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130 Cards in this Set

  • Front
  • Back
Target Market
*a specific group of customers on whom an organization focuses its marketing efforts
Market Research
*the systematic design, collection, interpretation, and reporting of information to help marketers solves specific marketing problems or take advantage of marketing opportunities
Marketing Mix
*Choices about product attributes, distribution strategy, communication strategy, and pricing strategy that a firm offers its targeted markets
Benefits of Marketing Research
-Helps firm 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
The Five Steps of the Marketing Research Process
1. Locating and defining issues or problems
2. Designing the research project
3. Collecting data
4. Interpreting research findings
5. Reporting research findings
Explanatory Research
*research conducted to gather more information about a problem or to make a tentative hypothesis more specific
Conclusive Research
*research designed to verify insights through objective procedures and to help marketers in making decisions
Descriptive Research
*research conducted to clarify the characteristics of certain phenomena to solve a particular problem
Experimental Research
*research that allows marketers to make causal inferences about relationships
Types of Research
-Explanatory Research
-Conclusive Research
-Descriptive Research
-Experimental Research
*a condition existing when a research technique produces almost identical results in repeated trials
*a condition exiting when a research method measures what it is supposed to measure
1. Locating and Defining Issues or Problems
*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
2. Designing the research project
*Research Design

-Accepted as conclusions for the research effort
Primary Data
*data observed and recorded or collected directly from respondents
*all the elements, units, or individuals of interest to researchers for specific study
*a limited number of units chosen to represent the characteristics of a total population
Types of Sampling
*each element has an known chance for study

*each element has an equal chance for study

*study population divided into like groups
*element’s likelihood of study is unknown
*population is grouped and elements are arbitrarily chosen
Survey Methods
-Mail Survey
-Telephone Survey
-Online Survey
-Personal Interview Survey
Types of Personal Interview Survey's
-In-home (door-to-door) interview
-Focus-group interview
-Customer advisory boards
-Telephone depth interview
-Shopping mall intercept interviews
Mail Survey
*Method of administering a survey that involves mailing questionnaires to participants
Telephone Survey
*A research method for collecting information by interviewing people over the telephone
Online Survey
*Survey conducted on the Internet, typically by having participants fill out a Web-based questionnaire
Personal Interview Survey
*Method of administering a questionnaire that involves face-to-face interaction with the participant
In-home (door-to-door) interview
*survey where the interviews are conducted in pre-selected areas involving knocking on the doors of homes to find qualified respondents
Focus-group interview
*A research method that brings together a small group of consumers to discuss the product or advertising, under the guidance of a trained interviewer
Customer advisory boards
*is a representative group of customers that meets periodically to offer advice on the product and company direction
Secondary Data
*data complied both inside and outside the organization for some purpose other than the current investigation
Internal Sources of Secondary Data
-Sales data, which may be broken down by geographic area, product type, or even type of customer

-Accounting information, such as costs, prices, and profits, by product category

-Competitive information gather by the sales force
External Sources of Secondary Data
-Government Sources
-Trade Associations and Shows
-Magazines, Newspapers, Video, Audio News Programming
-Corporate Information
Government Sources
examples- economic census, STAT-USA, National Technical Information Services
Trade Associations and Shows
examples- American Society of Association Executives, Directory of Associations, Tradeshow Week
Magazines, Newspapers, Video, Audio News Programming
examples- Blinkx, FindArticles.com, Google Video Search, Yahoo! Video Search
Corporate Information
example- Annual Report Service, Hoover’s Online, PR Newswire-press releases
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
4. Interpreting Research Findings
*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
5. Reporting Research Findings
-Take an objective look at survey findings
--Report faults and reasons for faults

-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
Requirements of a Market
-Must need or desire a particular product
-Must have the ability to purchase the product
-Must be willing to use their buying power to purchase the product
-Must have the authority to buy the product
Target Market Selection Process
1. Identify the appropriate targeting strategy
2. Determine which segmentation variables to use
3. Develop market segment profiles
4. Evaluate relevant market segments
5. Select specific target markets
Types of Markets
-Consumer Markets
-Business Markets
Consumer Markets
-Purchasers and individuals in households

-Purchases are for personal consumption, not profit
Business Markets
-Individuals and groups that purchase products for resale, direct use to produce other products, or use in daily business operations

