MARK 4389 - Marketing Strategy and Planning: Exam 2 Review

Vocabulary review flashcards covering key strategic marketing terms, concepts, and frameworks from Sessions 6 through 10 for Exam 2 of MARK 4389.

Brand Positioning

The strategic practice of designing an offering and image to occupy a distinctive, valued place in the target customer's mind relative to competitors. Example: Volvo positioning its vehicles around safety and family protection rather than pure luxury or speed.

Physical Positioning vs. Perceptual Positioning

Physical approaches evaluate products strictly on objective, measurable technical specifications (e.g., comparing computers by processor clock speed and storage size). In contrast, perceptual approaches evaluate offerings based on subjective customer opinions and impressions (e.g., perceiving a brand as creative, intuitive, or prestigious).

Categories of Brand Attributes Influenced by Perception

Four attribute types that shape buyer impressions: Simple Physically Based (direct, observable traits like vehicle color), Complex Physically Based (multi-component traits assessed subjectively like ride smoothness), Essentially Abstract (non-physical emotional traits like prestige or coolness), and Price (monetary cost perceived as a signal of craftsmanship or status).

Determinant Attribute

A specific product feature or benefit that consumers actively rely on to differentiate and choose between competing brands during a purchase decision. Example: Airline on-time arrival reliability when ticket prices and schedules are otherwise equal.

Perceptual Map

A two-dimensional visual diagram plotting customer perceptions of competing brands along decisive evaluative axes. Example: A graph displaying vehicle brands plotted along two dimensions: Price (Budget to Premium) and Style (Sporty to Conservative).

Features vs. Benefits

Features are objective physical or technical characteristics engineered into a product (e.g., a phone with a 5,000 mAh battery). Benefits are the tangible value, solutions, or positive outcomes delivered to the consumer (e.g., using the device all day without needing a charger).

Five Key Branding Strategies

Core naming methods: Individual Branding (unique names per product, e.g., Tide and Cheer under P&G), Family Branding (a single master name across products, e.g., Heinz condiments), Brand Extension (applying an established name to a new product category, e.g., Virgin entering air travel), Embedded Branding (highlighting a branded component, e.g., Intel Inside), and Cobranding (pairing two independent brands on a single offering, e.g., Betty Crocker brownie mix made with Hershey's chocolate).

Product Warranties

Formal manufacturer guarantees promising repair or replacement if an offering fails, functioning as credible quality signals that lower perceived customer risk. Example: A 10-year/100,000-mile powertrain guarantee used to elevate consumer perceptions of automotive dependability.

Three Managerial Approaches to Setting Prices

Cost-Oriented (calculating direct expenses and tacking on a markup percentage), Competitor-Oriented (benchmarking against rival rates), and Customer-Oriented (aligning price with the perceived value and utility delivered to the buyer).

Limitations of Cost-Oriented and Competitor-Oriented Pricing

These frameworks ignore customer demand and perceived value. Focusing strictly on internal costs risks setting prices too high when demand is weak or undercharging when customers value the product highly; focusing strictly on rivals risks unprofitable price wars and ignores unique operational cost advantages.

Demand Curve

A graphic model showing the inverse relationship between unit price and the total quantity demanded by consumers over a given period. Example: Lowering movie ticket prices from $15$ to $10$, causing theater seat sales to rise.

Differential / Discriminatory Pricing

Selling the same product or service at varying prices to different market segments, purchase locations, or times without corresponding cost differences. Example: Offering discounted student or senior citizen movie tickets, or dynamic airline ticket pricing based on time of purchase.

Three Channel Efficiencies of Middlemen

Functional Efficiency (specialized execution of storage, transport, and sorting), Transactional Efficiency (reducing the total quantity of separate buyer-seller exchanges required across a market), and Scale Efficiency (consolidating product shipments across multiple producers to minimize unit distribution costs).

Three Primary Marketing Channel Institutions

Merchant Wholesalers (independent businesses that purchase, take legal ownership of, and store goods before reselling to retailers), Agent Middlemen (representatives who negotiate sales on commission without taking title, such as brokers), and Retailers (businesses that sell directly to final individual consumers).

Push Strategy vs. Pull Strategy

A push approach focuses promotional spending on distributors and retailers to incentivize stocking and displaying products (e.g., offering retail slotting allowances and trade discounts). A pull approach directs promotional campaigns at final consumers to generate demand that pulls items through the channel (e.g., consumer television advertisements prompting patients to ask their physician for a specific medication).

Core Components of the Promotion Mix

Advertising (paid, non-personal mass communication by an identified sponsor, e.g., a TV commercial), Personal Selling (direct interpersonal interaction between a sales rep and a buyer to build relationships and close deals, e.g., enterprise software demonstrations), and Sales Promotion (short-term purchase incentives, e.g., discount coupons, free trials, and buy-one-get-one offers).

AIDA Model

A sequential framework outlining the stages of promotional response: Attention (gaining initial awareness), Interest (building curiosity by explaining features and benefits), Desire (creating strong preference and emotional appeal), and Action (motivating immediate purchase or sign-up behavior).

Four Elements of Well-Defined Promotional Objectives

Target Audience (specifying the target demographic or market segment), Desired Outcome (identifying the required cognitive or behavioral response), Degree of Change (quantifying the precise metric, such as increasing brand recall from $20\%$ to $35\%$), and Time Frame (setting an exact deadline, such as within six months).

Integrated Marketing Communications (IMC) Plan

A comprehensive strategic blueprint that unifies all marketing tools, messaging, and channels into a coordinated voice. Example: Aligning digital social media ads, public relations statements, packaging design, and in-store displays around an identical brand slogan and visual palette.