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MKT 300 Final Exam Study Guide

by: Julie Knight

MKT 300 Final Exam Study Guide MKT 300

Marketplace > University of Alabama - Tuscaloosa > Business > MKT 300 > MKT 300 Final Exam Study Guide
Julie Knight
GPA 3.8

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About this Document

This study guide covers everything we learned this semester.
Susan Fant
Study Guide
MKT, MKT300, Marketing
50 ?




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This 32 page Study Guide was uploaded by Julie Knight on Tuesday May 3, 2016. The Study Guide belongs to MKT 300 at University of Alabama - Tuscaloosa taught by Susan Fant in Spring2015. Since its upload, it has received 65 views. For similar materials see Marketing in Business at University of Alabama - Tuscaloosa.


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Date Created: 05/03/16
MKT  300   Susan  Fant   Marketing  Final  Exam  Study  Guide     Chapter  1:  Marketing   •   Marketing-­‐  the  process  by  which  companies  create  value  for  customers  and  build  strong  customer   relationships  in  order  to  capture  value  from  customers  in  return   •   Needs-­‐  states  of  felt  deprivation   •   Wants-­‐  the  form  human  needs  take  as  they  are  shaped  by  culture  and  individual  personality   •   Demands-­‐  human  wants  that  are  backed  by  buying  power   •     •   Market  offering-­‐  some  combination  of  products,  services,  information,  or  experiences  offered  to  a   market  to  satisfy  a  need  or  want   •   Marketing  myopia-­‐  the  mistake  of  paying  more  attention  to  the  specific  products  a  company  offers   than  to  the  benefits  and  experiences  produced  by  these  products   •   Exchange-­‐  the  act  of  obtaining  a  desired  object  from  someone  by  offering  something  in  return   •   Market-­‐  the  set  of  all  actual  and  potential  buyers  of  a  product  or  service   •     •   Marketing  management-­‐  the  art  and  science  of  choosing  target  markets  and  building  profitable   relationships  with  them     •   Market  segmentation-­‐  refers  to  dividing  the  markets  into  segments  of  customers   •   Target  marketing-­‐  a  set  of  buyers  sharing  common  needs  ort  characteristics  that  the  company  decides   to  serve   •   Value  proposition-­‐  the  set  of  benefits  or  values  it  promises  to  deliver  to  customers  to  satisfy  their   needs   •   Production  concept-­‐  the  idea  that  consumers  will  favor  products  that  are  available  and  highly   affordable;  therefore,  the  organization  should  focus  on  improving  production  and  distribution   efficiency   MKT  300   Susan  Fant   •   Product  concept-­‐  the  idea  that  consumers  will  favor  products  that  offer  the  most  quality,  performance,   and  features;  therefore,  the  organization  should  devote  its  energy  to  making  continuous  product   improvements;  the  focus  is  on  continuous  product  improvements   •   Selling  concept-­‐  the  idea  that  consumers  will  not  buy  enough  of  the  firm’s  products  unless  the  firm   undertakes  a  large-­‐scale  selling  and  promotion  effort   •   Marketing  concept-­‐  a  philosophy  in  which  achieving  organizational  goals  depends  on  knowing  the   needs  and  wants  of  target  markets  and  delivering  the  desired  satisfactions  better  than  competitors  do   •   Societal  marketing  concept-­‐  the  idea  that  a  company’s  marketing  decisions  should  consider  consumer’   wants,  the  company’s  requirements,  consumers’  long  run  interests,  and  society’s  long  run  interests   Societal   Production   Product   Selling   Marketing   concept concept concept concept Marketing   concept •     •   Marketing  mix-­‐  the  set  of  tools  (four  Ps)  the  firm  uses  to  implement  its  marketing  strategy;  product,   price,  promotion,  and  place   •   Integrated  marketing  program-­‐  a  comprehensive  plan  that  communicates  and  delivers  the  intended   value  to  chosen  customers   •   Customer  relationship  management-­‐  the  overall  process  of  building  and  maintaining  profitable   customer  relationships  by  delivering  superior  customer  value  and  satisfaction   •   Customer  perceived  value-­‐  the  customer’s  evaluation  of  the  difference  between  all  the  benefits  and  all   the  costs  of  a  marketing  offer  relative  to  those  of  competing  offers   •   Customer  satisfaction-­‐  the  extent  to  which  a  product’s  perceived  performance  matches  a  buyer’s   expectations   Customer-­‐ perceived  value Customer  satisfaction • The  difference  between  total   • The  