Marketing 350 Final Exam GVSU (Walz)

What are Cookies?

These help companies track an item from the moment they are manufactured, through the distribution system, to the retail store, and into the hands of the consumer.

What is marketing?

The set of institutions and processes for 1. creating, 2. capturing, 3. communicating, 4. delivering, and 5. exchanging offerings that have value for the customers, clients, partners and society at large. -Satisfaction of needs and wants through the whole exchange

What are the 4 p's (marketing mix)?

Product (creating value), price (capturing value)- how much a customers are willing to pay so they get value but the company still receives a profit, promotion (communicating value)- tool that informs, persuades, and reminds the customer, and place/distribution (deliver value)- right product, right place, right time, right customer

What does marketing have to do with value and the exchange process?

Marketers are exchange facilitators (that helps us get value)

What do market oriented and value based companies focus on?

Information centered: collecting information from customers and competitors and sharing it to (manufactures and employees). Relationship oriented: Build relationships with everyone (customers, retailers, suppliers, employees) by customer relationship management (CRM)- a philosophy and set of strategies, programs, and systems that focus on identifying and building loyalty with the firms most valuable customers.

Customer Satisfaction vs. value

satisfaction: the feeling a product or service gives the customer when it have met the customers expectations.

P>E=delight

P

Corporate Social Responsibility (CSR)

voluntary actions taken by a company to address the ethical, social, and environmental impacts of its business operations and the concerns of its stakeholders. actions taken to increase positive effect and decrease negative effects of a firm on society

What is the marketing plan?

a written document that acts as a guidebook of marketing activities for the marketing manager. Step 1. mission statement: "What are we, and why we are in business." Focuses on the benefits rather than the product (If you do not suffer from marketing myopia). Step 2. SWOT Analysis Strengths and Weakness are internally, and Opportunities and Threats are external. then SMART objectives, this is a statement of what is to be accomplished has to be Specific, Measurable, Attainable, and Relevant with the mission statement, and in a certain Time Frame. Step 3. target market and positioning. Step 4. implement the marketing mix. Step 5. evaluate performance.

What is a marketing strategy? 3 components

Target market: the group of customer you are going to focus on satisfying their needs and wants with value.

Marketing mix 4 p's: how are you going to satisfy that

SCA: something that a firm can persistently do better than the competitors and cannot be copied in the long run.

market penetration strategy

a growth strategy that employs the existing marketing mix and focuses the firm's efforts on existing customer

market development strategy

a growth strategy that employs the existing marketing offering to reach new market segments, whether domestic or international

product development strategy

a growth strategy that offers a new product or service to a firm's current target market

diversification strategy

a growth strategy whereby a firm introduces a new product or service to a market segment that it does not currently serve

what is a market?

a group of customers that have all the same general need or want

what is a segment ?

market + some other characteristics that have separated them from the rest of the market (dividing the market into segments)

What is a target market?

segment of the market that a firm decides to satisfy by developing valuable 4 P's/marketing mix. every segment you target gets their own 4 p's.

What is positioning?

"How do you want customers to think of you compared to the other competitors?" defining the 4P's so customers get a clear, distinctive, and desirable understanding of what the product does and represents in comparison to other products

RFID (radio frequency identification)

Enables firms to track an item from the moment it was manufactured, through the distribution system, to the retail store, and into the hands of the consumer.

Cookies

These help companies track what a customer does on the web, allowing marketers to better meet the needs/wants but increasing privacy concerns.

what is the CDSTEP (Macroenvironment)?

Culture, Demographics, social, technology, economic, and political/legal

Baby boomers

people born between 1946 and 1964, this group has massive buying potential

Generation X

the group born after the baby boomers, is smaller in number

Generation Y

the group that follows generation X, also called millennials.

Consumer Product Safety Commission

This sets safety standard for consumer products (products used at home)

Federal Trade Commission (FTC)

Regulates unfair competitive practices and practices that deceive or are unfair to consumers

What roles do marketers play in need recognition?

They create stimuli ( any unit of input that affects the senses)

Universal set

includes all possible choices for a product category

Retrieval set

includes those brands or stores that the consumer can readily bring forth from memory

Evoked set

3-5 brands that you are considering for further evaluation. -if you are brand loyal to a specific brand, that is the only option for you always.

compensatory decision rule

trade off were made in your decision

noncompensatory decision rule

go with what performs best on the most important attribute no matter what else

Attributes

characteristics that are important to your evaluation

what is perception

process by which people select, organize, and interpret stimuli into a meaningful coherent picture.

