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by: Mrs. Oleta Okuneva


Mrs. Oleta Okuneva
GPA 3.74

Stephen Hertzenberg

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Stephen Hertzenberg
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This 7 page Study Guide was uploaded by Mrs. Oleta Okuneva on Saturday September 26, 2015. The Study Guide belongs to COB 300D at James Madison University taught by Stephen Hertzenberg in Fall. Since its upload, it has received 30 views. For similar materials see /class/214040/cob-300d-james-madison-university in College of Business at James Madison University.

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Date Created: 09/26/15
Marketing Exam 1 Overview and Study Guide 1 Marketing Concept vs alternatives A Marketing the art and science of nding acquiring and satisfying customers in order to create a mutually acceptable exchange between an organization and its customers B Marketing Concept Relationship Era 7 Based on consumer orientation which is a management philosophy that focuses on ways to satisfy customers needs and wants Focuses on Making coordinated decisions to satisfy those customers and persuading customers to obtain satisfaction from you C Alternatives i Production orientation emphasizes the most efficient ways to produce and distribute products Works best in a sellers market where demand is greater than supply because it focuses on the most efficient ways to produce and distribute products Ex Ford Model T ii Sales orientation managements View of marketing as a sales function or a way to move products out of warehouses to reduce inventory Gained popularity after WW2 and companies that follow sales orientation tend to be more successful at making onetime sales rather than at building repeat business II Identifying the TRUE need for a productservice What Underlying need does the product or service satisfy in the target market What value does it add Ex Satisfy Thirst with Pepsi III Process for developing a Marketing Strategy A Marketing Strategy is a step in the marketing planning process where marketing managers develop their actual marketing strategiesthat is they make decisions about what activities they must accomplish to achieve the marketing objectives Marketers must figure out how they want consumers to think of their product compared to competing products Flows from and supports Corporate strategy Follows same steps as Corporate strategy B Environment specific impact on mktg function C Marketing objectives states what marketing must accomplish if firm is to achieve its overall objectives Speci c to the firm s brands and other mix elements D Marketing strategy i Select target markets and develop mix strategy a Select a Target Market The target market is the market segment a firm selects because it believes its offerings are most likely to win those customers Firm assesses potential demandnumber of customers willing and able to pay for its productsand decides if it is able to create a sustainable competitive advantage in the marketplace among target consumers b Develop Marketing Mix Strategies 7 Marketing mix decisions identify how marketng will accomplish its objectives in the firms target markets by using product price promotion and place They use product strategies product design packaging branding support services product features pricing strategies how much a rm charges for a product promotional strategies how marketers communicate a productsvalue proposition to the target market and distribution strategies how when and where the rm will make the product available to targeted customers 7 place component See page 53 E Page 44 Strategic planning includes i Step 1 Defining the mission 7 What business are we in What customers should we serve How should we develop the f1rm s capabilities and focus its efforts Includes the mission statement a formal statement in an organizations strategic plan that describes the overall purpose of the organization and what it intends to achieve in terms of its customers products and resources ii Step 2 situation analysis Evaluate the Internal controllable elements inside an organization including its people its facilities and how it does things that in uence the operations of the organization and External environments the uncontrollable element outside an organization that may affect its performance either positively or negatively Controllable elements include Product Place Price and Promotion Uncontrollable elements include Legal Social Economic Demographic Technology and Competitive Also uses SWOT analysis in this step iii Step 3 Set the Objectives Determine what the firm hopes to accomplish with longrange business plan Use SMART goals Specific Measurable Attainable Realistic Timely iv Step 4 Develop the Strategies Determine HOW the firm will fulfill its mission and hit its goals Includes using ProductMarketGrowth Matrix and Market GrowthMarket Share Matrix v Step 5 Implement Strategy and Evaluate Results vi Step 6 Adjust and Correct IV Goals and missions Page 44 Determine what the firm hopes to accomplish with longrange business plan A Goals focus on Sales profitability product development market share productivity ROI customer satisfaction andor social responsibility Use SMART goals Specific Measurable Attainable Realistic Timely B Mission Three key questions include What business are we in What customers should we serve How should we develop the f1rm s capabilities and focus its efforts Includes the mission statement V SWOT analysis Page 46 A How when to do it 7 Used when an organization is evaluating their internal and external environments B What information comes from it 7 Summarizes the ideas developed in the situation analysis allows managers to focus clearly on the strengths and weaknesses in the firms internal environments and opportunities and threats coming from its external environment C What decisions are made based on it 7 A SWOT analysis enables a firm to develop strategies that make use of what the firm does best in seizing opportunities for growth while at the same time avoiding external threats that might hurt the rms sales and pro ts VI Core competency Things a rm does extremely well which usually give it an advantage over its competition and enable it to execute the mission VII Competitive advantage The result of a company s matching a core competency superior skill or resources to opportunities in the marketplace YOU DO NOT WANT TO OUTSOURCE Core competencies Opportunities in Market Place Comp