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192 Cards in this Set

  • Front
  • Back
Marketing Defined
-Customers are the focus
-Marketing deals with products, price, distribution, and promotion
-Marketing builds satisfying exchange relationships
-Marketing occurs in a dynamic environment
The Importance of Marketing in Our Global Economy
-Marketing costs consume a sizable portion of buyers’ dollars
-Marketing is used in nonprofit organizations
-Marketing is important to businesses
-Marketing fuels our global economy
-Marketing knowledge enhances consumer awareness
-Marketing connects people through technology
-Socially responsible marketing can promote the welfare of customers and society
-Marketing offers many exciting career prospects
Those constituents who have a “stake,” or claim, in some aspect of a company’s products, operations, markets, industry, and outcomes; these include customers, employees, investors and shareholders, suppliers, governments, communities, and others
The process of creating, pricing, distributing, and promoting goods, services, and ideas to facilitate satisfying exchange relationships with customers and other stakeholders in a dynamic environment
The purchasers of an organization’s products; the focal point of all marketing activities
Target Market
-A specific group of customers on whom an organization focuses its marketing efforts
-Large or small customer groups
-Single or multiple product markets
-Single or multiple products
-Local to global markets
The purchasers of an organization’s products; the focal point of all marketing activities
Target Market
-A specific group of customers on whom an organization focuses its marketing efforts
-Large or small customer groups
-Single or multiple product markets
-Single or multiple products
-Local to global markets
The Marketing Mix
Four marketing activities—product, pricing, distribution, and promotion—that a firm can control to meet the needs of customers within its target market
Goods, services, or ideas that satisfy customer needs
Decisions and actions that establish pricing objectives and policies and set product prices
The ready, convenient, and timely availability of products
Activities that inform customers about the organization and its products
The provision or transfer of goods, services, or ideas in return for something of value
Exchange Conditions
-Two or more participants have something of value that the other party desires.
-Exchange provides mutual benefit/satisfaction.
-Each party has confidence in the exchange value of the other party’s offering.
-Each party must meet the expectations of the exchange to become trusted by the other parties.
Marketing Environment
The competitive,
legal and regulatory,
and sociocultural forces that surround the customer and affect the marketing mix
Marketing Concept
A philosophy that an organization should try to satisfy customers’ needs through a coordinated set of activities that also allows the organization to achieve its goals
Customer satisfaction
-Analysis of customers’ current and long-term needs
-Analysis of competitors’ capabilities
-Integration of firm’s resources
Evolution of the Marketing Concept
-Production Orientation

-Sales Orientation

-Marketing Orientation
Implementing the Marketing Concept
-Becoming marketing oriented requires establishing an information system to discover customers’ needs and using the information to create satisfying products.

-coordinating all marketing activities by restructuring the organization.

-obtaining the support of all managerial and staff levels in the organization.
Relationship Marketing
-Establishing long-term, mutually satisfying buyer-seller relationships allowing for cooperation and mutual dependency

-Increased value of customer (loyalty) over time results in increased profitability.
Customer Relationship Management (CRM)
Using customer information to create marketing strategies that develop and sustain desirable relationships

-Identifying buying-behavior patterns

-Using behavioral information to focus on the most profitable customers
A customer’s subjective assessment of benefits relative to the costs in determining the worth of a product

Customer value = customer benefits – customer costs
Customer Benefits
Anything desired by the customer that is received in an exchange
Customer Costs
Anything a customer gives up in an exchange for benefits

