Principles Of Marketing Ch. 6-10

Front 1

Characteristics of the Business Market

Back 1

1.Fewer but larger buyers
2.More geographically concentrated
3.Demand is derived from demand for consumer products
4.Demand is more inelastic (less affected by changes in price)
5.Demand fluctuates more
6.Business purchases involve more buyers
7.Purchasing is more professional
8.Purchase decisions are more complex
9.Buying process is more formalized
10.Buyers and sellers develop more long term relationships

Front 2

Major Types of Business Decisions

Back 2

1.Straight Rebuy (Reorders without modification)
2. Modified Rebuy (Reoders with modification)
3. New Task

Front 3

Participants in the Buying Process

Back 3

1. Users
2. Influencers
3. Buyers
4. Deciders
5. Gatekeepers

Front 4

Influencers

Back 4

– anyone in the buying center who affects the buying decision

Front 5

Buyers

Back 5

– makes the purchase (e.g. purchasing agent)

Front 6

Deciders

Back 6

– the person(s) with the authority to make the selection

Front 7

Gatekeepers

Back 7

– people who control the flow of information

Front 8

Product Specification

Back 8

- Stage of the business buying process in which a firm specifies the best technical product characteristics of a needed item

Front 9

Value Analysis

Back 9

- Cost reduction by looking for less costly methods of production

Front 10

Supplier Search

Back 10

- Stage of the business buying process where the firm tries to find the best vendors

Front 11

Proposal Solicitation

Back 11

-The stage of the business buying process in which the buyer invites qualified suppliers to submit proposals.

Front 12

Supplier Selection

Back 12

-The stage of the business buying process in which the buyer reviews proposals and selects a supplier or suppliers.

Front 13

Steps in Market Segmentation, Targeting, and Positioning

Back 13

1. Segmentation
2.Targeting
3.Differentation
4.Positioning

Front 14

Segmentation

Back 14

-Dividing a market into smaller groups with distinct needs, characteristics, or behaviors

Front 15

Targeting

Back 15

-Evaluating each market segment’s attractiveness and selecting segments to enter.

Front 16

Differentation

Back 16

-making the market offering different to create superior customer value.

Front 17

Positioning

Back 17

-arranging for a product to occupy a clear, distinctive, and desirable place relative to other products

Front 18

Segmenting Consumer Markets

Back 18

1. Geographic
2. Demographic
3. Psychographic
4. Behavioral

Front 19

Geographic

Back 19

– to account for consumers’ regional differences, population density or limitations in distribution.

Front 20

Demographic

Back 20

– most popular segmentation for consumer products. Vary by characteristics (Age, gender, race, education, etc.)

Front 21

Psychographic

Back 21

-different groups based on social class, lifestyle, or personality characteristics

Front 22

Behavioral

Back 22

-different groups based on consumer knowledge, attitude, use or response to a product.

Hint 22

a) Occasion Segmentation
b) Benefit segmentation
c) User status
d) Usage rate
e) Loyalty status

Front 23

Segmenting Business Markets

Back 23

1. Geographically
2. Demographically
3. Benefits sought
4. User status
5. Usage rate
6. Loyalty status
7. Operating characteristics
8. Purchasing approaches
9. Situational factors
10. Personal characteristics

Front 24

Segmenting International Markets

Back 24

1. Geographic location
2. Economic factors
3. Political and legal factors
4. Cultural factors

Front 25

Political and legal factors

Back 25

a) Type and stability of government
b) Receptivity of foreign firms
c) Monetary regulations
d) Amount of bureaucracy

Front 26

Intermarket Segmentation

Back 26

Forming segments of consumers who have similar needs and buying behavior even though they are located in different countries.

Front 27

Requirements for Effective Segmentation

Back 27

1. Measurable
2. Accessible
3. Substantial
4. Differential
5. Actionable

Front 28

Evaluating Market Segments

Back 28

1. Segment Size and Growth
2. Segment Structural Attractiveness
3. Company objectives and resources

Front 29

Types of Target Marketing

Back 29

1. Undifferentiated
2. Differentiated
3. Concentrated
4. Micromarketing

Front 30

Choosing a Targeting Strategy

Back 30

1. Company Resources
2. Product Variability
3. Product Lifestyle Stage
4. Market Variability
5. Competitors Strategy

Front 31

Socially Responsible Target Marketing

Back 31

1. Children to Cereal
2. Tobacco and Beer to Underage
3. Casinos and Lottery to Middle Class

Front 32

Product Position

Back 32

the place the product occupies in consumers’ minds relative to competing products.

Front 33

Perceptual Map

Back 33

a visual depiction of consumers’ perceptions of their brands versus competing products on important buying dimensions.

Front 34

Differentiation and Positioning Task

Back 34

1.Identifying a set of possible customer value differences that provide competitive advantages
2.Choosing the right competitive advantages
3.Selecting an overall positioning strategy
4.Communicate and deliver the chosen position to the market.

Front 35

Competitive Advantage

Back 35

1.Product differentiation
2.Services differentiation
3.Channel differentiation
4.People differentiation
5.Image differentiation

Front 36

Overall Positioning Strategies

Back 36

1. More for More (Upscale, Premium)
2. More for Same (Lexus to Mercedes)
3.More for Less (Homedepot)
4. Same for Less (Walmart)
5.Less for Less (Dollar store)

Front 37

Product

Back 37

Anything that can be offered to a market that satisfies a want or need

Front 38

Service

Back 38

One party can offer another an intangible product, does not result in ownership

Front 39

Consumer Product

Back 39

1. Convenience products
2. Shopping products
3. Specialty products
4. Unsought products

Front 40

Convienence Product

Back 40

– buys frequently, immediately and with minimum amount of comparison and buying effort. (Gum)

Front 41

Shopping products

Back 41

purchased less frequently and usually involves comparison shopping. (Car, Home)

Front 42

Specialty products

Back 42

– products with a unique characteristic for which consumers will go out of their way to find. (iphone?)

