MKTG 400 Unit 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

What is needed for marketing to occur

1. Two or more parties with unsatisfied needs
2. Desire and ability to be satisfied
3. A way for the parties to communicate
4. Something to exchange 

The four Ps

Price, product, promotion, place

Marketing mix

the controllable factors- product, price, promotion, and place- that can be used by the marketing manager to solve a marketing problem

Customer value

the unique combination of benefits received by targeted buyers that includes quality, convenience, on-time delivery, and both before-sale and after-sale service at a specific price

Customer value proposition

the cluster of benefits that an organization promises customers to satisfy their needs

Marketing program

a plan that integrates the marketing mix to provide a good, service, or idea to prospective buyers

Marketing segments

relatively homogenous groups of prospective buyers who (1) have common needs and (2) will respond similarly to a marketing action (product feature, promotion, or a price)

Customer relationship management (CRM)

the process of identifying prospective buyers, understanding them intimately, and developing favorable long-term perceptions of the organization and its offerings so that buyers will choose them in the marketplace and become advocates after their purchase

Organization

a legal entity that consists of people who share a common mission. This motivates them to develop offerings (goods, services, or ideas) that create value for both the organization and its customers by satisfying their needs and wants

Organizational levels

corporate, strategic-business unit, functional

Corporate level

where top management directs overall strategy for the entire organization

Strategic-business unit level

managers set a more specific strategic direction for their businesses to exploit value-creating opportunities 

Functional level

the organization's strategic direction becomes its most specific and focused 

Organizational purpose

describes why an organization exists, what problems it wishes to solve, and who it wants to be to every person it touches through its work

Core values

the fundamental, passionate, and enduring principles that guide its conduct over time

Mission

a statement of the organization’s function in society that often identifies its customers, markets, products, and technologies

Organizational culture

the values, ideas, attitudes, and norms of behavior that are learned and shared among the members of an organization

Strategy

an organization’s long-term course of action designed to deliver a unique customer experience while achieving its goals

Goals/objectives

statements of an accomplishment of a task to be achieved, often by a specific time

Market share

the ratio of sales revenue of the firm to the total sales revenue of all firms in the industry, including the firm itself

Marketing plan

a roadmap for the marketing actions of an organization for a specified future time period

Market

consists of people with both the desire and the ability to buy a specific offering

Target-market

one or more specific groups of potential customers toward which an organization directs its marketing program

Marketing dashboard

the visual display of the essential information related to achieving a marketing objective 

Marketing metric

a measure of the quantitative value or trend of a marketing action or result

Business portfolio analysis

a technique that manager use to quantify performance measures and growth targets to analyze their firms’ SBUs as though they were a collection of separate investments

Diversification analysis

a technique that helps a firm search for growth opportunities from among current and new markets as well as new and current products

The strategic marketing process

involves the allocation of an organization’s marketing mix resources to reach its target markets and achieve a competitive advantage

Phases of the strategic marketing process

planning, implementation, evaluation

Guiding principles of the strategic marketing process

1. Customers are different
2. Customers change
3. Competitors change and react
4. Organizational resources are limited

SWOT analysis

strengths, weaknesses, opportunities, threats

The planning phase

1. Conduct a SWOT analysis
2. Develop a market-product focus, customer value proposition, and goals
3. Design a marketing program

The implementation phase

1. Obtaining resources
2. Designing the market organization
3. Defining precise tasks, responsibilities, and deadlines
4. Actually executing the marketing program designed in rhe planning phase

The evaluation phase

1. Compare the results of the marketing program with the goals in the written plans to identify the presence and causes of deviations using marketing metrics
2. Act on these deviations

Business plan

a roadmap for the entire organization for a specified future period of time

Planning gap

the difference between the projection of the path to reach a new sales revenue goal and the projection of the path of a plan already in place

Evolution toward a market orientation

1. Production
2. Sales
3. Marketing concept
4. Marketing orientation

Business plan

a roadmap for the entire organization for a specified future period of time

Environmental scanning

the process of continually acquiring information on events occurring outside the organization to identify and interpret potential trends

Social forces

the demographic characteristics of the population and its culture

Demographics

describe a population according to selected characteristics such as age, gender, ethnicity, income, and occupation

Multicultural marketing

consists of combinations of the marketing mix that reflect the unique attitudes, ancestry, communication preferences, and lifestyles of different races 

Generational cohorts

Baby boomers, gen X, millennials, gen z

Culture

incorporates the set of values, ideas, and attitudes that are learned and shared among members of a group

Value consciousness

the concern for obtaining the best quality features, and performance of a product or service for a given price that drives consumption behavior

Economic forces

pertains to the income, expenditures, and resources that affect the cost of running a business and household

Gross income

the total amount of money made in one year by a person, household, or family unit