-Monetary price of the benefit
-Search costs (time and effort) to locate the product
-Risks associated with the exchange
Marketing Management
The process of planning, organizing, implementing, and controlling marketing activities to facilitate exchanges effectively and efficiently
The degree to which an exchange helps an organization achieve its objectives
The process of minimizing the resources an organization must spend to achieve a specific level of desired exchanges
-Assessing opportunities and resources
-Determining marketing objectives
-Developing a marketing strategy and plans for implementation and control
-How, when and by whom are marketing activities performed?
-Developing the internal structure of the marketing unit
-Functions, products, regions, customer types
Coordinating marketing -activities
-Motivating marketing personnel
-Developing effective internal communications within the unit
-Establishing performance standards
-Comparing actual performance to established standards
-Reducing the difference between desired and actual performance
Effective Marketing Control Process
-Provides for quick detection of differences in planned and actual performance
-Accurately monitors activities and is flexible enough to accommodate changes
-Incurs low process costs relative to the costs of a “no-control” situation
-Is understandable by both managers and subordinates
The Importance of Marketing in Our Global Economy
-Mktg costs consume a sizable portion of buyers’ dollars
-Mktg used in nonprofit organizations
-Important to business
-Mktg fuels global economy
-Mktg knowledge enhances consumer awareness
-Mktg connects people through technology
-Socially responsible marketing promotes welfare of customers and society
-Mktg offers many exciting career prospects
Strategic Planning
The process of establishing an organizational mission and formulating goals, corporate strategy, marketing objectives, marketing strategy, and a marketing plan
Marketing Strategy
A plan of action for identifying and analyzing a target market and developing a marketing mix to meet the needs of that market
Marketing Plan
A written document that specifies the activities to be performed to implement and control an organization’s marketing activities
Core Competencies
Things a firm does extremely well (strengths), which sometimes give it an advantage over its competition
-Financial and human resources
-Reputation, goodwill, and brand names
Market Opportunity
A combination of circumstances and timing that permits an organization to reach a target market
Strategic Windows
Temporary periods of optimal fit between the key requirements of a market and the particular capabilities of a firm
Competitive Advantage
The result of a company’s matching a core competency (superior skill or resources) to opportunities in the marketplace
-Manufacturing skills
-Technical skills
-Marketing skills
SWOT Analysis
An assessment of the organization’s strengths, weaknesses, opportunities, and threats
-Strengths: competitive advantages or core competencies
-Weaknesses: limitations on competitive capability
-Opportunities: favorable conditions in the environment
-Threats: conditions or barriers to reaching objectives
Mission Statement
-A long-term view, or vision, of what the organization wants to become
-The mission statement answers two questions:
1. Who are our customers?
2. What is our core competency?
Marketing Objective
A statement of what is to be accomplished through marketing activities to match strengths to opportunities, or to provide for the conversion of weaknesses to strengths
-Should be stated in clear, simple terms
-Should be accurately measurable
-Should specify a time frame for accomplishment
-Should be consistent with business-unit and corporate strategy
Corporate Strategy
Determines the means for utilizing resources in the various functional areas to reach the organization’s goals
-Determines the scope of the business
-Guides its resource deployment
-Identifies its competitive advantages
-Provides overall coordination of functional areas
Issues Influencing Corporate Strategy Development
-Corporate culture
-Interrelationships among business units
-Environment concerns and social issues
Strategic Business Unit (SBU)
A division, product line, or other profit center within a parent company
A group of individuals and/or organizations that have needs for products in a product class and have the ability, willingness, and authority to purchase those products
Market Share
The percentage of a market that actually buys a specific product from a particular company
Market-Growth/Market-Share Matrix
A strategic planning tool based on the philosophy that a product’s market growth rate and market share are important in determining marketing strategy
Factors determining SBU/product’s position within a matrix
1. Market growth rate
2. Relative market share
BCG Classification
- Star
- Cash Cow
- Dog
- Question Mark
Star—high growth market, dominant market share
requires additional resources for continued growth
Cash cow
low growth, dominant market share -- generates surplus resources for allocation to other SBUs
low/declining market, subordinate market share --
has diminished prospects and represents a drain on the portfolio
Question mark
high growth market, low market share -- represents a high-risk/cost opportunity requiring a large commitment of resources to build market share
Defining/understanding the target market
-focusing on specific profitable customer groups/market segments.
-recognizing changes occurring in the market.
Creating the Marketing Mix
-Analyze customer needs, preferences, and behavior
-Have the skills and resources required for product design, pricing, distribution, and promotion
-Maintain strategic consistency and flexibility in marketing mix decisions
Marketing Planning
