Marketing Exam 1

The Marketing Concept

• Starting Point: market

• Focus: Customer needs

• Means: Integrated Marketing

• Ends: Profits through customer satisfaction

Creating Value

• physical objects

• people

• organizations

• places

• information

• ideas

The selling concept

• starting point: factory

• focus: existing products

• means: selling and promoting

• ends: profits through sale volume

Marketing Myopia

a short-sighted business approach that focuses on selling specific products rather than understanding and fulfilling the broader needs of customers.

The production concept

• an old business and marketing philosophy stating that consumers prefer products that are widely available and inexpensive

• ex: ford model T car

The product concept

• detailed vision and description of a new product or service, created before any design or engineering work begins

• usually summarized into a written concept statement

Societal Marketing Concept

• society (human welfare) at the top

• consumers at bottom left

• companies (profits) at bottom right

The Marketing Mix

• how marketers implement marketing strategies

Butterflies

• high profitability

• low loyalty

True Friends

• high profitability

• high loyalty

Strangers

• low profitability

• low loyalty

Barnacles

• low profitability

• high loyalty

Customer Equity

the sum of the entire group

Domain of Marketing

• product

• place

• promotion

• price

Marketing Environment

“the actors and forces outside marketing that affect marketing management’s ability to build and maintain successful

Actors in the Microenvironment

• the company

• suppliers

• marketing intermediaries

• competitors

• publics

• customers

The company

• think consumer

• cooperate inter-functionally to provide superior customer value and satisfaction

Suppliers and Intermediaries

• suppliers provide resources needed for production and innovation

• intermediaries help the company promote, sell, and distribute the products to end-user

Competitors

• who might the customer choose instead

• provide reasonable substitutes to customers

• ex: McDonald’s vs. Burger King

Law of Color

• a brand should use a color that is opposite of its major competitors

• when its the same color people will choose the main brand

Publics

• any group that has an interest in or impact on an organization’s ability to achieve its objectives

Types of Publics

• financial

• media

• government

• citizen-action

• local

• general

• internal

Customers

• who buys our products

• five basic types

  • consumers

  • business

  • reseller

  • government and non-profit

  • international markets

Major Forces in Macroenvironment

• demographic forces

• economic forces

• natural forces

• technological forces

• political forces

• cultural forces

Demographic Forces

• household structures

• age structures

• geographic population shifts

• educational characteristics

• population diversity

• occupations

Demographic challenge

• more single person household’s

• ex: Campbell’s came out with soup for one person

Boomers

• most afluent generation

• born between 1946 & 1964

• digitally active

• care about staying active and youthful thinking

Gen X

• born between 1965 & 1980

• weigh up decisions, juggle, resilient

• adapted to teach in young adulthood

• self reliant

• care about experiences

Millenials/Gen Y

• born between 1981 & 1996

• large buying power

• came of age with technology

• frugal and want to connect with brands

• care about value and sharing experiences

Gen Z

• born between 1997 & 2012

• largest generation

• seamless fluency

• desire lots of sensory information

• expect personalized experiences

Gen Alpha

• born after 2012

• tech giants; take tech for granted

• marketing gateway to reach their parents

• important future consumers just beginning

Economic Forces

• consists of factors that affect consumer purchasing power and spending patterns

• changes in buying behavior

• changes in come distribution

Natural Forces

• natural resources that are needed as inputs by marketers or that are affected by marketing activities

• factors include

  • shortages of raw materials

  • increased pollution

  • increased government intervention

Technological Factors

• factors that create new technologies, creating new product and market opportunities (while making other products obsolete)

• ex: waymo self-driving car, VR, tesla supervised self-driving

Political Forces

• laws, regulations, and pressure groups that influence and limit various organizations and individuals in a given society

Sherman Antitrust Act

• companies can’t collude on prices

• price fixing

• predatory pricing: sell below market price to put other companies out of business

Robinson-Patman Act

• price discrimination is illegal; can’t randomly discriminate on prices

Cultural Forces

• the forces that affect a society’s basic values, perceptions, preferences, and behavior

Hypertasking

multitasking in overdrive

Egonomics

craving recognition of individuality

Mass Mingling

digital technologies affect offline mingling

Cocooning

spending more time at home

Down Aging

comfort in familiar pursuits and products from decades past

Clanning

validating one’s own belief system by belonging to a group that shares common beliefs or ideals

LOHAS

general concern for natural world

Renewed spirituality

less materialism, greater “meaning of life”

Internal Databases

what information do we have already

Marketing Intelligence

what public information is available

Exploratory Research

• gather preliminary information that will help define the problem and suggest hypothesis

Descriptive Research

• describes things (e.g. market potential for a product

Causal Research

• tests hypothesis about cause and effect relationships

Primary Data

• collect specific info

• directly available

• costly

Secondary Data

• rely on existing info

• often not as applicable

• less expensive

• LexisNexis: database of company information

Observational Research

• the gathering of primary data by observing relevant people, actions, and situations

Ethnographic Research

• observation in a natural environment

• ex: research on how old people use kitchen tools

Mechanical Observation

• on device meters

• checkout scanners

• eye cameras

Survey Research

• most widely used method for primary data collection

• best for gathering descriptive

• can gather info about people’s knowledge, attitudes, preferences, or buying behavior

Personal Interview

• highly flexible

• good control of sample

• high cost per respondent

• highly subject to interviewer bias

Phone

• mostly used for surveys

• gather info fast

• greater flexibility than mail surveys

• higher costs than mail

• interviewer effects exist

• quantity of data that can be collected is smaller than in mail surveys

Mail

• mostly used for surveys using a questionnare

• cheaper

• can send to a lot of people

• takes longer to get all the answers back

• low response rate

Online Marketing Research

• can do surveys, experiments, and personal (group and individual) interviews

• the least expensive way to gather info

• saves time on data processing

• questionable data

• low response rate

Experimental Research

• best for gathering exploratory/causal

• select matched groups of subjects

• give different treatments

• control for unrelated factors

• check differences in responses between groups

Consumer Behavior

• buying behavior of individuals and households who buy goods and services for personal consumption

Culture

• the most basic cause of a person’s wants and behaviors

Subculture

the culture of a group of people who share value systems based on common life experiences

Social Classes

a society’s relatively permanent and ordered divisions whose members share similar values, interests, and behaviors

Hispanic Americans

• use X/twiiter more

• brand names sell well

• family affair

African Americans

• enjoy shopping

• spend more

• selection/innovative

Asian Americans

• use the internet more and more likely to be brand conscious

• more likely to use yelp

Social Factors

• reference groups

• family/household

• roles and status within groups

Personal Factors

• age & life-cycle stage

• occupation

• economic situation

• lifestyle

• personality and self-concept

VALS

• ideals

• achievement

• self-expression

Psychological Factors

• motivation

• perception

• learning changes behavior based on experience

• beliefs and attitudes affect choices

Maslow’s Hierarchy of Needs

• self-actualization

• esteem

• social

• safety

• psychological