MKT 300 Test 1 Study Guide
MKT 300 Test 1 Study Guide MKT300
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This 14 page Study Guide was uploaded by Gabbi Oppenheimer on Friday February 5, 2016. The Study Guide belongs to MKT300 at University of Alabama - Tuscaloosa taught by Joel Strayer in Spring 2016. Since its upload, it has received 152 views. For similar materials see Marketing in Marketing at University of Alabama - Tuscaloosa.
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Date Created: 02/05/16
MKT 300 Test 1 Study Guide Chapter 1 organizations must create utility to survive utility: beneﬁt/usefulness; the want-satisfying power of a good or service concept borrowed from economics Four Types of Utility 1. form utility: conversion of raw materials and components into ﬁnished goods and services; i.e.: iPhone, a pair of jeans, dinner in a restaurant 2. time utility: availability of goods and services when consumers want them; i.e.: UPS Next Day Air delivery, dental appointment, digital photographs 3. place: availability of goods and services at convenient locations; i.e.: banks in grocery stores, onsite day care 4. ownership (possession): ability to transfer title to goods or services from marketer to buyer; i.e.: retail sales (in exchange for currency, credit, or debit card payment) organizations create customers using a three step approach: 1. identifying needs in the marketplace 2. ﬁnding out which needs the organization can proﬁtable serve 3. developing goods and services to convert potential buyers into customers marketing specialists are responsible for the activities necessary to create the customer the organization wants, including: • identifying customer needs • designing products that meet those needs • communicating information about those goods and services to prospective buyers • making the items available at times and places that meet customers’ needs pricing merchandise and services to reﬂect costs, compassion, and customers’ ability to buy • • providing necessary service and follow-up to ensure customer satisfaction after the purchase marketing: activity, set of institutions, and processes for: •creating, communicating, delivering, and exchanging offerings •managing customer relationships in ways that have value for customers, clients, partners, and society at large marketing variables: product, price, promotion, & distribution combine to provide customer satisfaction emphasizes creating & maintaining long-term relationships w/ customers and suppliers factors that have extended economic views: •increase in international trade agreements •growth of electronic business •interdependence of the world’s economies to remain competitive, companies must continually search for the most efﬁcient manufacturing sites and the most lucrative markets for their products exchange process: two or more parties give something of value to each other to satisfy perceived needs Five Eras of Marketing History 1. Production: “A good product will sell itself”; prior to 1920s; manufacturers stressed production of quality products and looked for people to purchase them 2. Sales: manufacturers began to increase their emphasis on effective sales forces to ﬁnd customers for their output; ﬁrms attempted to match their output to the potential number of customers who would want it; sales orientation–creative advertising and selling will overcome consumers’ resistance to purchasing nonessential goods and persuade them to buy; prior to 1950s 3. Marketing: the consumer rules, ﬁnd a need and ﬁll it; “customer is always right”; since 1950s; shift from a sellers market to a buyers market created the need for consumer orientation–business philosophy incorporating the marketing concept that emphasizes ﬁrst determining unmet consumer needs and then designing a system for satisfying them 4. Relationship: focus on maintaining long-term, value-added relationships with customers, suppliers, and employees; since 1990s 5. Social: using the Internet and social media to maintain customer relationships and market products; since 2000s marketing concept: companywide consumer orientation with the objective of achieving long run success strong market orientation generally improves market success and overall performance companies that implement market-driven strategies are better able to understand their customers’ experiences, buying habits, & needs; able to design products with advantages and levels of quality compatible with consumer requirements consumers acquire goods and services on a continuing basis to ﬁll certain needs to convert needs into wants, marketers: •focus on the beneﬁts of goods and services marketing myopia: management’s failure to recognize scope of its business; focusing all marketing on company speciﬁcally, lose track of what customers are looking for; focusing on customer need satisfaction can help overcome myopia Not for Proﬁt Marketing strategy adopted to meet service objectives; organizations form alliances with business ﬁrms for mutual beneﬁt does not focus on bottom line markets to multiple audiences proﬁt-seeking businesses tend to focus their marketing on just one public–their customers non-proﬁts must market to multiple publics; at least 2 major publics: clients and sponsors Nontraditional Marketing 1. person marketing: marketing efforts designed to cultivate the attention and preference of a target market toward a person; can include celebrity endorsements 2. place marketing: attract visitors to