The process of assessing opportunities and resources, determining objectives, defining strategies, and establishing guidelines for implementation and control of the marketing program
Benefits of Planning
-Provides the basis for internal communication among employees
-Defines the assignment of responsibilities and tasks and sets the schedules for implementation
-Presents objectives and specifies resource allocations
-Helps in monitoring and evaluating the performance of the marketing strategy
Marketing Implementation
process of putting marketing strategies into action
Intended Strategy
strategy that the company decides on during the planning phase
Realized Strategy
strategy that actually takes place
Internal Marketing
-Coordinating internal exchanges between the firm and its employees to achieve successful external exchanges between the firm and its customers
-Helping employees understand and accept their roles in the marketing strategy
External customers
Individuals who patronize a business
Internal customers
A company’s employees
Total Quality Management (TQM)
philosophy that uniform commitment to quality in all areas of the organization will promote a culture that meets customers’ perceptions of quality
Comparing the quality of the firm’s goods, services, or processes with that of the best-performing competitors
Giving customer-contact employees authority and responsibility to make marketing decisions on their own
Centralized Organization
A structure in which top management delegates little authority to levels below it
Decentralized Organization
A structure in which decision-making authority is delegated as far down the chain of command as possible
Marketing Control Process
Establishing performance standards and trying to match actual performance to those standards
Taking Corrective Action
-Improve actual performance
-Reduce or change the performance standards
-Do both
Problems in Controlling Marketing Activities
-Lack of information
-Uncontrollable influence of market environment changes on marketing activities
-Time lag that occurs between marketing campaigns and their results delays corrective actions
Environmental Scanning
The process of collecting information about forces in the marketing environment
-Secondary sources
-Market research
Environmental Analysis
The process of assessing and interpreting the information gathered through environmental scanning
Reactive approach to Environmental Forces
-Passive view of environment as uncontrollable
-Current strategy is cautiously adjusted to accommodate environmental changes
Proactive approach to Environmental Forces
-Actively attempts to shape and influence environment
-Strategies are constructed to overcome market challenges and take advantage of opportunities
Monitoring Competition
-Helps determine competitors’ strategies and their effects on firm’s own strategies
-Guides development of competitive advantage and adjusting firm’s strategy
-Provides ongoing information about competitors
-Assists in maintaining a marketing orientation
Economic Forces
-Buying Power
-Willingness to Spend
Buying Power
-Resources, such as money, goods, and services, that can be traded in an exchange
Disposable income
after tax income
Discretionary income
disposable income available for spending and saving beyond the basic necessities of life
Willingness to Spend
An inclination to buy because of expected satisfaction from a product, influenced by the ability to buy and numerous psychological and social forces
Expectations influencing the willingness to spend
-Future employment
-Income levels
-Family size
-General economic conditions (e.g., rising prices)
Stages in the Business Cycle
Low unemployment and high total income create high buying power
Rising unemployment reduces total buying power; consumer and business spending decline
Unemployment extremely high, wages and total disposable income are very low, and there is a lack of consumer confidence
Economy is moving out of recession or depression towards prosperity
Federal Trade Commission (FTC)
influences marketing activities most; can seek civil penalties and require corrective advertising
Self-Regulatory Forces
-Better Business Bureau
-National Advertising Review Board (NARB)
Food and Drug Administration (FDA)
Enforces laws and regulations to prevent distribution of adulterated or misbranded foods, drugs, medical devices, cosmetics, veterinary products, and potentially hazardous consumer products
Consumer Product Safety Commission (FCC)
Ensures compliance with the Consumer Product Safety Act; protects the public from unreasonable risk of injury from any consumer product not covered by other regulatory agencies
Federal Communications Commission (FCC)
Regulates communication by wire, radio, and television in interstate and foreign commerce
Environmental Protection Agency (EPA)
Develops and enforces environmental protection standards and conducts research into the adverse effects of pollution
Federal Power Commission (FPC)
Regulates rates and sales of natural gas producers, thereby affecting the supply and price of gas available to consumers; also regulates wholesale rates for electricity and gas, pipeline construction, and U.S. imports and exports of natural gas and electricity
The application of knowledge and tools to solve problems and perform tasks more efficiently
Impact of Technology
-Dynamic means constant change
-Reach refers to how technology quickly moves through society.
-The self-sustaining nature of technology as the catalyst for even faster development
Sociocultural Forces
The influences in a society and its culture(s) that change people’s attitudes, beliefs, norms, customs, and lifestyles
Demographic Diversity and Characteristics
-Increasing proportion of older consumers
-Entering another baby boom
-Increasingly multicultural U.S. society
Cultural Values
Primary source of values is the family

