FMK329 Introductory Marketing Exam Revision

Comprehensive vocabulary flashcards covering the core marketing principles, product levels, pricing strategies, services marketing, consumer behavior, market segmentation, branding, digital marketing tools, and social marketing from FMK329.

Product Concept

• A core marketing philosophy based on the premise that consumers are looking for quality products, focusing business efforts on continuous product improvements.

• ex: telecommunications/technology

Sales Concept

• A core marketing orientation that places an emphasis on sales or aggressively selling the product via promotion due to increased market competition.

• ex: insurance

Marketing Concept

• A business philosophy focused on determining customer needs and wants and delivering tailored solutions to satisfy them.

• ex: car rental

Three Levels of a Product

A framework structuring a product offering into three layers: the core product, the actual product, and the augmented product.

Core Product

The basic problem-solving benefits, solutions, or core utility that consumers seek when purchasing a product.

Actual Product

The physical and tangible attributes of an offering, including brand name, design, style, packaging, quality level, and features.

Augmented Product

The non-physical attributes and supplementary services associated with a product, including warranties, installation, training, credit facilities, customer help centres, and maintenance.

Convenience Products

• Consumer goods and services that customers typically buy frequently, immediately, and with minimal comparison and buying effort.

• ex: toothpaste, rice

Shopping Products

• Consumer products that customers compare carefully on suitability, quality, price, and style before purchasing.

• ex: clothing, laptop

Specialty Products

• Consumer goods or services with unique characteristics or brand identification for which a significant group of buyers is willing to exert special purchasing effort.

• ex: luxury brands (Prada, Ferrari)

Unsought Products

• Consumer products that buyers either do not know about or know about but do not normally consider purchasing until a need arises.

• ex: insurance, funeral service

Product Life-Cycle (PLC)

The stages that products move through as they enter, get established in, and ultimately leave the marketplace: Introduction, Growth, Maturity, and Decline.

Value-Based Pricing Strategies

Pricing approaches that set prices based on the overall value of the product offering as perceived by the consumer, including improvement value and cost of ownership over time.

Improvement value

how much a consumer is willing to pay in relation to other comparable products

Cost of ownership

consumers willing to pay more because over time it will cost less than cheaper items

Competitor-Based Pricing Strategies

Pricing approaches where a firm sets prices according to those of competitors, reflecting how consumers interpret prices relative to competitive offerings.

Cost-Based Pricing Strategies

A pricing method that calculates the final selling price by starting with costs plus a desired profit margin, represented by the formula: $\text{Price} = \frac{\text{cost} + \text{profit}}{\text{demand}}$.

Market Penetration Pricing

A new product pricing strategy setting an initial low price to rapidly build sales, profits, and market share while discouraging competitors from entering.

Price Skimming

A new product pricing strategy that introduces a groundbreaking product at a high price to capture early adopters willing to pay a premium, lowering the price later as demand wanes.

Customer-Oriented Pricing

A pricing objective that targets market segments that place a high value on product benefits, setting relatively high prices (also referred to as premium pricing).

Profit-oriented Pricing

Company-wide policy that all products must provide at least on 18% profit margin to reach profit-goals

Sales-oriented Pricing

Set prices very low to generate sales & take sales away from competitors

Competitor-oriented

Discourage more competitors from entering the market, set prices very low

Introduction (Product Life-Cycle)

• low sales

• low profits

• innovators

• one or few competitors

Growth (Product Life-Cycle)

• rising sales

• rapidly rising profits

• early adopters and early majority

• few or increasing competitors

Maturity (Product Life-Cycle)

• peak sales

• peak to declining profits

• late majority consumers

• high number of competitors and products

Decline (Product Life-Cycle)

• declining sales

• declining profits

• laggards

• low number of competitors and products

Promotion

• Communication by the marketer

• Informs, persuades and reminds about products or services to influence opinions or gain a response

Supply Chain Management

The set of activities and approaches used to efficiently integrate suppliers, manufacturers, warehouses, and stores so merchandise is distributed to the right customer at the right time.

Marketing channels

the pathway or medium a business uses to communicate its brand, connect with target audiences, and deliver products or services to end consumers

Service

Any act, performance, or economic activity that one party offers to another that is essentially intangible, does not result in the ownership of anything, and provides time, place, problem-solving, or experiential value.

7Ps of Services Marketing

The extended marketing mix for services, encompassing the traditional $4$ Ps (Product, Price, Place, Promotion) plus three service-specific elements: People, Physical Evidence, and Process.

