Marketing Chapter 5

Front 1

Consumer behavior

Back 1

the actions a person takes in purchasing and using products and services, including the mental and social processes that come before and after these actions

Front 2

purchase decision process

Back 2

the stagges a buyer passes through in making choices about which products and services to buy

Front 3

evaluative criteria

Back 3

represent both the objective attributes of a brand and the subjective ones you use to compare different products and brands.

Front 4

consideration set

Back 4

the group of brands that a consumer would consider acceptable from among all the brands of which he or she is aware in the product class

Front 5

cognitive dissonance

Back 5

postpurchase psychological tension or anxiety

Front 6

involvement

Back 6

the personal, social, and economic significance of the purchase to the consumer

Front 7

situational influences

Back 7

an impact on the purchase decision process: the purchase task, social surroundings, physical surroudings, temporal effects and antecedent states

Front 8

motivation

Back 8

the energizing force that stimulates behavior to satisfy a need

Front 9

personality

Back 9

a person's consistent behaviors or responses to recurring situations

Front 10

self-concept

Back 10

the way people see themselves and the way they believe others see them

Front 11

perception

Back 11

the process by which an individual selects, organizes, and interprets information to create a meaningful picture of the world

Front 12

subliminal perception

Back 12

you see or hear messages without being aware of them

Front 13

perceived risk

Back 13

the anxiety felt because the consumer cannot anticipate the outcomes of a purchase but believes there may be negative consequences.

Front 14

brand loyalty

Back 14

a favorable attitude toward and consistent purchase of a single brand over time

Front 15

attitude

Back 15

a learned predisposistion to respond to an object or class of objects in a consistently favorable or unfavorable way

Front 16

beliefs

Back 16

a consumer's subjective perception of how a product or brand performs on different attributes.

Front 17

lifestyle

Back 17

a mode of living that is identified by how people spend their time and resources, what they consider important in their environment, and what they think if themselves and the world around them

Front 18

opinion leaders

Back 18

individuals who exert direct or indirect social influence over others

Front 19

word of mouth

Back 19

influencing of people during conversation

Front 20

reference group

Back 20

peoople to whom an individual looks as a basis for self appraisal or as a source of personal standards

Front 21

consumer socialization

Back 21

the process by which people acquire the skills, knowledge, and attitudes necessary to function as consumers

Front 22

family life cycle

Back 22

describes the dinstinct phases that a family progresses through from formation to retirement, each phase bringing with it identifiable purchasing behavior

Front 23

social class

Back 23

the relatively permanent, homogeneous divisions in a society into which people sharing similar values, interests, and behavior can be grouped

Front 24

subcultures

Back 24

subgroups within the larger, or national, culture with unique values, ideas and attitudes

Front 25

describe the stages in the consumer purchase decision process

Back 25

The consumer purchase decision process consists of five stages. They are problem recognition, information search, alternative evaluation, purchase decision, and postpurchase behavior. Problem recognition is perceiving a difference between a person's ideal and actual situation big enough to trigger a decision. Information search involves remembering previous purchase experiences (internal search) and external search behavior such as seeking information from other sources. Alternative evaluation clarifies the problem for the consumer by (a) suggesting the evaluative criteria to use for the purchase, (b) yielding brand names that might meet the criteria, and (c) developing consumer value perceptions. The purchase decision involves the choice of an alternative, including from whom to buy and when to buy. Postpurchase behavior involves the comparison of the chosen alternative with a consumer's expectations, which leads to satisfaction or dissatisfaction and subsequent purchase behavior.

Front 26

distinguish among three variations of the consumer purchase decision process: routine, limited, and extended problem solving

Back 26

Consumers don't always engage in the five-stage purchase decision process. Instead, they skip or minimize one or more stages depending on the level of involvement—the personal, social, and economic significance of the purchase. For low-involvement purchase occasions, consumers engage in routine problem solving. They recognize a problem, make a decision, and spend little effort seeking external information and evaluating alternatives. For high-involvement purchase occasions, each of the five stages of the consumer purchase decision process is used, including considerable time and effort on external information search and in identifying and evaluating alternatives. With limited problem solving, consumers typically seek some information or rely on a friend to help them evaluate alternatives.

Front 27

identify major psychological influences on consumer behavior

Back 27

Psychology helps marketers understand why and how consumers behave as they do. In particular, psychological concepts such as motivation and personality; perception; learning; values, beliefs, and attitudes; and lifestyle are useful for interpreting buying processes. Motivation is the energizing force that stimulates behavior to satisfy a need. Personality refers to a person's consistent behaviors or responses to recurring situations. Perception is the process by which an individual selects, organizes, and interprets information to create a meaningful picture of the world. Consumers filter information through selective exposure, comprehension, and retention.
Much consumer behavior is learned. Learning refers to those behaviors that result from (a) repeated experience and (b) reasoning. Brand loyalty results from learning. Values, beliefs, and attitudes are also learned and influence how consumers evaluate products, services, and brands. A more general concept is lifestyle. Lifestyle, also called psychographics, combines psychology and demographics and focuses on how people spend their time and resources, what they consider important in their environment, and what they think of themselves and the world around them.