Advantage A Sources differentiated niche etc i Sources include Cost ProductService Differentiation and Niche Strategies ii Cost Reduction 7 Experience Curves Product Design Ef cient Labor Reengineering Nofrills products Product Innovations Government Subsidies New Service Delivery Methods iii Product Differentiation Brand name image Strong dealer network Product reliability Superior service iv Niche Strategy 7 Limited resources limited geographic market focused product line a Importance b Sustainability 7 A product focus that seeks to create products that meet present consumer needs without compromising the ability of future generations to meet their needs Skills and Assets of an Organization 7 STRONGEST Patents Copyrights Locations Equipment Technology Customer Service WEAKEST Promotion VIII BCG Market Share matrix Page 49 A Know axis quadrants star dog etc and what the quadrants mean for marketers i Stars SBUS with products that have a dominant market share in high growth markets Larger Revenues Require large amounts of funding to keep up with production and promotion demands Get largest share of loyal customers so that the SBU will generate pro ts to relocate to other parts of business EX Disney Movie BrandHannah MontanNamia ii Cash Cowsdominant market share in a lowgrowth potential market No opportunity for new companies use funds from cash cows to fund growth of other SBU s Well established high market share minimal funding Ex Disney Theme Parks iii Question Marks problem children LOW market share in a fast growth market suggests that the rm failed to compete successfully Advertising weak too high of prices Could put more money in but throwing good money after bad Ex Disney Stores iv Dogs SBUS nobody wantsSMALL SHARE in slow growth markets offer specialized products in limited markets that are not likely to grow quickly Large rms may sell off their dogs to smaller rms v Key Terms a Establish the Business Portfoliothe group of different products or brands owned by an organization and characterized by different income generating and growth capabilities Ex Disney Movies Disney Theme Parks Disney Cruises b Portfolio Analysisa mgmt tool for evaluating a rms business mix and assessing the potential of an organization s strategic business units c BCG Growth Market Share Matrix assesses the potential of successful products to generate cash that a rm will then use to invest in new products IX The Marketing Environment The external forces that directly or indirectly in uence a rm s acquisition of inputs and creation of outputs A Know categories examples of them and why they matter a Competitive Forces Competition rms that market similar or substitute products What to look for when analyzing competition Competitors by type Competitive structure Identify key competitiors SWOT data on key competitiors Competitive advantages of key competitiors Marketing mix of key competitors b Economic Forces Economic Conditions overall economic health current stage of the business cycle Buying Power resources such as money goods and services that can be traded in an exchange Willingness to Spend closely realted to ability to buy c LegalRegulatory and Political Forces Legislation Procompetition Consumer Protection Legal decisions interpreted by courts Regulatory agencies created and operated Selfregulatory forces Marketers Adjust to conditions In uence through contributions d Technology Forces Technology is the application of knowledge and tools to solve problems and or perform tasks more ef ciently Can be a source of competitive advantage Can transform industries and societies Ex Internet FedEX e Sociocultural Forces The in uences in a society and its cultures that change people s attitudes beliefs norms customs and lifestyles Green Marketing peoples attititudes towards the environment have changed businesses that protect the environment are looked up to Cultural Values deeply held beliefs about right and wrong ways to live Health Family Environment Impacted by changing gender roles Increasing customer sophistication meaning Consumers are smarter than they ever were due to the Internet 139 Demographic Forces Changes in or changing attitudes toward the characteristics of a population such as Age Gender Ethnic origin Race Sexual Orientation Social Class family structure Statistics that measure the observable aspects of a population g Implication for Marketers Monitor external forces closely Identify key trends earlier is better Assess impact quicklyaccurately Make decisions Find trends is market growing or shrinking This will help you make decisions B Controllable vs uncontrollable variables i Controllable Variables Product Place Price Promotion also people human capital physical facilities nancial stability ii Uncontrollable Variables Legal Social Economic Demographic Technology Competitive X Competition types of competitors brand product etc and competitive markets monopoly etc A Know them and how to recognize them Brand Competitors Coke vs Pepsi Product Competitors Meet underlying need Powerade vs Pepsi Generic Competitors Tap water vs Pepsi Total Budget Indirect Competitors candy bar vs pepsi anything else you can spend money on i Competition in the Microenvironment Microenvironmentthe product alternatives from which members of a target market may choose Marketers Compete for a Discretionary Incomethe portion of income people have left over after paying for necessities such as housing utilities food and clothing a Product Competition competitors offerng different products attempt to satisfy the same consumers needs and wants Starbucks vs Englands Staple of Tea a Brand Competitioncompetitions offering similar good or services vie for consumer dollars Golds Gym vs YMCA ii Competition in the Macroenvironment marketers need to understand the big picturethe overall structure of their industry a MonopolyOne seller controls the market feels little pressure to keep prices low or to produce quality goods or services Many typically big barriers And no close product substitutes EX Comcast Utilities in College only game in town b Oligopolyrelatively small number of sellers each holding substantial market share in a market with many buyers there are FEW sellers each seller is conscious of other sellers action Some barriers Homogeneous or differentiated products Often exist in industries requiring substantial 39 in J 391 or 39 39 J to produce a productonly a few competitors have the resources to enter the game EXAirlines Gas Stations Car Companies c Monopolistic