Principles of Marketing

What are the four concepts in the Evolution of Marketing?

Production Concept, Product Concept, Selling Concept, Marketing Concept

What is the Production Concept?

Consumers will buy anything that is available and at a good price 

What is the Product Concept?

Focuses on continuous product improvement

Who was a staple of the Product Concept?

Henry Ford 

What was the Selling Concept?

Focused on persuading consumers to buy more.

What is the Marketing Concept?

Delivering the watns and needs of target customers (Customer Orientation).

How can companies “add value”?

Engage consumer effectively, understand their needs, develop products that provide superior customer value & prices, distribtute them & promote them well.

What are the four steps to the Marketing Process?

1. Analysis

2. Strategy

3. Planning

4. Management

What is a Market?

All actual and potential buyers of a product or service category

What is Market Volume?

The size of the market based on the number of interested buyers.

What is Market Value?

The market size based on the total spent by buyers.

What is Market Share?

How much buyers buy from a certain company vs. competitors.

What is Market Analysis?

Understanding customers needs, wants, & demands.

What is true about all human needs and wants.

Universal needs, unique wants/ways to satisfy their needs.

What does the PESTLE Analysis do?

Analyzes the external factors. 

What does PESTLE stand for?

Political

Economical

Social

Technological

Legal

Environmental

What is the purpose of Marketing Strategy?

The selection of new opportunities to pursue & current activities to support.

What is the purpose of the Marketing Strategy Step?

Identify Target Market & Value Proposition

What is Target Market?

The group of customers whichthe business can serve best & profitably.

What is Value Proposition?

A statement that explains why a customer should choose your product.

What is the purpose of the Marketing Planning Step?

Create the Marketing Mix.

What are the 4 P’s of the Marketing Mix?

Product, Price, Place, Promotion

What is the Marketing Mix?

A business tool that helps companies plan how to bring a product or service to market successfully.

What is the Purpose of the Marketing Management Step?

Marketing Control 

What is Marketing Control?

Setting clear objectives, budgets, and schedules to guide performance.

What is Process Monitoring?

Tracking campaigns and results to spot issues.

What is Customer Share?

The amount customers spend on one brand compared to all brands in the same category.

What is Customer Equity?

The total value of all the money a company expects to earn from its customers now and in the future.

What are the four types of customers in the Customer Relationship Management Matrix?

Butterflies, True Friends, Strangers, Barnacles. 

What are “Butterfly” Customers?

Customers who buy a lot but not often (short-term, high profit.).

How should we interact with “Butterfly” Customers?

Offer them a positive experience.

What are “True Friends” Customers?

Customers who are loyal and profitable,buying often (long-term, high profit.).

How should we interact with “True Friends” Customers.

Invest in them and reward loyalty.

What are “Strangers” Customers.

Customers who are neither loyal nor profitable (short-term, low profit.).

How should we interact with “Strangers” Customers.

Minimise the marketing costs for them.

What are “Barnacle” Customers.

Loyal customers who spend little (long-term, low profit).

How should we interact with “Barnacle” Customers?

Try to increase the amount they spend.

What is Marketing?

Convincing customers you have a solution to their problem (want/need). 

What is a mission statement?

Explaining in simple term’s a businesses purpose(s) for being (Their Goal).

What is a vision statement?

An inspirational statement of an idealistic goal for the future (A motivation or dreamt to achieve).

What is the purpose of the 7 S’s model?

Used to assess and improve an organization's internal alignment by analyzing seven interconnected elements.

What are the 7 S’s?

Structure, Strategy, Systems, Skills, Staff, Style, Shared Values

What are the Hard S’s?

Strategy, Structure, Systems

What are the characteristics of the Hard S’s?

Tangible and easy to define

What are the Soft S’s?

Skills, Staff, Style, Shared Values. 

What are the characteristics of the soft S’s?

Less tangible and harder to define.

What are Porter’s 5 Forces?

Industry Rivaly Among Existing Competitors, Threat of New Entrants, Threat of Substitutes, Bargaining Power of Customers, Bargaining Powers of Suppliers.

What are the internal elements of SWOT Analysis?

Strengths & Weaknesses

What are the external elements of SWOT Analysis?

Opportunities & Threats

What is Segmentation?

When you divide the market into smaller groups of customers with identical/similar characteristics. 

What are the steps to STP Framework?

Context, segmentation, targeting, positioning, implementating marketing mix, control

What is the purpose of the STP Model?

It helps businesses identify & reach the right audience in order to deliver greater value. 

