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Exam 2 study guide Marketing

by: Mary-Cynthia Okeke

Exam 2 study guide Marketing MKTG 3310-001

Marketplace > Auburn University > MKT-Marketing > MKTG 3310-001 > Exam 2 study guide Marketing
Mary-Cynthia Okeke

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these are going to cover what will be in the exam
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This 9 page Study Guide was uploaded by Mary-Cynthia Okeke on Sunday September 18, 2016. The Study Guide belongs to MKTG 3310-001 at Auburn University taught by MICHAEL KINCAID in Fall 2016. Since its upload, it has received 108 views. For similar materials see PRINCIPLES OF MARKETING in MKT-Marketing at Auburn University.

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Date Created: 09/18/16
Exam 2 Study Guide 1.Briefly, explain the activities involved when conducting a competitor analysis.  Competitor Analysis is the process of identifying, assessing and selecting key competitors. o Identifying the company’s competitors o Assessing the competitors’ strategies, weaknesses, strengths, objectives, and goals o Selecting which companies to avoid 2.Describe the three winning strategies suggested by Michael porter. What is the losing strategy identified by the Porter?  Overall cost leadership A company achieves the lowest production and distribution costs and allows it to lower its prices and gain market share. Walmart and JetBlue Airways are leading practitioners of this strategy.  Differentiation A company concentrates on creating a highly differentiated product line and marketing program so it comes across as an industry class leader. Most customers would prefer to own this brand if its price is not too high. Nike and Caterpillar follow this strategy.  Focus Here, the company focuses its effort on serving a few market segments well rather than going for the whole market. Examples of companies that follow this strategy are Four Seasons, Bose, Ritz-Carlton. The losing strategy is middle-of-the-roader 3.What is “competitor myopia”? Competitor Myopia is defined as a focus on a competitor or rival that is so intense that it causes distraction from larger strategic threats or opportunities. 4.Describe customer-centered, competitor-centered and market-centered companies. Which orientation is considered the best?  A Customer-centered company spends most of its time focusing on customer developments in designing strategies.  A Competitor-centered company is one that spends most of its time tracking competitors’ moves and market shares and trying to find strategies to counter them.  A Market-centered company is that spends most of its time watching both their customers and competitors A market-centered company is considered the best. 5.Describe how information systems can support each of these competitive strategies and give examples.  Low-cost leadership: Use information systems to improve inventory management, supply management, and create efficient customer response systems. Example: Wal-Mart.  Product differentiation: Use information systems to create products and services that are customized and personalized to fit the precise specifications of individual customers. Example: Google, eBay, Apple, Lands’ End.  Focus on market niche: Use information systems to produce and analyze data for finely tuned sales and marketing techniques. Analyze customer buying patterns, tastes, and preferences closely in order to efficiently pitch advertising and marketing campaigns to smaller target markets. Example: Hilton Hotels, 6.What are the types of innovation? Disruptive innovation, Continuous innovation, Discontinuous innovation 7.How do market leaders expand demand? New users, new uses for products, more usage of products 8.Which basic competitive strategy focuses on serving sub-segments rather than going for the whole market? Focus 9.Which basic competitive strategy focuses on highly differentiated product line and marketing program? Differentiation 10. Which basic competitive strategy focuses on achieving the lowest production and distribution costs? Overall Cost Leadership 11. Describe the blue ocean strategy: This strategy generally refers to the creation by a company of a new, uncontested market space that makes competitors irrelevant and that creates new consumer value often while decreasing costs 12. Describe and explain the utility levers 13. Explain the buyers’ utility map.  Purchase: how easy it is to find a product, the level of attractiveness and accessibility of the store  Delivery: the speed and convenience of product delivery  Use: the amount of training or expert assistant needed to use the product and the ease of storing the product  Supplements: other products or accessories that are needed to use the product.  Maintenance: ease of maintaining the product  Disposal: ease of disposal and whether it is environmentally safe or friendly. 14. What is value innovation? Value innovation is a new way of thinking about and executing a strategy that results in the creation of a blue ocean. The creation of blue oceans is about driving costs down while simultaneously driving value up for buyers. 15. What tools are used in creating a blue ocean? Strategy canvas and EERC grid 16. What is a Strategy Canvas? A strategy canvas is a graphical representation of a strategy. It includes the degree of what each competitor offers or invests in each factor and factors that the industry invests and competes, also potential areas where customer value could be created. 17. What are the four actions framework? 18. Four actions Framework explained Which factors that the industry takes for granted should be eliminated? a.Factors which your industry has long competed on b.Factors of competition intended for a Red Ocean Strategy. c. Factors which we take for granted but no longer have any value Which factors should be reduced well below the industry standard? a)Factors which are pushing too hard to stay competitive but yield little or no gain over the competition b)High development costs but little or no profit Which factors should be created that the industry has never offered a.Find a new source of value for the customer b.Shift demand and/or create new demand c. Shift strategic pricing in the industry Which factors should be raised well above the industry standard? a)Eliminate compromises your industry forces consumers to make 19. EERC GRID Applied to Casella wines 20. List three importance of the EERC GRID  Pushes companies to differentiate and reduce costs, breaking the value-cost trade-off.  Checks companies which decide to focus on only creating new products without reducing costs  Easy to understand  Every factor is scrutinized leading the company to discover implied assumptions made unconsciously in competition 21. What is the price corridor of the mass? The Price Corridor of the Mass is a tool used to help find the right offer price of the new product or service so that it attracts and retains buyers in large numbers. It is a graphical display of the price and volume of alternatives in order to capture the most target buyers. 22. Describe the steps in the price corridor of mass. Step 1: Identify the price corridor of mass  Uses match-pricing within and between industries and ideas.  Attempts to understand the price sensitivities of customers.  When choosing a price that will initially target a large population, two techniques emerge to help look at products/services in other industries: o Different forms, but same function  Example: Coke vs. Water o Different forms, different functions, but same overall objective.  The goal is for managers to identify the full range of potential buyers by listing groups of alternative products and services from other industries and non-industries, and price against them. Step 2: Specify a level within the price corridor  Determines how high the firm can afford to set the price within the price corridor, without increasing competition from imitation products/services.  Two factors help set the price level: o The degree to which the product is legally protected by patents or copyrights. o The degree of which the company owns exclusive assets or core capabilities. o There are three ranges that make up the corridor: Upper-level pricing, Mid-level pricing, and Lower-level pricing.  Higher protection allows a company to strategically set the price higher to attract the mass of target buyers. No protection from imitation means the company must set a relatively low price because it is easier to compete.


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