a particular area; attract new business; improve consumer images of an area; has become more important in the global economy beyond tourism to recruit businesses and workers 3. cause marketing: identiﬁcation and marketing of a social issue, cause, or idea to selected target markets; increasingly common for proﬁt-seeking ﬁrms to link their products to social causes 4. event marketing: marketing of sporting, cultural, and charitable activities to selected target markets; also includes sponsorship of such events by ﬁrms seeking to increase public awareness and bolster their images by linking themselves and their products to the events 5. organization marketing: marketing efforts of mutual beneﬁt organizations, service organizations, and government organizations that seek to inﬂuence others to accept their goals, receive their services, or contribute to them in some way transaction based marketing: buyer and seller exchanges characterized by limited communications and little or no ongoing relationships between the parties marketers now realize that consumers are becoming more and more sophisticated mobile marketing: marketing messages transmitted via wireless technology social marketing: use of online social media as a communications channel for marketing messages Using Social Marketing to Build Relationships: -focus is on moving the customers up the loyalty ladder to increase their lifetime value -by converting indifferent customers into loyal ones, companies generate repeat sales -interactive marketing: buyer-seller communications in which the customer controls the amount and type of info received from a marketer -increasingly taking place on social media sites like Facebook, Twitter, and blogs strategic alliances: partnerships in which companies combine resources and capital to create competitive advantages in the market Forms of Alliances: product development partnerships, vertical alliances not for proﬁt organizations often raise awareness and funds through strategic partnerships marketing costs are estimated to be between 40 and 60% of total product costs Eight Universal Marketing Functions: 1. buying 2. selling 3. transporting 4. storing 5. standardizing and grading 6. ﬁnancing 7. risk taking 8. securing marketing information • buying and selling represent exchange functions • transporting and storing are physical distribution functions • standardizing and grading, ﬁnancing, risk taking, and securing marketing information are facilitating functions because they help the marketer perform the exchange and physical distribution functions • securing marketing information involves gathering info about potential customers: who they are, what they buy, where they buy, and how they buy; collection and analysis can help marketers understand why consumers purchase some goods and not others ethics: moral standards of behavior expected by a society social responsibility: marketing philosophies, policies, procedures, and actions whose primary objective is to enhance society and protect the environment through sustainable products and practices companies that promote ethics and social responsibility produce increased employee loyalty and customer growth sustainable products: can be produced, used, and disposed of w/ minimal impact on environment social responsibility programs are meant to enhance a society’s welfare and help in improving the public image of the ﬁrm -sustainable products and practices are goals of socially responsible ﬁrms Chapter 2 planning: anticipating future events and conditions and determining the best way to achieve organizational objectives includes identifying objectives and determining actions creates blueprint for everyone in the organization marketing planning: implementing planning activities devoted to achieving marketing objects; establishes basis for a marketing strategy many planning activities take place over the Internet w/ virtual conferences strategic planning: determining an organization’s primary objectives, adopting courses of action that will achieve these objectives, provides long-term direction for decision makers; big picture tactical planning: guides the implementation of activities speciﬁed in the strategic plan, addresses shorter-term actions; how to achieve strategy more ﬂuid and subject to change top management engages in strategic planning middle management engages in tactical planning supervisory management engages in operational planning (day to day tasks) Steps in Marketing Planning Process 1. deﬁning organization’s mission and objectives 2. assessing organizational resources and evaluating environmental risks and opportunities 3. formulating, implementing, and monitoring a marketing strategy marketing strategy: selecting and satisfying target consumers through the marketing mix elements Porter’s Five Forces Model 1. the potential of new entrants–deals with barriers to entry; internet reduces barriers to entry 2. the bargaining power of buyers–switching costs (how much does it cost a buyer to switch to a similar product; the less it costs, the more power buyer has); internet shifts greater power to consumers 3. the bargaining power of suppliers–Internet tends to increase bargaining power of suppliers 4. the threat of substitute products–Internet creates new substitution threats 5. rivalry among competitors–previous four factors contribute to rivalry; the internet blurs differences among competitors First Mover Strategy: company ﬁrst to offer a product in a marketplace