Front 43

Unsought products

Back 43

– products that consumer is not aware of or is not interested in.

Front 44

Industrial Product

Back 44

1. Materials and Parts
2. Capital Items
3. Supplies and Services

Front 45

Materials and Parts

Back 45

products that become part of the finished product (raw materials)

Front 46

Capital Items

Back 46

installations and accessory equipment (depreciated)

Front 47

Supplies and Services

Back 47

similar to convenience products in the consumer market (not depreciated)

Front 48

Branding

Back 48

A name, term, sign, symbol or design that identifies the maker or seller

Front 49

Product Line

Back 49

A group of products that are closely related because they function in a similar manner

Front 50

Product Line Stretching

Back 50

when a company lengthens its product line beyond its current range

Hint 50

(___ <---, Medium, High)

Front 51

Product Line Filling

Back 51

adding more items within the present range of the line

Hint 51

(Low, ____ <----, High)

Front 52

Product Mix

Back 52

1. Width
2. Length
3. Depth
4. Consistency

Front 53

Width

Back 53

number of different product lines a company carries.

Front 54

Length

Back 54

total number of items the company carries within its product lines.

Front 55

Depth

Back 55

number of versions or varieties offered of each product in the line

Front 56

Consistency

Back 56

how closely related the various product lines are in end use

Front 57

Brand Equity

Back 57

The amount a consumer is willing to pay to get the brand name

Front 58

Qualities for a Brand Name

Back 58

1.Suggest something about the product’s benefits and qualities
2.Easy to pronounce, recognize and remember
3.Should be distinctive
4.Should be extendable
5.Should translate easily into foreign languages
6.Capable of registration and legal protection

Front 59

Brand Sponsorship

Back 59

1.Manufacturer’s brand – associated with the manufacturer (Example: Coca Cola, Weber grills)
2.Private brand – associated with the reseller (i.e. store brands)
3.Licensing – designer brands
4.Co-branding – using two brands together (Example: Butterfinger Blizzard)

Front 60

Brand Development

Back 60

1. Line Extension (Crest Gel)
2. Brand Extension (Apparel)
3. Multibrands (Dove, Lux Soaps)
4. New Brands (Band-Aid, Tylenol)

Front 61

Characteristics of Service

Back 61

1. Intangibility
2. Inseparability
3. Variability
4. Perishability

Front 62

Interactive Marketing

Back 62

Quality of the buyer-seller interaction during the service encounter.

Front 63

New Product Development

Back 63

The development of original products, product improvements, product modifications, and new brands

Front 64

New Product Development Process

Back 64

1. Idea generation
2. Idea screening (funnel)
3. Concept development and testing (develop idea)
4. Marketing strategy development
5. Business analysis(profitability)
6. Product development (prototype)
7. Test marketing (Partial Sales)
8. Commercialization (Full scale sales)

Front 65

Test Marketing

Back 65

1. Not used for shopping products and appliances
2. Don't do if you want secrecy
3. Interference from competitors

Front 66

Types of Test Markets

Back 66

1. Standard Test market
2. Controlled Test Market
3. Simulated Test Market

Front 67

Product Life Cycle

Back 67

The course of a product’s sales and profits over its life cycle.

Front 68

Product Lifestyle Stages

Back 68

1. Product Development
2. Introduction (sales low)
3. Growth (rapid sales)
4. Maturity (longest stage)
5. Decline (sales drop)

Front 69

Product Decisions and Social Responsibility

Back 69

1. Planned obsolescence
2. New Products that lessen Competition
3. Products in Compliance with Laws

Front 70

Price

Back 70

The amount charged for a product or service

Front 71

Value Based Pricing

Back 71

Setting Prices based on buyers perceptions

Front 72

Cost Based Pricing

Back 72

Prices set based on costs for producing

Front 73

Types of Costs via Cost Based Pricing

Back 73

1. Fixed Costs
2. Variable Costs
3. Total Costs
4. Unit Costs

Front 74

Experience Curve

Back 74

The drop in the average per unit production cost that comes with accumulated production experience.

Front 75

Cost Plus Pricing

Back 75

Adding a standard markup to the cost of the product

Front 76

Break Even Pricing

Back 76

Setting prices to break even on the costs of making and marketing a product, or setting prices to make a target profit.

Front 77

Target Costing

Back 77

Pricing that starts with an ideal selling price, then targets costs that will ensure that the price is met.

Front 78

Market Types

Back 78

1. Pure Competition
2. Monopolistic competition
3. Oligopolistic competition (Airlines)
4. Pure monopoly

Front 79

Demand Curve

Back 79

A curve that shows the number of units the market will buy in a given time period, at different prices that might be charged.

Front 80

Price elasticity

Back 80

A measure of the sensitivity of the demand to changes in price. Calculated as the % Change in Quantity Demanded / % Change in price

Front 81

Price Sensitivity

Back 81

Less Price Sensitive if...
a) The product is unique
b) Substitute products are hard to find or cannot easily be compared
c) Total expenditure is low in relation to their income
d) Expenditure is a small percentage of their total expenditure
e) Consumers expect the price to go up