Disposable income

the money a consumer has left after paying taxes to use for necessities, such as food, housing, clothing

Discretionary income

the money that remains after paying for taxes and necessities

Technological forces

consists of the inventions or innovations from applied science or engineering research

Marketspace

an information and communication based electronic exchange environment mostly occupied by sophisticated computer and telecommunication technologies and digital offerings

Electronic commerce (e-commerce)

the activities that use electronic communication in the inventory promotion, distribution, purchase, and exchange of products and services

Internet of things

the network of products embedded with connectivity-enabled devices

Competitive forces

consists of the alternative firms that could provide a product to satisfy a specific market’s needs

Pure competition

there are many sellers and each has a similar product

Monopolistic competition

many sellers compete with substitute products within a price range

Oligopoly

occurs when a few companies control the majority of industry sales

Monopoly

occurs when only one firm sells the product

Components of competition

1. Entry
2. Power of buyers and suppliers
3. Existing competitors and substitutes
4. Existing rivalries

Regulatory forces

consists of restrictions state and federal laws place on business with regard to the conduct of its activities

Consumerism

a grassroots movement started in the 1960s to increase the influence, power, and rights of consumers in dealing with institutions

Sherman Antitrust Act (1890)

forbids conspiracies in restraint of trade

Clayton Act (1914)

forbids acts likely to lessen competition

Robinson-Patman Act (1936)

unlawful to discriminate in prices

Barriers to entry

business practices or conditions that make it difficult for new firms to enter the market

Ethics

the moral principles and values that govern the actions and decisions of an individual or group

Laws

society’s values and standards that are enforceable in courts

Factors affecting ethical marketing behavior

1. Societal culture and norms
2. Business culture and industry practice
3. Corporate culture and expectations
4. Your personal moral philosophy and ethical behavior

Economic espionage

the clandestine collection of trade secrets or proprietary information about a company’s competitors

Self-regulation

an alternative to government control where an industry attempts to policy itself

Economic espionage

the clandestine collection of trade secrets or proprietary information about a company’s competitors

Caveat emptor

let the buyer beware

Consumer Bill of Rights

an outline presented by President John F. Kennedy in 1962 that codified the ethics of exchange between buyers and sellers, including the rights to safety, to be informed, to choose, and to be heard

Code of ethics

a formal statement of ethical principles and rules of conduct

Whistle-blowers

employees who report unethical or illegal actions of their employers

Moral idealism

a personal moral philosophy that considers certain individual rights or duties as universal, regardless of the outcome

Utilitarianism

a personal moral philosophy that focuses on “the greatest good for the greatest number” by assessing the costs and benefits of the consequences of ethical behavior

Social responsibility

the idea that organizations are part of a larger society and are accountable to that society for their actions

Consumer behavior

the actions a person takes in purchasing and using products and services, including the mental and social processes that come before and after these actions

Consumer purchase decision process

1. Problem recognition
2. Information searching
3. Alternative evaluation
4. Purchase decision
5. Post purchase behavior

Involvement

the personal, social, and economic significance of the purchase to the consumer

Situational influences

1. The nature of the purchase task
2. Social surroundings
3. Physical surroundings
4. Temporal effects
5. Antecedent states

Consumer touchpoints

a marketer’s product, service, or brand points of contact with a consumer from start to finish in the purchase decision process

Consumer journey map

a visual representation of all the touchpoints a consumer comes into contact with before, during, and after a purchase

Motivation

the energizing force that stimulates behavior to satisfy a need

Personality

a person’s consistent behaviors or responses to recurring situations

Perception

the process by which an individual selects, organizes, and interprets information to create a meaningful picture of the world

Perceived risk

the anxiety felt because the consumer cannot anticipate the outcomes of a purchase but believes there may be negative consequence

Learning

those behaviors that result from (1) repeated experience and (2) reasoning

Behavioral learning

the process of developing automatic responses to a situation

Attitude

a learned predisposition to respond to an object or class of objects in a consistently favorable or unfavorable way

Beliefs

a consumer’s subjective perception of how a product or brand performs on different attributes based on personal experience, advertising, and discussions with other people

Lifestyle

a mode of living that is identified by how people spend their time and resources, what they consider important in their environments, and what they think of themselves and the world around them

Opinion leadership

individuals who exert direct or indirect social influence over others

Word of mouth

the influencing of people during conversations

Brand loyalty

a favorable attitude toward and consistent purchase of a single brand over time

Consumer socialization

the process by which people acquire the skills, knowledge, and attitudes necessary to function as consumers

Subculture

subgroups within the larger, or national, culture with unique values, ideas, and attitudes

Family life cycle

the distinct phases that a family progresses through from formation to retirement, each phase bringing with it identifiable purchasing behaviors