will be the long-term market winner; not always true if done well, your ﬁrm’s name is synonymous with the entire market second mover strategy: observing the innovations of ﬁrst movers and then improving on their ideas to gain an advantage in the marketplace SWOT Analysis: helps planners compare internal organizational strengths and weaknesses with external opportunities and threats provides managers with a critical view of the organization’s internal and external • environments • helps them evaluate the ﬁrm’s fulﬁllment of its basic mission The Strategic Window: limited periods when key requirements of a market and a ﬁrm’s particular competencies best ﬁt together Requires a thorough analysis of: • current and projected external environmental conditions • current and projected internal company capabilities • how, whether, and when the ﬁrm can reconcile environmental conditions and company capabilities Elements of a Marketing Strategy: target market: group of people toward whom the ﬁrm directs its marketing efforts and merchandise marketing mix variables: blending product, distribution, promotion, and pricing to ﬁt needs and preferences of a speciﬁc target market The Marketing Environment: Five external dimensions that affect the marketing mix variables: • competitive • political-legal • economic • technological • social cultural constraints affect ability to work with marketing mix variable rule of three: in any industry, the three strongest, most efﬁcient companies dominate between 70 and 90 percent of a market; beneﬁt of getting marketing plan and analysis perfect is huge business portfolio analysis: evaluation of a company’s products and divisions to determine the strongest and weakest strategic business units: smaller business units owned by a large corporation that allow them to diversify into different markets and reach more consumers; i.e.: Burt’s Bees is an SBU of Clorox BCG matrix: market share/market growth matrix that plots market share against market growth potential; developed by Boston Consulting Group plots growth rate against relative market share stars: high growth, high market share; generate considerable income, strategy is to invest more funds for future growth cash cows: low growth, high market share; strong cash ﬂows; strategy is to milk proﬁts to ﬁnance growth of stars and question marks question marks: high growth, low market share; strategy either to invest more funds for growth or consider disinvesting dogs: low growth, low market share; ﬁnancial drain on ﬁrm, strategy is to consider withdrawing–usually sold off or dissolved planning becomes vital as tech advances marketers must consider a changing and diverse population and the boundary-less business environment created by the internet planning reduces risk and worry of brining new goods and services to the market Chapter 3 environmental scanning: collecting external marketing environment info to identify and interpret potential trends environmental management: attainment of organizational objectives by predicting and inﬂuencing the competitive, political-legal, economic, technological, and social-cultural environments strategic alliance: partnership in which two or more companies combine resources and capital to create competitive advantages in a new market celebrity endorsements can be considered a type of strategic alliance The Competitive Environment: interactive process that occurs in the marketplace among marketers -of directly competitive products -of products that can be substituted for one another; i.e.: butter vs margarine, tea vs coffee -competing for the consumer’s purchasing power (resources are scarce) Types of Competition • direct: among marketers of similar products • indirect: involves products that are easily substituted competition among all ﬁrms that compete for consumers’ purchases • competitive strategy: methods through which a ﬁrm deals with its competitive environment • should we compete? • in what markets should we compete? • how should we compete? time-based competition: strategy of developing and distributing goods more quickly than competitors; i.e.: Jimmy John’s political-legal environment: consists of laws and their interpretations that require ﬁrms to operate under competitive conditions and to protect consumer rights; all marketers should be aware of the major regulations that affect their activities FDA, SEC, FCC, FTC Government Regulation–four historical phases: • antimonopoly period • protecting competitors • consumer protection • industry deregulation newest regulatory frontier is cyberspace Federal Trade Commission (FTC) enforces laws regulating unfair business practices consumer protection laws are important for marketers i.e.: price gouging laws Economic Environment Gross Domestic Product (GDP): sum of all goods and services produced by a nation in a year Gross National Product (GNP): everything made by a country’s citizens in and out of the country Economic Environment: factors that inﬂuence consumer buying power and marketing strategies business cycle: pattern of stages in the level of economic activity tech impact In a global economic crisis, business cycles take a severe turn and affect consumers and businesses across the globe. Marketers must reevaluate their strategies and concentrate on their most promising products inﬂation: devalues money by reducing the products it can buy through persistent price increases Deﬂation can cause: • a freefall in business proﬁts • lower returns on