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Midterm 1

by: Felicia Andreini

Midterm 1 MKTG 311

Felicia Andreini
GPA 3.5
Business Marketing
Marvin Ball

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Midterm #1 Review Chapters 1-12
Business Marketing
Marvin Ball
Study Guide
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This 12 page Study Guide was uploaded by Felicia Andreini on Sunday April 26, 2015. The Study Guide belongs to MKTG 311 at University of Oregon taught by Marvin Ball in Spring 2015. Since its upload, it has received 224 views. For similar materials see Business Marketing in Marketing at University of Oregon.


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Date Created: 04/26/15
Midterm 1 Review Exchange People giving up something in order to receive something else they would rather have 1 There must be at least two partie 2 Each party has something that might be of value to the other party 3 Each party is capable of communication amp delivery 4 Each party is free to accept or reject the exchange offer 5 Each party believes it is appropriate or desirable to deal with the other party Product Orientation A philosophy that focuses on the internal capabilities of the rm rather than on the desires and needs of the marketplace Sales Orientation The belief that people will buy more goods and services if aggressive sales techniques are used and that high sales result in high pro ts Market Concept The idea that the social and economic justi cation for an organization s eXistence is the satisfaction of customer wants and needs while meeting organization objectives Includes Focusing on customer wants and needs so that the organization can distinguish its products from competitors offerings Integrating all the organizations activities including production to satisfy customer wants Achieving longterm goals for the organization by satisfying customer wants and needs legally and responsibly Recipe for success a thorough understanding of your customers and your competition your distinctive capabilities that enable your company to execute on the basis of this customer understanding and how to deliver the desired eXperience using and integrating all the resources of the rm Market Orientation A philosophy that assumes that a sale does not depend on an aggressive sales force but rather than on a customer s decision to purchase a product it is synonymous with the marketing concept Understanding your competitive arena and competitor s strengths and weaknesses this includes assessing what eXisting or potential competitors might intend to do tomorrow or what they are doing today Societal Marketing Orientation The idea that an organization eXists not only to satisfy customer wants and needs and to meet organizational objectives but also to preserve or enhance individuals and society s longterm best interests A Nielsen study found that 83 of consumers worldwide believe companies should have environmental programs only 22 would pay more for an ecofriendly product THE CUSTOMER IS BOSSThey can re everyone simply by spending their elsewhere gt Sales oriented firms Personnel in salesoriented rms tend to be inward looking by focusing on selling what the organization makes rather than making what the market wants Today many successful firms derive their competitive advantage from an external market oriented focus Customer Value The relationship between benefits and the sacrifice necessary to obtain those benefits gt Customers value goods and services that are of the quality they expect and that are sold at prices they are willing to pay Value is something that shoppers of all markets and at all income levels look for Marketers interested in customer value Offer products that performEam TrustAvoid Unrealistic Pricing Give the buyer facts Offer organization widecommitment in service and after sales Support Cocreation Customer Satisfaction Customer s evaluation of a good or service in terms of whether it has met their needs and expectations Building relationship companies can expand market share in three ways Relationship marketing A strategy that focuses on keeping and improving relationships with current customers Most successful relationship marketing strategies depend on Empowerment delegation of authority to solve customers problems quickly usually by the first person the customer notifies regarding a problem Teamwork collaborative efforts of people to accomplish common objectives Customer relationship mmgement CRM a companywide business strategy designed to optimize profitability revenue and customer satisfaction by focusing on highly defined and precise customer groups What is this firms business in terms of the benefits customers seek 1 Ensures the firm keeps focusing on customers and avoids becoming preoccupied w goods 2 Encourages innovation and creativity by satisfying customer wants 3 Stimulates an awareness of changes in customer desires and preferences Strategic planningThe managerial process of creating and maintaining a t between the organization s objectives and resources and the evolving market opportunities Draw and label marketing plan pg 21 What is the rst amp last step Competitive advantage A set of unique features of a company and its products that are perceived by the target market as signi cant and superior to those of the competition What are the three types of competitive advantage 1 being the lowcost competitor in an industry while maintain satisfactory pro t margins 2 the provision of something that is unique and valuable to buyers beyond simply offering a lower price than that of the competition 3 an advantage that cannot be copied by the competition SWOT Analysis is Target Market Identifying S Strengths W Weaknesses 0 Opportunities T Threats ARGUMENTS FOR AND AGAINST SOCIAL RESPONSIBILITY Corporate social responsibility CSR a business s concern for society s welfare corporate social responsibility triangle Stakeholder Theory ethical theory stating that social responsibility is paying attention to the interest of every affected stakeholder in every aspect of a fIrm s operation 39 have their jobs and incomes at stake If the firm moves or closes employees often face hardship In return for their labor employees expect wages bene ts and meaningful work In return for loyalty workers expect the company to carry them through difficult times 39 have their jobs and incomes at stake On the other hand they must safeguard the welfare of the organization Sometimes this mean balancing the multiple claims of con icting stakeholders generate the revenue for the organization In exchange they expect high quality goods and services delivered in a timely manner Customer satisfaction leads to higher revenues and the ability to enhance the satisfaction of other stakeholders through its government grants the firm the right to build facilities In turn the community benefits directly from local taxes paid by the corporation and indirectly