Marketing Exam 2

What are the five steps of the consumer decision-making process?

Needs recognition, Information Research, Alternative Evaluation, Purchase, PostPurchase Evaluation

Needs Recognition

Finding a need in day-to-day life for a product

Information Research

Search for information internal first, then external

Alternative Evaluation

Take the brands of consideration and compare

Purchase

What, Where, When, How of buying

Post Purchase Evaluation

Decide if satisfied with decision made

What are the different types of consumer buying decisions?

Routine, Limited, and Extensive

What type of consumer buying decision is low involvement, over a short amount of time, low cost, internal info search, and only one alternative?

Routine

What type of consumer buying decision is moderate involvement, time, and cost, mostly internal info search, and a few alternatives?

Limited

What type of consumer buying decision is high involvement, time, and cost, mixed internal/external info search, and many alternatives?

Extensive

What is involvement?

The amount of time and effort a buyer puts into the purchasing process

What factors impact the level of involvement?

Previous experience, interest, risk, and social visibility

What are the types of risk?

Financial, Physical, psychological, social

How does involvement impact marketing?

Involvement can make marketers work differently.

What cultural factors affect decision making?

Culture, subculture, and social class.

What psychological factors affect consumer decision-making?

Perception, Motivation, Learning, Beliefs, and Attitudes

What is Selective Exposure?

Consumer notices certain stimuli and ignore others

What is Selective distortion?

Consumer changes or distorts information that conflicts with their beliefs

What is Selective Retention?

Consumer remembers only information that supports their current beliefs

What is Maslows Hierarchy of needs?

Psychological Needs, Safety Needs, Social Needs, Esteem Needs, Self Actualization.

What is Business Marketing?

Marketing where products are bought for some reason other than personal want or need

What are the four major categories of business market customers?

Producers, Resellers, Governments, Institutions

Which business consumer category produces the goods?

Producers

Which business consumers category buys produced goods and sells them for a profit?

Resellers

Which business consumers category is set at the federal level?

Government

Which business consumers category seeks to achieve a goal other than profit?

Institutions

What are the 11 ways that business and consumer markets are different?

Demand, Purchase Volume, Number of Customers, Concentration of Customers, Distribution Structure, Nature of Buying, Nature of Buying Influence, Types of Negotiations, Use of Reciprocity, Use of Lease, and Type of Promotion Used.

What is demand?

Quantity of a good sold at different prices

What are the four types of demand?

Derived, Inelastic, Joint, and Fluctuation

What is Derived demand?

Demand with different customers where demand for one item determines another

What is Inelastic demand?

Demand that will not change at the price of a product.

What is Joint demand?

Demand with ONE customer where demand for one thing determines the demand for another

What is Fluctuation demand?

Demand for business products is less stable than demand for consumer products

What is purchasing volume?

The amount purchased in one order

Do business customers buy in larger or smaller quantities?

Larger

What is number of customers?

How many customers a business market has

Do business customers more or fewer customers than consumer markets?

Fewer

What is concentration of customers?

How concentrated a business markets customer base is to one geographic area

Do Business markets tend to be more or less geographically concentrated?

More

What is distribution sequence?

How products move through a channel of distribution

Are channels of distribution in business markets longer or shorter than consumer markets?

Shorter

What is Nature of Buying?

The nature of the markets decision making process

Are business markets more formal or casual in their Nature of buying?

Formal

What is Nature of Buying Influence?

The amount of people brought in on a decision

Do business markets bring in more or less people on a decision than consumer markets?

More

Do businesses negotiate more or less than a consumer market?

More

Is Reciprocity more or less common with Business markets?

More

Is Leasing more or less common in Business market?

More

What kind of selling do Business markets typically use?

Personal Selling

What are the seven types of Business goods and services?

Major Equipment, Accessory Equipment, Raw Material, Component Parts, Processed Material, Supplies, and Business Services

What type of good is Capital goods, like X-Ray Machines?