most investments • widespread job layoffs if inﬂation or deﬂation is at a predictable rate, companies can adjust their strategies accordingly unemployment: proportion of people in the economy actively seeking work but do not have jobs -income inﬂuences consumer buying power resources are scarce demarketing: reducing consumer demand for a good or service to level that the ﬁrm can supply International Economic Environment marketers must monitor the economic environment of other nations politics in other countries affect economic environment as well technological environment: represents application of knowledge based on discoveries in science, inventions, and innovations to marketing Technology leads to new products, new services Sources of technology: • industry • educational institutions • not-for-proﬁt institutions • federal government social-cultural environment: relationship between marketer, society, and culture; marketers must be sensitive to demographic shifts and changing values; increasing importance of cultural diversity i.e.: Univision and Telemundo face growing competition in Spanish-language TV programming consumerism: social force within the environment • aids and protects consumer • exerts legal, moral, and economic pressures on business and government consumer rights: • right to choose freely • right to be informed • right to be heard • right to be safe–leads to safety standards, etc. marketing ethics: marketers’ standards of conduct and moral values; some industries are required by law to maintain corporate-level positions responsible for ethics and legal compliance Ethical considerations inﬂuence: • marketing research • product strategy • distribution strategy • pricing social responsibility in marketing: philosophies, policies, procedures, and actions that have the enhancement of society’s welfare as primary objective Four dimensions of social responsibility: • economic • legal • ethical • philanthropic green marketing: production, promotion, and reclamation of environmentally sensitive products entire industries have developed out of green marketing Strategic Implications of Marketing in the 21st Century -changes in technology & internet have made competition even more intense than before -marketers face new regulations as the political and legal environment responds to change in the US and abroad -ethics and social responsibility must underlie everything that marketers do in the 21st century Chapter 4 social marketing: different forms of electronic communication through which users can create online communities to exchange information, ideas, messages, and other content such as videos or music social media platform: type of software or technology that allows users to build, integrate, or facilitate a community, interaction among users, and user-generated content social media tool: enables users to communicate w/ each other online social networking sites: websites that provide virtual communities for people to share daily activities, post opinions on various topics, etc bookmarking sites: these give people a place to save, organize, and manage links to websites, and other resources on the internet social news sites :people post news items or links to outside articles on such sites, then vote on which postings get the most prominent display–and viewed by the most readers online forums: members hold conversations by posting messages blogging sites: blog postings and comments are attached to such sides and typically focus on speciﬁc topics microblogs: subscribers get a steady stream of brief updates from anyone ranging from a high- school friend to a celebrity app: free or paid software download that links users to a wide range of goods and services, media and text content, social media platforms, search engines, and the like QR codes: two-dimensional bar code that can be read by some mobile phones with cameras social media is an important tool for marketers to: build relationships with customers • • strengthen brands • launch new products • enter new markets • boost sales consumers, businesses, and not-for-proﬁt organizations all use social media social media marketing: uses social media portals to create a positive inﬂuence on consumers or business customers toward an organization’s brand, goods & services, public image, and website Social Media Marketing (SMM) Plan: formal document that identiﬁes and describes goals and strategies, targeted audience, budget and implementation methods as well as tactics for monitoring, measuring, and managing the SMM effort Cycle of Social Media Marketing: • set goals • target audience develop strategies • • produce content • implement plan • monitor and measure content marketing: creating and distributing relevant and targeted material to attract and engage an audience, with the goal of driving them to a desired action social media monitoring: process of tracking, measuring, and evaluating a ﬁrm’s social media marketing initiatives social media analytics: tools that help marketers trace, measure, and interpret data related to social media marketing initiatives; i.e.: likes, views, etc. ﬁrms calculate the return on investment of their social media marketing initiatives using: • reach: percentage of people in a target market who are exposed to the marketing effort at least once • frequency: the number of times an individual is exposed to the marketing material during the campaign managing a social media marketing campaign or a company’s overall social media