Front 28

identify the major sociocultural influences on consumer behavior

Back 28

Sociocultural influences, which evolve from a consumer's formal and informal relationships with other people, also affect consumer behavior. These involve personal influence, reference groups, the family, social class, culture, and subculture. Opinion leadership and word-of-mouth behavior are two major sources of personal influence on consumer behavior. Reference groups are people to whom an individual looks as a basis for self-approval or as a source of personal standards. Family influences on consumer behavior result from three sources: consumer socialization, passage through the family life cycle, and decision making within the family or household. A more subtle influence on consumer behavior than direct contact with others is the social class to which people belong. Persons within social classes tend to exhibit common values, attitudes, beliefs, lifestyles, and buying behaviors. Finally, a person's culture and subculture have been shown to influence product preferences and buying patterns.

Front 29

What is the first stage in the consumer purchase decision process?

Back 29

problem recognition. perceiving a difference between a person's ideal and actual situations big enough to trigger a decision

Front 30

The brands a consumer considers buying out of the set of brands in a product class of which the consumer is aware is called the

Back 30

consideration set

Front 31

What is the term for postpurchase anxiety?

Back 31

cognitive dissonance

Front 32

The problem with the Toro snow pup was an example of selective ________

Back 32

comprehension

Front 33

What 3 attitude-change approaces are most common?

Back 33

changing beliefs about the extent to which a brand has certain attributes, changing the perceived importance of attributes and adding new attributes to the product

Front 34

What does lifestyle mean?

Back 34

A mode of living that is identified by how people spend their time and resources, which they consider important in their environment, and what they think of themselves and the world around them

Front 35

What are the 2 primary forms of personal influence?

Back 35

opinion leadership and word of mouth activity

Front 36

Marketers are concerned with which types of reference groups?

Back 36

membership, aspiration and dissociative groups

Front 37

What 2 challenges must marketers overcome when marketing to Hispanics?

Back 37

The hispanic subculture. cultural differences amonth these nationalities often affect product preferences, second, language barriers exist

Front 38

Business marketing

Back 38

the marketing of goods and services to companies, governments, or not-for-profit organizations for use in the creation of goods and services that they can produce and market to others.

Front 39

Organizational buyers

Back 39

the manufacturers, wholesalers, retailers, and government agencies that buy goods and services for their own use or for resale.

Front 40

North American Industry Classification System (NAICS)

Back 40

provides common industry definitions for Canada, Mexico, and the United States which makes it easier to measure economic activity in the three member countries of the (NAFTA).

Front 41

Derived demand

Back 41

the demand for industrial products and services is driven by, or derived from, demand for consumer products and services.

Front 42

Organizational buying criteria

Back 42

the objective attributes of the supplier's products and services and the capabilities of the supplier itself.

Front 43

ISO 9000

Back 43

refer to standards for registration and certification of a manufacturer's quality management and assurance system based on an on-site audit of practices and procedure.

Front 44

supplier development

Back 44

involves the deliberate effort by organizational buyers to build relationships that shape suppliers' products, services, and capabilities to fit a buyer's needs and those of its customers.

Front 45

reciprocity

Back 45

an industrial buying practice in which two organizations agree to purchase each other's products and services.

Front 46

supply partnership

Back 46

exists when a buyer and its supplier adopt mutually beneficial objectives, policies, and procedures for the purpose of lowering the cost or increasing the value of products and services delivered to the ultimate consumer.

Front 47

buying center

Back 47

share common goals, risks, and knowledge important to a purchase decision.

Front 48

buy classes

Back 48

3 types of buying situations. straight rebuy, new buy, and modified rebuy

Front 49

organizational buying behavior

Back 49

the decision making process that organizations use to establish the need for products and services and identify, evaluate, and choose among alternative brands and suppliers.

Front 50

make-buy decision

Back 50

an evaluation of whether components and assemblies will be purchased from outside suppliers or built by the company itself

Front 51

value analysis

Back 51

a systematic appraisal of design, quality, and performance of a product to reduce purchasing costs.

Front 52

bidder's list

Back 52

a list of firms believed to be qualified to supply a given item

Front 53

e-marketplaces

Back 53

online trading communities that bring together buyers and supplier organizations.

Front 54

traditional auction

Back 54

a seller puts an item up for sale and would-be buyers are invited to bid in competition with each other.