Major Equipment

What type of good is less expensive, with a shorter life span, like a laptop?

Accessory Equipment

What type of business good is unprocessed, and used to make something new, like raw cotton or fruit?

Raw Materials

What type of business good is a finished good on its own, but is used with something else, like batteries?

Component Part

What type of business good have been processed into something a business can use, like sheet metal or chemicals?

Processed Materials

What type of business good is used by the business but not sold as a product, like hand soap or copy paper?

Supplies

What type of business good are expense items that don’t go into a final product, like advertisement or insurance?

Business Services

What is STP Process?

The process that helps to create a marketing process

What does STP stand for?

Segmenting, Targeting, and Positioning

What is a Market?

People or organizations with Needs or wants and the Ability and Willingness to Buy

What is a Market Segment?

A part of the population with similar characteristics

What is Market Segmentation?

Separating the population into smaller, simillar groups

Why is Market Segmentation so important?

Segments make marketing to different consumers easier

How do marketers know if a segment is worth pursuing?

Substantial, Measurable, Identifiable, Accessible, and Responsive

What does it mean if a segment is substantial?

It is large enough to merit a marketing mix

What does it mean if a segment is Measurable and Identifiable?

It is able to be measured and distinquished

What does it mean if a segment is Accessible?

It is able to be reached

What does it mean if a segment is Responsive?

It will respond to the marketing mix differently

What are Segmentation bases?

The characteristics used to divide the market into segments

What are the most commonly used segmentation bases for consumer markets?

Geography, Demographics, Psychographics, Benefits Sought, and Usage Rate

What are psychographics?

Personality, Lifestyle, Motives,

What is the 80/20 Principle?

The idea that 20% of the population generates 80% of the companies income

What are the 3 strategies for selecting a target market?

Undifferentiated, Concentrated, and Multisegmented

What is an Undifferentiated strategy?

Market is one big market, with one marketing mix

What are the advantages of an Undifferentiated strategy?

Potential savings on production and marketing cost

What are the disadvantages of an Undifferentiated strategy?

Unimaginative product offerings, and more susceptible to competition

What is a Concentrated strategy?

Choose one segment and use a marketing mix to target, Niche

What are the advantages of a Concentrated strategy?

Concentration of resources, and small firms can compete

What are the disadvantages of a Concentrated strategy?

Segments too small or changing, large companies may market to niche market

What is a Multi-Segmented strategy?

Takes 2 or more segments and targets them with their very own marketing mix

What are the advantages of a Multi-Segment strategy?

Greater economic scale and financial success

What are the disadvantages of a Multi-Segment strategy?

cannibalization and more expensive

What is Positioning?

What your customers think about when thinking about yout brand.

How do firms implement positioning strategies?

Changing the marketing mix to shift perception

What are the most common positioning bases?

Attribute, Price, Quality, User Application, Product Use and Class, Competitor, Emotion

What is repositioning?

Changing consumers perception of a brand in relation to competitors

What is a Product?

Everything a person receives in an exchange

What are the two types of Product?

Consumer and Business

What is a Business product?

A product used to produce other goods and services, facilitate an organizations operations, or resell to a consumer

What is a Consumer product?

A product bought to satisfy an individuals personal wants or needs

What are the 4 types of consumer products?

Convenience, Specialty, Shopping, and Unsought

What is a convenience product?

Cheap and accesible

What is a shopping product?

Slightly more costly and less accesible

What is a specialty product?

Expensive, hard to find

What is an unsought product?

Products a buyer does no actively seek, like funeral services

What is a product item?

A specific version of a product that is distinct from other products

What is a Product Line?

A group of closely related products

What is a Product Mix?

All products an organization sells

What are the 3 ways brands can make a change to their products?

Modifications, Repositioning, Extension or Contraction

What does it mean to modify a product?

To change it functionally, or change the style