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UB / Management Marketing / MGM 301 / management 301 exam 1

management 301 exam 1

management 301 exam 1

Description

School: University at Buffalo
Department: Management Marketing
Course: Marketing
Professor: Dick
Term: Spring 2016
Tags: Marketing
Cost: 50
Name: Exam 1 Complete Study Guide - MGM
Description: Completed study guide. Should still use PowerPoints from class and textbook - just main things from class
Uploaded: 03/03/2016
13 Pages 6 Views 9 Unlocks
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MGM Exam 1 Study Guide 


Marketing mix makes decisions based on what?



∙ The Four P’s: Product, Price, Place, & Promotion – Regarding  advertising

∙ Advertising Age’s Top 5 “Marketers of the Century”: o Proctor & Gamble  Multiple Branding – Many brands in many  market segments; focusing on individual brands, giving them  individual identity.

 Family Branding – Name on every product

o McDonald’s  Target audience are tweens (10-12) b/c they are young, and can be longer lasting customers

 Transformational advertising

o Coca Cola  Coca Cola is one of the largest brand equities in  the country

 Brand Equity – value in brand name

 Value of Company ($) – Tangible Assets Value = Brand  Equity

o Anheuser Busch

o Nike  Family Branding

∙ Competing on price is “lazy” & generally unsustainable  lose $$ ∙ Intro. To Marketing:

o Marketing – “The activity of creativity, communicating,  delivering, and exchanging offerings that benefit the  


What are the controallable factors?



organization, its stakeholders, and society at large.”

 Creating ideas, goods and services, and being able to  communicate and deliver what they are about.

 It is the profitable establishment of Consumer Value;  from either high quality or low price

o Purpose of business: to obtain & keep customers

o Customer Value – “A unique combination of benefits  received by targeted buyers that includes quality, price,  convenience, on-time delivery & both before and after sale  service.”

 Consumer’s individual benefits of the product including  quality, price, convenience, & punctuality

o Synonyms for Value:

 Utility (4 Types):

∙ Time – customers appreciate things on their  

schedule (convenience – fast & now)

∙ Place – people want the product where they want If you want to learn more check out apr study guide

it

o E.g. – beer at the game way more  


How to apply STP marketing in planning?



expensive than in a liquor store, yet people

purchase it because it’s convenience  an  

experience is sold with the product  

(atmospherics)

∙ Form – product comes in multiple forms

o (E.g. – Apple v. Apple Juice)

∙ Possession – The use of a product before actually  owning it (E.g. – mortgage)

 Satisfaction – are people satisfied with the product  Benefit

o The Exchange Process – the trade of things of value between  buyer and seller so that each is better off after the trade  We trade in different products, money for something of  worth to us. Both benefit. Don't forget about the age old question of chapter 1 study guide

 Diminishing Marginal Utility – trading two things of  value, but if you keep getting that something it  If you want to learn more check out What disease does neil young have?

becomes of less worth to you

o Marketing Mix – make decisions based on the mass, not the  few

 Controllable Factors (the 4 P’s)

∙ Product – Variety, quality, design, features, brand

name, packaging, services, warranties

∙ Price – List price, discounts, allowances, payment

period, credit terms

∙ Promotion – Channels, location, inventory,  

transportation, atmospherics

∙ Place – Sales promotion (coupons/rebates),  

advertising, sales force, public relations, direct  

marketing, e-commerce

o Bring product from one place to another

o Market Share – ratio of sales revenue of the firm to the total  sales revenue of all firms in the industry, including the firm  itself

 Market Share % = Sales $/Total Market $

o STP Marketing:

 Segmentation – How do we think of the market place?  Identify all relevant segments if the market

∙ Different consumers/customers, provide different  

marketing mix

∙ Break up market into groups Don't forget about the age old question of amr addas

 Targeting – different purposes & different prices for  different audiences. Choose 1 or more of the segments to concentrate on

 Positioning – positioning compared to competitors.  Position the products in the minds of the consumer

∙ Marketing & Corp. Strategy:

o Mission Statements – indication of the company’s values.  Information about products, customers, technology,  etc.

o Avoid Marketing Myopia

 Myopia – cannot see the big picture. Many companies  view themselves in production process as supposed to  from what the consumer wants

o Corporate Goals: must be specific & measurable

 Sales Revenue

 Profit

 Return on Investment  Quality

 Social Responsibility

o Relative Market Share (RMS) – Firm’s raw market share  divided by the raw market share of a firm’s largest  competitor

 RMS > 1, RMS is the highest/one of the highest in  market

 RMS < 1, fast growing market, does not create profit immediately (?-products)

 Star products are often still not profitable, but they  produce & learn more from competitors so cost of  production is less

 Dog Products are in a slow market

 Cash Cow products are slow in growth market with  highest market share & low production costs

∙ Cash cow invests in all 3 (?, star, & dog  

products), which is known as a success  

sequence

 RMS ≥ 10% = fast growth market

o Focus on market growth rate instead of market size  because it is more dynamic & future oriented

 When market power increases, production costs  decrease & entry barriers increase

 When you have the highest market share, you have  more power (deters competition) If you want to learn more check out mktg 3104

o Core Competencies – capabilities resulting from personnel,  resources, or functional units that determine the means of  achieving sustainable competitive advantage and  marketplace success

 Sustainable Competitive Advantage – unique  strength from consumer’s perspective relative to  competitors (quality, service, time, cost, etc.) We also discuss several other topics like classical mythology 9th edition

o SWOT: Strengths, Weaknesses, Opportunities, & Threats of an organization

 Determines where business is now, & where it is  going

o Return on Investment:

