Principles of Marketing Exam 1 Study Materials

What are the goals of marketing?

Create, Communicate, and Deliver Value!

What are the 4 “Eras” of Marketing?

1. Production Era

2. Selling Era

3. Relationship Era

4. Triple Bottom Line

What are the characteristics of the Production Era?

Assembly-Style Manufacturing takes off.

-Customers had to take whatever was available

-High Demand for limited quantity

-Marketing played a pretty insignificant role

What are characteristics of the Sales Era?

-Product availability exceeded demand

(Too much to sell, not enough buyers!)

-Management relied on salesforce to move products out of the warehouse to customers so that inventory wouldn’t pile up.

What are characteristics of the Relationship Era?

-CUSTOMER ORIENTATION!

-Companies had to learn their customer’s wants and needs and then work to exceed them.

-LOTS of research into what customers wanted.

What are characteristics of the Triple Bottom Line Era? (CSR)

Businesses want to maximize three components:

1. the financial bottom line

2. Social bottom line

3. environmental bottom line

What is Competitive Advantage?

What sets a firm apart from competitors to win over customers.

Firms identify, establish, and maintain one or more distinctive competencies.

What are the 4 P’s in marketing?

PRICE, PROMOTION, PLACE, PRODUCT! (most important being product!)

T or F: Effective implementation of the 4 P’s requires a great deal of planning?

TRUE!

Who are the 4 P’s centered around?

The TARGET market!

Decisions like : whether to base pricing on costs, demand, or price of competing products and whether to bundle products into a pricing package fall into which of the 4 P’s?

These are PRICING decisions

Decisions about : Product design, packaging, support services and maintenance, and upgrades and product variations fall under which of the four P’s?

PRODUCT!

Decisions about : Advertising, Sales Promotion, Public Relations, and Direct Marketing / Personal Selling fall under which of the 4 P’s?

PROMOTION!

Decisions about : when, how, and where the firm will make the product, whether to sell directly to the final customer or work through retailers or wholesalers, and choosing the right distribution strategy fall under which of the 4 P’s?

PLACE / DISTRIBUTION

What are the 3 levels of business planning?

1. Strategic Planning

2. Functional (Market) Planning

3. Operational Planning

Who conducts Strategic Planning?

Top-Level corporate management

What are the 5 steps in Strategic Planning

1. Define the mission

2. Evaluate the internal and external environment

3. Set organizational or SBU objectives

4. Establish the Business Portfolio

5. Develop Growth Strategies

Who oversees (Functional) marketing

Top functional-level management (like CMO)

What are the steps in (Functional) Market Planning

1. Perform a situation analysis

2. Set marketing objectives

3. Develop marketing strategies

4. Implement and control the marketing plan

Who oversees Operational Planning

Done by supervisory managers

What are the steps associated with Operational Planning?

1. Develop action plans to implement the marketing plan

2. Use marketing metrics to monitor how the plan is working

What does Defining the Mission Entail

Answers “What Business are we in?"

How do we Evaluate the Environment in Strategic Management?

We examine the external and internal environment of the business.

Factors like : Climate, Technology, Economy, Political, Legal, Competition, Media and Fashion are what type of a businesses environment?

External

Factors like Organizational Culture, Human Resources, Organizational Structure, Physical Assets, Profit and Cash Flow, and Management are what type of environment?

Internal Environment

How do employers communicate their environmental analysis?

SWOT analysis

What does SWOT stand for?

Strengths, Weaknesses, Opportunities, and Threats

What makes up a Business Portfolio?

The Business’s SBUs or businesses that the company operates (think Disney studios, theme parks, cruises)

What is the Boston Consulting Group Matrix used for?

BCG is a method used to analyze a business portfolio.

What does the BCG Matrix assess?

The growth potential for a company’s SBUs

Growth-Relative Market Share Matrix

Stars on the BCG Matrix represent what type of SBUS?

SBUs whose products have a dominant market share in a high-growth market.

Question marks on the BCG matrix represent what type of SBUS?

