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UA / Advertising / ADV 221 / in terms of user status, aware nontriers:

in terms of user status, aware nontriers:

in terms of user status, aware nontriers:


Test 2 Study Guide

What is a target market?

Chapter 4

Utility: A product’s ability to satisfy needs and wants

Research can uncover the needs and wants of companies

Exchange: Trading of one thing for another thing of value

Marketing facilitates exchanges by:

- Developing goods and services we might want

- Pricing them attractively  

- Distributing them to convenient locations

- Informing us about them through advertising and other communication  tools

Satisfaction must occur every time customers use the product, or people won’t think they  got a fair exchange

Satisfaction leads to:

- Higher repurchases

- Positive word of mouth

Advertising reinforces satisfaction by:

- Reminding customers why they bought the product

- Helping them defend the purchase against skeptical friends and  


- Enabling them to persuade other prospects to buy it

What is a target audience?

Marketing: The process companies use to make a profit by identifying and satisfying  their customers’ needs and desires  

The Marketing Segmentation Process:

- Identifying groups with shared needs and characteristics  

- Aggregating the groups into larger segments (according to their interest in the  product’s utility) through a marketing mix

Target Market: The market segment or group within the market segment toward which all  marketing activities will be directed  

The people we want to talk to

Two Types:

- Consumer  

The advertising we see daily  

Sponsored by the producer of the product/service

- Business

The people who buy goods and services for resale, for use in their  

own business, or for manufacturing other products




Target Audience: The specific group of individuals to whom the advertising message is  directed

What is a geographic segmentation?

Who we reach  

Categories of Market Segmentation:

Behavioristic Segmentation: Method of segmenting consumers based on the  benefits being sought If you want to learn more check out marduk creates the world from the spoils of battle

Determined by:

- User Status (Sole Users, Semisole Users, Discount Users, Aware  

Nontriers, Trial/Rejectors, Repertoire Users)

- Usage Rates: The extent to which consumers use a product: light,  

medium, or heavy  

Measured by Volume Segmentation  

- Purchase Occasion: When consumers buy and use a good or  


- Benefits: Product attributes offered to a customer (high quality,  

low price, status, speed, sex appeal, good taste, etc.)

Geographic Segmentation: Segmenting markets by geographic regions based on  the shared characteristics, needs, or wants of people within a region

Demographic Segmentation: Based on a population’s statistical characteristics  such as gender, age, ethnicity, education, occupation, income, etc.

Geodemographic Segmentation: Combining demographics with  

geographic segmentation to select target markets  

Psychographic Segmentation: Based on psychological variables including values,  attitudes, personality, and lifestyle

VALS: assigns consumers to one of eight groups based on Primary Motivation (ideals,  achievement, self-expression), and Resources Don't forget about the age old question of prouss

Segmenting Business and Government Markets:  

Business Markets

- Employ professional buyers and use systematic purchasing procedures - Concentrated geographically

- Small number of buyers

- Purchase decisions depend on:

Price and quality

Product demonstrations

Delivery time

Terms of sale and dependability

Brand loyalty and risk management  

Market Concentration: markets can be focused in specific regions or areas

Target Marketing Process: The process by which an advertiser focuses its marketing  efforts on a target market

Target Market selection: Those consumers the company wishes to appeal to,  design products for, and tailor its marketing activities toward

Assessing which of the newly created segments:

- Offer the greatest profit potential If you want to learn more check out chem 4204 textbook notes

- Is the most successfully penetrated

Matching products to market

Product Life Cycle:

Introductory Phase: New product is introduced, costs are highest, and profits are  lowest

Growth Stage: Market Expansion—More and more customers make their first  purchases while others are already making their second or third purchases

Maturity Stage: The market has become saturated with products, the number of  new customers has dwindled, and competition is most intense

Competition intensifies and profits diminish  

Decline Stage: Sales begin to decline due to obsolescence, new technology, ot  changing consumer tastes

Product Positioning:  

How the product is perceived in the marketplace  

Product Differentiation:  

Creating a difference in the product that appeals to a market segment  Perceptible differences: differences that are visibly apparent  If you want to learn more check out py 211

Hidden differences: imperceptible but existing differences that may affect  the desirability of a product

Induced differences: differences effected through branding, packaging,  merchandising, and advertising  

Branding: A marketing function that identifies products and their source and  differentiates them from all other products  

The role of branding: Recognition and Identification

Brand: combination of name, words, symbols, or designs that distinguishes a  product from competitors  

Types of Brands:  

Individual Brand: A unique name to each product a manufacturer produces  Family Brand: Various products under the same umbrella name If you want to learn more check out hdfs 1060 uconn

National Brand: Marketed in several regions of the country  

Private Label: Personalized brands applied by distributors or dealers to  products supplied by manufacturers  

Product Packaging:

The marketer’s last chance to communicate and promote  


Identification, Containment, Protection, Convenience, Consumer Appeal,  Economy If you want to learn more check out ub 301

