MGMT 323 Exam 1 Purdue

Marketing

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

Marketing Plan

A written document composed of an analysis of the current marketing situation, opportunities and threats for the firm, marketing objectives and strategy specified in terms of the four Ps, action programs, and projected or pro forma income (and other financial) statements.

Exchange

the trade of things of value between the buyer and the seller so that each is better off as a result.

Marketing Mix

Product, price, place, and promotion—the controllable set of activities that a firm uses to respond to the wants of its target markets.

Four P's

Product, price, place, and promotion

Goods

items that you can physically touch

Services

intangible customer benefits that are produced by people or machines and cannot be separated from the producer

Ideas

include thoughts, opinions, and philosophies; intellectual concepts such as these also can be marketed

business-to-consumer (B2C) marketing

The process by which businesses sell to consumers

business-to-business (B2B) marketing

the process of selling merchandise or services from one business to another

consumer-to-consumer (C2C) marketing

consumers sell to other consumers

Value

reflects the relationship of benefits to costs, or what you get for what you give

value cocreation

customers can act as collaborators to create the product or service

relational orientation

A method of building a relationship with customers based on the philosophy that buyers and sellers should develop a long-term relationship.

customer relationship management (CRM)

a business philosophy and set of strategies, programs, and systems that focus on identifying and building loyalty among the firm's most valued customers

marketing strategy

A firm's target market, marketing mix, and method of obtaining a sustainable competitive advantage

sustainable competitive advantage

Something the firm can persistently do better than its competitors

Customer excellence

Focuses on retaining loyal customers and excellent customer service

Operational excellence

Achieved through efficient operations and excellent supply chain and human resource management

Product excellence

Having products with high perceived value and effective branding and positioning

Locational excellence

Having a good physical location and Internet presence

Planning Phase

The part of the strategic marketing planning process when marketing executives, in conjunction with other top managers (1) define the mission or vision of the business and (2) evaluate the situation by assessing how various players, both in and outside the organization, affect the firm's potential for success.

implementation phase

The part of the strategic marketing planning process when marketing managers (1) identify and evaluate different opportunities by engaging in segmentation, targeting, and positioning and (2) implement the marketing mix using the four Ps.

control phase

The part of the strategic marketing planning process when managers evaluate the performance of the marketing strategy and take any necessary corrective actions.

Mission Statement

a broad description of a firm's objectives and the scope of activities it plans to undertake,21 attempts to answer two main questions: What type of business are we? What do we need to do to accomplish our goals and objectives?

SWOT analysis

assesses both the internal environment with regard to its Strengths and Weaknesses and the external environment in terms of its Opportunities and Threats

segmentation, targeting, and positioning (STP)

Firms use these processes to identify and evaluate opportunities for increasing sales and profits.

market segment

A group of consumers who respond similarly to a firm's marketing efforts.

market segmentation

The process of dividing the market into groups of customers with different needs, wants, or characteristics—who therefore might appreciate products or services geared especially for them.

target marketing or targeting

The process of evaluating the attractiveness of various segments and then deciding which to pursue as a market.

market positioning

Involves the process of defining the marketing mix variables so that target customers have a clear, distinctive, desirable understanding of what the product does or represents in comparison with competing products

Integrated marketing communications (IMC)

Represents the promotion dimension of the four Ps; encompasses a variety of communication disciplines—general advertising, personal selling, sales promotion, public relations, direct marketing, and electronic media—in combination to provide clarity, consistency, and maximum communicative impact.

Metric

A measuring system that quantifies a trend, dynamic, or characteristic

strategic business unit (SBU)

A division of the firm itself that can be managed and operated somewhat independently from other divisions and may have a different mission or objectives

product lines

Groups of associated items, such as those that consumers use together or think of as part of a group of similar products.

market share

Percentage of a market accounted for by a specific entity

relative market share

A measure of the product's strength in a particular market, defined as the sales of the focal product divided by the sales achieved by the largest firm in the industry

market growth rate

The annual rate of growth of the specific market in which the product competes

market penetration strategy

A growth strategy that employs the existing marketing mix and focuses the firm's efforts on existing customers

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

related diversification

A growth strategy whereby the current target market and/or marketing mix shares something in common with the new opportunity

unrelated diversification

A growth strategy whereby a new business lacks any common elements with the present business

social media

Media content used for social interactions such as YouTube, Facebook, and Twitter