Question marks are SBUs who’s products have a small market share in a high growth market.

Cash Cows represent what on the BCG Matrix?

SBUs with a dominant market share in a low-growth market.

Dogs on the BCG matrix represent what?

SBUs with a low market share in a low-growth market. (Companies do NOT want dogs, they typically sell them off)

What are the 4 Product-Market Growth Strategies?

1. Market Penetration

2. Market Development

3. Product Development

4. Diversification

What is the Market Penetration Product-Market Growth Strategy?

Increase market share among EXISTING customers.

What is the Market Development Product-Market Growth Strategy?

Attract NEW customers to EXISTING products

What is the Product Development Product-Market Growth Strategy?

Create NEW products for PRESENT markets

What is the Diversification Product-Market Growth Strategy?

Introduce NEW products into NEW markets

What are the three major steps in the market research process?

1. Gather Evidence

2. Interpret Evidence

3. Apply What You’ve Learned

There are 4 steps that go into “Gathering the Evidence” what are they?

1. Define the Research Problem

2. Determine the Research Strategy.

3. Select the Research Design

4. Collect the Data

There are two major steps that go into Interpreting the Evidence, what are they?

1. Analyze and Interpret the Data

2. Prepare the Research Report

How do you “Apply What You’ve Just Learned?”

By implementing data-driven strategies!

What is The Research Strategy?

A step-by-step plan of action that gives direction to the researcher in planning, executing, and monitoring a study.

There are two major types of data - what are they?

1. Primary

2. Secondary

What is Primary Data?

Info gathered SPECIFICALLY for the research objectives at hand

What is Secondary Data?

Info gathered for some other purpose than the research objectives at hand.

What is Exploratory Research?

Describes less structured data collection methods.

Focus Groups are…?

Flexible group discussions about a product, ad, or concept

What is a moderator?

A focus group’s discussion leader.

What is the flow in a focus group?

They start off general, get more specific.

What are Case Studies?

An analysis of a business situation similar to the one at hand

Observation Research:

systematically recording the behavioral patterns of people, objects, and events in order to obtain marketing information.

What do observation methods of research answer?

They answer the Who, What, Where, When, How

Television and audio monitoring, monitoring website traffic, eye tracking technology, and scanner-based research are all examples of what type research techniques?

Observation Techniques!

Descriptive Research in Surveys does what?

Answers the how, who, what, when, why

Conclusions based on a large representative sample of a population

Collected through a survey, results published in quantitative terms

What is the difference between a cross-sectional study and a longitudinal study?

A cross-sectional study looks at a population at a given moment in time

a Longitudinal study follows participants over a LONG period.

What does Casual Research do?

Identifies the cause and effect between variables.

T or F : Experiments are a type of Causal data?

TRUE! Experiments help establish the relationship between variables in research.

What do experiements do?

Manipulate one variable (x) and note its affect on another variable (y) while controlling for all other extraneous variables.

What is a Population?

The entire group under the study as defined by research objectives.

What is a sample?

A smaller, manageable set of individuals representing the population under study.

What are the 2 types of sampling?

Probability & Non-Probability

What is the difference between probability and non-probability sampling?

Probability - gives every member of a population a known, random chance of being selected.

Non-Probability - Selects participants based on researcher choice/judgement. NOT randomly chosen.

What are the 2 types of non-probability sampling?

1. Convenience

2. Quota

What are the 3 types of probability sampling?

1. SRS

2. Stratified

3. Systematic

A sample with no control, non-representative of the population, and exploratory would be what type of sample?

A Non-Probability Convenience Sample

A sample that is: Purposefully selected to mirror the population, takes demographics into account, and is similar to stratified but non-probability is a _________ sample.

A QUOTA Sample

_________ Sampling assigns each frame element a number and then randomly selects participants

Simple Random Sampling (SRS)

In ___________ Sampling, the researcher selects a random starting point and then chooses a participant every ith element.

Systematic Sampling

_____________ Sampling involves two steps:

1. Divide the population into Strata

2. Randomly choose elements from each stratum.

Stratified Sampling