extent  to  which  perceived   customer  perceived  benefits  and   performance  matches  a  buyer’s   expectations customer  cost •     •   Customer  engagement  marketing-­‐  making  the  brand  a  meaningful  part  of  consumer’s  conversations   and  lives  by  fostering  direct  and  continuous  customer  involvement  in  shaping  brand  conversations,   experiences,  and  community   •   Customer  generated  marketing-­‐  brand  exchanges  created  by  consumers  themselves-­‐  both  invited  and   uninvited-­‐  by  which  consumers  are  playing  an  increasing  role  in  shaping  their  own  brand  experiences   and  those  of  other  consumers   •   Partner  relationship  management-­‐  working  closely  with  partners  in  other  company  departments  and   outside  the  company  to  jointly  bring  greater  value  to  customers   •   Customer  lifetime  value-­‐  the  value  of  the  entire  stream  of  purchases  a  customer  makes  over  a  lifetime   of  patronage   MKT  300   Susan  Fant   •   Share  of  customer-­‐  the  portion  of  the  customer’s  purchasing  that  a  company  gets  in  its  product   categories   •   Customer  equity-­‐  the  total  combined  customer  lifetime  values  of  all  the  company’s  customers   •     •   Digital  and  social  media  marketing-­‐  using  digital  marketing  tools  such  as  Web  sites,  social  media,   mobile  apps  and  ads,  online  video,  email,  and  blogs  that  engage  consumers  anywhere,  at  any  time,  via   their  digital  devices   •     •         Chapter  2:  Company  and  Marketing  Strategy   •   Strategic  planning-­‐  the  process  of  developing  and  maintaining  a  strategic  fit  between  the   organization’s  goals  and  capabilities  and  its  changing  marketing  opportunities   MKT  300   Susan  Fant   •     •   Mission  statement-­‐  a  statement  of  the  organization’s  purpose-­‐  what  it  wants  to  accomplish  in  the   larger  environment   •   Business  portfolio-­‐  the  collection  of  businesses  and  products  that  make  up  the  company   •   Portfolio  analysis-­‐  the  process  by  which  management  evaluates  the  products  and  businesses  that  make   up  the  company   •   Growth  share  matrix-­‐  a  portfolio  planning  method  that  evaluates  a  company’s  SBUs  in  terms  of  market   growth  rate  and  relative  market  share   •     •   Product/market  expansion  grid-­‐  a  portfolio  planning  tool  for  identifying  company  growth   opportunities  through  market  penetration,  market  development,  product  development,  or   diversification   •   Market  penetration-­‐  company  growth  by  increasing  sales  of  current  products  to  current  market   segments  without  changing  the  product   •   Market  development-­‐  company  growth  by  identifying  and  developing  new  market  segments  for   current  company  products   •   Product  development-­‐  company  growth  by  offering  modified  or  new  products  to  current  market   segments   •   Diversification-­‐  company  growth  through  starting  up  or  acquiring  businesses  outside  the  company’s   current  products  and  markets   •   Value  chain-­‐  the  series  of  internal  departments  that  carry  out  value  creating  activities  to  design,   produce,  market,  deliver,  and  support  a  firm’s  products   •   Value  delivery  network-­‐  the  network  made  up  of  the  company,  its  suppliers,  its  distributors,  and,   ultimately,  its  customers  who  partner  with  each  other  to  improve  the  performance  of  the  entire   system   MKT  300   Susan  Fant   •     •   Marketing  strategy-­‐  the  marketing  logic  by  which  the  company  hopes  to  create  customer  value  and   achieve  profitable  customer  relationships   •   Market  segment-­‐  dividing  a  market  into  distinct  groups  of  buyers  who  have  different  needs,   characteristics,  or  behaviors,  and  who  might  require  separate  products  or  marketing  programs   •   Market  targeting-­‐  the  process  of  evaluating  each  market  segment’s  attractiveness  and  selecting  one  or   more  segments  to  enter   •   Positioning-­‐  arranging  for  a  product  to  occupy  a  clear,  distinctive,  and  desirable  place  relative  to   competing  products  in  the  minds  of  target  consumers   •   Differentiation-­‐  actually  differentiating  the  market  offering  to  create  superior  customer  value   •   Marketing  mix-­‐  the  set  of  tactical  marketing  tools-­‐product,  price,  place,  and  promotion-­‐  that  the  firm   blends  to  produce  the  response  it  wants  in  the  target  market   •     •   SWOT  analysis-­‐  an  overall  evaluation  of  the  company’s  strengths  (S),  