Competition a market structure in which many firms each having slightly different products offer unique consumer benefrts Many competitors fewer barriers product differentiation many substitutes Focus on differentiation and productbrand Also focus on customer and most frequently seen d Perfect Competition Unlimited competitors no barriers to entry countless substitutes Many small sellers all of whom offer similar products are unable to have an impact on the quality price or supply of the product EX Agricultural industry comes in the closest very rare PC actually occurs e Monitoring Competition Helps determine competitors strategies and their effects on your rm s strategies Guides A 39 I of r quotquot J and adjustments to your rm s strategy Provides ongoing information about competitors Assists in maintaining a marketing orientation Helps you make good market decisions figure out competitive advantage XI Consumer problem solving routine etc A Know each behavior its elements time involvement etc and be able to categorize decisions i Involvement The relative importance of perceived consequences of the purchase to a consumer ii Perceived Risk The belief that choice of product has potentially negative consequences whether nancial physical andor social Can also be a factor in product choice if choosing the wrong product results in embarrassment or social rejection Ex Wearing sketchers to a job interview iii Habitual Decision Making Routine Internal processing of information Some environmental cues little conscious processing of info Options considered typically one preferred Low involvement Low Risk Low cost Ex Buying Cereal iv Limited Problem Solving Internal and some conscious processing of external info Several options are considered Moderate Involvement Moderate Risk Moderate Cost v Extended Problem Solving very important decisions carefully go through decision making process Extensive gathering and careful processing of external info Many options considered High Involvement High Risk High Cost B Know what each type of problem solving means for marketers Page 137 for Marketing Actions 12 Consumer decision making process a Know each step be able to recognize where someone is in the process by what they have just done and0r what their next step is 13 Know in uences on consumer behavior social situational etc how and why they in uence behavior 14 Understand Selective perception process and recognize where someone might be in it Information Processing What do you perceive Selection organization and interpretation of stimuli Selective perception 7 what did you choose to pay attention to Identical advertisements packages or products may be perceived very differently by consumers Getting consumers attention in a world of messages How many commercial messages were you exposed to today The process of selective perception Selective exposure 7 The extent to which a stimulus is capable of being registered by a persons receptors Ex which radio stations you listen to Selective attention 7 The extent to which a person devotes mental processing to a particular stimulus Ex Far more likely to notice an ad for fast food when you are hungry Selection comprehension 7 the process of assigning meaning to a stimulus based on prior associations a person has with it and assumptions he makes about it Selective retention 7 what do you remember 15 B2B decision making a How it is similar to and differs from consumer decision making Page 172 16 Segmentation and target markets a Segmentation process Segments are identifiable divisible Market can be divided so segments can be compared on sales potential costs and profits At least one market segment has the potential to justify marketing expenses The targeted market segment can be reached with a particular marketing mix Questions to answer Who are my potential customers What characteristics do they have in common How should I group the various potential customers in ways that make sense Which groups makes the most sense to consider going after Who will I direct my limited resources towards Segmentation Process A Determine the segmentation variables to use Demographic Variables Age Gender Race Ethnicity Education Occupation Family size Social Class Geographic Variables Country Region Climate Terrain City size Urbansuburbanrural Market density Psychographic Variables segments consumers in terms on psychological and behavioral similarities such as shared activities interests and opinions AIO motives lifestyles focuses on how people want to spend their time personal attributes Behavioristic Variables Dividing a market according to some feature of consumer behavior toward a product how they act towards feel about or use a product ex 8020 rule for targeting customers Ex Users and nonusers of a product than heavy moderate and low Black and white is upscale rounded edges is safe Long tail don t have to be a best seller to make profits as long as you sell enough of the product Ex Barnes and nobles vs amazon benefit expectations enduse volume usage price sensitivity usage occasions 7 indicator in behavioral marketing based on when consumers use a product most Geodemographic segmentation 7 combines geography and demographics people who live near one another share similar characteristics buy zip code or smaller Micromarketing Zip plus 4 B Develop market segment profiles How should I group my potential customers Describes the similarities between the customers in each particular segment typical customer Covers demographic characteristics geographic factors benefits sought lifestyles brand preferences and usage rates how frequently the customer buys the product C Evaluate relevant market segments Which groups make the most sense to go after Sales Estimates forcasted expected sales market potential company sales potentialpossible sales Competitive Assessment Cost Estimates Page 213 D Select your target market segments Who will I direct my limited resources towards Should satisfy the following requirements Are members in segments similar to each other in wants and needs and different from consumers in other segments Can marketers measure the segment Is the segment large enough to be profitable now and in the future Can marketing communications reach the segment Can the marketer adequately serve the needs of the segment E Develop mix and positioning Targeting strategy definitions differentiated concentrated etc Undifferentiated everyone in markt is the same Ex Walmart


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