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138 Cards in this Set

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keys to using marketing theory

-elasticity of demand


-differentiation


-segmentation


-relationships


-commitment

Pure subsistence economy

each family unit produces everything it consumes



customer satisfaction

the extent to which a firm fulfills consumer needs, desires, and expectation

economies of scale

as a company produces larger numbers of a particular product the cost for each of these products goes down

marketing ethics

the moral standards that guide marketing decisions and actions

universal functions of marketing

buying, selling, transporting, storing, standardizing and grading, financing, risk taking, and market information

competitive environment

the number and types of computers the marketing manager must face, and how they may behave

discretioanry income

what is left of disposable income after paying for necessitates

disposable income

income that is left after taxes

task utility

provided when someone performs a task for someone else and for instance when a bank handles financial transactions

form utility

provided when someone produces something tangible

time utility

having the product available when the customer wants it

place utility

having the product available where the customer wants it

possession ( ownership) utility

obtaining a good or service and having the right to use or consume it

simple trade era

a time when families traded or sold their surplus output to local middlemen who resold these goods to other consumers or distant middlemen

production era

a time when a company focuses on production of a few specific products and perhaps because few of these products are available in the market

production orientation

making whatever products are easy to produce and then trying to sell them

sales era

a time when a company emphasizes selling because of increased competition

marketing orientation

trying to carry out the marketing concept that maintains a philosophy of customer satisfaction

marketing concept

the idea that an organization should aim all its efforts at satisfying its customers at a profit

relationship era

the current marketing era that emphasizes developing loyal customers

social media era

current day marketing that utilizes social media technology to develop markets through instant and frequent communication with targeted data base customer groups

social responsibility

a firms obligation to improve its positive effects on society and reduce its negative effects

competitive advantage

a firm has a marketing mix that the target markets sees as better than a competitors mix

marketing mix

the controllable variables that the company puts together to satisfy a target group AND INCLUDES product, place, price, and promotion

marketing strategy

specifies a target market and a related marking mix

target market

a fairly homogeneous group of customers to whom a company wishes to appeal

target marketing

a marketing mix is tailored to fit some specific target customers

mass marketing

the typical production oriented approach that vaguely aims at everyone with the same marketing mix

mass selling

communicating with large numbers of potential customers at the same time

market penetration

trying to increase sales of a firms present products in its present markets probably through a more aggressive marketing mix

market development

trying to increase sales by selling present products in new markets

product development

offering new or improved products for present markets

diversification

moving into totally different lines of business perhaps entirely unfamiliar products, markets, or even levels in the production marketing system

SWOT analysis

identifies and lists the firms strengths and weaknesses and its opportunities and threats

positioning

an approach that refers to how customers think about proposed and or present brands in a market

market

a group of potential customers with similar needs who are willing to exchange something of value with sellers offering various goods or services that satisfy customer needs

market segment

a relatively homogenous group of customers who will respond to a marketing mix in a similar way

market segmentation

a two step process of naming broad markets and segmenting these broad markets in order to select target markets and develop suitable marketing mixes

differentiation

the marketing mix is distinct from ( unique form) and better than whats available from a competitor

customer value

the difference between the benefits a customer sees from a market offering and the costs of obtaining those benefits

economic buyers

people who know all the facts and logically compare choices in terms of cost and value received to get the greatest satisfaction from spending their time and money

low involvement purchases

purchases that have little importance or relevance for the customer

high involvement purchases

purchases that are more conspicuous and have greater social and ego value and risk from their consumption

routinized response behavior

when consumers regularly select a particular way of satisfying a need when it occurs

limited problem solving

when a consumer is willing to put some effort into deciding the best way to satisfy a need

extensive problem solving

the type of problem solving consumers use for a completely new or important need and when they put much effort into deciding how to satisfy it

dissonance

tension caused by uncertainty about the rightness of a decision

needs

the basic forces that motivate a person to do something

wants

needs that are learned during a persons life

expectation

an outcome or event that a person anticipates or looks forward to

learning

a change in thought process caused by prior experience

drive

a strong stimulus that encourages action to reduce a need

cues

products, signs, ads and other stimuli in the environment

reinforcement

occurs in the learning process when a response is followed by satisfaction and a reduction in the drive

opinion leader

a person who influences others

reference group

the people to whom an individual looks when forming attitudes about a particular topic

social class

a group of people who have approximately equal social position as viewed by other in the society

social needs

needs conceded with love, friendship, status, and esteem and things that involve interaction with others

empty nestes

people whose children are grown and who are now able to spend their money in other ways

senior citizens

people over 65

millenial

generational consumers born after 1990 and ver progressive and technological savvy

perception

how we gather and interpret information from the world around us

selective perception

people screen out or modify ideas, messages, and information that conflict with previously learned attitudes and beliefs

physiological needs

biological needs such as the need for food, drink, rest, and sex. Also called psychogenic needs

attitude

a point of view toward something

belief

a persons opinion about something

keys to using marketing theory

-elasticity of demand


-differentiation


-segmentation


-relationships


-commitment

demand curves


perfect elasticity

-undifferentiated market


-pure competition


-standardization


(P X Q= total revenue)


