BUSN 331 EXAM 2 Study Set

Lectures 5,6,7,8,9

The Five Step Model of Purchase Decision Making.

Need recognition, information search, evaluation of alternatives, purchase decision, post-purchase behavior.

Need Recognition

Consumer wants and needs.

Information Search

Where the consumer gains information leading them to evaluate options. (Personal, Commercial, Public, or Experimental source)

Evaluation of Alternatives

Where consumers process the information and weigh their options to select the brand/product that best suits their needs.

Purchase Decision

What (Product/Brand Choice), Where (Dealer/Retailer Choice), When (Purchasing Timing), How Much (Purchase Amount).

Post-Purchase Behavior

Is the customer satisfied? (Loyalty and positive WOM) or are they dissatisfied? (negative WOM).

Consideration Set

• Apart of step 3 of the Five Step Model of Purchase Decision Making.

• It is important that your brand is included in the consideration set of alternatives for consumers, otherwise your product won't even be compared or evaluated. (It won't be considered if its not part of the consideration set).

Net Promoter Score (NPS)

• Measures customer satisfaction and helps to predict business growth, This proven metric provides the core measurement for customer experience management programs.

• On a scale of 1-10, how likely are you to recommend this to a friend or colleague?

  • ex. Chick-fil-a satisfaction survey

Purpose of SWOT analysis:

To match the company strengths to attractive opportunities in the environment, while eliminating or overcoming the weaknesses and minimizing the threats.

Components of SWOT analysis:

Strengths, Weaknesses, Opportunities, and Threats.

Strengths (opportunities):

Internal capabilities that may help a company reach its objectives.

Weaknesses (threats):

Internal limitations that may interfere with a company reaching its objectives.

Communication and Coordination Device:

External and internal members of marketing activities that have the same goal.

Criterion for decision making:

Provides a baseline to guide choices and evaluate creative work.

Evaluation tool:

Determine if advertising was successful or not.

Key Performance Indicator/Index(KPI):

Critical/key quantifiable indicators of progress toward and intended result.

Top of Funnel (TOFU):

Goal is to generate interest, capture attention, and initiate the customer journey.

Middle of Funnel (MOFU):

Goal is to nurture and guide towards becoming qualified customers.

Bottom of Funnel (BOFU):

Goal is to convert potential customers into actual customers.

S in SMART criteria to develop a statement of marketing objective in a sentence.

Specific; states exactly WHAT needs to be achieved.

M in SMART criteria to develop a statement of marketing objective in a sentence.

Measurable; capable of measuring whether it has been achieved.

A in SMART criteria to develop a statement of marketing objective in a sentence.

Ambitious/Achievable; needs to be REALISTIC to the circumstances.

R in SMART criteria to develop a statement of marketing objective in a sentence.

Relevant; should be RELEVANT to people responsible for achieving them.

T in SMART criteria to develop a statement of marketing objective in a sentence.

Time Bound: set with a realistic time frame/deadline.

S in STP stands for:

Segmentation: Dividing the market into smaller segments with distinct needs, characteristics, or behaviors that might require separate marketing strategies or mixes.

T in STP stands for:

Targeting Strategy: The process of evaluating each market segments attractiveness and selecting one or more segments to enter.

P in STP stands for:

Positioning Strategy: Arranging for a market offering to occupy a clear, distinctive and desirable place relative to competing productings in the mids of target consumers.

Marketing Differences:

Different needs and wants; different characteristics

Limited Resources:

Marketing budget, time/distribution/media, human resource

Marketing Efficiency:

Intense competition, minimum input/maximum output

Geographic segmentation:

Divides the market into different geographical units such as nations, regions, states, counties, or cities

Demographic segmentation:

Divides the market into groups based on age, gender, family size, income, education, etc…

Psychographic segmentation:

Divides the market into segments based on different personality traits, values, attitudes, interests, and lifestyles of the consumers

Behavioral segmentation:

Divides buyers into groups based on their knowledge, attitudes, uses, or responses to a product or service.

Targeting:

The process of EVALUATING each market segment’s attractiveness and SELECTING one or more segments to enter.