by property and sales taxes paid by the workers are vital to the success of a fIrm The materials supplied determine the overall quality of the product produced and create a cost oor which helps determine retail price In turn the firm is the customer of the supplier and is therefore vital to the success and survival of the supplier have a fInancial stake in the form of stock in a corporation They expect a reasonable return based upon the amount of inherent risk on their investment Often managers and employees have a portion of their retirement funds in company stock the idea that socially responsible companies will outperform their peers by focusing on the world s social problems and viewing them as opportunities to build profIts and help the world at the same time Pyramid of Corporate Social Responsibility Philanthropic Responsibilities e a good corporate citizen butts Ethical Responsibilities lt1 Tin Avoid harm Target Marke a group of people or organizations for which an organization Obey designs implements and maintains a marketing miX intended to meet the need of that group resulting in mutually satisfying exchanges MAIN MARKETING PLANNING PURPOSE OF IDENTIFYING A TARGET MARKET 39 Understand current customers Understand what drives consumer decisions Identify the most valuable customers and understand their needs Understand the competition Demographic Factors Demography the study of people s vital statistics such as age race and ethnicity and location People are directly or indirectly the basis of all markets making population the most basic statistic in marketing 39 America s tweens ages eight 10 tWClVe are a Population of more than 20 million ages 1319 people born between 1979 and 1994 people born between 1965 and 1978 people born between 1946 and 1964 External Environment faced by Global Marketers Describe amp Understand Culture set of values shared by its citizens that determine what is socially acceptable Economic Factors facing the global marketer is the level of economic development in the countries where it operates In general complex and sophisticated industries are found in developed countries and more basic industries are found in less developed nations The Global Economy must be fully aware of the intertwined nature of the global economy Example In the past the size of the US economy was so large that global markets tended to move up and down depending on its health Doing Business in China and India two of the worlds largest geographic areas greater linguistic and sociocultural diversity and among the highest levels of income disparity in the world Political Structure and Actions government policies run the gamut from no private ownership and minimal individual freedom to little central government and maximum personal freedom Demographic makeups need to know whether the population is mostly urban or rural Natural resources shortage of natural resources EX petroleum Elements of global marketing mix gt Trick Question 4 P s 5 stages of consumer making process 1 result of an imbalance between actual and desired states 2 Internal the process of recalling past information stored in the memory External the process of seeking information in the outside environment 3 Reviews stuff found in internal information search and external information search 4 39 1 Whether to buy 39 2 When to buy 39 3 What to buy product type and brand 39 4 Where to buy type of retailer speci c retailer online or instore 5 How to pay 5 Whether a customer is satis ed or dissatis ed with the purchase Cognitive dissonance inner tension that a consumer experiences after recognizing an inconsistency between behavior and values or opinions Major category of Business customers 1 profitoriented individuals and organizations that use purchased goods and services to produce other products to incorporate into other products or to facilitate the daily operations of the organization Original equipment manufacturer OEM individuals and organizations that buy business goods and incorporate them into the products they produce for eventual sale to other producers or to consumers 2 Retail and Wholesale businesses that buy nished goods and resell them for a pro t 3 thousands of federal state and local buying units Federal state county and city governments 4 Schools hospitals colleges and universities churches labor unions fraternal organizations civic clubs foundations and other socalled nonbusiness organizations STRATEGIES FOR SELECTING TARGET MARKETS Target market a group of people or organizations for Which an organization designs implements and maintains a marketing miX intended to meet the needs of that group resulting in mutually satisfying exchanges a marketing approach that views the market as one big market with no individual segments and thus uses a single marketing miX Advantages potential for saving on production and marketing Example CocaCola used this strategy with a single product and a single size of its familiar green bottle a strategy used to select one segment of a market for targeting marketing efforts A firm selects a market niche one segment of market for targeting its marketing efforts Example Enterprise RentACar started as a small company catering to people with cars in the shop a strategy that chooses two or more welldefined market segments and develops a distinct marketing miX for each Example P amp G offers eighteen different laundry detergents each targeting a different segment of the market Tide is a tough powerful cleaner and Era is good for stain treatment and removal Cannibalization a situation that occurs when sales of a new product cut into sales of a firm s existing products Example Since Apple released the iPad mini sales of the larger screen have fallen forcing Sharp Corp to cut back its production of the larger screens Customer relationship management CRM Definition in Chapter 1 CRM AS A Targeting Tool customer wants to be treated as the individuals they are with own set of needs wants direct and personal marketing efforts will continue to grow to meet needs of customers who no longer have time to spend shopping and making purchase decisions consumers will be loyal only to those companies and brands that have earned their loyalty and reinforce it at every purchase occasion New technology offers marketers a more costeffective way to reach customers and enable businesses to personalize their messages Positioning in the Minds of Positioning developing a specific marketing miX to in uence potential customers overall perception of a brand product line or organization in general Position the place a product brand or group of products occupies in consumers minds relative to competing offerings Product differentiation a positioning strategy that some firms use to distinguish their products from those of competitors Perceptual mapping a means of displaying or graphing in two or more dimensions the location of products brands or groups of products in customers