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MARKETING EXAM 2
Marketing Research (Analytics)
Q: What is marketing research?
A: The process of planning, collecting, and analyzing data to make relevant marketing decisions.
Q: How does analytics go beyond marketing research?
A: It takes a step further by analyzing data patterns to generate insights and predictions.
Q: What is marketing research mostly about?
A: Statistics.
Types of Marketing Research Projects
Q: What are the four types of marketing research projects?
A: Descriptive, Diagnostic, Predictive, and Causal.
Q: What does descriptive marketing research do?
A: It provides a summary and overview using statistics like mean, median, mode, and standard deviation.
Q: What does diagnostic marketing research focus on?
A: Identifying why something is happening and determining the problem.
Q: What is predictive marketing research?
A: It estimates the likelihood of future outcomes, such as product sales, using past data.
Q: What is required for predictive marketing research?
A: Regression analyses.
Q: What does causal marketing research focus on?
A: Establishing cause-and-effect relationships through experiments, such as A/B testing in digital marketing.
Regression Analysis
Q: What does regression analysis show?
A: The relationship between different variables.
Q: How does correlation differ from causation?
A: Correlation shows a relationship between variables, while causation proves that one variable directly affects another.
Q: What is the formula for a linear relationship in regression analysis?
A: y = m.x + K
Q: In regression analysis, what is the dependent variable (y)?
A: The outcome that changes based on the independent variable.
Q: In regression analysis, what is the independent variable (x)?
A: The factor that influences the dependent variable.
Q: Give an example of dependent and independent variables in marketing research.
A: Dependent: Amount of money spent in the auto parts sector.
Independent: Average age of vehicles.
Marketing Research Process (Steps)
Q: What are the steps in the marketing research process?
A: 1. Define the marketing issue/problem
2. Plan the data collection
3. Collect data
4. Analyze data
5. Take relevant actions
Q: What should be considered when defining the marketing issue/problem?
A: Clearly identifying what needs to be found out.
Types of Data Collection
Q: What is secondary data?
A: Data that has already been collected for other purposes.
Q: What are the pros and cons of secondary data?
A: Pros: Cheaper, quicker to obtain.
Cons: Less controlled, potentially outdated or irrelevant.
Q: What are some sources of secondary data?
A: Government agencies, private companies (Google), journals, magazines, newspapers.
Q: What is primary data?
A: Data collected specifically for a particular project.
Q: What are the pros and cons of primary data?
A: Pros: More relevant, more controlled, timely.
Cons: More expensive.
Q: What are some methods of collecting primary data?
A: Observation, interviews, surveys, research, experiments, focus groups.
Types of Data
Q: What are the two main types of data?
A: Quantitative and Qualitative.
Q: What is quantitative data?
A: Numerical data, such as surveys, observation, sales data.
Q: What types of questions provide quantitative data?
A: Closed-ended questions and scaled response questions (e.g., "How happy are you from 1-10?").
Q: What is a variable?
A: A measurable outcome.
Q: What are the two types of observable data?
A: Observable: Captured without a response (e.g., behavior tracking).
Latent: Captured through interaction (e.g., survey responses, emotions).
Q: What bias can affect latent data collection?
A: Socially desirable response bias—people may not answer truthfully.
Q: What is qualitative data?
A: Non-numerical information, such as interviews, focus groups, and open-ended survey questions.
Sampling Methods
Q: What is a random sample?
A: A truly random group selected from a larger population.
Q: What is a systematic sample?
A: A sample chosen using a set interval (e.g., every 5th person).
Q: What is a quota sample?
A: A sample that ensures representation of certain groups (e.g., 60% female, 40% male).
Q: If a sample size (n) is 40, with 24 females and 16 males, what would the proportional breakdown be for a population of 400?
A: 240 females, 160 males.
Statistical Software for Marketing Research
Q: What are common statistical software options used in marketing research?