weaknesses  (W),  opportunities   (O),  and  threats  (T)   •                                                         Internal         •     External MKT  300   Susan  Fant   •   Marketing  implementation-­‐  turning  marketing  strategies  and  plans  into  marketing  actions  to   accomplish  strategic  marketing  objectives  (addresses  who,  where,  when,  and  how)   •   Marketing  control-­‐  measuring  and  evaluating  the  results  of  marketing  strategies  and  plans  and  taking   corrective  action  to  ensure  that  the  objectives  are  achieved   •   Marketing  return  on  investment  (marketing  ROI)-­‐  the  net  return  from  a  marketing  investment  divided   by  the  costs  of  the  marketing  investment  (measurement  of  profits  generated  by  investments  in   marketing  activities   •         Chapter  3:  Analyzing  the  Marketing  Environment   •   Marketing  environment-­‐  the  actors  and  forces  outside  marketing  that  affect  marketing  management’s   ability  to  build  and  maintain  successful  relationships  with  target  consumers   •   Microenvironment-­‐  the  actors  close  to  the  company  that  affect  its  ability  to  serve  its  customers-­‐  the   company,  suppliers,  marketing  intermediaries,  customer  markets,  competitors,  and  publics   •     •   Macroenvironment-­‐  the  larger  societal  forces  that  affect  the  microenvironment-­‐  demographic,   economic,  natural,  technological,  political,  and  cultural  forces   •     MKT  300   Susan  Fant   •   Marketing  intermediaries-­‐  firms  that  help  the  company  to  promote,  sell,  and  distribute  its  goods  to   final  buyers   •   Public-­‐  any  group  that  has  an  actual  or  potential  interest  in  or  impact  on  an  organization’s  ability  to   achieve  its  objectives   •   Demography-­‐  the  study  of  human  population  in  terms  of  size,  density,  location,  age,  gender,  race,   occupation,  and  other  statistics   •   Demographic  environment-­‐  involves  people,  and  people  make  up  markets   •   Demographic  trends-­‐  include  changing  age  and  family  structures,  geographic  population  shifts,   educational  characteristics,  and  population  diversity   •   Generational  marketing-­‐  important  in  segmenting  people  by  lifestyle  or  life  state  instead  of  age   •   Baby  boomers-­‐  the  78  million  people  born  during  the  years  following  WWII  and  lasting  until  1964   •   Generation  X-­‐  the  49  million  people  born  between  1965  and  1976  in  the  “birth  dearth”  following  the   baby  boom   •   Millennials  (Generation  Y)-­‐  the  83  million  children  of  the  baby  boomers  born  between  1977  and  2000   •   Generation  Z-­‐  people  born  after  2000  (although  many  analysts  include  people  born  after  1995)  who   make  up  the  kids,  tweens,  and  teens  markets   •   Economic  environment-­‐  consists  of  factors  that  affect  consumer  purchasing  power  and  spending   patterns   •   Natural  environment-­‐  the  physical  environment  and  the  natural  resources  that  are  needed  as  inputs   by  marketers  or  that  are  affected  by  marketing  activities   •   Environmental  sustainability-­‐  developing  strategies  and  practices  that  create  a  world  economy  that   the  planet  can  support  indefinitely   •   Technological  environment-­‐  forces  that  create  new  technologies,  creating  new  product  and  market   opportunities   •   Political  environment-­‐  laws,  government  agencies,  and  pressure  groups  that  influence  and  limit   various  organizations  and  individuals  in  a  given  society   •   Cultural  environment-­‐  institutional  and  other  forces  that  affect  society’s  basic  values,  perceptions,   preferences,  and  behaviors   •   Value  marketing-­‐  offering  financially  cautious  buyers  greater  value-­‐  the  right  combination  of  quality   and  service  at  a  fair  price   •   Core  beliefs  and  values-­‐  persistent  and  are  passed  on  from  parents  to  children  and  are  reinforced  by   schools,  churches,  businesses,  and  government   •   Secondary  beliefs  and  values-­‐  more  open  to  change  and  include  people’s  views  of  themselves,  other,   organizations,  society,  nature,  and  the  universe   Uncontrollable Proactive Reactive •React  and  adapt  to  forces  in   •Take  aggressive  actions  to   •Watch  and  react  to  forces  in   the  environment affect  forces  in  the   the  environment environment •         Chapter  4:  Managing  Marketing  Information   •   Big  data-­‐  the  huge  and  complex  data  sets  generated  by  today’s  sophisticated  information  generation,   collection,  storage,  