Marketing Fundamentals and Market Orientation (Lecture Notes)

A comprehensive set of QUESTION_AND_ANSWER flashcards covering key concepts from market orientation to pricing, promotion, placement, people, process, and physical evidence in marketing.

What is marketing?

Identifying, anticipating, and satisfying customer needs and wants profitably; acting as the bridge between businesses and consumers to ensure products meet market demands.

What is a brand name?

A unique word or phrase that identifies a company, product, or service and distinguishes it from competitors.

What is market orientation?

A business approach focused on understanding and meeting the needs and wants of consumers through continuous market research and adaptation.

Name one benefit of market orientation.

Increased customer satisfaction.

Name one limitation of market orientation.

Complexity in implementation due to extensive market research.

What is product orientation?

A strategy that emphasizes the quality and features of the product itself rather than consumer needs.

Name one benefit of product orientation.

Innovation focus.

Name one limitation of product orientation.

Misalignment with customer needs.

What factors influence the choice of orientation?

Nature of the product, market conditions, organizational goals, resources available, corporate culture, and regulatory environment.

What is market growth?

The increase in the size, value, or volume of a market over a defined period.

How can market growth be measured?

In terms of revenue (sales), volume (units), or the number of customers.

What is current market size vs original market size?

Current market size is the total sales revenue for the current period; original market size is the total sales revenue for the previous period.

How do you calculate market growth rate?

(Current market size − Original market size) ÷ Original market size × 100.

How can market share be influenced?

Product innovation; geographic expansion; marketing strategies; strategic partnerships; enhancing customer experiences.

What is market share?

The percentage of total sales in a market that is controlled by a particular company.

How is market share calculated?

(Firm's sales ÷ Total sales in the market) × 100.

What is Market Leadership?

The position of being the largest seller in a market, holding the highest market share and influencing trends, pricing, and consumer preferences.

Name two advantages of market leadership.

Economies of scale; Brand loyalty (also Pricing power, access to resources, innovation leadership).

How do market leaders keep their audience?

Through customer retention, market expansion, and ongoing innovation and adaptation.

List one drawback of market leadership.

Regulatory scrutiny and potential antitrust issues.

What is the role of marketing planning?

A structured approach to defining marketing objectives and developing strategies to achieve them.

Name two components of a marketing plan.

Market analysis (research, SWOT/STEPP analyses) and marketing objectives/goals.

How does market planning help a business?

Clarifies market understanding, aligns marketing objectives with organizational goals, outlines financial constraints, identifies problems, and supports monitoring and improvement.

What is segmentation?

Dividing a broad market into smaller, defined categories based on shared characteristics.

Name the four bases of segmentation.

Demographic, Geographic, Psychographic, Behavioral.

What is targeting in STP?

Selecting one or more segments identified during segmentation to focus marketing efforts on.

What are the four targeting approaches?

Undifferentiated, Differentiated, Concentrated, Micromarketing.

What is positioning?

Placing a product in the mind of the consumer to occupy a distinct, advantageous place relative to rivals.

What is a position map?

A graphical representation of customer perceptions of a product or brand versus competitors based on criteria such as price and quality.

Define a niche market.

A smaller segment of a larger market targeted with specialized products or services for specific groups.

Name two advantages of a niche market.

Less competition and higher customer loyalty (plus potential higher margins).

Name one disadvantage of a niche market.

Limited customer base and vulnerability to market changes.

What is a Unique Selling Point (USP)?

A feature or benefit that makes a product distinct from competitors and addresses a specific customer need.

What are the advantages of a mass market?

Economies of scale, wider reach, and brand recognition.

What is the difference between goods pricing and services pricing in relation to the 7 Ps?

Goods typically use the 4 Ps (Product, Price, Place, Promotion); services use the extended 7 Ps (also People, Process, Physical Evidence).

What is the Product Life Cycle (PLC)?

A charting of a product's sales over its lifetime, divided into four stages: Introduction, Growth, Maturity, and Decline.

