Marketing Exam 1

Marketing

the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large

How does marketing sell products?

informs organizations about consumer wants and informs customers about available products and services

How can marketing change the way you think?

it shapes your perception and behavior

How does marketing create experiences?

it goes beyond selling a product or service. it delivers value and benefits to customers

What is the “Art of Exchange”?

process in which a customer, provider, and product come together in a transaction where both parties trade value for value

Who is the customer?

a person that has a want or need and has willingness and ability to buy

What is a product?

a physical good, service, experience, or idea designed to fill a customer’s want or need

What is a transaction?

the terms both parties agree to, involving a trade of value for value

What are the 5 conditions required for an exchange?

1. There must be at least two parties

2. Each party has something of value to the other party

3. Each party is capable of communication and delivery

4. Each party is free to accept or reject the exchange offer

5. Each party believes it is appropriate or desirable to deal with the other party

What must occur for an exchange to take place?

All 5 conditions of exchange must be met

What happens when all conditions of exchange are met?

a transaction can take place, where both parties trade value for value

How does a company identify customers?

identify a customer with a want or need that the company can address

What are the 3 steps for creating value for customers?

Identify, Satisfy, Retain

How does a company satisfy customers?

Deliver a product or service at the appropriate time

How does a company retain customers?

create new opportunities to win customer loyalty and business

Production Orientation

Focuses on low production costs, high efficiency, and mass distribution; “Field of Dreams’ orientation

Product Orientation

primary focus on technology and innovation, with investment in building and showcasing impressive features and product advancement

What is the main focus of Product orientation?

technology, innovation, features, and product advancement

What is Sales Orientation?

uses aggressive sales techniques, based on the idea that higher sales = higher profits

What is the problem with Sales Orientaiton?

it can be difficult to convince people to buy goods or services if they aren’t needed

What’s Marketing Orientation?

a focus on understanding customer needs and wants and examining information from a total business perspective to deliver value

What is the main focus of Market Orientation?

the customer, understanding their needs and wants

What is the Societal Marketing concept?

the organization exists to satisfy customer wants and needs, meet organizational objectives, preserve or enhance people’s long term best interest

What’s the difference between Societal Marketing and Market Orientation?

Market orientation focuses on customer needs/wants and societal marketing focuses consideration of individuals’ and society’s long term best interests

What is the main focus on Production Orientation?

Efficient, low costs, and mass distribution

What is the main focus of Product Orientation?

Technology, innovation, and product features

What is the main focus of Sales Orientation?

aggressive selling and increasing sales/profits

What is the main focus of Market Orientation?

understanding customer needs/wants and delivering superior value

What is the main focus of Societal Marketing?

customer needs + organizational objectives + society’s long term best interests

What are the 4 reasons we study marketing?

Society, businesses, careers, and everyday life

Why do we study marketing from a Society perspective?

Marketing helps society get what we want, when we want it

Why do businesses study marketing?

For survival, profits, and growth

Why is marketing important to careers?

Approximately ¼ to 1/3 of the U.S. workforce performs marketing activities

Why is marketing important in everyday life?

You are a consumer of goods and services every day

What does it mean that “marketing is everywhere”?

Marketing appears in shopping, your home, social media, online shopping, products, brands, logos, and services

What is Advertising?

Paid media designed to draw a person in to a company, product, or message

What is Branding?

Creating a name, symbol, or design that identifies or differentiates one product from another

What is Sales?

The process of actually selling a product or service.

For-Profit Organization

an organization that measures success in terms of profit

Nonprofit Organization

an organization that exists to benefit a mission or purpose

Customer

individual who purchases a product

Consumer

individual who uses a product

B2B (Business to Business)

Marketing from one business to another; often uses personal selling to build relationships

B2C (Business to Consumer)

Marketing from a business directly to the public/consumers; focuses more on mass advertising and selling to the public

4 P’s

Product, Promotion, Place, Price

Product

The good or service offered by a company

Promotion

Communication and information used to communicate with customers

Place

The distribution or delivery of a product

Price

Ensuring fair value in a transaction

4 C’s

Customer Solution, Communication, Convenience, Cost

Customer Solution

what the customer wants and needs

Communication

two way dialogue with the customer and company

Convenience

making it easy for the customer to buy

Cost

the amount the customer must give up to satisfy want or need

How do the 4 C’s better address customer needs?