-horizontal line

demand curves


perfect inelasticity

-unique product market


-monopoly


-differentiation/ uniqueness


p X Q =TR


line goes straight up and down

demand curve shifts right


expansion benefits

-revenue personal income


-GDP


-GNP


-economic growth

brands role in demand

-perfect inelasticity= complete control


-perfect elasticity- no control


-F= (differentiation, segmentation)


want to move slope from 9 to 12




-imperfect competition: differentiated markets

demand curve


marketing magic

-change location ( develop markets)


-change slope ( create preferences, repeat business)


-benefit consciousness (differentiation)




marketing effect shifts demand curve to the right

broad market divisions

-lower interests market=16%


-Mass market = 68%


-Higher interest market=16%




relevance in mass market segment




initial strategy: market penetration

six universal questions

who


what


why


when


where


how




relevance= when where and how

categories of adopters based on relative times of adoption

-consumer innovators 2.5%


-early adopters 13.5%


-early majority 34%(white collar)


-late majority 34%(blue collar)


-laggards 16%

marketing tasks/ objectives

-AIDA


-gain attention


-develop interest


-create desire


-gain action

marketing messages

-encoder ( source)


-decoder ( receiver)


-benefits= functional, emotional, self enhancement


-consumers buy benefits- not products!

marketing changing role


simple trade era

focus- sell surplus


surplus exchange



production era

focus increase supply


manufacturer centric

sales era

focus beat competition


marketing deceit

marketing era

focus coordinate and control


marketing concept

relationship era

focus long run customer satisfaction


customer loyalty



social media era

focus life style access/customer development


frequent reinforcement

the marketing concept

-guiding ideology, people first


total company effort->profit->customer satisfaction

utility and marketing


utility

-value that comes from satisfying human needs(utility definition)


-customer centric


-create value


-value added approach

from production and from marketing

production


-form


-task




from marketing


-time


-place


-possession

classification of markets

1. business ( commercial) market


-business to business (B-2-B)




2.consumer ( household) markets


-B-2-C

consumer purchasing criteria


red zone

-1-4 frequency


-consuming period=quick


-price to consume= low price under 5


-consumer knowledge= considerable


-problem solving= routine


-information seeking=limited none




usually groceries

yellow zone

-purchase frequency is from 4-6


-consuming period is4-6


-price to consume 5-100


-consumer knowledge 4-6


-problem solving 4-6


-information seeking 4-6




apparel

blue zone

-purchase frequency= infrequent


-consuming period=delayed


-price to consume- higher price over 100


-consumer knowledge- limited


-problem solving= extended


-information seeking= extensive




appliances

marketing facilitates production and consumption


production sector

-specialization and division of labor= heterogeneous supply capabilities



production sector downwards


left side of graph



-economies of scale


discrepancies of quantity




-goes to adjustment




- discrepancies of assortment


single product households

right side of graph

-spatial separation


-sparation in time


-separation of information


-separation in values


-separation of ownership

consumption sector

heterogeneous demand for form, task, time, place, and possession utility

marketing strategy planning


marketing strategy

marketing mix and target market


product and price

marketing strategy and planning


marketing concept

customer satisfaction and total company effort


place and promotion

elements of marketing mix within an environmental framework




marketing environment uncontrollable/limiting

-political legal(laws)


-economy (inflation, recession)


-competition ( opponent)


-technological ( production)


-social-cultural ( attitudes)


(PECTS)

controllable

product, pricing, promotion, distribution

target marketing strategies

-undifferentiated marketing- normally in red zone ( elastic demand)


-differentiated marketing- more common in yellow/blue zone


-concentrated ( niche) marketing


-micro marketing

customer value reflects benefits and costs


customer value

customer value concerns the difference between the benefits a customer sees from a firms market offering and the costs of obtaining those benefits