Stimulus generalization

a form of learning that occurs when one response is extended to a second stimuli similar to the first one (ipod,ipad,iphone)

learning

a process that creates change in behavior or in a person thought process through practice or experience. Learn by doing (testers, samples), learn by knowledge (ads, websites, videos)

What is shaping?

tactic used by marketers that uses all four aspects of learning to create a repetitive buying ( mostly with consumable- paper, food, water, deodorant)

Reinforcement/Punishment

Reinforce positive behavior with bogo, premiums. punish negative behavior with late fees, return fees

ABC model of attitudes

Attitudes: a persons enduring, overall evaluation of an object or idea

Affective; reflects what a person feels about the issue at hand (like or dislike of something, involves emotion)

Behavioral; the actions a person takes with regards to the issues at hand (based on what they feel)

Cognitive; reflects what the person believes is true

What is true about segments?

SEGMENT BUYERS NOT PRODUCTS

FLC Family life cycle Segmentation variables

Combines 3 demographic groups; age, gender, and absence/non absence of children

Geodemographic Segmentation

combines income, age, and location. segmenting potential customers into neighborhood lifestyle categories

What is geography, demographics, psychographics, benefits sought, usage rate, and occasion/situation of use (Segmentation bases)

Geography: location, climate

Demographics: age, income, gender, ethnicity, family size, job type.

Psychographics: attitudes, interests, opinions (A.I.O), values, and lifestyle

Benefits sought: extra benefits (ex; Bluetooth, leather, very fast)

Usage rate: High or low

Occasional/ Situation of use: running late, at home use, sit-down, store location

Undifferentiated Target Strategy

marketing approach that views the market as one big market with no individual segments and thus uses a single marketing mix.

Advantages: potential savings on production and marketing costs

Disadvantages: unimaginative product offerings, more susceptible to competition

Concentrated Target Strategy

a strategy used to select one segment of a mark for marketing efforts

Advantages: large profit if it works

Disadvantages: all of your eggs are in one basket so if it fails or customers needs and wants change, you have nothing to fall back on

Differentiated Target Strategy

a strategy that chooses two or more well defined market segments and develop a distinct marketing mix for each.

Advantages: greater financial success (reach more people), economies of scale, lower overall risk (more diverse if it fails or a customer needs or wants change)

Disadvantages: higher costs ( more money for ads, products, and research) cannibalization

Micromarketing/ Mass Customization

when a firm tailors part of the marketing mix to suit individuals and customers needs and wants

Advantages: Individualized

Disadvantages: extremely expensive, relies on technology, difficult to meet every person with the 4 P's

Economies of Scale

Lower cost per a unit (large productions of the same product for massive amounts of people that results in large savings)

What is Cannibalization?

Sales of existing products eat away at the sale of another product (From the same company)

General info about product P

Everything, both favorable and unfavorable, that a person receives in an exchange (includes goods, services, ideas, a person, place, or organization).

It is the starting point in the marketing mix

Product Category Vs Brands

Product Category: a type of service or product

Product Brand: a name, term, symbol, design, or combination thereof that identifies a sellers product and differentiates them from competitors

Core customer value

What are the basic problems that you want solved from benefits that you want your products to have

Product line

a group of closely related product items that provide the same benefit or satisfies the same need. Ex: Coke company has pop, drinks, chips

Product mix

all products a company has

Product item

a specific version of a product that can be designated as distinct.

ex; coke makes coke, diet coke, coke zero, ect.

Product Line Depth

The number of products in a line.

increasing depth attracts buyers with different options, increases sales by further market segmentation, capitalizes economies of scale.

increasing product line depth= new segment

Product Mix width

Increases the number of product lines in a product mix.

Increasing width: diversifies risk, capitalizes on established reputation.

increasing width= new market

Licensed brands

when someone seeks permission from a company to use/"borrow" their brand

Trademark

the exclusive right to use the brand (this is before registered trade mark)

Generic brand

a no-frills, no-brand-name, low-cost product that is simply identified by its product category (ex: peanut butter says peanut butter and that's it)

Manufacturer Brand (National Brand)

Brand name owned and managed by a manufacturer, and sold at multiple retail locations (ex: Dawn dish soap)

Private Brand (Store Brand)

products and services developed by retailer or wholesaler (ex: Meijer brand, Victoria secret, Kirkland)

What is innovation? and why do firms innovate?

The process by which ideas are transformed into new offerings, including products, services, processes, and branding concepts that will help the firm grow.

Marketer do this so they can beat competitors and lower costs.

What is diffusion of innovation and an adopter?

Diffusion of innovation: is a process by which an adopter of an innovation (new to the world product that creates a new market or industry and drastically changes the way people do things and their preference), spreads through the market, overtime and across various categories of adopters.

Adopter: uses the product, is satisfied (meets their expectations), and intends to keep buying/using it. MUST DO ALL 3.