 Larger market share has greatest influence on ROI ∙ Costs go down  discourages competition

∙ If market is lousy, so is market share

 The faster a company moves along the cost curve,  the better of

∙ In the short-run they give up profit, but in the  long-run they will make profit  need to spend  

$$ to make $$

o Product Growth Strategies:

 Market Penetration – same product & customers, but  try to sell more

 Market Development – same product with new  customers

 Product Development same customer, different  product

 Diversification – new product & new markets

o Budgeting: must be affordable, percentage of sales,  optimized, with an objective and task that is competitive  Promotion is necessary to drive sales up

 Take a % & put it towards next year’s  

promotions/advertising

 What you do v. what you need to do

 Share of Marketing Effort – appropriate market share  with budget

∙ Spend more to make more in order to grow

∙ To maintain just balance the budget

∙ 1 ½ Rule – amount of market share growth,  

take market share % X 1.5

∙ Marketing Environment:

o Constraining – understanding the environment & how it’s  changing (where it is going)

o Perspectives:

 Control:

∙ Adapt – most often because environment is out

of our control

∙ Modify – approach for goal

 Threat/opportunity – company can either take  

advantage of or get rid of the rumors

o Environmental Levels:

 Marketing Department – 4 P’s with regards to  

environment

 Internal – Top Management personnel & other  

departments

 Micro – customers, competitors, stakeholders,  

suppliers, channels

 Macro – Social, economic, technological, regulatory ∙ Social: Micro-cultures & Diversity – core set of  

beliefs

∙ Demographics: population size, geographic  

distribution, age distribution, & household  

consumption

o Population size increased with baby boom which led to  greater thinking

 Echo Boom  followed baby boom, smaller, but still  large growth of people

 Had to relate old age with younger age

 Population shifted from rural to urban (early 1900s),  urban to suburban (1930s-80s), & suburban to  

exurbs (1990s-2000s)

 Fewer babies now because we are focused on careers

∙ 50% of families were “traditional” back in 70s  now 25%

∙ Divorce rate is now ~50%

∙ Economic Environment:

o Size of Economy

 Gross Domestic Product (GDP) – directed towards  inflation

o Consumer Ability & Willingness to Buy

 Ability to Buy:

∙ Gross Income  (Taxes)  Disposable Income

∙ Disposable Income  (necessities) 

Discretionary Income

o Necessities are different for everyone

∙ Taxes & necessities – impact what we do with  

money in the future; almost like ‘fixed costs’

∙ Environmental Levels:

o It is easy to do business when things are good, but it is  important to keep chugging when things are bad (E.g. –  Hyundai)

 Hyundai gave their cars out during the recession and if customers couldn’t be paid back, they could just  

return them no charge. Big return for Hyundai 

o Macro Levels: Social (slower), Economic (faster),  Technological (much faster), & regulatory

 Regulatory:

∙ Protecting Consumers

∙ Consumerism

∙ Protecting Competition

∙ Political Pressure

 Technological Environment (issues):

∙ Television – HD/Digital, TiVo; cuts  

advertisements  bad for marketing; method of

delivery  now can just use web

∙ Telephone – went from only phone calls 

Basically everything (portable computer) &  

ads. Can be delivered based on consumer  

location

∙ Genetic Engineering – drugs made for specific  

individuals in the future

∙ Computer & WorldWideWeb – retail and  

advertising has changed due to social media

∙ Smart Products – integrate more technologies  

into individual products

∙ Consumer Behavior & Marketing:

o Consumer Decision Making: How do consumers decide  what to buy?

 Influences on Decision Making Process:

∙ Psychological – motivation, personality,  

learning, values, beliefs & attitudes

∙ Sociocultural – Personal influence, reference  

groups, family influence, social class, culture,  

etc.

∙ Situational – Purchase task, social  

surroundings, physical surroundings, temporal  

effects, & antecedent states

∙ Marketing Mix – Product, Price, Place, &  

Promotion

 Basic Decision Making Concepts:

∙ Goal Directed

∙ Low Involvement/Unimportant

∙ Banded Rationality

∙ Selective (in information we listen to)

∙ Adaptive (if we decide we don’t like, don’t buy  

again)

 Decision Making Unit: the different roles people play  in DM

∙ Information gatherer

∙ Influencer

∙ Decision Maker ∙ Purchaser

∙ User

Managing Customer Satisfaction:

∙ Managing Customer Satisfaction:

o Measurement, service after sale, website/phone  number, & consumer advocate all assist in keeping  customers satisfied even with complaints

∙ Alternative Evaluation:

o Evaluative Criteria – what is important to you when you  purchase a product

o Multi-Attribute Model – use eval. Criteria to predict  purchases & ratings on criteria

 Tells why “we,’ the company, are getting beat

∙ Developing a Customer Profile:

o Demographic examples: gender, age, marital status o Socio econ. examples: income, education, occupation o Psychographic examples: Lifestyle (Activities, Interests,  & Opinions)

 Lifestyle variable research

∙ Customer Profile Specificity:

o General individual differences – no matter what  happens, those characteristics remain the same

o Brand specific individual differences – characteristics  that change from each purchase

∙ Symbolic Consumer Behavior: meanings we give to products o We are what we wear, drink, drive, etc.

o Self Concept – consumers are conscious of their view of  themselves & how they would like to be viewed

o Hedonic Consumption/consumption experiences o Product enthusiasts

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