Untitled Flashcards Set

Lesson 1 – Overview of Marketing and Value Creation

1. Define marketing, marketing strategy, and customer value:

• Marketing: The process of creating, communicating, delivering, and exchanging offerings that provide value to customers, clients, partners, and society.

• Marketing Strategy: A company’s plan to reach prospective consumers and turn them into customers of their products or services. It outlines target markets and the marketing mix.

• Customer Value: The perception of what a product or service is worth to a customer versus the possible alternatives. It is the balance between benefits received and costs paid.

2. Describe the role of marketing in organizations:
Marketing helps organizations identify customer needs, develop products and services to meet those needs, build brand awareness, drive sales, and foster customer loyalty. It connects businesses to consumers and creates value for both sides.

3. Define and apply the four variables of the marketing mix (The 4 Ps):

• Product: What the business offers to meet customer needs (goods, services, or ideas).

• Price: The amount customers must pay to obtain the product.

• Place: Where and how the product is distributed to customers.

• Promotion: Activities that communicate the product’s benefits and persuade customers to buy it (advertising, sales promotions, PR).

4. Difference between a seller’s market and a buyer’s market:

• Seller’s Market: A market where demand exceeds supply, allowing sellers to have more control over pricing.

• Buyer’s Market: A market where supply exceeds demand, giving buyers more power to negotiate prices.

5. Define the marketing mix:
The marketing mix is a set of controllable marketing tools (Product, Price, Place, Promotion) that a company uses to influence demand and meet customer needs effectively.

6. Different eras related to marketing:

• Production Era: Focused on producing as many goods as possible (late 1800s - early 1900s).

• Sales Era: Focus on aggressive sales techniques to overcome market competition (1920s-1950s).

• Marketing Concept Era: Emphasized identifying customer needs and satisfying them better than competitors (1950s-1990s).

• Relationship Era: Building long-term relationships with customers (1990s-present).

• Social/Mobile Marketing Era: Emphasis on digital platforms, social media, and personalized marketing (2000s-present).

7. Value of new customers vs. retaining customers:

• It is generally more expensive to acquire a new customer than to retain an existing one.

• Retaining customers increases loyalty, repeat business, and referrals.

8. Cost to acquire new customers and churn rates:

• Customer Acquisition Cost (CAC): The total cost of gaining a new customer (includes marketing, sales, and other efforts).

• Churn Rate: The percentage of customers who stop using a product or service over a given period. A lower churn rate indicates higher customer retention and loyalty.

Lesson 2 – Strategic Planning

1. Define strategic planning and its importance in marketing:

• Strategic Planning: The process of defining an organization’s long-term goals and determining the best strategies to achieve them.

• Importance in Marketing: It helps businesses set objectives, allocate resources effectively, and ensure all marketing efforts align with overall business goals. It also guides decision-making and provides a framework for growth.

2. How strategic planning works with the marketing mix:

• Strategic planning identifies target markets and develops a marketing mix (Product, Price, Place, Promotion) tailored to those markets.

• It ensures that marketing actions support broader organizational goals and address the needs of the target audience.

3. Differentiate between direct and indirect competition:

• Direct Competition: Businesses that offer the same or very similar products or services.

  • Example: McDonald's vs. Burger King (both sell fast food).

• Indirect Competition: Businesses that satisfy the same need in a different way.

  • Example: McDonald’s vs. Subway (both satisfy hunger but offer different types of food).

4. Three basic characteristics of effective marketing strategy objectives:

• Measurable: The objective should be quantifiable (e.g., increase sales by 10%).

• Realistic: Achievable within available resources and time.

• Time-Specific: A clear deadline for achieving the objective.

5. Define sustainable competitive advantage:

• A sustainable competitive advantage is a long-term edge a company holds over its competitors that is difficult for others to replicate.

  • Example: Apple’s brand loyalty and ecosystem of products.

6. Four basic categories of marketing growth strategies (Ansoff Matrix):

• Market Penetration: Selling more of existing products to current markets (e.g., loyalty programs).

• Market Development: Entering new markets with existing products (e.g., expanding internationally).

• Product Development: Offering new products to current markets (e.g., Apple launching AirPods).

• Diversification: Introducing new products to new markets (e.g., Amazon entering the grocery industry with Whole Foods).

7. Define and recognize the differences in SWOT analysis:

• SWOT Analysis: A strategic tool used to identify:

  • Strengths: Internal capabilities that provide an advantage (e.g., strong brand reputation).

  • Weaknesses: Internal factors that could hinder success (e.g., limited product range).

  • Opportunities: External chances for growth or improvement (e.g., new market trends).

  • Threats: External challenges that could cause trouble (e.g., increasing competition).