Categories of Adopters

1. Innovators

2. Early Adopters

3. Early Majority

4. Late Majority

5. Laggards

1. are rich and well educated (high socioeconomic status), adventurous, obsessed with being first, and connected to outside community. INTRO STAGE

2. locally tied to the community, are an "influencer, care about respect, compassionate, talk to everyone. INTRO-GROWTH STAGE

3. weigh pros/cons, deliberate, do information search/explore. Adopt because of early majority. GROWTH STAGE

4. Late Majority: care about money, and low education, avoid change, simple life, older, skeptical, get peer pressured or accept as gifts. MATURITY STAGE

5. tied to tradition, low socioeconomic status, forced to get the product, WHOLE PRODUCT LIFE CYCLE behind (their products are normally in the decline stage)

Point of diffusion of innovation: tells us how the type of customer changes over their life time.

What is the point of the Product life cycle?

a tool that tells marketers how the 4P's will change over the products life time.

Reverse Engineering

Process by which a man made object is deconstructed to reveal its designs, architecture. or extract knowledge from the object involved in manufacturing it usually in order to produce something similar.

Point of supply chain

to deliver/ increase the value (increasing both benefits and lower costs in all parts of the supply chain)

What is a distribution center?

a facility owned by retailers or manufacturers that receive goods, store them, and redistribute them to store.

What is a fulfillment center?

Facilities owned by an online retailer that receive the goods and distribute them directly to the customer.

Direct vs indirect

Direct: manufactures sell directly to the customer

Indirect: sell to a retailer then they sell to a customer.

Intensive Distribution

Strategy designed to get products into as many outlets as possible

Selective Distribution

Lies between the intensive and exclusive strategy: uses a few selected customers in a territory

Exclusive Distribution

A strategy in which only selected retailers can sell this manufacturers brand.

3 Sub-goals of Promotion (Communication)

Inform (about the product category benefits. (the intro stage of plc)

Persuade (your product item benefits- used in growth and maturity stage)

Remind (maturity and decline stage)

What is the Promotional Mix?

Public Relations, sales promotions, personal selling, advertising, direct marketing, and online marketing

Public Relations

The organizational function that manages the firms communication to achieve building a positive brand image and educating the stakeholders.

Pro: Free media (don't have to pay for new coverage) becoming cheaper, better because ppl don't trust marketers

Con: Cannot always control the type of publicity you get

Sales Promotions

Special incentives or excitement-building programs that encourage the purchase of a product or service, such as coupons, rebates, contests, free samples, and point-of-purchase displays.

-easy to track, it is immediate, can tell if a coupon is working right away if people are purchasing.

Disadvantage: gains are really short run, don't have a positive longterm gain

Advertising

The placement of announcements and persuasive messages purchased in any form of mass media communication by firms, non-profit, gov. agencies, and individuals who seek to inform and or persuade members of a particular target market or audience about their products, service organizations, or ideas. (impersonal form of communication in which a company is identified).

Advantages: builds good awareness interest, high total cost but low cost per contact, high reach.

Disadvantages: not personalized, everyone gets the same message, and customers don't give feedback.

Personal Selling

The two-way flow of communication between a buyer and a seller that is designed to influence the buyer's purchase decision. (Personal interaction for the point of making a sale)

Disadvantages: low reach, most expensive

Advantages: most effective, and the most value to the consumer, easy to track, customers can give feedback

Direct Marketing

marketing that is communicated directly with the target customers to generate a response or transaction purchase

Advantages: growing, database technology improves, easy to track.

AIDA Model

Model that outlines the process for achieving promotional goals.

Awarness: customers ability to recognize or recall the brand name is a particular type of retailer/product/service, (measured through added recall or top of the mind awareness)

Interest: The customer must want to further investigate the product service

Desire: emotions and feelings about wanting the product/ service

Action: Purchase, spread word of mouth, bring a friend, loyalty program, post a review, fill out a survey.

The Point: consumers must go through this in order to purchase the product and marketers promote at all stages

Online Marketing

Through websites, blogs, and social media

Push vs Pull Promotion

Push: Manufacturers talk to the retailer about the products

Pull: manufacturer to the end consumer directly about products, creates demand in the consumers eyes

Institutional vs Product Advertising ( and what type of product advertising)

Institutional advertising: used to promote the organization as a whole and is designed to establish, change, or maintain the org. identity.

Advocacy advertising: supports a cause or a issue, sometimes is controversial issue, usually sponsored by a For-Profit org.

Trade Promotion

sales promotions that are targeted at channel members or B2B

Product Placement

Subtle promotion of a product or service through placement through entertainment media (ex: celeb on a late night show to promote the movie)

Event Sponsorship

corporation support an event usually cultural, sports, or entertainment (ex: Meijer sponsoring art prize)

Issue Sponsorship

corporation support of an issue by raising awareness or tackling the issue.

Elasticity

consumer buy more or less of a product when the price changes (clothes, concert tickets)

Inelasticity

an increase or decrease in price will not significantly affect demand (gas, medicine, surgery)