How do PLC stages relate to marketing strategy?

Different stages require different marketing mix approaches and investment levels (e.g., Introduction requires high promotional spending; Growth focuses on pricing and distribution; Maturity emphasizes differentiation; Decline may involve cost reductions or extensions).

What are extension strategies for PLC?

Cosmetic changes, new variants, lower prices, more effective distribution, finding new segments, new advertising campaigns.

What is branding in marketing?

The process of creating a unique name and image for a product to distinguish it from competitors and build recognition.

What is brand awareness?

The extent to which customers recognize and recall a brand.

What is brand loyalty?

The tendency of customers to repeatedly purchase the same brand due to satisfaction and emotional connection.

What is brand value?

The financial worth of a brand based on reputation and customer loyalty.

Why is price important in marketing?

It helps identify the USP, differentiates from competitors, supports promotional strategy, influences customer loyalty, and can enable premium pricing.

What should be considered before adopting pricing strategies?

Market competition, customer perceptions and behavior, cost structure and profit goals, product life cycle, and product uniqueness.

What is Cost Plus (markup) pricing?

Adding a fixed percentage to the cost of production; easy to justify but may ignore demand and competition.

Describe Penetration pricing.

Setting a low initial price to attract customers and gain market share, with potential for low initial profit margins.

What is a Loss Leader pricing strategy?

Selling a product below cost to attract customers who will buy other, more profitable items.

What is Predatory Pricing?

Setting very low prices to drive competitors out of the market; often illegal and can cause short-term losses.

What is Premium pricing?

Setting high prices to reflect exclusivity or high quality, yielding higher profit margins but limiting customer base.

What is Dynamic pricing?

Adjusting prices in real-time based on demand or other factors to maximize revenue.

What is Above the Line (ATL) promotion?

Mass media advertising aimed at a broad audience (TV, billboards, magazines); wide reach but expensive and hard to measure directly.

What is Below the Line (BTL) promotion?

Targeted, direct communication (emails, sponsorships) that is more personalized and often easier to measure.

What is Through the Line (TTL) promotion?

An integrated approach combining ATL and BTL to reach mass audiences and specific segments.

What is Social Media Marketing (SMM)?

Using digital platforms to promote, engage with customers, and increase brand awareness through targeted content, promotions, and advertising.

Name two advantages of SMM.

Increased brand awareness and cost-effectiveness.

Name two disadvantages of SMM.

Time-consuming and risk of negative publicity; rapid trend changes and cybersecurity concerns.

What is Place in the marketing mix?

Distribution; how a product reaches the right customers at the right time in the most convenient and cost-effective way.

What is a distribution channel?

The path a product takes from manufacturer to consumer, involving intermediaries like retailers, wholesalers, or agents.

What are direct distribution advantages and disadvantages?

Advantages: Higher profits, direct customer relationships, faster delivery. Disadvantages: Higher marketing and delivery costs and limited reach.

What are indirect distribution intermediaries?

Agents, wholesalers, and retailers who sell products on behalf of producers or to consumers.

What is one-channel distribution?

Using one intermediary (e.g., retailers or agents) to reach customers.

What is two-channel distribution?

Using two intermediaries (e.g., wholesalers and retailers) to reach customers.

What is three-channel distribution?

Using three intermediaries (e.g., agents, wholesalers, and retailers) to reach customers.

What is the role of People in service marketing?

Employees who interact with customers and act as brand ambassadors, influencing service quality, reputation, and retention.

What is Process in service marketing?

Systems and procedures used to deliver a product or service, including queuing, payment, and delivery mechanisms.

How can processes change in marketing?

Through technological advancements, changing customer expectations, globalization, and sustainability efforts.

What is Physical Evidence in services marketing?

Tangible elements customers can see or experience that help convey service quality and reduce perceived risk.

Why is Physical Evidence important?

It builds trust, enhances the customer experience, reinforces brand, and supports the marketing mix for services.