Principles of Marketing – 20100 (Bob Essig) Midterm Study Guide Includes Marketing Management 2e – Chapter 1 – 8, Old Rules, and class lectures and videos Understanding BIf you want to learn more check out Differentiation is caused by what?
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usiness to Consumer (Chapter Four) 1. Name several Personal Characteristics that help in understanding the consumer and what is their significance in running a B2C company? • Motivation- the stimulating power that induces and then directs behavior o Products must target someone’s needs • Attitude- learned predisposition to respond to an object or class of objects in a consistently favorable or unfavorable way o People’s beliefs/values effect their purchase decisions • Perception- a system to select, organize, and interpret information to create a useful, informed picture of the world o A consumer’s perception of a product determines if they will purchase it, not reality • Learning- any change in the content or organization of long-term memory or behavior o Marketers must attempt to provide information which will be retained in long term memory • Personality- set of unique personal qualities which produce distinctive responses across similar situations o These personality traits can be measured to identify differences between individuals o Knowing these differences is important for marketing managers 2. The consumer has become more powerful in today’s business climate. How, why, give an example. • The consumer has access to almost unlimited data with help of the internet & company transparency • Marketers' no longer have secrets from consumers • Consumers are able to use all of their information to make whatever choice pleases them, based on their desires and personal/psychological/cultural factors. Consumer choice has all the power, and companies are racing to be chosen by consumers. • Example: movie theaters vs media/streaming companies o trying to get customers to buy their product, they have to follow consumer trends. 3. Give examples of Lifestyle Trends in the US that are important for B2C market planning?• Lifestyle- an individual's perspective on life which manifests itself in that person’s activities, interests, and opinions • Examples: o Women have increasing wealth and purchasing power o Health-conscious eating o Single-parent homes o Online era 4. How does one consider gender roles in developing marketing ads and campaigns? • Woman now have increased prominence in the work force and increased purchasing power • It is important to target this market and not enforce typical gender roles in marketing campaigns 5. Why is it important to study motivation when creating a B2C market strategy? • Motivation directs why people do what they do • Understanding consumers’ motivation allows marketing managers to launch marketing campaigns directed at these motivations • Marketing campaigns must target consumers needs to motivate them 6. How does understanding of Psychology assist in Marketing Planning and implementation? • Psychology forces drive the need, shape the content and format of information stored in memory, and have an effect on point of view about products and brands • Understanding these forces allow marketing managers to develop strategies which target these forces 7. What is Selective Awareness, selective distortion and selective retention? • Selective Awareness- the act of focusing on a particular object for a period of time while simultaneously ignoring irrelevant information that is also occurring o Marketing managers must try to break through this selective awareness to get consumers to pay attention to their marketing campaigns • Selective Distortion- when information is misunderstood or made to fit existing beliefs o If people see an ambiguous commercial saying the company they like is good, they agree o People think it is an ad for a different company (Energizer batteries and Duracell)• Selective Retention- process of placing in one’s memory only those stimuli which support existing beliefs and attitudes about a product or brand o Memory is where people store past learning events and beliefs and effects consumer actions 8. External factors shape consumer choices. How does culture play a role and give an example? • Culture- assimilates shared artifacts such as values, morals, beliefs, art, law, and customs into an organized system that enables people to function as members of society o Language- important cultural building block and the primary communication tool in society ▪ Words convey deep meanings ▪ Marketing managers must interpret these words and use them to advantage to market their product o Cultural Values- principles shared by society that assert positive ideas ▪ Marketing managers must understand these values and how they effect consumer actions ▪ These values should be reflected in the marketing of a product/service to get consumers to use it o Nonverbal Communication- communication through sending and receiving wordless clues. It includes the use of visual cues such as body language, distance, and physical environments/appearance, of voice, and of touch ▪ Different cultures put different amounts of emphasis on these factors (such as time) 9. “Time is money” is a slogan critical in situational understanding. Explain. • An emerging consumer trend in many industrialized countries is the willingness to trade time for money. F • Issue is not always the best price, but instead the best service • Customers want to purchase a product that will free up their time or be less of a hassle. • Example: car-buying has become more hassle-free. 10. What is “Household Life Cycle” and why is it important to understand in B2C marketing. • The pattern of life stages that people go through • Traditional cycle is that people get married, start a family, raise kids, and retire. • Still true for some people, but there are more and more new household life cycle narratives. Single parents, parents who have been remarried, people who wait longer to get married, people who don't have kids, etc. • Marketers have to understand all of these different types of life cycles in order to best market to consumers. 11. What is a “market maven” and how do they influence B2C marketing process? • A group that has information about many kinds of products, places to shop, and other facets of markets, and the members initiate discussions with consumers and respond to requests from consumers for market information. • Market mavens have a broader understanding and expertise that goes beyond product to include other elements of the purchase decision such as shopping experience and price. • Marketers must seek this group out, identify the members, and encourage them to try a particular product so that they can endorse it to others. 12. Describe the Consumer decision making process. How can one use it to develop marketing plans? • Problem recognition • Search for information • Evaluation of alternatives • Product choice decision • Post-purchase decision • Marketers must target consumers at each step of this process in order to help convince consumers to buy their product and then ensure satisfaction afterwards. 13. What is post-purchase dissonance? How does it effect the B2C marketing process? • This is a level of doubt or anxiety that comes usually after high-involvement, large purchases • Marketers must direct marketing communications to reduce dissonance, particularly with large purchases such as automobiles. 14. What is a “brand personality” and why is important. • Brand Personality: association between a brand and specific personality characteristics • Research suggests that consumers purchase brands that have a personality consistent with their own • Knowing your brand personality helps marketers connect their brand to a customer.15. Define “attitude” based choices versus “attribute” based choices? • Attitude -based choices: tend to be more holistic, using summary impressions rather than specific attributes to evaluate the options. "It's important to buy cars made in America." • Attribute-based choices: product choices are made by comparing brands across a defined set of attributes. 16. What is the distinction between high and low involvement decisions and learning? • High-Involvement Learning- someone stimulated to acquire new information. Entire process takes longer, but consumers report high levels of satisfaction with their purchases. • Low-Involvement Learning - happens when people are not prompted to value new information. o Example: TV ads. consumers don't watch TV for the commercials and don't care much about the information 17. Name several sources of external information when a consumer makes a decision. • Independent Groups • Personal Associations • Marketer Information • Experiential 18. Targeted advertising to an individual through use of data mining and GPS systems can be both good and bad. What are the pros and cons? • Pros o consumers get ads targeted directly to them and they don't have to waste time with other ads o Many consumers believe they save money through use of these ads, coupons, rewards programs, etc. • Cons o Most consumers end up actually spending more because of the ads o There is an issue with privacy (Target example with woman who was pregnant). o Opportunity for companies to discriminate based on health or income