People (Services Marketing)

All individuals who play a role in service delivery and influence buyer perceptions and behavior, including company staff, customers, and other participants.

Physical Evidence (Services Marketing)

The physical environment in which a service is delivered and any tangible representations of value, such as brochures, premise design, uniforms, signage, and logos.

Process (Services Marketing)

The procedures, mechanisms, operational flows, and systems through which a service is executed and delivered to customers.

Intangibility (Service Characteristic)

• A fundamental characteristic of services meaning they cannot be seen, touched, tasted, or held, making them difficult for consumers to evaluate prior to purchase.

• ex: doctor, dentist

Inseparability (Service Characteristic)

• A fundamental characteristic of services where production and consumption occur simultaneously, requiring the consumer's presence and preventing service returns.

• ex: hairdresser, nail technician

Variability (Service Characteristic)

• A fundamental characteristic of services where service quality fluctuates depending on who provides it, when, where, and the varying expectations of customers.

• ex: restaurant

Perishability (Service Characteristic)

• A fundamental characteristic of services stating they cannot be stored for future use, inventoried, or resold after purchase; unused capacity represents revenue lost forever.

• ex: plane ticket, hotel

People Processing

• Tangible service actions directed at consumers' physical bodies, including healthcare, beauty salons, and restaurants.

• Intangible service actions aimed at people’s mind, including education, theaters, museum.

Possessions Processing

• Tangible service actions directed at physical objects and possessions owned by customers, such as transportation, equipment repairs, and laundry.

• Intangible service actions aimed at informtion including, banking, accounting, and insurance

Market Segmentation

The process of dividing the total market for a good or service into smaller, internally homogeneous groups where members share similar factors influencing demand.

Geographic Segmentation

Dividing the market based on physical location, such as countries, states, regions, urban/rural divides, or climatic conditions.

Demographic Segmentation

Grouping consumers using easily quantifiable population statistics, including age, gender, income, education, and ethnicity.

Psychographic Segmentation

Segmenting consumers based on psychological criteria and self-descriptions, specifically their self-values, self-concept, and lifestyle.

Self-Values

Overriding life goals and desires that drive individuals to live their lives in a particular way, such as self-respect, belonging, or self-fulfillment.

Self-Concept

The psychological image or view an individual has of themselves in the context of achieving their life goals (e.g., viewing oneself as fun-loving or caring).

Lifestyle

The way a person lives their life to achieve their goals, shaped by income, profession, education, peer influence, and upbringing.

Benefit Segmentation

Dividing consumers into groups according to the specific benefits, advantages, or solutions they seek from a product or service.

Behavioural Segmentation

Dividing consumers into groups based on their knowledge, use, occasion of consumption, or loyalty toward a product or brand.

Baby Boomer (1946-1964)

• Value trust, quality, loyalty, reliability, and personal relationships

• Prefer established brands, good customer service, and proven products

• Testimonials, clear product information, personal selling, Facebook, and traditional advertising

Generation X (1965-1976)

• Independent, practical, financially conscious, and family-oriented

• Research products, compare prices, and prioritize value for money

• Product reviews, discounts, email marketing, Facebook, and YouTube

Millennial (1977-1995)

• Tech-savvy, socially conscious, convenience-oriented, and experience-driven

• Often research online, consider reviews, and appreciate brands that reflect their values

• Social media marketing, influencer partnerships, storytelling, Instagram, and YouTube

Generation Z (1996-2010)

• Digital natives, creative, trend-aware, and interested in authenticity and individuality

• Discover products through social media, consider peer recommendations, and respond to engaging content

• TikTok, Instagram Reels, short videos, user-generated content, and influencer marketing

Buyer Decision Process

The five sequential stages consumers experience when making a purchase: Need recognition, Information search, Evaluation of alternatives, Purchase, and Post-purchase behaviour.

Functional Needs

Consumer needs that pertain directly to the tangible performance, utility, and operational capabilities of a product.

Psychological Needs

Consumer needs that pertain to the personal gratification, emotional satisfaction, and social status associated with owning or consuming a product.

Maslow's Hierarchy of Needs

A psychological paradigm organizing human needs into five sequential tiers: Physiological needs, Safety needs, Love and belonging, Esteem, and Self-actualization.