and  analysis  technologies   •   Customer  insights-­‐  fresh  marketing  information  based  understandings  of  customers  and  the   marketplace  that  become  the  basis  for  creating  customer  value,  engagement,  and  relationships   MKT  300   Susan  Fant   •   Marketing  information  systems  (MIS)-­‐  people  and  procedures  dedicated  to  assessing  information   needs,  developing  the  needed  information,  and  helping  decision  makers  to  use  the  information  to   generate  and  validate  actionable  customer  and  market  insights   •     •   Internal  databases-­‐  collections  of  consumers  and  market  information  obtained  from  data  sources   within  the  company  network   •   Competitive  marketing  intelligence-­‐  the  systematic  monitoring,  collection,  and  analysis  of  publicly   available  information  about  consumers,  competitors,  and  developments  in  the  marketing  environment   •   Marketing  research-­‐  the  systematic  design,  collection,  analysis,  and  reporting  of  data  relevant  to  a   specific  marketing  situation  facing  an  organization   •     •   Exploratory  research-­‐  marketing  research  to  gather  preliminary  information  that  will  help  define   problems  and  suggest  hypotheses   •   Descriptive  research-­‐  marketing  research  to  better  describe  marketing  problems,  situations,  or   markets,  such  as  the  market  potential  for  a  product  or  the  demographics  and  attitudes  of  consumers   •   Causal  research-­‐  marketing  research  to  test  hypotheses  about  cause  and  effect  relationships   •   Secondary  data-­‐  information  that  already  exists  somewhere,  having  been  collected  for  another   purpose   •   Primary  data-­‐  information  collected  for  the  specific  purpose  at  hand   •     •   Observational  research-­‐  gathering  primary  data  by  observing  relevant  people,  actions,  and  situations   •   Ethnographic  research-­‐  a  form  of  observational  research  that  involves  sending  trained  observers  to   watch  and  interact  with  consumers  in  their  “natural  environments”   •   Survey  research-­‐  gathering  primary  data  by  asking  people  questions  about  their  knowledge,  attitudes,   preferences,  and  buying  behavior   •   Experimental  research-­‐  gathering  primary  data  by  selecting  matched  groups  of  subjects,  giving  them   different  treatments,  controlling  related  factors,  and  checking  for  differences  in  group  responses   MKT  300   Susan  Fant   •   Focus  group  interviewing-­‐  personal  interviewing  that  involves  inviting  6-­‐10  people  to  gather  for  a  few   hours  with  a  trained  interviewer  to  talk  about  a  product,  service,  or  organization   •   Online  marketing  research-­‐  collecting  primary  date  online  through  internet  surveys,  online  focus   groups,  Web  based  experiments,  or  tracking  of  consumers’  online  behavior   Advantages •Low  cost •Speed •Higher  response  rates •Good  for  hard  to  reach  groups •     •   Online  focus  groups-­‐  gathering  a  small  group  of  people  online  with  a  trained  moderator  to  chat  about   a  product,  service,  or  organization  and  gain  qualitative  insights  about  consumer  attitudes  and  behavior   •   Behavior  targeting-­‐  using  online  consumer  tracking  data  to  target  advertisements  and  marketing  offers   to  specific  consumers   •   Sample-­‐  a  segment  of  the  population  selected  for  marketing  research  to  represent  the  population  as  a   whole   •   Customer  relationship  management  (CRM)-­‐  managing  detailed  information  about  individual   customers  and  carefully  managing  customer  touch  points  to  maximize  customer  loyalty   Customer   Sales  force   Service  and   Web  and  social   purchases contacts support  calls media  sites CRM  Touch  Points Credit  and   Marketing   Satsurveyson   payment   research   interactions studies •         Chapter  5:  Consumer  Markets  and  Buyer  Behavior   •   Consumer  buyer  behavior-­‐  the  buying  behavior  of  final  consumers-­‐  individuals  and  households  that   buy  goods  and  services  for  personal  consumption   •   Consumer  market-­‐  all  the  individuals  and  households  that  buy  or  acquire  goods  and  services  for   personal  consumption   •     •     MKT  300   Susan  Fant   •   Culture-­‐  the  set  of  basic  values,  perceptions,  wants,  and  behaviors  learned  by  a  member  of  society   from  family  and  other  important  institutions   •   Subculture-­‐  a  group  of  people  with  shared  value  systems  based  on  common  life  experiences  and   situations   •   Cross  cultural  marketing-­‐  