efforts requires skill, expertise, and understanding of the company’s brand, competitors, and social media environment ethical and legal issues well written social media policies are: • consistent w/ a ﬁrm’s organizational culture and values • explain why employees should take certain steps or actions or avoid them; employees can be ﬁred for violating social media policies, candidates may not be hired if their social media doesn't reﬂect the image the ﬁrm wishes to perpetuate • broad enough to cover the major points, but brief enough to ﬁt onto two pages; important to be concise while including relevant content • linked to other relevant company policies and guidelines when mistakes happen, smart social media marketers: • take action to solve the problem or resolve the issue • acknowledge the problem and take responsibility for it • communicate w/ the right people, via the most relevant channels • promise to take steps necessary to correct the situation • implement the agreed-upon changes or make other concessions • evaluate ways to avoid similar problems in the future types of jobs: -social media marketing manager or digital marketing manager -social media strategist -brand manager -online community manager -inﬂuencer relations -social media specialist -social media analytics -social media design -social media developer -content programmer -blogger or copywriter Strategic Implications of Marketing the in 21st Century -companies are ﬁguring out how to use these new modes of communication -marketers are learning fast the beneﬁts of using social media to reach their targeted audiences -sometimes social media marketing campaigns don’t work as intended and must adapt accordingly Chapter 5 e-business: wide range of business activities taking place via internet applications; can be divided into ﬁve broad categories: 1. e-tailing: virtual storefronts on websites 2. business-to-business (B2B) transactions 3. electronic data interchanges (EDI), the business-to-business exchange of data 4. email, instant messaging, blogs, podcasts, vlogs, and other Web-enabled communication tools and their use as media for reaching prospective and existing customers 5. gathering and use of demographic, product, and other information through web contacts e-marketing: strategic process of creating, distributing, promoting,and pricing goods and services to a target market over the internet or through digital tools such as smartphones and tablets can encompass digital technologies ranging from video streaming to interactive store kiosks that do not involve computers online marketing: marketing activities that connect buyers and sellers electronically through interactive computer systems Opportunities of E-marketing: global reach: ability to reach anyone connected to the internet anywhere in the world • • personalization: ability to create products to meet customer speciﬁcations • interactive marketing: buyer-seller communications in which the customer controls the amount and type of information received from a marketer through channels like the Internet and virtual reality kiosks • right-time marketing: ability to provide a product at the exact time needed integrated marketing: coordination of all promotional activities to produce a uniﬁed, • customer-focused promotional message • effective online presence can improve the performance of traditional marketing operations corporate website: website designed to increase a ﬁrm’s visibility, promote their offerings, and provide information to interested parties attempt to build customer goodwill and assist channel members in their marketing efforts variety of other purposes, i.e.: -disseminate ﬁnancial information to investors -give prospective employees opportunities to apply online for jobs -provide a communication channel for customers and other interested parties via email, blogs, and online forums marketing websites: site who main purpose is to increase purchases by visitors try to engage consumers in interactions that will move them closer to a demonstration, trial visit, purchase, or other marketing outcome business-to-business (B2B) e-marketing: use of internet for business transactions between organizations by some estimates, B2B e-commerce revenues are more than double that of consumer transactions • provides detailed product descriptions whenever needed payments and other info are exchanged on the web, and B2B e-marketing can slash order- • processing expenses • orders placed via the Internet usually contain fewer errors than handwritten ones • when mistakes occur, technology can locate and ﬁx them quickly electronic data interchange (EDI): computer-to-computer exchanges of price quotations, purchase orders, invoices, and other sales information between buyers and sellers requires compatible hardware and software systems to exchange data over a network extranets: secure networks used for e-marketing and accessible through the ﬁrm’s website by external customers, supplier, or other authorized users; give selected outsiders access to internal information intranets: secure internal networks that help companies share info among employees private exchange: secure website where a company and its suppliers share all types of data related to e-marketing, from product design through order delivery more collaborative than a typical extranet sometimes called “c-business” e-procurement: web-based systems that enable all types of organizations to improve the efﬁciency of their bidding and