Physiological Needs

• Basic survival and comfort

• Food, water, clothing, housing, reproduction

Safety Needs

• Security, stability, and protection

• personal security, employment, insurance, healthcare

Love and Belonging Needs

• Friendship, love, acceptance, and connection

• Gifts, family activities, social platforms

Esteem Needs

• Recognition, confidence, achievement, and status

• Luxury brands, fashion, beauty products

Self-Actualization

• Personal growth, fulfillment, and reaching one's potential

• Education, training, travel, creative hobbies

Belief

An organized pattern of knowledge and perception that an individual holds as true about their world.

Attitude

A learned tendency to evaluate and respond consistently in a favorable or unfavorable way toward a given object, person, or idea.

Emotional Involvement

strong personal feelings and emotional connections that consumers develop toward a product, brand, activity, or experience

Brand

A name, term, design, symbol, or other feature that identifies one seller's good or service as distinct from others, representing an expectation of performance and a promise of value.

• brand name

• URLs and domain name

• logos and symbols

• characters

• slogans

• jingles and sounds

What makes a brand?

Brand is greater than the product

consumers do not evaluate products based only on their physical features, quality, and usefulness, but also consider the brand's reputation, personality, emotional benefits, image, and associations.

• websites

• search engines

• email

• mobile technology

Digital Channels

4E Framework for Social Media

A strategic model outlining how social media tools build customer connections by seeking to Excite, Educate, Experience, and Engage the customer.

Excite the customer

• Attract customers' attention and make them interested in the product.

• Personalized offers, discounts, promotions, and social media advertisements.

Educate the customer

• Inform customers about the product's features, benefits, and value.

• Tutorials, blogs, product reviews, educational videos, and FAQs.

Experience the product

• Allow customers to see, try, or understand how the product works.

• Free samples, product demonstrations, trials, and how-to videos.

Engage the customers

• Build relationships and encourage customers to interact with the brand.

• Social media interactions, customer feedback, online communities, and loyalty programs.

Search Engine Marketing (SEM)

A digital marketing tool involving the optimization of search engine listings and keyword targeting to drive relevant traffic to a website.

Affiliate Marketing

A form of online advertising in which one business rewards an external entity or partner for placing advertising that generates web traffic or sales.

Mobile Marketing

The creation and delivery of marketing communication messages tailored for mobile devices such as smartphones and tablet computers.

Social Marketing

• An approach combining commercial marketing techniques and social science principles to design activities aimed at changing or maintaining people's behaviour for the benefit of individuals and society.

• ex: ice-bucket challenge, quit smoking, fighting poverty, drink driving

Additional 4Ps of Social Marketing

Four supplementary elements used alongside the traditional 4Ps in social marketing: Publics, Partnerships, Policy, and Pursestrings.

Publics (Social Marketing)

external groups (target audience, secondary audience, policymakers, gatekeepers) and internal groups (those approving or implementing the programs) involved in the societal intervention

Partnerships (Social Marketing)

collaboration with organisations within a community to increase accessibility and demand and have a common goal

Policy (Social Marketing)

media advocacy programs to encourage regulation change when needed

Purse Strings (Social Marketing)

where the money source/funds for the campaign comes from (foundations, governmental grants, donations, etc); stakeholders involved and what they expect/require

Integrated Marketing Communications (IMC)

A strategic approach that integrates and coordinates a brand's varied communication channels (advertising, PR, sales promotions, social media) to deliver a clear, consistent, and seamless message across all platforms.

Media Outreach (IMC)

• Building relationships with media organizations to increase brand awareness and publicity.

• Press releases, media interviews, news coverage, and product announcements.

Advertising (IMC)

• Paid promotion of products or services to attract customers and increase sales.

• TV commercials, online ads, billboards, radio ads, and sponsored posts.

Branding Strategies (IMC)

• Creating a unique identity and image that differentiates a brand from competitors.

• Logos, slogans, packaging, brand personality, and consistent messaging.

Public Relations (IMC)

• Building and maintaining a positive reputation and relationship with the public.

• Community programs, sponsorships, charity events, and crisis communication.

Social Media (IMC)

• Using social networking platforms to promote products and interact with customers.

• Facebook posts, Instagram Reels, TikTok videos, influencer collaborations, and customer engagement.

Direct Selling (IMC)

• Communicating directly with potential customers to promote and sell products.

• Face-to-face selling, product demonstrations, personal presentations, and sales consultations.

Blogging (IMC)

• Creating written content that informs, educates, and attracts potential customers.

• Educational articles, product guides, tutorials, and industry insights.

Full Marketing Strategy (IMC)

• An overall marketing plan that coordinates all promotional activities to achieve business objectives.

• Identifying target markets, setting goals, choosing channels, planning budgets, and evaluating results.