including  ethnic  themes  and  cross  cultural  perspectives  within  a  brand’s   mainstream  marketing,  appealing  to  consumer  similarities  across  subcultural  segments  rather  than   differences   •   Social  class-­‐  relatively  permanent  and  ordered  divisions  in  a  society  whose  members  share  similar   values,  interests,  and  behaviors   •   Group-­‐  two  or  more  people  who  interact  to  accomplish  individual  or  mutual  goals   Membership  Groups   Aspirational  Groups Reference  Groups •Groups  with  direct   •Groups  an  individual   •Groups  that  form  a   influence  and  to  which  a   wishes  to  belong  to comparison  or  reference   person  belongs in  forming  attitudes  or   behavior •     •   Word  of  mouth  influence-­‐  the  impact  of  the  personal  words  and  recommendations  of  trusted  friends,   family,  associates,  and  other  consumers  on  buying  behavior     •   Opinion  leader-­‐  a  person  within  a  reference  group  who,  because  of  special  skills,  knowledge,   personality,  or  other  characteristics,  exerts  social  influence  on  others   •   Online  social  networks-­‐  online  social  communications-­‐  blogs,  social  networking  Web  sites,  and  other   online  communities-­‐  where  people  socialize  or  exchange  information  and  opinions   •   Family-­‐  the  most  important  consumer  buying  organization  in  society   •   Role  and  status-­‐  defined  by  a  person’s  position  in  a  group   •   Occupation-­‐  affects  the  goods  and  services  bought  by  consumers   •   Lifestyle-­‐  a  person’s  pattern  of  living  as  expressed  in  his  or  her  activities,  interests,  and  opinions   •   Personality-­‐  the  unique  psychological  characteristics  that  distinguish  a  person  or  group   •   Motive  (drive)-­‐  a  need  that  is  sufficiently  pressing  to  direct  the  person  to  seek  satisfaction  of  the  need   •   Motivation  research-­‐  qualitative  research  designed  to  probe  consumers’  hidden,  subconscious   motivations   •     •   Selective  attention-­‐  the  tendency  for  people  to  screen  out  most  of  the  information  to  which  they  are   exposed   •   Selective  distortion-­‐  the  tendency  for  people  to  interpret  information  in  a  way  that  will  support  what   they  already  believe   MKT  300   Susan  Fant   •   Selective  retention-­‐  the  tendency  to  remember  good  points  made  about  a  brand  they  favor  and  forget   good  points  about  competing  brands   •   Perception-­‐  the  process  by  which  people  select,  organize,  and  interpret  information  to  form  a   meaningful  picture  of  the  world   •   Learning-­‐  changes  in  an  individual’s  behavior  arising  from  experience   •   Belief-­‐  a  descriptive  though  that  a  person  holds  about  something   •   Attitude-­‐  a  person’s  consistently  favorable  or  unfavorable  evaluations,  feelings,  and  tendencies  toward   an  object  or  idea   •   Complex  buying  behavior-­‐  consumer  buying  behavior  in  situations  characterized  by  high  consumer   involvement  in  a  purchase  and  significant  perceived  differences  among  brands   •   Dissonance  reducing  buying  behavior-­‐  consumer  buying  behavior  in  situations  characterized  by  high   involvement  but  few  perceived  differences  among  brands   •   Habitual  buying  behavior-­‐  consumer  buying  behavior  in  situations  characterized  by  low  consumer   involvement  and  few  significant  perceived  brand  differences   •     •   Variety  seeking  buying  behavior-­‐consumer  buying  behavior  in  situations  characterized  by  low   consumer  involvement  but  significant  perceived  brand  differences   •     •   Need  recognition-­‐  the  first  stage  of  the  buyer  decision  process,  in  which  the  consumer  recognizes  a   problem  or  need   •   Information  search-­‐  the  stage  of  the  buyer  decision  process  in  which  the  consumer  is  motivated  to   search  for  more  information   •   Alternative  evaluation-­‐  the  stage  of  the  buyer  decision  process  in  which  the  consumer  uses  information   to  evaluate  alternative  brands  in  the  choice  set     •   Purchase  decision-­‐  the  buyer’s  decision  about  which  brand  to  purchase     •   Postpurchase  behavior-­‐  the  stage  of  the  buyer  decision  process  in  which  consumers  take  further  action   after  purchase,  based  on  their  satisfaction  or  dissatisfaction   •   Cognitive  dissonance-­‐  buyer  discomfort  caused  by  postpurchase  conflict   •   New  product-­‐  a  good,  service,  or  idea  that  is  perceived  by  some  potential  customers  as  new   •   Adoption  process-­‐  