What is Targeting?

Selecting the segment you can better serve.

What is Differentiation?

Making the product/service stand out from competitors.

What are the types of Segmentation?

Demographic,Geographic, Psychographic, Behavioral

What is Demographic Segmentation?

Who are you? → age, gender, income, education, generation

What is Geographic Segmentation?

Where are you? → location, population density, countries, climate, language

What is Psychographic Segmentation?

What do you believe? → hobbies, personality, lifestyle, culture & values

What is Behavioral Segmentation?

How do you shop? → occasions, usage rates, loyalty, purchase behavior, benefit seeking

Each segment needs to have what characteristics?

Measurable, Substaintial or Differentiable, Accessible, Stable, Actionable

What does Substaintial mean in Segmentation?

The segment must be large and profitable enough to matter.

What does Accessible mean in Segmentation?

The segment can be reached & served.

What does Stable mean in Segmentation?

The segment should remain unchangeable in the near future.

What does Actionable mean Segmentation? 

You are able to design a program to attract & serve the segment. 

What is the purpose of Targeting?

Optimize resource allocation, imrpoved return on investment, increased customer satisfaction

What is Undifferentiated (Mass) Marketing?

Targeting the whole market with a single marketing mix.

What is Differentiated Marketing?

Targeting 2 or more market segments and developing separate marketing mixes, growing customer base in both segments.

What is Concentrated Marketing?

Targeting a single market segment, aiming to capture the largest share and growth.

What is Individual Marketing?

One-to-One marketing, utilised new technologies to deliver customised personal products. 

What is Positioning in Marketing?

The process of creating an image for a product in the minds of target customers.

What is a Proposition Statement (Value Proposition)?

A sentence that shows why the product’s worth buying, emphasiing on its differentiated attributes & gaining a competitive advantage.

What is Marketing Research? 

The systematic design, collection, interpretation, & reporting of information to help marketers solve peticular problems or take advantage of marketing opportunities. 

What is Observational Research?

Involves gathering primary data by observing relevant people, actions, & situations, online or off-line

What is Expiremental Research?

Involves expirements that reveal cause and effect relations online or in-person.

What is a Convinience Product?

G&S consumers buy frequently and with minimal comparison or buying effort. They are low priced and widely available.

What are Shopping Products?

Less frequently purchased. Consumers gather information & compare to competitive products before buying. Products are accompanied by customer service & offered at selective outlets.

What are Specialty Products?

Customers are willing to put extra effort into buying them, usually because of their unique premium characteristics or brand identification. 

What are Unsought Produdcts?

Products consumers don’t know about (yet) or don’t normally consider buying. Requires a lot of marketing.

What are Industrial Products?

Products businesses buy to use in making other products or to help

What are the types of Industrial Products?

Materials & Products, Capital Items, Supplies & Services

What are Capital Items? (B2B)

Installations (factories & offices), manufacturing equipment, accessories/tools

What are the three things in a Product Portfolio?

Product Item, Product Line, Product Mix

What is a Product Item?

A specific version of a product (Pantene Shampoo)

What is a Product Line?

Group of closely related items (All P&G Shampoos)

What is a Product Mix?

Total group of products a company offers (All P&G Products)

What are the Three Levels of a Product?

Core Product, Actual Product, Augmented Product

What is a Core Product?

The main benefit or solution (transport, refreshment, status)

What is an Actual Product?

The tangible features: quality, design, brand, packaging

What is an Augmented Product?

The extra services/support that come after buying the product: warranty, delivery, customer service, credit

What are all the aspects of Branding?

Elements, Brand Mark, Trademark, Trade Name

What are the differences in Brand vs. Branding?

Brand - A tool

Branding - the process of creating the tool

What are the elements of Brand Equity

Brand Awarness + Brand Loyalty + Perceived Brand Quality + Positive Brand Associations

What is Brand Awarness?

Familiar brands are more likely to be chosen.

What is Brand Loyalty?

Reduces vulnerability to competitors and ensures repeat purchases.

What is Perceived Brand Quality?

Signals reliability and supports premium pricing

What is Brand Associations?

Links to lifestyle, values, or personality. Means that people react differently to a product just because they know the name. 

What is Goodwill?

Intangible Assets relating to a company’s business practices (brand recognition, customer loyalty, employee happiness)

What are the three main testing stages?

1. Concept Testing

2. Pruduct Testing

3. Marketing Testing

Step 1: New Product Development Process?

Idea Generation 

What is Idea Generation?

Creating large number of marketable ideas.