BA101, Week 1 & 2 Notes
BA101, Week 1 & 2 Notes BA 101
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This 4 page Class Notes was uploaded by Emma Cochrane on Tuesday January 5, 2016. The Class Notes belongs to BA 101 at University of Oregon taught by Engel S in Fall 2015. Since its upload, it has received 114 views. For similar materials see Intro To Business in Business at University of Oregon.
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Date Created: 01/05/16
Sales – Expenses = Proﬁt -Sales = what the costumer pays, proﬁt is what is left when you pay oﬀ your expenses. -the proﬁt goes to the owner of the business Bridge of Marketing: Marketing (top of bridge) –> ﬁnance, accounting, management, research and development, operations (pillars under the bridge) -Finance: where the company got the money to buy the assets to start the business; there is equity ﬁnancing and there is borrowing ﬁnancing. -Accounting: looking forwards and backwards; evaluates the company and issues income statements (quarterly) on how the company operated looking backwards and predicts what will happen in the future -Management (HR): decides who to hire and how many people to hire, decides what to pay them and what beneﬁts they get, decides how much of production should be manual labor and how much should be machine labor. Chooses to hire the best people they can as competition to other businesses. -Research and Development: chooses what products to come out with based on what people want to buy, designs product for consumers. -Operations: what’s going on inside the factory: Is it running eﬃciently? Are materials being used eﬃciently? Is everything cost eﬀective? How much factory capacity needs to be added with company growth? -Marketing: Product (what it is), Price (how much it costs), Place (where it can be bought), Promotion (advertising), and Service (customer service). Objective of business: get customers onto and over the bridge to purchase something from your brand. Inconsistent marketing will cause less people to buy the product. If you have a prestige product that you sell at a premium price and advertise in a fancy magazine, but you decide to sell your product at Walmart, it isn’t going to sell. What is Marketing? • Marketing is an organizational function and a set of process for creating, communicating, and delivering value to customers and for managing customer relationships in ways that beneﬁt the organization and it stakeholders. Marketing • Who are our customers? ◦ Helps us decide whether or not the segment will be proﬁtable. ◦ Marketing is aimed directly at the target market chosen. • What do they want? Demographics vs Psychographics • Demographics: age, gender, income, education, etc • Psychographics: lifestyle, beliefs, etc Segments • Segments are diﬀerent groups of customers that companies can describe. • Within a segment, customers share similar characteristics ◦ Ex: Same age, same gender, same income, same lifestyle, etc. • Companies don’t always market to all segments. They choose which ones they want to market to. ◦ Segments chosen to market to become the target market. • Segments are described using demographics and psychographics. Bases for Segmentation: • Geographic • Psychographic • Demographic Marketing Research • Primary Data Research: research is done by the company/research department (used when answer isn’t readily available) ◦ Ex: surveys, observational research, contracting a third party to do research speciﬁcally for you • Secondary Data Research: Someone has already done the research and made it publicly available for a free or for a fee. (most used way of collecting research) ◦ Ex: online research, book research (anything that’s already been done and is available) Customers • Low Tech Customers ◦ People who buy the cheaper, more easily manufactured option • High Tech Customers ◦ People who buy the more expensive, more complicated/more diﬃcultly manufactured option Marketing • The activities designed to provide goods and services that provide value and satisfy customers. • Marketing Mix: 4 P’s + Service Purchasing Criteria: What you want in a product • Ex: price, style, comfort Expectations: what they expect from their purchase criteria. • Ex: $75-$100, modern, soft Importance: Prioritized purchasing criteria (has to add up to 100%). • Ex: 50% price, 30% style, 20% comfort Attraction/Attractiveness: Buyer looked at product and rated it based on their purchasing criteria and expectations. • Ex: 40 points for price, 75 points for style, 50 points for comfort. Customer Survey Score: Used to compare products between competitors. (found by multiplying importance % by the attractiveness points, then adding the numbers together) • Ex: 20 + 22.5 + 10 = 52.5 customer survey score Purchasing Criteria in Foundations • Mean Time Before Failure (MTBF): Average time before a product lasts before breaking/failing. (how reliability is measured) • Price: The lower the price, the more attractive, but if you sell it too low priced, you won’t make a proﬁt. • Age: How old is the product? When was the last time there was an upgrade or an update. • Position: Position within the market. (Uses monthly customer survey score) Proﬁt Maximization: • setting prices so that total revenue is as large as possible relative to total cost. Segment Criteria Ranking • Low Tech Market: 1. Price 2. Age 3. Reliability 4. Positioning • High Tech Market: 1. Positioning 2. Age 3. Price 4. Reliability Perceived Age • You introduce a product on July 1, 2010. ◦ On July 1, 2010 it is 0 years old. ◦ On December 31, 2010 it’s .5 years old. • You reposition and the revision date is July 1, 2010 ◦ On June 30, 2010, it’s almost 2 years old. ◦ On July 1, 2010, it’s perceived age is cut in half (1 year old)
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