-expectations


what is the outcome of purchasing


VALUE GAP- the difference between expected benefits and actual costs

summary overview he wrote


customer value reflects benefits and costs


customer value

customer value is the difference between the benefits a customer sees from a marketing offering and the costs of obtaining those benefits. the customer is likely to be more satisfied when the value is higher-- when benefit exceed costs by a larger margin. On the other hand, a customer who sees the costs as greater than the benefits isn't likely to become a cusomter

summary overview


one complication

one complication is that different customers may see the benefits and costs in different ways. That makes it difficult to satisfy everyone with one offering

summer review competition and customer value

-customer point of view


to better understand what it takes to satisfy a customer, its useful to take the customer point of view. they have choices about how to meet their needs. So a firm that offers superior customer value is likely to win and keep customers. This is expescially important when what different firms have to offer is very similar

summary overview


customer value reflects benefits and costs

customer value is the difference between the benefits a customer sees from a market offering and the costs of obtaining those benefits

consumer value and price

value= F( perceived benefits, Price)


exceed customer expectations!


value- perceived benefits/price




walmarts practice: accentuate customer value

supply chain channel


suppliers

raw material to parts suppliers

demand suppliers

manufacturer

demanders

trades resellers to consumers

supply chain channel

wholesale retail and business households




(form+task utility) + ( time + place + ownership utility) = value added

directive strategic question

1. where are we now- what is our situation?


2. where do we want to go?


- Business(es) we want to be in.


-market positions we want to stake out buyer needs and segments we want to serve


-outcomes we want to achieve


3. how will we get there?

broad market types

1. homogenous ( undifferentiated) markets


2. heterogeneous ( differentiated) markets

types of strategic opportunities


four basic strategies

-market condition left, product conditions on top


-Present markets and new markets on market conditions


-present products and new products on product conditions


-1st square market penetration


-2nd market development ( 1st top left, 2nd bottom left)


3rd ( top right) product development


4th diversification

classifying product offering


consumer goods

those products meant for final consumers (household users)

industrial goods

those products meant for producing other products or making profits


( profit- oriented users)

the learning process model

1. drive


2. cues


3. response


-between cues and response is a black box ( response back to cues is reinforcement)


in the black box are needs, wants, and expectations

hierarchy of needs

-personal needs


-ego and social needs


-safety needs


-physiological needs

levels of problem solving


routinized response behavior


red

-low involvement, frequently purchased, inexpensive, little risk, little information needed


-buyer experience factor= considerable


-involvement continuum= low involvement


-buyer brand commitment = high

levels of problem solving


limited problem solving


yellow

in the middle

levels of problem solving


extensive problem solving


blue

-high involvement, infrequently purchased, expensive, high risk, much information needed


-buyer experience factor= limited


-involvement continuum = high involvement


-buyer brand commitment = low

the adoption process

-awareness ( between awareness and interest is attention on right side)


-interest


(pre purchase)-evaluation


(actual) - trail- to left is perceived


(avoidance)-decision- left is repurchase


(repeat purchase)-confirmation)- left is preference

the black box

buying influences


interpersonal determinants


-cultural influences ( congruence)


-social influences ( social class)


-family influences ( spousal influence)


-opinion leadership and reference groups




situations determinants




personal determinants


-needs and motives( motivation)


-perception ( selectivity)


-attitudes( cognitive, affective, conative)


-learning ( memory, recall, habit)


-self concept ( idealization, rationalization)






-

pre purchase behaviors

problem récognition


search


alternative evaluation


purchase

decisions

routine


limited


extended


(intentions)

new purchase

problem recognition


search


alternative evaluation


purchase


consumption usage


post purchase evaluation

social class dimensions

-1.5% upper-class ( old money)


-12.5% upper middle class ( new rich)


-32% lower middle class ( white collar)


-38% upper lower ( working class blue collar)


-16% lower- lower class

marketing message why people buy

functional motives


personal motives


social motives


impulse shopping


BENEFITS



PLC strategies

differentiation


segmentation


price leadership

segmentation dimensions


all potential dimensions

focus relevant purchase behavior


-who? potential purchases users



qualifying dimensions

focus relevant customer type


-who? demographic relevant market



determining dimensions ( product type)

focus specific purchase influence


-what? benefits sought

determining dimesntions ( brand specific)

focus attraction to brand


-why? brand promise

criteria for effective segmentation

-measurable purchasing power and size


-accessibility


-substantial ( sufficient in size to be profitable)


-match marketers capabilities

methods of segmentation


geographic segmentation

-metropolitan statistical area (SMSA)


-consolidated metropolitan statistical area ( megalopolis)


-primary metropolitan statistical area ( exhibits social and economic ties)



MOS


demographic segmentation (socioeconomic segmentation)

- consumer descriptive characteristics ( gender, age, education, income)




- generational cycles ( baby boomers, yuppies, generation X)

the rest of methods of segmenting markets

-ethnic segmentation


-lifecycle segmentation


-household segmentation ( traditional v non traditional )


-income segmentation ( engels laws of consumption)


-psychographic segmentation ( lifestyle segmentation)

central markets

convenient place where buyers and sellers can meet one on one to exchange goods and services

GNP

the total market value of goods and services in an economy