A: IBM SPSS, R, Python, LIWC.
Q: How is Python useful in marketing research?
A: It uses machine learning to analyze qualitative data and improve over time.
Q: What is LIWC used for?
A: Analyzing qualitative data, such as sentiment analysis in text.
Marketing Research (Analytics)
Sampling Methods
Q: What is a random sample?
A: A truly random selection from a larger population; fine in most cases, but errors can occur if all demographics aren’t represented.
Q: What is a systematic sample?
A: A sample selected at regular intervals from a larger population.
Q: What is a quota sample?
A: A sample that ensures all demographics have the same likelihood of selection.
Q: What is a convenience sample?
A: A non-random sample chosen based on ease of access, often leading to biased outcomes (e.g., women are more likely to take surveys than men).
Errors in Marketing Research
Q: What are the main types of errors in marketing research?
A:
Measurement error – More common with latent (not directly observable) variables.
Sampling error – Errors due to sample selection.
Random error – Unpredictable variations in data.
AI in Marketing Research
Q: What is a synthetic sample?
A: A hypothetical dataset used to test possible outcomes; not 100% accurate.
Analyzing Data
Q: What statistical tests are used when the dependent variable is continuous?
A: F-tests and T-tests.
Q: When is a Chi-square test used?
A: When the dependent variable is a rank, choice, or proportion.
Q: What test is used for normally distributed data?
A: F-test or T-test.
Q: What test is used for non-normal distributions?
A: Non-parametric tests.
Product & Brand Management
Product Classification
Q: How are products classified?
A:
Goods – Tangible products (e.g., food, clothes, cars).
Services – Intangible offerings (e.g., tutoring, haircuts, house cleaning).
Product Hierarchy
Q: What is a product item?
A: A specific version of a product (e.g., Coke Zero).
Q: What is a product line?
A: A group of closely related products (e.g., all Coke drinks).
Q: What is a product mix?
A: The total range of products sold by a company.
Q: What determines the depth of a product mix?
A: The number of product items within a line (e.g., Campbell’s soups have high depth due to many flavors).
Q: What determines the width of a product mix?
A: The number of product lines a company offers.
Benefits of Product Lines
Q: What are the benefits of having product lines?
A:
Economies of scale – Lower costs from mass production.
Standardized components – Reduces production complexity.
Package uniformity – Creates consistent branding.
Distribution efficiencies – Easier to distribute and market.
Adjustments to Product Items, Lines, & Mixes
Q: What are ways companies adjust product items, lines, and mixes?
A:
Adding new product items – New flavors, seasonal/limited-edition options.
Adding new product lines – Expanding into different categories (e.g., Kylie Jenner launching skincare).
Product repositioning – Adjusting brand perception due to market changes.
Product line/mix extension or contraction – Adding/removing products based on demand.
Q: What factors drive product changes?
A:
Changing demographics
Declining sales
Macro-level social changes
Q: What is planned obsolescence?
A: When brands modify products strategically to make older versions obsolete.
Q: What is natural obsolescence?
A: When new technology naturally replaces older products.
Brand Identity & Branding Strategies
Brand Identity
Q: What elements contribute to a brand’s distinctive identity?
A:
Name – Legally trademarked.
Logos/Symbols – Visually recognizable brand marks.
Sensory branding – Trademarked colors, sounds, and scents.
Benefits of Branding
Q: What are the key benefits of branding?
A:
Distinct identity – Helps products stand out.
Brand loyalty – Encourages repeat purchases.
Price premium – Allows for higher pricing.
Types of Branding Strategies
Q: What are the different branding strategies?
A: Individual branding, family branding, private branding, manufacturer branding, co-branding.
Individual Branding
Q: What is individual branding?
A: Each product line has a separate brand name (e.g., P&G, Unilever).
Q: When is individual branding used?
A: When products are positioned differently (e.g., shampoo vs. laundry detergent).
Q: What is a disadvantage of individual branding?