4E framework

Excitement, Education, Experience, Engagement

Blog

A web page that contains periodic posts; corporate blogs are a new form of marketing communications

corporate blog

A website created by a company and often used to educate customers

professional blog

Website written by a person who reviews and gives recommendations on products and services

personal blog

Website written by a person who receives no products or remuneration for his or her efforts

microblog

Differs from a traditional blog in size. Consists of short sentences, short videos, or individual images. Ex. Twitter

showrooming

Customers visit a store to touch, feel, and even discuss a product's features with a sales associate, and then purchase it online from another retailer at a lower price

ad-supported app

Apps that are free to download, but place ads on the screen when using the program to generate revenue

freemium app

Apps that are free to download, but include in-app purchases

in-app purchase

When a game or app prompts or allows customers to make small "micropurchases" to enhance an app or game

paid app

Apps that charge the customer an up-front price to download the app ($0.99 is the most common), but offer full functionality once downloaded

paid apps with in-app purchase

Apps that require the consumer to pay initially to download the app and then offer the ability to buy additional functionality

sentiment analysis

A technique that allows marketers to analyze data from social media sites to collect consumer comments about companies and their products

Hits

A request for a file made by web browsers and search engines. Hits are commonly misinterpreted as a metric for website success; however, the number of hits typically is much larger than the number of people visiting a website

Page Views

the number of times an Internet page gets viewed by any visitor

bounce rate

The percentage of times a visitor leaves the website almost immediately, such as after viewing only one page

click path

Shows how users proceed through the information on a website—not unlike how grocery stores try to track the way shoppers move through their aisles

conversion rates

Percentage of consumers who buy a product after viewing it

keyword analysis

An evaluation of what keywords people use to search on the Internet for their products and services

THE IMMEDIATE ENVIRONMENT

the company's capabilities, competitors, and corporate partners

macroenvironmental factors

Aspects of the external environment that affect a company's business, such as the culture, demographics, social trends, technological advances, economic situation, and political/regulatory environment

Culture

The set of values, guiding beliefs, understandings, and ways of doing things shared by members of a society; exists on two levels: visible artifacts (e.g., behavior, dress, symbols, physical settings, ceremonies) and underlying values (thought processes, beliefs, and assumptions).

country culture

Entails easy-to-spot visible nuances that are particular to a country, such as dress, symbols, ceremonies, language, colors, and food preferences, and subtler aspects, which are trickier to identify

regional culture

The influence of the area within a country in which people live

Demographics

Information about the characteristics of human populations and segments, especially those used to identify consumer markets such as by age, gender, income, and education

generational cohort

A group of people of the same generation—typically have similar purchase behaviors because they have shared experiences and are in the same stage of life

Generation Z (Gen Z) or Digital Natives

Generational cohort of people born between 2001 and 2014. Also known as Digital Natives because people in this group were born into a world that already was full of electronic gadgets and digital technologies, such as the Internet and social networks.

Generation Y (Gen Y) or Millennials

Generational cohort of people born between 1977 and 2000; biggest cohort since the original postwar baby boom

Generation X (Gen X)

Generational cohort of people born between 1965 and 1976

Baby Boomers

Generational cohort of people born after World War II, between 1946 and 1964

green marketing

Involves a strategic effort by firms to supply customers with environmentally friendly merchandise

greenwashing

Exploiting a consumer by disingenuously marketing products or services as environmentally friendly, with the goal of gaining public approval and sales

technological advances

Macroenvironmental factor that has greatly contributed to the improvement of the value of both products and services in the past few decades

economic situation

Macroeconomic factor that affects the way consumers buy merchandise and spend money, both in a marketer's home country and abroad; see also inflation, foreign currency fluctuations, and interest rates

Inflation

Refers to the persistent increase in the prices of goods and services

foreign currency fluctuations

Changes in the value of a country's currency relative to the currency of another country; can influence consumer spending

interest rates

These represent the cost of borrowing money

political/regulatory environment

Comprises political parties, government organizations, and legislation and laws

need recognition

The beginning of the consumer decision process; occurs when consumers recognize they have an unsatisfied need and want to go from their actual, needy state to a different, desired state

functional needs

Pertain to the performance of a product or service

psychological needs

Pertain to the personal gratification consumers associate with a product or service

internal search for information

Occurs when the buyer examines his or her own memory and knowledge about the product or service, gathered through past experiences

external search for information

Occurs when the buyer seeks information outside his or her personal knowledge base to help make the buying decision

internal locus of control

Refers to when consumers believe they have some control over the outcomes of their actions, in which case they generally engage in more search activities

external locus of control

Refers to when consumers believe that fate or other external factors control all outcomes

performance risk

Involves the perceived danger inherent in a poorly performing product or service

financial risk

Risk associated with a monetary outlay; includes the initial cost of the purchase, as well as the costs of using the item or service

social risk

The fears that consumers suffer when they worry others might not regard their purchases positively

physiological risk or safety risk

the fear of an actual harm should a product not perform properly

psychological risk

Associated with the way people will feel if the product or service does not convey the right image

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

Comprises the alternative brands or stores that the consumer states he or she would consider when making a purchase decision

evaluative criteria

Consist of a set of salient, or important, attributes about a particular product

determinant attributes

Product or service features that are important to the buyer and on which competing brands or stores are perceived to differ