Factors for segment evaluations:

Size of opportunity, segment size, segment growth, level of competition, match with corporate objectives, corporate objectives, corporate resources.

Target Market:

Market segment that a company chooses to focus its market resources on.

Target Audience:

A selected group within the target market that is the primary focus of a specific marketing campaign.

Buyer Persona:

A detailed and semi-functional representation of an ideal customer.

Brand Positioning:

The place a brand occupies in the minds of consumers relative to its competitors. Its about how customers perceive the brand and what unique, distinctive value it represents compared to alternatives.

Triad of Brand Distinction:

The Only, The First, and The Best

Sourced-based Positioning:

Philosophy, product attribute, benefit, value, brand personality, user imagery, TPO, competition, product class.

Positioning Map:

Shows consumer perceptions of their brands versus competing products on important buying dimensions.

Definition of Product

• Anything that can offered in a market for attention, acquisition, use, or consumption that might satisfy a need or want

  • Include more than just tangible items

Consumer Products

• Bought by final consumers for personal consumption

• Differ in the way consumers buy them

Industrial Products

• Bought for further processing or use in conducting business

• Bought by other businesses, not consumers

Brand

• A name, term, sign, symbol, design or a combination of these that identifies the product or services of one seller or group of sellers and differentiates them from those competitors.

  • Select name (7 types)

  • Decide what you want the name to say, stand for a big idea (ex. Nike is about winning)

  • Check that the name is not already taken and make sure that it doesn't mean anything offensive in another language

2d Model Popularity

• Simple and clean, symbols are impactful

• Keep up with the times

• Easier on users and designers

  • Logos can be enlarged or shrunk easier

Brand Equity

• The differential effect that knowing the brand name has on customer response to the product or its marketing

  • Loyalty, awareness, quality perception, image association

Advantages of Strong Brand Equity

• A powerful brand enjoys higher level of customer brand awareness and loyalty

• More leverage in bargaining with resellers

• Line and brand extensions]Some defense against fierce price competition

Brand Hierarchy

Corporate Brand > Individual Brand > Modifier (pet name)

Brand Extension

When a company uses one of its established brand names on a new product or new product category.

Brand Experience (EX)

What is the key feeling customers have when they interact with a brand?

Product Experience:

The consumer's direct interaction with the core product or service. It is primarily shaped by how well the product world and how it feels to use. Includes product performance/functionality, design and usability, etc…

Non-Product Experience:

All brand related experiences beyond the core product itself. Non-product experience shapes how consumers perceive and emotionally connect with the brand outside of actual product usage

Intangibility

build strong reputation

Inseparability

service cannot be separated from their providers

Variability

quality of services depend on who provides them and where, when and how

Perishability

services cannot be stored for later sale or use

Internet of Things (IoT)

Interconnection via the internet of computing devices embedded in everyday objects enabling them to send and receive data.

Rlgld Planning (Traditional approach) 

• Win or Lose, has to be perfect to succeed

• Step by step procedure before introducing the product to the market

Agile Adaptation (Lean approach)

• Trial and error, see where to improve

• Bypassing step by step, update and upgrade after feedback

Minimum Viable Product (MVP)

• A product with just enough features to gather validated learning about the product and its continued development.

• Basically a prototype.

Pivoting

• A strategic shift in business model, target audience, or marketing channels.

• “It doesn't mean failure, it means adapting to become more successful.”

Tool-to-Network Shift

• This concept explains how some businesses evolve from a useful tool to a valuable network.

  •  Users are initially attracted to  a platform for its utility (the “tool”) and over time the network of users itself becomes the primary value (the network).

A/B Testing

• “Test everything”

• A method used to compare two versions of the product to determine which one performs better.

Experience Design (XD) → (UX, CX, BX, AX)

• Customer experience design is the process of designing a frictionless experience for the customer anytime they interact and use a brand.

• Focus on the user experience, want to improve it overall

Product Life Cycle (PLC)

The process a product goes through from when it is first introduced into the market until it declines or is removed from the market