4 C’s focus on what customers want and need, how they prefer to communicate, how convenient it is to buy, and total cost they must give up

How do companies find the right marketing mix?

Companies consider their organizational goals and how they can meet the needs of their target customers

Marketing Research

the process of planning, collecting, and analyzing data

Descriptive Research

gathers and presents factual statements

Diagnostic Research

explains data by examining the impact of something

Predictive Research

addresses “what if” questions and is future oriented

How does marketing research help managers?

improve the quality of decision making, trace problems, understand very detailed and complicated relationships

Marketing Research Process Steps

1. Problem/Opportunity

2. Research Design

3. Sampling Procedure

4. Data Collection

5. Analyzing Data

6. Report-Findings

7. Follow Up

Step 1: Problem/Opportunity

identify the information needed an determine how that information can be obtained
Marketing Problem - what information is needed, and how can it be obtained
Management Problem - an action problem; broader scope and more general

Step 2: Research Design

determines when and how data will be gathered and analyzed
Primary Data - data collected for the first time and specific to the problem being researched
Most popular primary data technique - survey research

In-Home Survey

research conducted in a person’s home; it has a high cost in the U.S. and is used more in less developed countries

Mail-Intercept Survey

research conducted in a common area of a shopping mall or research office

Telephone Survey

survey conducted by telephone; it has a high refusal rate, whcih leads to high costs; and is affected by federal Do Not Call List

Postal Mail Survey

survey sent through the mail; has low cost and anonymity, but a low response rate

Focus Group

personal interviews with 7-10 people; typically with audio and video recording

Online Survey

online research that has low cost, high participation rate, and is easily administered

Open Question

question that encourages respondents to answer in their own words

Closed Question

question where respondent selects from a limited list

Dichotomous Question

a closed question with two choices; such as Yes/No

Multiple Choice Question

a closed question with several options to choose from

Scaled Question

a closed question designed to measure intensity, usually using a numerical scale

Mystery Shopping

Researchers pose as customers to gather information

Behavioral Targeting

tracking which websites individuals visit to determine how much, how often, and where they engage

Ethnographic Research

studying behavior in a person’s natural context

Experiment

a method of gathering primary data by altering one or more variables and observing the effects of those alterations

Population

all people whose opinions, behaviors, preferences, etc. are of interest ot the marketer

Sample

a subset of the larger population

Step 3: Sampling Procedure

the process of selecting a sample from the larger population to represent the people the marketer is interested in

Step 4: Data Collection

the step where researchers actually collect the data; either collected independently or hire a collection agency

Step 5: Analyzing Data

the step where the collected data is analyzed to help produce the research findings

Step 6: The Report

The step where you prepare and communicate the conclusions and recommendations

Step 7: Follow Up

The step where we try to understand why management did or didn’t follow the recommendations

Market

People or organizations who have needs or wants, the ability to buy, and the willingness to buy

Market Segment

a subgroup of a market with one or more similar characteristics and product needs

Market Segmentation

The process of creating market segments by identifying groups of customers with similar needs

What is the purpose of Market Segmentation?

to give marketers information that helps them design marketing mixes specifically matched to the characteristics and desires of one or more segments

Why do marketers segment markets?

Identify similar customers, understand customers, create better marketing mixes

What are the 4 criteria for successful segmentation?

Substantiality, Identifiability & Measureability, Accessibility, Responsiveness

Substantiality

The segment must be large enough and have enough buying power to warrant developing and maintaining a special marketing mix

Identifiability & Measurability

Being able to determine which customers are in the segment

Accessibility

Being able to reach members of the segment with customized marketing mixes through appropriate marketing channels

Responsiveness

Customers within the segment should have similar needs, seek similar benefits, and be satisfied by similar offerings, while beign different from customers outside the segment

What are the 5 approaches for segmentation?

Geographic, Demographic, Psychographic, Benefit, Usage Rate

Geographic Segmentation

Dividing a market based on location/geography

Demographic Segmentation

Dividing a market based on demographic characteristics such as age, gender, income, education, and family life cycle

Psychographic Segmentation

Dividing a market based on psychological and lifestyle characteristics