MKT 300 Final Exam Study Guide
MKT 300 Final Exam Study Guide MKT 300
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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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