the  mental  process  through  which  an  individual  passes  from  first  hearing  about  an   innovation  to  final  adoption   Awareness   Interest Evaluation Trial Adoption •       MKT  300   Susan  Fant   Chapter  7:  Customer-­‐Driven  Marketing  Strategy   •   Market  segmentation-­‐  dividing  a  market  into  smaller  segments  of  buyers  with  distinct  needs,   characteristics,  or  behaviors  that  might  require  separate  marketing  strategies  or  mixes     •   Market  targeting  (targeting)-­‐  evaluating  each  market  segment’s  attractiveness  and  selecting  one  or   more  segments  to  enter   •   Differentiation-­‐  differentiating  the  market  offering  to  create  superior  customer  value   •   Positioning-­‐  arranging  for  a  market  offering  to  occupy  a  clear,  distinctive,  and  desirable  place  relative   to  competing  products  in  the  minds  of  target  consumers     •     •   Geographic  segmentation-­‐  dividing  a  market  into  different  geographical  units,  such  as  nations,  states,   regions,  counties,  cities  or  even  neighborhoods   •   Demographic  segmentation-­‐  divides  the  market  into  segments  based  on  variables  such  as  age,  life-­‐ cycle  stage,  gender,  income,  occupation,  education,  religion,  ethnicity,  and  generation   •   Age  and  life  cycle  stage  segmentation-­‐  divides  a  market  into  different  age  and  life-­‐cycle  groups   •   Gender  segmentation-­‐divides  a  market  into  different  segments  based  on  gender   •   Income  segmentation-­‐  divides  a  market  into  different  income  segments   •   Psychographic  segmentation-­‐  divides  a  market  into  different  segments  based  on  social  class,  lifestyle,   or  personality  characteristics   o   Ex:  Dunkin  Donuts   o   Marketers  also  use  personality  variables  to  segment  markets   o   Marketers  sometimes  refer  to  brand  focused  psychographic  segments  as  brand  “tribes”-­‐   communities  of  core  customers  with  shared  characteristics,  brank  experiences,  and  strong   affinities  for  a  particular  brand   •   Behavioral  segmentation-­‐  divides  a  market  into  segments  based  on  consumer  knowledge,  attitudes,   uses  of  a  product,  or  responses  to  a  product   •   Occasion  segmentation-­‐  dividing  the  market  into  segments  according  to  occasions  when  buyers  get   the  idea  to  buy,  actually  make  their  purchase  or  use  the  purchased  item   •   Benefit  segmentation-­‐  dividing  the  market  into  segments  according  to  the  different  benefits  that   consumers  seek  from  the  product     •   Using  multiple  segmentation  bases:   o   Multiple  segmentation-­‐  is  used  to  identify  smaller,  better-­‐defined  target  groups   o   Experian’s  Mosaic  USA-­‐  system  classifies  U.S.  households  into  one  of  71  lifestyle  segments  and   19  levels  of  affluence   •   Segment  International  Markets:   Geographic   Economic   Political  and   Cultural   location factors legal  factors   factors •     MKT  300   Susan  Fant   •   Intermarket  (cross  market)  segmentation-­‐  forming  segments  of  consumers  who  have  similar  needs   and  buying  behaviors  even  though  they  are  located  in  different  countries     •   Requirements  for  Effective  Segmentation:   Measurable Accessible Substantial Differentiable Actionable •     •   Target  market-­‐  a  set  of  buyers  who  share  common  needs  or  characteristics  that  the  company  decides   to  serve   •     •   Undifferentiated  (mass)  marketing-­‐  a  market  coverage  strategy  in  which  a  firm  decides  to  ignore   market  segment  differences  and  go  after  the  whole  market  with  one  offer     o   Focuses  on  common  needs  rather  than  what’s  different   •   Differentiated  (segmented)  marketing-­‐  a  market  coverage  strategy  in  which  a  firm  decides  to  target   several  market  segments  and  designs  separate  offers  for  each     o   Goal  is  to  achieve  higher  sales  and  stronger  position   o   More  expensive  than  undifferentiated  marketing   •   Concentrated  (niche)  marketing-­‐  a  market  coverage  strategy  in  which  a  firm  goes  after  a  large  share  of   one  or  a  few  segments  or  niches   o   Limited  company  resources   o   Knowledge  of  the  market   o   More  effective  and  efficient   •   Micromarketing-­‐  is  the  practice  of  tailoring  products  and  marketing  programs  to  suit  the  tastes  of   specific  individuals  and  locations   o   Local  marketing-­‐  involves  tailoring  brands  and  promotion  to  the  needs  and  wants  of  local   customer  segments   §   Cites,  neighborhoods,  and  stores   o   