purchasing processes business-to-consumer (B2C) e-marketing: selling directly to consumers over the internet driven by convenience and improved security for transmitting ﬁnancial information electronic storefronts: websites where retailers offer items for sale to consumers electronic shopping cart: ﬁle that holds items the online shopper has chosen to buy consumers shop online because of: • competitive pricing: easy to ﬁnd the best deals on products • bots (shopbots): search programs that check hundreds of sites, gather and assemble information, and bring it back to the sender • bots make comparison shopping online very easy • access and convenience: can order goods and services from around the world at any hour of the day or night • personalized service: most leading online retailers offer customized features on their websites • some websites offer customized products to match individual consumer requirements Challenges in E-Business and E-Marketing consumers have had concerns about the safety of sending ﬁnancial info over the internet encryption: process of encoding data for security purposed; used to protect sensitive information online like credit card numbers Secure Sockets Layer (SSL): technology to encrypt information and provide authentication; consists of a public key–used to encrypt information–and a private key–used to decipher it marketing research indicates privacy as one of the top concerns of many internet users electronic signatures: way to enter into legal contract policies online; individual obtains a form of electronic identiﬁcation and installs it in the web browser; signing the contract involves looking up and verifying the buyer’s identity with this software online companies can track their customers’ shopping and viewing habits thanks to cookies and spyware–software used to automatically collect data from internet browsers ﬁrewall: electronic barrier between a company’s internal network and the internet that limits access into and out of the network; combination of hardware and software that keeps unauthorized users from accessing private corporate data fraud is another impediment to the growth of e-business and e-marketing phishing: high tech scam that uses email or pop-up messages that claim to be from familiar businesses or organizations such as banks, Internet service providers, or even government agencies; message usually asks reader to update or validate account information, often stating that some dire consequence will occur if the reader doesn’t respond -purpose is to get unsuspecting victims to disclose personal info like credit card numbers, bank account numbers, Social Security numbers, or computer passwords -also commonly used to distribute viruses and malicious spyware programs to computer users vishing: voice phishing; email or VoIP phone call requests the user to make a phone call to a voice response system that asks for the caller’s credit card number smishing: scam delivered via text message when a manufacturer uses the internet to sell directly to customers, it can compete with its usual partners retailers often have their own websites, so they don’t want suppliers competing with them for sales channel conﬂicts: conﬂicts between producers, wholesalers, and retailers four main functions of internet: e-business, entertainment, information, and communication communication remains most popular Web function ﬁrms often use email to inform customers about events such as new products and special promotions must be careful because many customers consider such emails to be spam blog: web page that is a publicly accessible journal for an individual or organization wiki: web page anyone can edit so a reader can, in addition to asking questions or posting comments, actually make changes to the web page podcasts: online audio or video ﬁle that can be downloaded to other digital devices marketers are particularly interested in blogs that focus on new-technology products, because they can prove effective at quickly forming public opinion some companies have decided to treat bloggers as members of the press many companies allow and even encourage their employees to blog Promotions on the Web banner ads: most common form of internet advertising; small, strip messages placed in high visibility areas of frequently visited websites pop-up ads: separate windows that pop up with an advertising message; effectiveness is questionable scam artists use pop-ups; most internet users hate them and block them pre-roll video ads: marketing messages that play before and online video; very popular search marketing: companies pay search engines fees to have tier websites or ads pop up after a user enters certain words into the search engine or to make sure tier ﬁrm’s listing appears toward the top of the search results; search engine optimization (SEO); one of the most effective forms of web-based advertising establishing goals is the ﬁrst and most important step in the website development process objectives for the website determine the scope of the project implementing goals of the site is the next stage -content is one of the most important factors in determining whether visitors return to a site -many e-business websites try to distinguish themselves by offering additional features web-to-store shoppers: group that favors the Internet primarily as a research tool and time- saving device for retail purchases made in stores; signiﬁcant consumer niche
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