Values influence:
-Eating habits (healthier foods)
-Alternative health and medical treatment choices
Social Responsibility
An organization’s obligation to maximize its positive impact and minimize its negative impact on society
Marketing citizenship
The adoption of a strategic focus for fulfilling the economic, legal, ethical, and philanthropic social responsibilities expected by stakeholders
Constituents who have a “stake” or claim in some aspect of the company’s products, operations, markets, industry, and outcomes
Marketing Ethics
Principles and standards that define acceptable marketing conduct as determined by various stakeholders
Ethical Issue
An identifiable problem, situation, or opportunity requiring a choice among several actions that must be evaluated as right or wrong, ethical or unethical
Influence Factors of Ethical Standards
-Interest Groups
Cause-Related Marketing
The practice of linking products to a particular cause on an ongoing or short-term basis
Strategic Philanthropy
The synergistic use of organizational core competencies and resources to address key stakeholders’ interests and achieve both organizational and social benefits
Green Marketing
The specific development, pricing, promotion, and distribution of products that do not harm the natural environment
The organized efforts of individuals, groups, and organizations to protect the rights of consumers

-Lobbying government officials and agencies
-Letter-writing campaigns and boycotts
Kennedy’s Consumer “Bill of Rights”
-Right to safety
-Right to be informed
-Right to choose
-Right to be heard
Codes of Conduct (Ethics)
Formalized rules and standards that describe what the company expects of its employees
Benefits of Codes of Conduct and Social Responsibility
-Socially responsible companies (and their employees) can better respond to stakeholder demands.
-A company’s reputation for social responsibility is important to consumers’ buying decisions.
-Social responsibility and ethical behavior reduce the costs of legal violations, civil litigation, and damaging publicity.
Electronic Commerce (E-Commerce)
Sharing business information, maintaining business relationships, and conducting business transactions by means of telecommunications networks
Electronic Marketing (E-Marketing)
The strategic process of creating, distributing, promoting, and pricing products for targeted customers in the virtual environment of the Internet
Benefits of E-Marketing
1. Open and Instantaneous Flows of Information
-Marketers and customers share information in real-time on prices, specifications, and product availability.
2. Enhanced Customer Service Efficiencies
-Rapid response and always-on availability
3. Worldwide Scope
-Opens markets to firms of all sizes
marketer’s ability to identify customers before they make a purchase
How E-Merchants Attain Addressability
-Limit access to areas of their web site to encourage customer registration
-Offer contests and prizes in exchange for consumer information
-Place “cookies” on visitor’s computer to track visitor usage and preferences
the ability to allow customers express their needs and wants directly to the firm in response to the firm’s marketing communications
-Real-time interaction with customers
-Broader market coverage at a lower cost
a sense of group membership or feeling of belonging
web-based journals where writers can editorialize and interact with others
the ability to access databases or data warehouses containing individual customer profiles and past purchase histories and to use these data in real-time to customize a marketing offer.
a collection of information arranged for easy access and retrieval.
Refers to customers’ ability to regulate the information they view and the rate and sequence of their exposure to that information.
-The Web is a pull medium because users control the information they view
-Marketers have to work harder and more creatively to retain customers at their web sites
a multiservice web site that serves as a gateway to other web sites.
The ability to obtain information available on the Internet.
-Informs and educates the inquiring consumer about competing products and prices
-Creates competition for the consumer’s attention
the ability to represent a product, or at least some of its benefits, as digital bits of information.
E-Marketing Strategy Considerations
-Target Markets
-Product Marketing
-Distribution Systems
-Promotion Mediums
Customer relationship management (CRM)
focuses on using information about customers to create marketing strategies that develop and sustain desirable long-term relationships.
-A focus on CRM is possible in e-marketing because of marketers’ ability to target individual customers.
-The ability to identify individual customers allows marketers to shift their focus from increase share of market to increasing share of customer.
-CRM is often based on the use of information technology.
The 80/20 Rule
80 percent of business profits come from 20 percent of customers.
-Advances in technology allow marketers to profile customers in real-time and thereby assess their lifetime value (LTV) to the firm.
-Some customers may be too expensive to retain given the low level of profits they generate.
-Firms should focus instead on developing and managing long-term relationships with more profitable customers.
Personal Privacy Issues
Unauthorized placement of “cookies” on personal computers
-Web site information requirements for registration
-Collection of information from children
-Use of “spyware” in software
Unsolicited commercial e-mail (UCE)
Misappropriation of Intellectual Property
Illegal copying of copyrighted software, movies, CDs, and other creative materials
International Marketing
Developing and performing marketing activities across national boundaries
-Provides growth opportunities
-Promotes innovation
-Fosters marketing of better, less expensive products
Cultural and Social Forces
Beliefs and values about:
Economic Differences Affecting International Marketing
-Standards of living
-Buying power
-Income distribution
-National resources
-Exchange rates
Gross Domestic Product (GDP)
The market value of a nation’s total output of goods and services for a given period; an overall measure of economic standing
Import tariff
A duty levied by a nation on goods bought outside its borders and brought in
A limit on the amount of goods an importing country will accept for certain product categories in a specific period of time
A governmental suspension of trade in a particular product or with a given country
Exchange controls
Government restrictions on the amount of a particular currency that can be bought or sold
Balance of Trade
The difference between the value of a nation’s imports and exports
Political, Legal, and Ethical Forces
-Differences in legal and ethical standards have caused some companies to establish ethics programs and standards for international business conduct.
-Differences may revolve around such things as intellectual property, labor conditions, payoffs and bribes, and tips and gifts.
The North American Free Trade Agreement (NAFTA)
An alliance that merges Canada, Mexico, and the United States into a single market
-Eliminates barriers
-Eases investment
-Simplifies trade
The European Union (EU)
An alliance that promotes trade among its member countries in Europe
-Market unification
-Common currency (euro)
-Economic efficiency
The Common Market of the Southern Cone (MERCOSUR)
An alliance that promotes the free circulation of goods, services, and production factors, and has a common external tariff and commercial policy among member nations in South America
Asia-Pacific Economic Cooperation (APEC)
An alliance that promotes open trade and economic and technical cooperation among member nations throughout the world
General Agreement on Tariffs and Trade (GATT)
-An agreement among nations to reduce worldwide tariffs and increase international trade
-Dumping: selling products at unfairly low prices
World Trade Organization (WTO)
-An entity that promotes free trade among member nations
-Provides legal ground rules for international commerce and trade policy
The purchase of products from a foreign source
The sale of products to foreign markets
Importing and exporting may be facilitated by:
-Exporting agencies
-Trading companies
An alternative to direct investment requiring the licensee to pay commissions or royalties on sales or supplies used in manufacturing
A form of licensing in which the franchiser grants the franchisee the right to market its product in accordance with the franchiser’s standards
Contract Manufacturing
The practice of hiring a foreign firm to produce a designated volume of product to specification
Joint venture
A partnership between a domestic firm and a foreign firm or government
Strategic alliance
A partnership (possibly of traditional rivals) formed to create a competitive advantage on a worldwide basis
Direct Ownership
A situation in which a company owns subsidiaries or other facilities overseas
Multinational Enterprise
A firm that has operations or subsidiaries in many countries
Adjusting marketing mixes according to cultural, regional, and national differences
The development of marketing strategies that treat the entire world (or its major regions) as a single entity
-Includes standardization of products, promotion campaigns, prices, and distribution channels
-“Think globally, act locally”
Standardization of International Marketing
Easiest marketing mix variables to standardize
-Brand name
-Product characteristics