Front 55

reverse auction

Back 55

a buyer communicates a need for a product or service and would-be suppliers are invited to bid in competition with each other.

Front 56

What are 3 main types of organizational buyers?

Back 56

industrial, reseller, and government

Front 57

What one department is almost always represented by a person in the buying center?

Back 57

A buyer or purchasing manager.

Front 58

In general, what type of online auction creates upward pressure on bid prices and which type creates downward pressure on bid prices?

Back 58

traditional auction creates upward and reverse auction creates downward

Front 59

Distinguish among industrial, reseller, and government organizational markets.

Back 59

There are three different organizational markets: industrial, reseller, and government. Industrial firms in some way reprocess a product or service they buy before selling it to the next buyer. Resellers—wholesalers and retailers—buy physical products and resell them again without any reprocessing. Government agencies, at the federal, state, and local levels, buy goods and services for the constituents they serve. The North American Industry Classification System (NAICS) provides common industry definitions for Canada, Mexico, and the United States, which facilitates the measurement of economic activity for these three organizational markets.

Front 60

Describe the key characteristics of organizational buying that make it different from consumer buying

Back 60

Seven major characteristics of organizational buying make it different from consumer buying. These include demand characteristics, size of the order or purchase, number of potential buyers, buying objectives, buying criteria, buyer–seller relationships and supply partnerships, and multiple buying influences within organizations. The organizational buying process itself is more formalized, more individuals are involved, supplier capability is more important, and the postpurchase evaluation behavior often includes performance of the supplier and the item purchased. Figure 6–4 details how the purchase of a smart phone differs between a consumer and organizational purchase. The example describing the purchase of machine vision systems by an industrial firm illustrates this process in greater depth.

Front 61

Explain how buying centers and buying situations influence organizational purchasing.

Back 61

Buying centers and buying situations have an important influence on organizational purchasing. A buying center consists of a group of individuals who share common goals, risks, and knowledge important to a purchase decision. A buyer or purchasing manager is almost always a member of a buying center. However, other individuals may affect organizational purchasing due to their unique roles in a purchase decision. Five specific roles that a person may play in a buying center include users, influencers, buyers, deciders, and gatekeepers. The specific buying situation will influence the number of people in and the different roles played in a buying center. For a routine reorder of an item—a straight rebuy situation—a purchasing manager or buyer will typically act alone in making a purchasing decision. When an organization is a first-time purchaser of a product or service—a new buy situation—a buying center is enlarged and all five roles in a buying center often emerge. A modified rebuy buying situation lies between these two extremes. Figure 6–3 offers additional insights into how buying centers and buying situations influence organization purchasing.

Front 62

Recognize the importance and nature of online buying in industrial, reseller, and government organizational markets.

Back 62

Organizations dwarf consumers in terms of online transactions made and purchase volume. Online buying in organizational markets is popular for three reasons. First, organizational buyers depend on timely supplier information that describes product availability, technical specifications, application uses, price, and delivery schedules. This information can be conveyed quickly via Internet technology. Second, this technology substantially reduces buyer order processing costs. Third, business marketers have found that Internet technology can reduce marketing costs, particularly sales and advertising expense, and broaden their customer base. Two developments in online buying have been the creation of e-marketplaces and online auctions. E-marketplaces provide a technology trading platform and a centralized market for buyer–seller transactions and make possible the real-time exchange of information, money, products, and services. These e-marketplaces can be independent trading communities, such as PlasticsNet, or private exchanges such as the Global Healthcare Exchange. Online traditional and reverse auctions represent a second major development. With traditional auctions, the highest-priced bidder "wins." Conversely, the lowest-priced bidder "wins" with reverse auctions.

Front 63

countertrade

Back 63

the practice of using barter rather than money for making global sales

Front 64

gross domestic product

Back 64

the monetary value of all goods and services produced in a country during one year

Front 65

balance of trade

Back 65

the difference between the monetary value of a nation's exports and imports

Front 66

Economic Espionage Act 1996

Back 66

makes the theft of trade secrets by foreign entities a federal crime in the US

Front 67

protectionism

Back 67

the practice of shielding one or more industries within a country's economy from foreign competition through the use of tariffs or quotas.

Front 68

tariffs

Back 68

a government tax on goods or services entering a country, primarily serve to raise prices on imports.