Price Element: Amount charged for the good or service  

- Influences consumer perceptions of a brand

Factors influencing price:

- Market demand for the product

- Costs of production and distribution

- Competition and corporate objectives

Psychological Pricing: Influencing a consumer’s perceptions using price Place Element: How and where customers will buy a company’s product Two basic methods of distribution:

Direct Distribution: The manufacturer sells directly to the customers  without the use of retailers (Buy a mac from apple)

Indirect Distribution: Resellers buy products from manufacturers (buy a  mac from Best Buy)

Distribution Strategies:  

Intensive Distribution: Based on making the product available to  

consumers at every possible location

Selective Distribution: Limiting the distribution to select outlets  

Exclusive Distribution: Limiting the number of wholesalers or retailers  who can sell a product

Vertical Marketing System (VMS): The main members of a distribution channel  (producer, wholesaler, and retailer) work together as a cooperative group to meet  consumer needs

Three Types:  

Corporate: one company owns multiple levels of the distribution or  production channel

Administered: One member of the production and distribution chain is  dominant and calls the shots

Contractual: Involves a formal agreement between the various levels of  the distribution or production channel to coordinate the overall process

Marketing Communications: The various efforts and tools companies use to initiate and  maintain communication with customers and prospects



Personal Selling

Sales Promotion

Direct Marketing  

Public Relations

Promotion Element: All market related communications between the seller and the buyer Important for advertising success:

- Strong primary demand trend

- Potential for significant product differentiation

- Hidden qualities highly important to consumers  

- Opportunity to use strong emotional appeal  

- Substantial funds available to support advertising  

Chapter 5

The Human Communication Process:

Source: The party that formulates the idea, encodes it as a message, and sends it  via some channel to the receiver  

Organization that has information it wishes to share with others  

Sponsor of the advertising  

Message: The idea formulated and encoded by the source and sent to the receiver  Must be encoded so the receiver understands what’s being communicated  

Verbal or Nonverbal, using words and symbols familiar to the intended  audience  

Channel: Any medium through which an encoded message is sent to a receiver Personal Channels: Involve direct contact between the parties

Nonpersonal Channels: Do not involve interpersonal contact between the  sender and the receiver

Receiver: Consumer who receives the advertiser’s message

Decode: To interpret a message by the receiver

Noise: Sender’s advertising message competing with other commercial  and noncommercial messages

Feedback: Verifying that the message was received

Interactive Media: Permit consumers to give instantaneous, real-time  feedback on the same channel used by the sender

Consumer Decision Process:  

1. Problem recognition

2. Information search

3. Evaluation and selection

4. Store choice and purchase

5. Post-purchase behavior (positive or negative experience)  

Personal Processes: The three internal, human operations—perception, learning, and  motivation—that govern the way consumers discern raw data and translate them into  feelings, thoughts, beliefs, and actions

Mental processes and behavior affected by:  

Interpersonal Influences: Family, society, culture

Nonpersonal Influences: Time, place, environment

Personal processes of consumer behavior:

1. Create awareness that the product exists  

2. Provide enough compelling information about the product for  

prospective customers to become interested  

3. Advertising stimulates customers’ desire to satisfy their needs and  wants by trying the product

Consumer Perception Process:

Perception: One’s personalized way of sensing and comprehending stimuli Stimulus: Physical data that can be received through the senses

Perceptual Screens: Physiological or psychological filters that messages  must pass through  

Physiological screens: Use the senses to detect incoming data and  

measure the dimension and intensity of the stimulus  

Cognition: Point of awareness and comprehension of a stimulus

Self-concept: Images individuals carry in their minds of the type of  

person they are and who they desire to be

Mental Files: Stored memories in consumers’ minds

Consumer Involvement: Importance or relevance of a decision to a consumer Theories of Learning:

Cognitive Theory: An approach that views learning as a mental process of  memory, thinking, and the rational application of knowledge to practical problem  solving

More applicable in high involvement purchases

Conditioning Theory: Learning is a trial-and-error process

More applicable in low involvement purchases

Persuasion: Change in thought process or behavior caused by promotion communication The Elaboration Likelihood Model: A theory of how persuasion occurs.  

Proposes that the method of persuasion depends on the consumer’s level  of involvement with the product and the message

Central Route: High level of involvement; customers more motivated to  pay attention to product-related information

Peripheral Route: Low level if involvement; little reason to pay attention  to the central message of the ad

The Hierarchy of Needs: Maslow’s theory that the lower biological or survival needs are  dominant in human behavior and must be satisfied before higher, socially acquired needs  become meaningful

Negatively Originated Motives: Consumer purchase and usage based on problem removal  or problem avoidance

Solve a problem (skin care)

Called informational motives

Positively Originated Motives: Consumer’s motivation to purchase and use a product  based on a positive bonus that it promises

Transformational Motives: Promise to transform consumers through sensory  gratification, intellectual stimulation, or social approval  

Interpersonal Influences: Social influences on the consumer decision-making process Categories:

Family Influence

Societal Influence

Cultural and subcultural influence

Purchase Decision and Postpurchase Evaluation:

Evoked Set: Particular group of alternative goods a consumer considers when  making a buying decision

Evaluative Criteria: Standards a consumer uses for judging the features and  benefits of alternative products

Cognitive Dissonance: People try to justify their behavior by reducing the  inconsistency between their cognitions and reality  

FCB Grid: A 2-D model that categorizes consumer products into four quadrants based on  “high involvement” or “low involvement” and “think” or “feel.”  