More difficult to standardize
-Media allocation
-Retail outlets
Effect of a Firm Having a Global Presence
Provides global competitive opportunities for creating value through
-adapting to local market differences
-exploiting economies of global scale and scope.
-acquiring optimal locations for activities and resources.
-maximizing the transfer of knowledge across locations.
Marketing Research
The systematic design, collection, interpretation, and reporting of information to help marketers solve specific marketing problems or take advantage of marketing opportunities
The Benefits of Marketing Research
-Helps firms stay in touch with customers’ changing attitudes and purchase patterns
-Aids in the development of marketing mixes that match the needs of customers
-Assists in better understanding of market opportunities
-Determine the feasibility of a particular marketing strategy
-Improves marketer’s ability to make decisions
Locating and Defining Problems or Research Issues
Focusing on uncovering the nature and boundaries of a situation or question related to marketing strategy or implementation
-Departures from normal or expected marketing results
-Biases in marketing information that distort its meaning
-Evidence of possible or potential market opportunities
Research Design
An overall plan for obtaining the information needed to address a research problem or issue
-An informed guess or assumption about a certain problem or set of circumstances
-Accepted or rejected hypotheses act as conclusions for the research effort
Exploratory Research
Research conducted to gather more information about a problem or to make a tentative hypothesis more specific
Descriptive Research
Research conducted to clarify the characteristics of certain phenomena to solve a particular problem
Causal Research
Research in which it is assumed that a particular variable X influences a variable Y
A condition existing when a research technique produces almost identical results in repeated trials
A condition existing when a research method measures what it is supposed to measure
Types of Research Data
-Primary data: data observed and recorded or collected directly from respondents
-Secondary data: data complied both inside and outside the organization for some purpose other than the current investigation
a limited number of units chosen to represent the characteristics of a total population
Types of Sampling
-Probability: each element has an known chance for study
-Random: each element has an equal chance for study
-Stratified: study population divided into like groups
-Nonprobability: element’s likelihood of study is unknown
-Quota: population is grouped and elements are arbitrarily chosen
all the elements, units, or individuals of interest to researchers for specific study
Survey Methods
-Mail Survey
-Telephone Survey
-Online Survey
-Personal Interview Survey
-In-home (door-to-door) interview
-Focus-group interview
-Telephone depth interview
-Shopping mall intercept interviews
Open-Ended Question
Type of Question:

What is your general opinion about coffee shops?
Dichotomous Question
Type of Question:

Have you ever purchased a coffee product?
Yes _____ No _____
Multiple-Choice Question
Type of Question:

What income group are you in?
$0-$19,000 _____
$20,000-$59,999 _____
$60,000-$99,000 _____
more than $100,000 _____
Observation Methods for Data Collection
-Direct contact with subject is avoided to reduce possible awareness of observation process.
-Physical conditions, subject actions, and demographics are noted.
-Observations may be combined with same subject interviews.
-Data gathered may be influenced by observer bias.
A research method that attempts to maintain (control) certain variables while measuring the effects of experimental (uncontrolled) variables
-Independent variable: acts on the dependent variable
-Dependent variable: is affected by variations in the independent variable
Statistical Interpretation
Analysis of survey data to determine what is typical or what deviates from the average that indicates:
-How widely the responses vary
-How the responses are distributed
-Which hypotheses are supported
-Which hypotheses are rejected
-Whether construction errors have invalidated the survey’s results
Reporting Research Findings
Take an objective look at survey findings
-Report deficiencies and reasons for deficiencies

Prepare a formal, written document
-Summary and recommendations: Short, clear, and simply expressed for executives
-Technical report: Contains more detailed information about research methods and procedures and important data gathered
Marketing Information Systems
A framework for the management and structuring of information gathered regularly from sources inside and outside an organization
A collection of information arranged for easy access and retrieval
Single-Source Data
Information provided by a single marketing research firm
Marketing Decision Support Systems
Customized computer software that aids marketing managers in decision making
-Capability to create market models based on changes in marketing variables
-Artificial Intelligence (AI) assists in customer support
International Issues in Marketing Research
Modification of data-gathering methods to account for regional differences

Use of two-pronged approach to international marketing research
-Detailed search for and analysis of secondary data
-Field research to refine firm’s understanding of how local environment will shape/restrict data-gathering about customer needs and preferences