Front 69

quota

Back 69

a restriction placed on the amount of a product allowed to enter or leave a country

Front 70

World Trade Organization

Back 70

an organization formed by major industrialized nations to address an array of world trade issues

Front 71

global competition

Back 71

exists when firms originate, produce, and market their products and services worldwide

Front 72

strategic alliances

Back 72

agreements among two or more independent firms to cooperate for the purpose of achieving a common goals such as a competitive advantage or customer value creation

Front 73

multidomestic marketing strategy

Back 73

means that they have as many different product variations, brand names, and advertising programs as countries in which they do business

Front 74

global marketing strategy

Back 74

the practice of standardizing marketing activities when there are cultural similarities and adapting them when cultures differ

Front 75

global brand

Back 75

a brand marketed under the same name in multiple countries with similar and centrally coordinated marketing programs

Front 76

global consumers

Back 76

consist of consumer groups living in many countries or regions of the world who have similar needs or seek similar features and benefits from products or services

Front 77

cross cultural analysis

Back 77

involves the study of similarities and differences among consumers in two or more nations or societies

Front 78

values

Back 78

represent personally or socially preferable modes of conduct or states of existence that tend to persist over time

Front 79

customs

Back 79

what is considered normal and expected about the way people do things in a specific country

Front 80

Foreign Corrupt Practices Act 1977

Back 80

these acts make it a crime for US corporations to bribe an official of a foreign government or political party to obtain or retain business in a foreign country

Front 81

cultural symbols

Back 81

things that represent ideas and concepts

Front 82

semiotics

Back 82

a field of study that examines the correspondence between symbols and their role in the assignment of meaning for people

Front 83

back translation

Back 83

where a translated word or phrase is retranslated into the original language by a different interpreter to catch errors

Front 84

consumer ethnocentrism

Back 84

the tendency to believe that it is inappropriate to purchase foreign-made products

Front 85

bottom of the pyramid

Back 85

the largest but poorest socioeconomic group of people in the world

Front 86

microfinance

Back 86

the practice of offering small, collateral free loans to individuals who otherwise would not have access to the capital necessary to begin small businesses or other income generating activities

Front 87

currency exchange rate

Back 87

the price of one country's currency expressed in terms of another country's currency

Front 88

when foreign currencies can by more US dollars are US product more or less expensive for a foreign consumer?

Back 88

less expensive

Front 89

what is the trade feedback effect?

Back 89

imports affect exports and vice versa

Front 90

Describe the nature and scope of world trade from a global perspective and its implications for the United States

Back 90

A global perspective on world trade views exports and imports as complementary economic flows: A country's imports affect its exports and exports affect its imports. World trade flows to and from the United States reflect demand and supply interdependencies for goods among nations and industries. The four largest importers of U.S. goods and services are Canada, China, Mexico, and Japan. The four largest exporters to the United States are Canada, China, Mexico, and Japan. The United States imports more goods than it exports.

Front 91

Identify the major trends that have influenced the landscape of global marketing in the past decade.

Back 91

Four major trends have influenced the landscape of global marketing in the past decade. First, there has been a gradual decline of economic protectionism by individual countries, leading to a reduction in tariffs and quotas. Second, there is growing economic integration and free trade among nations, reflected in the creation of the European Union and the North American Free Trade Agreement. Third, there exists global competition among global companies for global consumers, resulting in firms adopting global marketing strategies and promoting global brands. And finally, a networked global marketspace has emerged using Internet technology as a tool for exchanging goods, services, and information on a global scale.

Front 92

Identify the environmental forces that shape global marketing efforts.

Back 92

Three major environmental forces shape global marketing efforts. First, there are cultural forces, including values, customs, cultural symbols, and language. Economic forces also shape global marketing efforts. These include a country's stage of economic development and economic infrastructure, consumer income and purchasing power, and currency exchange rates. Finally, political-regulatory forces in a country or region of the world create a favorable or unfavorable climate for global marketing efforts.

Front 93

Name and describe the alternative approaches companies use to enter global markets.

Back 93

Companies have four alternative approaches for entering global markets. These are exporting, licensing, joint venture, and direct investment. Exporting involves producing goods in one country and selling them in another country. Under licensing, a company offers the right to a trademark, patent, trade secret, or similarly valued items of intellectual property in return for a royalty or fee. In a joint venture, a foreign company and a local firm invest together to create a local business. Direct investment entails a domestic firm actually investing in and owning a foreign subsidiary or division.

Front 94

Explain the distinction between standardization and customization when companies craft worldwide marketing programs

Back 94

Companies distinguish between standardization and customization when crafting worldwide marketing programs. Standardization means that all elements of the marketing program are the same across countries and cultures. Customization means that one or more elements of the marketing program are adapted to meet the needs or preferences of consumers in a particular country or culture. Global marketers apply a simple rule when crafting worldwide marketing programs: Standardize marketing programs whenever possible and customize them wherever necessary.

Front 95

What variables influence why some companies and industries in a country succeed globally while others lose ground or fail?

Back 95

factor conditions, demand conditions, related and supporting industries and company strategy, structure, and rivalry