-Purchasers can be categorized as producers, resellers, government, and institutional markets
Undifferentiated Target Strategy
*defining an entire (homogeneous) market for a particular product as the target market

-Designing a single marketing mix for, and directing it at the total market
Concentrated Target Strategy
*segmenting (dividing) the total market into groups with similar products needs (heterogeneous markets) to design marketing mixes that match those needs

-Focusing on a single market segment using one marketing mix
Differentiated Target Strategy
*targeting two or more segments by developing a marketing mix for each

-Aiming marketing mixes at more people may yield a competitive advantage
Segmentation Variables
*characteristics of individuals, groups, or organizations used to divide a market into segments

-Demographic Variables
-Geographic Variables
-Geo-demographic Segmentation
Geo-demographic Segmentation
*marketing segmentation that clusters people in zip code areas and smaller neighborhood units based on lifestyle and demographic information
Demographic Variables
*population characteristics- such as age, gender, race, ethnicity, income, education-that influence purchasing behavior
Geographic Variables
*customer product needs are influenced by climate, terrain, city, size, population density, and urban/rural areas
Market Density
*the number of potential customers within a unit of land area
*an approach to market segmentation in which organizations focus precise marketing efforts on very small geographic markets
Psychographic Variables
-Personality Characteristics
Personality Characteristics
*marketers appeal to positive/ favorable personal characteristics to influence the purchase decision
*Marketers use individuals’ differing purchase motives to segment a product market
*Marketers segment markets according to how individuals choose to spend their time in various activities, their income, their interest and opinions, and their education
Variables for Segmenting Business Markets
-Geographic Location
--Location affects the level of product demand

-Type of Organization
--Variations in firms’ characteristics leads to segmentation by type

-Customer Size
--Larger customers strongly influence how they are treated in the marketplace

-Product Use
--Firms use basic inputs in ways different from one another
Market Segment Profile
*describes the similarities among potential customers within a segment

-Covers demographic characteristics, geographic factors, benefits sought, lifestyles, brand preferences, and usage rates
Evaluate Relevant Market Segments: Market and Sales Potential
-Sales Estimates
--Market potential
--Company sales potential

-Measuring Sales Potential
--Breakdown approach: top-down analysis
--Build-Up approach: bottom-up analysis

-Competitive Assessment
--Who, how many, how large, and how strong?

-Cost Estimates
--The expense of developing a marketing mix
--Costs of reaching segment relative to competitors cost
Benefit Segmentation
*the division of a market according to benefits that customers want from the product

-Individuals purchase and use products that provide them with benefits that meet their needs
Effective segmentation by behavior requires
-Benefits sought must be identifiable

-Market must be divisible into recognizable segments using the benefits

-One or more segments must be accessible to the marketing effort
Sales Forecast
*the amount of a product a company expects to sell during a specific period at a specified level of marketing activities
Executive Judgment
*based on the intuition of the firm’s manager
Issues in Selecting a Target Market
-Do customers’ needs differ enough to warrant the use of market segmentation?

-In which market segment(s) should the firm participate?

-Does the firm have the resources and skills to compete effectively in the target market?
Line Extension
*development of a product that is closely related to existing products in the line but meets different customer needs

-Is la less expensive, low risk alternative
-May focus on the same or a new segment
-Can be used to counter competing products
-Many “new products” are really line extensions
Product Modification
*a change in one or more characteristics of the product and the elimination of the original product from the product line

-Product must be modifiable
-Customer must be able to perceive modification has been made
-Modified product more closely satisfies customers’ needs
Quality Modifications
-changes in material or production processes related to a product’s dependability and durability

-Reducing quality to offer a lower price to customers (think Wal-Mart)
-Increasing quality to gain a competitive advantage (Whole Foods)
Functional Modifications
*changes affecting a products versatility, effectiveness, convenience, or safety; usually requiring redesign of the product
Aesthetic Modifications
*changes to sensory appeal of a product such as altering taste, texture, sound, smell, or appearance
Product Mix
*the set of all products and items that a particular seller offers for sale to buyers
*a good, a service, or an idea received in an exchange

-It can be tangible (a good) or intangible (a service or an idea) or a combination of both
-It can include functional, social, and psychological utilities or benefits
-It includes the core product itself, its supplemental features, and its symbolic or experimental value
Consumer Product
*products pruchased to satisfy personal and family needs

Example: Old Spice Deodorant
Convience Products
*relatively inexpensive, frequently purchased items for which buyers exert minimal purchasing effort?

