Marketing Management Exam 1

Exam 1W

What is marketing?

A process by which companies engage customers, build strong customer relationships, and create customer value in order to capture value from customers in return.

Market

The set of actual or potential buyers

Marketing Management

The art and science of choosing target markets and building profitable relationships with them.

Value Proposition

The set of benefits or values it promises to deliver to customers to satisfy their needs

Marketing Mix

• Product

• Place

• Promotion

• Price

Integrated Marketing

A comprehensive plan that communicates and delivers intended value

Acquiring vs Retention

Acquiring a new customer can cost 6 to 7 times more than retaining one

Customer lifetime value

The value of the entire stream of purchases that the customer would make over a lifetime of patronage

Customer relationship management

The overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction

Marketing Myopia

Focusing only on existing wants and losing sight of underlying consumer needs

Marketing Environment

Includes the actors and forces outside marketing that affect marketing management’s to build and maintain relationships with target customers

Marcoenvironment

Consists of the larger societal forces that affect the microenvironment

Segments of the macroenvironment (PEST)

• Politics

• Environmental

• Social

• Technological

  • Demographical

Microenvironment

Consists of the actors close to the company that affect its ability to serve its customers

The Demographic Environment

• Builders

• Baby Boomers

• Generation X

• Millennials

• Generation Z

• Generation Alpha

Strategic Planning

The process of developing and maintaining a strategic fit between the organization’s goals and capabilities, and its changing marketing opportunities

Mission Statement

The organization’s purpose. What it wants to accomplish in the larger environment

Market-oriented mission statement

Defines the business in terms of satisfying basic customer needs

Core competency

A harmonized combination of multiple resources and skills that distinguish a firm in the marketplace

Business Model

Describes the rationale of how an organization creates, delivers, and captures value

One-time transaction

Charge users for product download and use

E-Commerce

Earn Margins by selling products online

Commissions and Fees (business Model

Provide a platform of two-sided market place and collect commission (or fees) from each transaction made

Subscription (Business model)

Charge users for subscribing

Ad-supported (business model)

Sell ad spaces to other businesses

Freemium (business model)

Charge users for premium features (or versions) of a product distributed for free

Business Portfolio

The collection of businesses and products that make up the company

Portfolio Analysis

A major activity in strategic planning whereby management evaluates the products and businesses that make up the company

Strategic Business units

Can be:

• Company division

• Product line within a division

• Single product or brand

How to Analyze the Current Business Portfolio

• Identify strategic business units (SBUs)

• Assess the attractiveness of its various SBUs

• Decide how much support each SBU deserves

Business Objectives

• Build Profitable customer relationships

• Invest in research

• Improve profits

Marketing Objectives

• Increase market share

• Create local partnerships

• Increase promotion

Chief Marketing Officer

The head of large marketing organizations for a company

Ways Modern Marketing Departments can be organized:

• Functional organization

• Geographic Organization

• Product management organization

• Market or customer organization

Marketing Strategy

The marketing logic by which the company hopes to create customer value and achieve profitable customer relationships

Market Segmentation

The division of a market into distinct groups of buyers who have different needs, characteristics, or behaviors and who might require separate products or marketing mixes

Market Segment

A group of consumers who respond in a similar way to a given set of marketing efforts

Market Targeting

The process of evaluation each market segment’s attractiveness and selecting one or more segments to enter

Market positioning

The arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products in the minds of target consumers

Differentiation

Begins the transitioning process

Positioning

Arranging for a product to occupy a clear, distinctive, and desirable place relative to competing products from competing brands and give them the greatest advantage in their target markets

Marketing Implementation

• Turning marketing strategies and plans into marketing actions to accomplish strategic marketing objectives

• Addresses who ,where, when, and how

Return on Marketing Investment (ROI)

• Net return from a marketing investment divided by the cost of the marketing investment

• Measurement of the profits generated by investments in marketing activities