A: It is more expensive.
Family Branding
Q: What is family branding?
A: Using the same brand name across multiple product lines (e.g., Apple, Samsung).
Q: What are the benefits of family branding?
A:
Lower marketing costs – Leverages existing brand recognition.
Stronger carryover effects – A good experience with one product may lead to purchases of others.
Q: What is a drawback of family branding?
A: A bad product can damage the entire brand’s reputation.
Private Branding (Store Brands)
Q: What is private branding?
A: When retailers sell products under their own brand name (e.g., Equate, Great Value, Up&Up).
Q: Why do private brands perform well during economic downturns?
A: They offer cheaper alternatives to name brands.
Manufacturer Branding (Name Brands)
Q: What is manufacturer branding?
A: When companies sell branded products across multiple retailers (e.g., Coca-Cola, Tylenol).
Q: When do manufacturer brands perform better?
A: During strong economic periods when consumers are willing to spend more.
Co-Branding
Q: What is co-branding?
A: A partnership between two brands to create a unique product (e.g., Glad + Gain, American Express + Delta).
Q: What are the benefits of co-branding?
A:
Creates unique products.
Expands customer reach.
Enhances brand credibility.
Q: What is ingredient co-branding?
A: When a product cannot exist without both brands' contributions (e.g., music collaborations).
Greenwashing
Q: What is greenwashing?
A: When a company falsely portrays itself as environmentally friendly.
New Products & Innovation
Q: What is product innovation?
A: Any new feature or improvement added to an existing product.
Q: What percentage of new product launches fail?
A: Most.
Q: What factors influence new product success?
A:
Relative advantage – Offers better benefits than competitors.
Compatibility – Fits with current consumer habits.
Observability – Consumers can see others using it.
Trialability – Consumers can test it before committing.
Diffusion of Innovation
Q: What is diffusion of innovation?
A: The process by which the adoption of innovation spreads across a population.Categories of Adopters
Q: Who are innovators?
A: The very first group to adopt new technology; first to see a movie.Q: Who are early adopters?
A: Not the very first, but among the earlier users (first few weeks to see a movie).Q: Who are the early majority?
A: Those who wait a bit but are well-educated and open to trying new things.Q: Who are the late majority?
A: Those who wait a long time to adopt new technology to let the kinks be worked out.Q: Who are laggards?
A: Those who wait forever or never adopt unless absolutely necessary.Q: What shape does the adoption of innovation typically follow?
A: A bell-shaped curve due to heterogeneity in adoption rates.Product Life Cycle
Q: What are the four classic product life cycle stages?
A: Introduction, Growth, Maturity, Decline.Q: What happens in the introduction stage?
A: Companies often experience losses while launching a new product (e.g., most AI tools).Q: What happens in the growth stage?
A: Companies begin making profits (e.g., electric vehicles, ride-sharing apps like Uber/Lyft).Q: What happens in the maturity stage?
A: Sales level out, and competition is high (e.g., laundry detergent, insurance, online dating).Q: What happens in the decline stage?
A: Sales drop off (e.g., DVDs, carbonated beverages).Q: How can a product be brought back from the decline stage?
A: Through repositioning.Q: What is a fad life cycle?
A: A short-lived, rapid adoption and decline (e.g., fidget spinners).Q: What is a fashion life cycle?
A: A cyclical trend where products come in and out of style.Product Aspects
Q: What are the core aspects of a product?
A: The fundamental purpose of the product (e.g., a car must provide transportation).Q: What are the expected aspects of a product?
A: Features that are not core but are assumed (e.g., air conditioning in a car, WiFi in hotels).Q: What are the augmented aspects of a product?
A: Features that differentiate the brand (e.g., luxury car comfort, signature hotel scents).Q: What happens to augmented aspects over time?
A: They become expected.Pricing Strategies
Q: What is unique about pricing compared to other marketing mix elements?