Individual  marketing-­‐  involves  tailoring  products  and  marketing  programs  to  the  needs  and   preferences  of  individual  customers   §   Also  called:  one  to  one  marketing  or  mass  customization     •   Product  position-­‐  the  way  the  product  is  defined  by  consumers  on  important  attributes   •   Positioning  maps-­‐  show  consumer  perceptions  of  marketer’s  brands  versus  competing  products  on   important  buying  dimensions   o     MKT  300   Susan  Fant   •   Competitive  advantage-­‐  is  an  advantage  over  competitors  gained  by  offering  consumers  greater  value,   either  through  lower  prices  or  by  providing  more  benefits  that  justify  higher  prices   o   Product   o   Services   o   Channels   o   People     o   Image   o   A  difference  to  promote  should  be  à   Important Distinctive Superior Communicable Preemptive Affordable Profitable §     •   Value  proposition-­‐  the  full  positioning  of  a  brand;  the  full  mix  of  benefits  on  which  it  is  positioned     o     •   Positioning  statement-­‐  summarizes  company  or  brand  positioning  using  this  form:  To  (target  segment   and  need)  our  (brand)  is  (concept)  that  (point  of  difference)       Chapter  8:  Products,  Services,  and  Brands   •   Product-­‐  anything  that  can  be  offered  in  a  market  for  attention,  acquisition,  use,  or  consumption  that   might  satisfy  a  need  or  want   •   Service-­‐  a  product  that  consists  of  activities,  benefits,  or  satisfactions  and  that  is  essentially  intangible   and  does  not  result  in  the  ownership  of  anything   MKT  300   Susan  Fant   •     •   Consumer  products-­‐  products  and  services  bought  by  final  consumers  for  personal  consumption   o   Convenience  products   o   Shopping  products   o   Specialty  products   o   Unsought  products   •   Convenience  products-­‐  consumer  products  and  services  that  the  customer  usually  buys  frequently,   immediately,  and  with  a  minimum  comparison  and  buying  effort   o   Ex:  newspapers,  candy,  fast  food     •   Shopping  products-­‐  less  frequently  purchased        consumer  products  and  services  that  the  customer   compares  carefully  on  suitability,  quality,  price,  and  style   o   Ex:  furniture,  cars,  appliances   •   Specialty  products-­‐  consumer  products  and  services  with  unique  characteristics  or  brand  identification   for  which  a  significant  group  of  buyers  is  willing  to  make  a  special  purchase  effort   o   Ex:  medical  services,  designer  clothes,  high-­‐end  electronics   •   Unsought  products-­‐  consumer  products  that  the  consumer  does  not  know  about  or  knows  about  but   does  not  normally  think  of  buying   o   Ex:  life  insurance,  funeral  services,  blood  donations   •   Industrial  products-­‐  those  products  purchased  for  further  processing  or  for  use  in  conducting  a   business   o   Material  and  parts-­‐  raw  materials  and  manufactured  materials  and  parts     o   Capital  items-­‐  industrial  products  that  aid  in  the  buyer’s  production  or  operations   o   Suppliers  and  services-­‐  operating  supplies  repair  and  maintenance  items,  and  business  services   •   Organization  marketing-­‐  consists  of  activities  undertaken  to  create,  maintain,  or  change  the  attitudes   and  behavior  of  target  consumers  toward  an  organization   •   Person  marketing-­‐  consists  of  activities  undertaken  to  create,  maintain,  or  change  the  attitudes  or   behavior  of  target  consumers  toward  particular  people   •   Place  marketing-­‐  consists  of  activities  undertaken  to  create,  maintain,  or  change  attitudes  and   behavior  toward  particular  places   •   Social  marketing-­‐  uses  commercial  marketing  concepts  to  influence  individuals’  behavior  to  improve   their  well-­‐being  and  that  of  society   •     MKT  300   Susan  Fant   •   Product  quality-­‐  refers  to  the  characteristics  of  a  product  or  service  that  bear  on  its  ability  to  satisfy   stated  or  implied  customer  needs   o   Total  quality  management   o   Return-­‐on-­‐quality   o   Quality  level   o   Performance  quality   o   Conformance  quality   •   Product  features-­‐  Competitive  tool  for  differentiating  a  product  from  competitors’  products;  assessed   based  on  the  value  to  the  customer  versus  its  cost  to  the  company   •   Style-­‐  describes  the  appearance  of  the  product   •   Design-­‐  contributes  to  a  product’s  usefulness  as  well  as  to  its  looks   •   Brand-­‐  is  the  name,  term,  sign,  or  design  or  a  combination  