minds Positioning Bases 39 Attribute product is associated with an attribute feature product feature or cx benefit Price and quality may stress high price as a signal of quality or emphasize low price as indication of value Use or applicationstressing uses or applications can be an effective means of positioning a product with buyers Product userfocuses on a personality or type of user Product class position the product as being associated with a particular category of products Competito Positioning against competitors Emotion focuses on how the product makes you feel Repositioning changing consumers perceptions of a brand in relation to competing brands Marketing Research the process of planning collecting and analyzing data relevant to a marketing decision Customer Relationship Managemen CRM evolving circle 1 Identify customer relationships 2 Understand interactions with current customer base 3 Capture customer data based on interactions 4 Store and integrate customer data using information technology 5 Identify best customers 6 Leverage customer information Competitive Intelligenc CI an intelligence system that helps managers assess their competition and vendors in order to become more efficient and effective competitors Intemet is an important resource for gathering customer intelligence Erything both favorable and unfavorable that a person receives in an exchange Types of consumer products Business product industrial product a product used to manufacture other goods or services to facilitate an organizations operation or to resell to other customers Consumer product a product brought to satisfy an individual s personal wants or needs Convenience products a relatively inexpensive item that merits little shopping effort Shopping products a product that requires comparison shopping because it is usually more eXpensive than a convenience product and is found in fewer stores Specialty products a particular item for which consumers search extensively and are very reluctant to accept substitutes Unsought products a product unknown to the potential buyer or a known product that the buyer does not actively seek Product items product lines and product mixes Product item a speci c version of a product that can be designated as a distinct offering among an organizations products Product line a group of closely related product items Product miX all products that an organization sells Product miX width the number of product lines an organizations offers Product line depth the number of product items in a product line Product modification changing one or more of a product s characteristics Planned obsolescence the practice of modifying products so those that have already been sold become obsolete before they actually need replacement Product line extension adding additional products to an eXisting product line in order to compete more broadly in the industry Newproduct Development Process 1 a plan that links the newproduct development process with the objectives of the marketing department the business unit and the corporation 2 39 Customers Employees Distributors Competitors Research and development Consultants Other experts Brainstorming the process of getting a group to think of unlimited ways to vary a product or solve a problem 3 the rst lter in the product development process which eliminates ideas that are inconsistent with the organization s newproduct strategy or are obviously inappropriate for some other reason Concept test a test to evaluate a newproduct idea usually before any prototype has been created 4 the second stage of the screening process where preliminary gures for the demand cost sales and pro tability are evaluated 5 the stage in the product development process in which a prototype is developed and a marketing strategy is outlined Simultaneous product development a teamoriented approach to newproduct development 6 the limited introduction of a product and a marketing program to determine the reactions of potential customers in a market situation Simulatedlaboratory marketing testing the presentation of advertising and other promotional materials for several products including a test product to members of the products target market 7 the decision to market a new product New Product Why some products succeed and why other products fail Products fail for a number of reasons 1 simply do not offer any discernible bene t compared to existing products 2 poor match between product features and customer desires 3 overestimation of market size incorrect targeting or positioning pricing inadequate distribution poor promotion or simply an inferior product Successful new products deliver a meaningful and perceivable benefit to a sizeable number of people or organizations and are different in some meaningful way from their substitutes Innovation a product perceived as new by a potential adapter Diffusion the process by which the adoption of an innovation spreads the rst 25 of all those who adopt the product They are eager to try new products the next 135 to adopt the product Rely on group norms and values Local orie the next 34 to adopt the product Likely to collect more info and evaluate brand the next 34 to adopt Rely on group norms feel pressure to conform The nal 16 to adopt the product Their independence is rooted in their ties to tradition thus the past heavily in uences their decisions Product life cycle sales and profits 4 stages of product life cycle Product life cycle PLC a concept that provides a way to trace the stages of a product s acceptance from its introduction birth to its decline death Product category all brands that satisfy a particular type of need the fullscale launch of a new product into the marketplace the second stage of the product life cycle when sales typically grow at an increasing rate many competitors enter the market large companies may start to acquire small pioneering rms and pro ts are healthy a period during which sales increase at a decreasing rate a longterm drop in sales Know the graph curve pg 210 How Services differ from Goods 1 the inability of services to be touched seen tasted heard or felt in the same manner that goods can be sensed Search quality a characteristic that can be easily assessed before purchase Experience quality a characteristic that can be assessed only after use Credence quality a characteristic that consumers may have dif culty assessing even after purchase bc they do not have the necessary knowledge or eXperience 2 the inability of the production and consumption of a service to be separated consumers must be present during the production 3 the variability of the inputs and outputs of services which causes services to tend to be less standardized and uniform than goods 4 the inability of services to be stored warehoused or inventoried Example Airplane Company s and hotels gtxltLargest nonpro t organization 20 of GDFone kind of enterprise


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