8. Four quadrants of the BCG Matrix:

• The BCG Matrix helps companies analyze their product portfolio based on market growth and market share:

  • Stars: High market growth, high market share (Invest heavily to maintain growth).

  • Cash Cows: Low market growth, high market share (Generate consistent profits).

  • Question Marks: High market growth, low market share (Potential for growth, but risky).

  • Dogs: Low market growth, low market share (Consider discontinuing).

Lesson 3 – Marketing Environment and Ethics

1. Why marketing environments are important:

• The marketing environment consists of factors outside the company that can impact its ability to build and maintain relationships with customers.

• Understanding these environments allows businesses to adapt their strategies to market trends, customer needs, and external challenges, ensuring long-term success.

2. How a company’s immediate environment affects marketing strategy:

• A company’s immediate environment includes factors directly influencing the company's operations:

  • Customers: Their needs and preferences shape products and services.

  • Competitors: Businesses must monitor rival strategies to stay competitive.

  • Suppliers: Reliable suppliers ensure consistent product quality and availability.

  • Partners: Collaborations can expand a company’s reach and resources.

3. Six external environmental forces that influence the marketing environment:

1. Social-Cultural: Changes in societal values, demographics, and cultural trends (e.g., increased focus on sustainability).

2. Technological: Innovations that affect how products are created, delivered, and marketed (e.g., AI-driven customer service).

3. Economic: Economic conditions affecting purchasing power (e.g., inflation, unemployment rates).

4. Environmental (Natural): Environmental concerns that influence consumer behavior and business practices (e.g., climate change).

5. Political-Legal: Laws, regulations, and political stability that impact business operations (e.g., data protection laws).

6. Competitive: The actions and presence of competitors that influence a company’s strategies (e.g., new market entrants).

4. Define and understand marketing ethics:

• Marketing Ethics: The moral principles and values that guide behavior in marketing practices.

• Application in the Marketing Mix:

  • Product: Ensuring products are safe and accurately described.

  • Price: Avoiding deceptive pricing practices.

  • Place: Ensuring fair distribution practices.

  • Promotion: Avoiding misleading advertising or false claims.

5. Define and apply social responsibility:

• Social Responsibility: A company’s obligation to make decisions that benefit society as well as the business.

• Benefits:

  • Builds customer loyalty and trust.

  • Enhances brand reputation.

  • Can lead to increased profits and market share.

  • Examples: Charitable donations, sustainable sourcing, ethical labor practices.

6. Ethical decision rules: (From Lesson 3 slides — likely similar to common ethical frameworks)

• Utilitarian Approach: The decision that provides the greatest good for the greatest number.

• Rights-Based Approach: Respecting and protecting the fundamental rights of all individuals.

• Justice-Based Approach: Ensuring fairness and equality in decision-making.

• Common Good Approach: Focusing on what benefits society as a whole.

7. Why unethical practices are common in businesses: (From Lesson 3 slides — common reasons)

• Pressure to meet financial goals.

• Lack of clear ethical guidelines or leadership.

• Competitive business environment.

• Short-term focus on profits over long-term brand reputation.

Lesson 4 – Consumer Behavior

1. Stages of the consumer purchasing process:

1. Problem Recognition: The consumer realizes they have a need or want.

2. Information Search: The consumer gathers information about solutions (internal or external research).

3. Evaluation of Alternatives: The consumer compares products based on features, prices, and reviews.

4. Purchase Decision: The consumer selects and buys the product.

5. Post-Purchase Behavior: The consumer evaluates the purchase, which can lead to satisfaction or dissatisfaction (this can influence repeat purchases).

2. Types of information consumers may use and how products are evaluated and selected:

• Internal Information: Past experiences, personal preferences, or memories.

• External Information: Advertising, reviews, recommendations from others, or expert opinions.

• Consumers evaluate products based on price, quality, brand reputation, and personal needs.

3. Definition of cognitive dissonance:

• A feeling of discomfort or regret that occurs after making a purchase decision, especially when the choice is significant or expensive.

  • Example: Buyer’s remorse after purchasing a costly electronic device.

4. Resistance of attitudes toward change:

• Attitudes that are strongly held and based on personal values are highly resistant to change.

• Weak or less important attitudes are more likely to change with new information or experiences.

5. Classifications for types of goods:

• Specialty Goods: Unique items for which consumers are willing to make a special effort to purchase (e.g., luxury cars, designer clothing).

• Shopping Goods: Products that consumers compare on quality, price, and style before buying (e.g., electronics, furniture).

• Convenience Goods: Items bought frequently with minimal effort (e.g., snacks, toiletries).

• Unsought Goods: Products consumers don’t normally think about buying until needed (e.g., life insurance, emergency medical services).

