Principles of Marketing Final Study Guide

Marketing Research

Collects and analyzes new information about customers and markets (surveys, internet, studies).

Marketing Information System (MIS)

A system that continually gathers, organizes, and analyzes data from internal records, external sources, and research studies to support decision-making.

Key tools of MIS

Data warehouses, intranets, decision support systems, dashboards, and models for predicting outcomes.

Four V's of Big Data

Volume, Variety, Velocity, Veracity.

Volume

Very large amounts of data.

Variety

Many types of data (text, numbers, images).

Velocity

Data is created and received quickly.

Veracity

Accuracy and trustworthiness of data.

Focus Group Interviews

Small-group discussions used in qualitative research.

Advantages of Focus Groups

Provide in-depth insights quickly and cheaply.

Disadvantages of Focus Groups

Not always representative of the entire market; results may be influenced by researcher bias.

Qualitative Research

In-depth, open-ended responses that explore opinions and feelings.

Quantitative Research

Structured, numerical data that can be measured and analyzed.

Scientific Method in Marketing Research

Order of Steps: Define the problem, Analyze the situation, Collect new data, Interpret the data, Solve the problem.

Definition of Product Lines

A group of closely related products offered by a company.

Product Assortment

The full set of all product lines and individual products a firm sells.

Product Offering

Includes the physical product, service, or idea plus anything that adds value (quality, design, service, warranty).

Levels of Brand Familiarity

Brand Rejection, Non-Recognition, Recognition, Preference, Insistence.

Brand Rejection

Buyer refuses to purchase the brand.

Brand Non-Recognition

Buyer is unaware or indifferent.

Brand Recognition

Buyer recognizes the brand when presented.

Brand Preference

Buyer prefers one brand over others.

Brand Insistence

Buyer will only accept one specific brand.

Classifications of Brands

By Strategy and By Ownership.

Family Brand

Same brand name used for several products.

Individual Brand

Separate brand for each product.

Knockoffs

Similar look, legal but not identical.

Counterfeits

Illegal copies made to look authentic.

Consumer Product Classes

Convenience, Shopping, Specialty, Unsought Products.

Product Life Cycle (PLC)

Describes how sales and profits change over time.

Stages of Product Life Cycle

Introduction, Growth, Maturity, Decline.

Total Quality Management (TQM)

A company-wide commitment to continuous improvement.

Characteristics of Services

Intangibility, Inseparability.

Intangibility

Services cannot be touched or stored.

Inseparability

Service is produced and consumed at the same time.

Heterogeneity

Service quality may vary from person to person.

Perishability

Services cannot be stored or inventoried.

Repositioning

Changing how consumers perceive a product or brand.

Three Types of Pricing Objectives

1. Profit-Oriented Pricing - Focuses on maximizing profit or return on investment. 2. Sales-Oriented Pricing - Aimed at increasing sales volume or market share. 3. Status Quo Pricing - Seeks stability by matching competitors' prices.

Price Skimming

Start with a high price, then lower it over time to reach new customer segments.

Penetration Pricing

Start with a low price to quickly gain market share and discourage competitors.

Loss Leader Pricing

Pricing a product very low to attract customers.

Geographical Pricing

Different prices based on location.

Psychological Pricing

Pricing to influence perception (e.g., $9.99).

Dynamic Pricing

Prices change based on demand or time.

Promotional Pricing

Discounts and sales for short time periods.

Everyday Low Pricing

Constant low prices instead of sales.

Price Dumping

Selling products in a foreign market at below cost or below the price charged at home.

Price Fixing

When competitors illegally agree on prices instead of competing.

Cash Discount

Price reduction for early payment.

Quantity Discount

Lower price for buying in bulk.

Seasonal Discount

Lower prices during slow seasons.

Trade Discount

Given to distributors or retailers.

Promotional Discount

Temporary price cuts to encourage buying.

Employee / Loyalty Discounts

Rewards repeat customers or staff.

Types of Retailers

1. Specialty Stores - Focus on one type of product. 2. Department Stores - Carry many product lines. 3. Supermarkets - Large self-service grocery stores. 4. Discount Stores - Low prices on brand-name goods. 5. Convenience Stores - Small stores with limited selection. 6. Off-Price Retailers - Sell brand items at reduced prices. 7. Online Retailers - Sell products through websites or apps. 8. Warehouse Clubs - Sell in bulk with low prices and memberships.

Types of Wholesalers

1. Merchant Wholesalers - Buy goods and resell them to retailers. 2. Agents and Brokers - Arrange sales but don't own products. 3. Manufacturers' Sales Branches - Operated by manufacturers to distribute products. 4. Specialty Wholesalers - Handle specific product types.

Stockturn Rate

Measures how quickly inventory is sold and replaced.

Scrambled Merchandising

Selling many unrelated products in one store.

Exclusive Dealing

A contract that forces a retailer to buy from only one supplier.

Refusal to Deal

When a manufacturer will not sell to a certain retailer.

Different Methods of Promotion

1. Advertising - Paid, non-personal communication through media. 2. Public Relations (PR) - Creating a positive company image. 3. Sales Promotion - Short-term incentives. 4. Personal Selling - Direct communication between a salesperson and customer. 5. Direct & Digital Marketing - Email, social media, and online advertising.

Three Purposes of Promotion

1. Inform - Introduce products or explain features. 2. Persuade - Encourage switching brands or buying now. 3. Remind - Keep the product in customers' minds.

Customer-Initiated Model of Communication

The customer starts communication by seeking information online.

Integrated Marketing Communication (IMC)

Coordinating all promotional messages so they present a unified image.

Push Strategy

Marketing aimed at wholesalers and retailers to push products to consumers.

Pull Strategy

Marketing aimed directly at consumers to create demand.

Adoption Process

1. Awareness - Learn product exists. 2. Interest - Want more information. 3. Evaluation - Decide if useful. 4. Trial - Test product. 5. Adoption - Become regular user.

The AIDA Model

1. Attention - Get noticed. 2. Interest - Hold curiosity. 3. Desire - Make them want it. 4. Action - Lead to purchase.