect Marketing Channels

one or more intermediaries work with manufacturers to provide goods and services to customers