-Marketed through many retail outlets
-Relatively low per-unit gross margins
-Little promotional effort at the retail level
-Packaging is important marketing mix element

Example: Hot Pocket
Shopping Products
*items for which buyers are willing to expend considerable effort in planning and making purchases

-Expected to last a long time; less frequently
-Do not have brand loyalty appeal
-Require fewer retail outlets
-Inventory turnover is lower
-Gross Margins are higher
-More amendable to personal selling
-Supported (servicing and promting the product) by both the producer and channel members

Example: Office Furniture
Specialty Products
*items with unique characteristics that buyers are willing to expend considerable effort to obtain

-Are preselected by the consumer
-Have no close substitutes or alternatives
-Are available in a limited number of retail outlets
-Purchased infrequently and represent a significant and expensive investment
-Have high gross margins and low inventory turnover

Example: Expensive Car
Unsought products
*products purchased to solve a sudden problem, products of which the customers are unaware, and products that people do not necessarily think about buying

-Speed and problem resolution of the utmost importance
-Price and other features not considered
-No consideration of substitutes or alternatives
-Purchased infrequently

Example: Preparation H
Business Products
*products bought to use in an organization’s operations, to resell, or to make other products (raw materials and components)

-Raw Materials
-Component Parts
-Process Materials
-Business Services
Raw Materials
*basic natural materials that become part of a physical product such as ores, water, lumber, grains and eggs
Component Parts
*items that become part of the physical product

-Finished items ready for assembly
-Items needing little processing before assembly
-Computer chips, engine blocks, girders, and paints
Process Materials
*materials that are not readily identifiable when used directly in the production of other products such as screws, knobs, and handles
Business Services
*the intangible products that many organizations use in their operations such as cleaning, legal, consulting, and repair service
Product Item
*a specific version of a product that can be designated as a distinct offering among a firm’s products
Product Line
*a group of closely related product items views as a unit because of marketing, technical, or end-use considerations
Product Mix
*total group of products that an organization makes available to customers

-Width of Product Mix: the number of product lines a company offers

-Depth (Length) of Product Mix: the average number of different products in each product line
Product Life Cycle
*the progression of a product through four stages: introduction, growth, maturity, and decline
*the initial stage of a product’s life cycle—its first appearance in the marketplace—when sales start at zero and profits are negative
*the stage of a product’s life cycle when sales rise rapidly and profits reach a peak and then start to decline

-More competitors enter the market
-Product pricing is aggressive
-Brand loyalty becomes important
-Gaps in market coverage are filled
-Promotion expenditures moderate
-Production efficiencies lower costs
*the stage of a product’s life cycle when the sales cure peaks and starts to decline and profits continue to fall

-Intense competition
-Emphasis on improvements and difference in competitors’ products
-Weaker competitors lose interest and exit the market
-Advertising and dealer-oriented promotions predominate
-Distribution sometimes expands to global market

-Strategic Objectives for Maturity Stage
--Generate Cash Flow
--Maintain Market Share
--Increase Share of Customer
*the stage of a product’s life cycle when sales fall rapidly

-Pruning items from the product line
-Cutting promotion expenditures
-Eliminating marginal distributors
-Planning to phase out the product
Production Adoption Process
*the stages buyers go through in accepting a product
Categories of Product Adopters
Innovators: first adopters of new products

Early adopters: careful choosers of new products

Early majority: those adopting new products just before the average person

Late Majority: skeptics who adopt new products when they feel it is necessary

Laggards: the last adopters, who distrust new products
first adopters of new products
Early adopters
careful choosers of new products
Early majority
those adopting new products just before the average person
Late Majority
*skeptics who adopt new products when they feel it is necessary
*the last adopters, who distrust new products
*a name, term design, symbol, or any other feature that identifies one marketer’s product as distinct from those of other marketers

-One item, family of items, or all items of a seller
--Corvette, Chevrolet, General Motors
Brand Name
*the part of a brand that can be spoken