of  these,  that  identifies  the  maker  or  seller   of  a  product  or  service   •   Packaging-­‐  involves  designing  and  producing  the  container  or  wrapper  for  a  product   •   Labels-­‐  identify  the  product  or  brand,  describe  attributes,  and  provide  promotion   •   Product  line-­‐  is  a  group  of  products  that  are  closely  related  because  they  function  in  a  similar  manner,   are  sold  to  the  same  customer  groups,  are  marketed  through  the  same  types  of  outlets,  or  fall  within   given  price  ranges   •   Product  mix-­‐  consists  of  all  the  product  lines  and  items  that  a  particular  seller  offers  for  sale.   o   Width   o   Length   o   Depth   o   Consistency   •     •   Brand  equity  is  the  differential  effect  that  knowing  the  brand  name  has  on  customer  response  to  the   product  or  its  marketing   •   Brand  value  is  the  total  financial  value  of  a  brand       Chapter  9:  New  Product  Development   •   Acquisition-­‐  refers  to  the  buying  of  a  whole  company,  a  patent,  or  a  license  to  produce  someone  else’s   product   •   New  product  development-­‐  refers  to  original  products,  product  improvements,  product  modifications,   and  new  brands  developed  from  the  firm’s  own  research  and  development   o   “New  pie”   o   Major  stages  in  new  product  development   MKT  300   Susan  Fant   o     •   Idea  generation-­‐  is  the  systematic  search  for  new  product  ideas   o   Company  owns  ideas   o   Internal  sources-­‐  refer  to  the  company’s  own  formal  research  and  development,  management   and  staff,  and  intrapreneurial  programs   o   External  sources-­‐  refer  to  sources  outside  the  company  such  as  customers,  competitors,   distributors,  suppliers,  and  outside  design  firms   o   Crowdsourcing-­‐  involves  inviting  broad  communities  of  people—customers,  employees,   independent  scientists  and  researchers,  and  even  the  public  at  large—into  the  new  product   innovation  process   •   Idea  screening:       o   R-­‐W-­‐W    screening  framework:   §   Is  it  real?   §   Can  we  win?   §   Is  it  worth  doing?   •   Product  idea-­‐  is  an  idea  for  a  possible  product  that  the  company  can  see  itself  offering  to  the  market   o   Understand   •   Product  concept-­‐  is  a  detailed  version  of  the  idea  stated  in  meaningful  consumer  terms   o   Perceive   •   Product  image-­‐  is  the  way  consumers  perceive  an  actual  or  potential  product   •   Concept  testing-­‐  refers  to  testing  new  product  concepts  with  groups  of  target  consumers   o   Ex:  concept  cars   •   Marketing  strategy  development-­‐  is  designing  an  initial  marketing  strategy  for  a  new  product  based  on   the  product  concept   •   Ethnographic  research-­‐  how  and  why  people  use  certain  brands   •   Marketing  strategy  statement  consists  of:   o   Target  market  description     o   Value  proposition  planned   o   Sales,  market-­‐share,  and  marketing  mix   •   Business  analysis-­‐  is  a  review  of  the  sales,  costs,  and  profit  projections  for  a  new  product  to  find  out   whether  these  factors  satisfy  the  company’s  objectives   •   Product  development-­‐  is  developing  the  product  concept  into  a  physical  product  to  ensure  that  the   product  idea  can  be  turned  into  a  workable  market  offering   •   Test  marketing-­‐  is  the  stage  of  new  product  development  in  which  the  product  and  its  proposed   marketing  program  are  tested  in  realistic  market  settings   MKT  300   Susan  Fant   When  test  marketing  is  likely When  test  marketing  is  unlikely •New  product  with  large  investment •Simple  line  extension •Uncertainty  about  product  or  marketing   •Copy  of  competitor  product program •Low  costs •Management  confidence o     •   Product  Life-­‐Cycle  Strategies   o   Product  development     §   Zero  sales  and  increasing  investment  costs     o   Introduction     §   Slow  sales  growth   §   Little  or  no  profit   §   High  distribution  and  promotion  expenses   o   Growth   §   Sales  increase   §   New  competitors  enter  the  market   §   Profits  increase   §   Economies  of  scale   §   Consumer  education     §   Lowering  prices  to  attract  more  buyers   o   Maturity     §   Slowdown  in  sales   §   Many  suppliers   §   Substitute  products   §   Overcapacity  leads  to  competition   §   Increased  promotion  and  R&D  to  support  sales  and  profits   o   Decline   §   Sales  fall  off  and  profits  drop   §   Maintain ?


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