6. Influences on consumer behavior:

• Cultural: Beliefs, values, and customs of a society.

• Social: Family, friends, social media, and reference groups.

• Personal: Age, occupation, lifestyle, economic status.

• Psychological: Motivation, perception, learning, beliefs, and attitudes.

7. Differences between low-involvement and high-involvement products:

• Low-Involvement Products: Purchases made with little thought, often inexpensive (e.g., snacks, household items).

• High-Involvement Products: Purchases that require research and consideration, typically higher-cost or emotionally significant (e.g., cars, real estate).

8. Role of social proof in marketing:

• Consumers tend to follow the actions of others, especially when uncertain.

  • Example: Online reviews, celebrity endorsements, and “best-seller” labels encourage purchase decisions.

9. Anchoring and adjustment in marketing:

• The tendency for individuals to rely heavily on the first piece of information they receive (anchor) and then adjust from that reference point.

  • Example: Showing an expensive product first makes moderately priced options seem more reasonable.

Lesson 5 – Segmentation, Targeting, and Positioning (STP)

1. Define market segmentation:

• Market Segmentation is the process of dividing a broader market into smaller groups of consumers with similar needs, characteristics, or behaviors. This allows businesses to tailor their marketing strategies to specific groups.

2. Three key ways market segmentation plays a role in an organization's success:

1. Improved Customer Understanding: Helps businesses better understand their customers’ needs and preferences.

2. Effective Marketing Strategies: Allows companies to develop targeted campaigns that are more likely to resonate with specific groups.

3. Resource Allocation: Enables businesses to focus their resources on the most profitable or promising segments.

3. Four methods of market segmentation (definitions and characteristics):

1. Demographic Segmentation: Dividing the market based on characteristics such as age, gender, income, education, and family size.

   • Example: Marketing retirement plans to individuals aged 50 and above.

2. Geographic Segmentation: Dividing the market based on location, such as region, city, climate, or population density.

   • Example: Selling snow gear in colder regions and swimwear in tropical areas.

3. Psychographic Segmentation: Dividing the market based on lifestyle, values, interests, and personality traits.

   • Example: Marketing luxury cars to consumers who value status and prestige.

4. Behavioral Segmentation: Dividing the market based on consumer behavior, usage rate, loyalty, or buying patterns.

   • Example: Offering rewards programs for frequent shoppers.

4. Criteria for successful market segmentation:

• Measurable: The segment’s size and purchasing power can be quantified.

• Accessible: The segment can be effectively reached and served.

• Substantial: The segment is large and profitable enough to target.

• Differentiable: The segment is distinct from others and responds differently to marketing strategies.

• Actionable: The company can develop strategies to effectively attract and serve the segment.

5. Define target marketing and its importance:

• Target Marketing involves selecting specific market segments to focus on and tailoring marketing efforts to meet their needs.

• Importance: It ensures that marketing resources are used efficiently by focusing on customers most likely to buy the product, leading to higher conversion rates and better customer relationships.

6. How a firm evaluates segments and chooses a specific target market:

• Segment Size and Growth Potential: Analyzing the market’s size and future growth.

• Competitive Landscape: Assessing how much competition exists in the segment.

• Company Objectives and Resources: Choosing a segment that aligns with company goals and available resources.

7. Key strategies for targeting a market:

1. Undifferentiated Strategy: Targeting the entire market with one marketing approach (mass marketing).

   • Example: Basic necessities like salt or sugar.

2. Differentiated Strategy: Targeting several market segments with different offerings for each.

   • Example: Coca-Cola offering Diet Coke, Coke Zero, and Classic Coke.

3. Concentrated (Niche) Strategy: Focusing on a single market segment.

   • Example: Rolex targeting high-income luxury watch buyers.

8. Define market positioning and its importance:

• Market Positioning is the process of establishing a brand or product in the minds of consumers relative to competitors.

• Importance: Helps businesses allocate resources effectively and differentiate their brand in the market.

9. Difference between differentiated and undifferentiated strategies:

• Differentiated Strategy: Targets multiple segments with different marketing messages (more customized, higher cost).

• Undifferentiated Strategy: Uses one marketing approach for the entire market (less costly, less targeted).

• When to use:

  • Differentiated: When targeting diverse consumer needs.

  • Undifferentiated: When a product appeals broadly and meets the same need for everyone.

10. Three steps to effective market positioning:

1. Identify Competitive Advantages: Determine what sets the brand apart from competitors.

2. Choose the Right Competitive Advantage: Select the benefits that are most valued by the target market.

3. Communicate and Deliver the Chosen Position: Ensure the market understands the brand’s unique value through marketing strategies.

Positioning Map:

• A visual tool that shows how consumers perceive a brand compared to competitors based on key attributes (e.g., price vs. quality).