-Words, letters, numbers
--Union 76, NBA, 49’ers
Brand Mark
*the part of a brand not made up of words

-Symbols or designs
--Nike Swoosh, Mercedes Star, McDonald’s Arches
*a legal design of exclusive use of a brand

-Coca-Cola ®, Hewlett-Packard ®
Trade Name
*full legal name of an organization

-American Telephone and Telegraph Corporation (AT&T)
Brand Equity
*the marketing and financial value associated with a brand’s strength in a market

-Brand Loyalty
-Brand Recognition
-Brand Preference
-Brand Insistence
Brand Loyalty
*a customer’s favorable attitude toward a specific brand
Brand Recognition
*a customer’s awareness that a brand exists and is an alternative purchase
Brand Preference
*the degree of brand loyalty in which a customer prefers on brand over competitive offerings

-Axe Bodywash
Brand Insistence
*the degree of brand loyalty in which a customer strongly prefers a specific brand and will accept no substitute

-Abercrombie for me
Product Differentiation
*creating and designing products so that customers perceive them as different from competing products
Product Quality
*the overall characteristics of a product that allow it to perform as expected in satisfying customer needs

-Level of quality is the relative amount of quality a product possesses
-Consistency of quality is the degree to which a product has the same level of quality over time
Product Design
*how a product is conceived, planned, and produced

-Good design provides a strong competitive advantage
-Customers typically desire products with good designs and that function well
Customer Services
*human or mechanical efforts or activities that add value to a product

-Delivery and installation, financing, customer training, warranties and guarantees, repairs, online product information
-A competitive advantage when all other products features are equally matched by competitors
Product Positioning
*creating and maintaining a certain concept of a product in customers’ mind

-A product’s position results from customers’ perceptions of a product’s attributes relative to those of competing products
-Marketers emphasize characteristics most desired by the target market in advertising
Perceptual Mapping
*bases for positioning; show marketers how closely products are conceptually positioned by consumers to “ideal points” to their own products, and to competitors’ products
Repositioning a Product
*adjusting a product’s present position can strengthen/increase its market share and profitability

-Repositioning is accomplished by changing the product’s features, price, distribution, or image
-Adding new products to the line may neccessitate the repositioning of older products
Product Deletion
*the process of eliminating a product from the product mix

Reasons to remove a product:
-Slow sales create higher unit-prouction costs, inventory costs, and distribution costs
-To prevent negative feelings from affecting the company’s other products
*an intangible product involving a deed, performance, or effort that cannot be physically possessed

-Application of human and/or mechanical efforts directed at people or objects
New Product Development
1. Idea Generation
2. Screening
3. Concept Testing
4. Business Analysis
5. Product Development
6. Test Marketing
7. Commercialization
Idea Generation
*seeking product ideas to achieve objectives

-Internal sources: marketing managers, researchers, sales personnel, and engineers
-External sources: customers, competitors, advertising agencies, consultants, and new-product alliances
*(Idea) Screening: choosing the most promising ideas for further review

-Concerns about cannibalization of existing products
-Company capabilities to produce and market the product
-Nature and wants of buyers
Concept Testing
*seeking potential buyers’ responses to a product idea

-Low cost determination for initial reaction to product idea
-Identification of important product attributes and benefits
Business Analysis
*assessing the potential of a product idea for firm’s sales, costs, and profits

-Does product fit in with existing product mix?
-Is demand strong enough to enter the market?
-How will introducing the product change the market?
-Is the firm capable of developing the product?
-What are the costs for developing and marketing?
*A replica of a product as it will be manufactured, which may include such details as color, graphics, packaging and instructions
Product Development
*determining if producing a product is feasible and cost effective

-Construction of a prototype, or working model
-Testing of the prototype’s overall functionality
-Determining the level of product quality
-Branding, packaging, labeling, pricing, and promotion decision
Test Marketing
*introducing a product on a limited basis to measure the extent to which potential customers will actually buy it

-Sample launch of entire marketing mix
-Lessens risk of larger market failure
-Is expensive; simulated test marketing is an alternative
*deciding on full-scale manufacturing and marketing plans and preparing budgets

-Modifications indicated by the test marketing are incorporated into the production design.
-Marketing, distribution, and servicing plans are finalized
-Product roll-out occurs in stages to lessen the risk of introducing the new product