By positioning brands in the grid, an agency can determine the type of advertising  that would be most appropriate  

Kim-Lord Grid: A variation of the FCB grid, which allows for the fact that the level of  consumer involvement in a product does not have to be high “think” and low “feel” (or  vice versa) but can be high (or low) in both categories

Chapter 6

Account Planner: Individual at an advertising agency primarily responsible for account  planning

Represents the consumer

Ensures that the advertising strategy and executions are relevant to the target  audience

Marketing Research: Systematic gathering, recording, and analysis of information to help  managers make marketing decisions

Identifies consumer needs and market segments

Helps develop new products

Helps devise marketing strategies  

Assesses the effectiveness of marketing activities  

Pretesting: Testing the effectiveness of an advertisement for flaws in message content  before recommending it to clients

Conducted through focus groups


There is no best way to pretest advertising variables  

Respondents’ answers may not reflect their real buying behavior

- Assume the role of expert or critic

- Invent opinions to satisfy the interviewer  

- Be reluctant to admit they are influenced

- Vote for the ads they think they should like

Posttesting: Testing the effectiveness of an advertisement after it has been run Provides the advertiser with guidelines for future advertising


Recall tests only measure what respondents noticed and remembered  - Fail to measure whether they intend to buy the product

Inquiry tests may not reflect a sincere interest in a product

- Responses may take months to receive  

Sales tests are costly and time-consuming  

Steps in the Research Process:

1. Situation analysis and problem definition

2. Secondary research

3. Refinement of research objectives

4. Primary research

5. Interpretation and reporting of findings

Issues with advertising research:

Validity: Free of bias and reflects the true status of the market

Reliability: Repeatable with the same results

Sampling Methods:

Probability (Random): Everyone has an equal chance of being selected

Nonprobability (Convenience): Samples are selected because they are  readily available

Establishing Research Objectives:  

Concise statement of the research problem and objectives should be formulated Statement must be specific and measurable

Decision point must be clear and the questions must be related and  


Research results should provide the information required to decide on a new  positioning strategy

Primary Research: Collecting data directly from the marketplace using qualitative or  quantitative methods  

Qualitative Research: Uses small, nonrandom samples to explore behavior,  perceptions, needs, and motivations of a target audience


Projective technique

Intensive technique  

Ethnographic research or ethnography  

Quantitative Research: Uses larger, representative samples to quantify hypotheses  and measure market variables


Observation method

Experimental method


Collecting Primary Data in International Markets:

No economies of scale

Translating questionnaires to the local languages is a difficult task  Some cultures are not open to advanced methods of research

Lack of adequate facilities

Internet can be used to conduct foreign market research

Chapter 7

Marketing Plan: Assembles relevant facts about the organization, its markets, products,  services, customers, and competition

- Directs a company’s marketing effort

- Forces all departments to focus on the customer

- Lists goals and objectives for specific periods of time

- Lays out precise strategies and tactics to achieve them

- Length and complexity of the plan depends on the size of the company  - Ongoing activity

- Can be brief for smaller organizations or detailed and complex for larger  companies (Review and Revise)

Effect of the Marketing Plan on IMC

- Helps analyze and improve all company operations

- Defines the role of advertising in the marketing mix

- Enables better implementation, control, and continuity of advertising  programs

- Ensures efficient allocation of IMC dollars  

Traditional Top-Down Marketing Plan:

Situation Analysis: The organizations situation and how it got there SWOT Analysis: Strengths, Weaknesses, Opportunities, Threats)

Marketing Objectives: Goals of the marketing effort  

Marketing Strategy: How to achieve the objectives  

Marketing Tactics: Specific short-term actions to support strategy

Marketing Objectives, Strategies, and Tactics:

Marketing Objectives: Goals of the marketing effort expressed in terms of the  needs of specific target markets and specific sales objectives  


Customer’s perspective

Marketing Strategies: Statement of how the company is going to achieve its  marketing objectives


Company’s perspective

- Define the target markets

- Determine the strategic positioning (product attribute, price/quality, etc.) - Develop the marketing mix

Marketing Tactics: Specific short-term actions used to achieve marketing  objectives  

Bottom-Up Marketing Plan:  

Marketing Tactics

For smaller companies

When details come first

An ingenious tactic can develop into a strategy

Marketing Strategy

Marketing Results (Situation Analysis)

Relationship Marketing: Cooperation between the buyer and the seller

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