A: It is the only "P" that directly brings in money.Q: What is the formula for revenue?
A: Revenue = Price × Quantity (P × Q).Q: What is the formula for profit?
A: Profit = Revenue - Expenses.Pricing Objectives
Q: What are the three types of pricing objectives?
A: Profit-oriented, Sales-oriented, and Status quo pricing.Profit-Oriented Pricing
Q: What are the three profit-oriented pricing strategies?
A:Profit maximization – Adjust price to make the highest possible profit.
Satisfactory profits – Accepting a reasonable level of profit.
Target ROI (Return on Investment) – Setting price based on return targets.
Sales-Oriented Pricing
Q: What are the two sales-oriented pricing strategies?
A:Market share – Adjusting price based on desired market share.
Sales maximization – Pricing to move as many units as possible (e.g., liquidation sales).
Status Quo Pricing
Q: What is status quo pricing?
A: Maintaining current prices and adjusting slightly over time.Q: Is price matching (meeting competitor prices) illegal?
A: No, reacting to competitor prices is legal; collusion is illegal.Supply & Demand in Pricing
Q: What happens when price goes down?
A: Quantity demanded increases.Q: What happens when price goes up?
A: Quantity demanded decreases.Q: What happens when supply increases?
A: Prices fall.Q: What happens when supply decreases?
A: Prices rise.Q: How is pricing determined in the market?
A: Where supply and demand intersect.Elasticity of Demand
Q: What does elasticity of demand (E) measure?
A: How sensitive quantity demanded is to price changes.Q: What is the formula for elasticity of demand?
A:
E = (Percentage change in quantity demanded) / (Percentage change in price).Q: What does it mean if E > 1?
A: Demand is elastic (small price change = large quantity change).Q: What does it mean if E < 1?
A: Demand is inelastic (large price change = little quantity change).Q: How does price affect revenue in elastic markets?
A:Price ↑ → Revenue ↓
Price ↓ → Revenue ↑
Q: How does price affect revenue in inelastic markets?
A:Price ↑ → Revenue ↑
Price ↓ → Revenue ↓
Q: What type of products typically have inelastic demand?
A: Necessities, products with few substitutes, and addictive goods.Yield Management Systems (YMS)
Q: What is Yield Management (YMS)?
A: A dynamic pricing system using algorithms to maximize profits, common in airlines and hotels.Q: What are the requirements for YMS?
A:High fixed costs – Costs must be covered regardless of demand.
Low marginal costs – The cost of serving one more customer is minimal.
Highly perishable – Products cannot be stored (e.g., airline seats, hotel rooms).
Q: What industries use AI-powered dynamic pricing?
A: Amazon, Walmart, airlines, hotels.Cost Determinants of Price
Q: What are two cost-based pricing methods?
A:Markup pricing – Adding a fixed percentage to costs.
Break-even pricing – Setting price to cover costs.
Pricing Strategies for New Products
Q: What is price skimming?
A: Starting with a high price and gradually lowering it.Q: What is price penetration?
A: Starting with a low price to build market share, then increasing later.Q: What is a downside of price penetration?
A: Initial losses due to low prices.Psychological Pricing Strategies
Q: What is odd-even pricing?
A: Setting prices just below a round number (e.g., $19.99 instead of $20).Q: Why does odd-even pricing work?
A: Consumers read left to right and perceive $19.99 as significantly cheaper than $20.Q: What is extremeness aversion?
A: Consumers tend to avoid extreme options and choose a middle-priced option.Q: Give an example of extremeness aversion in action.
A: Many customers pick a medium-sized drink instead of the small or large.Relative Pricing
Q: What is relative pricing?
A: Comparing the cost of one good or service to another to help consumers and businesses make decisions.
NoteStudied by 11 peopleNoteStudied by 52 peopleNoteStudied by 48 peopleNoteStudied by 7 peopleNoteStudied by 10 peopleNoteStudied by 153 people