Koofers

Exam 1 - Flashcards

Flashcard Deck Information

Class:MKTG 3650 - Foundations of Marketing Practice
Subject:Marketing
University:University of North Texas
Term:Spring 2012
- of -
INCORRECT CORRECT
- INCORRECT     - CORRECT     - SKIPPED
Shuffle Remaining Cards Show Definitions First Take Quiz (NEW)
Hide Keyboard shortcuts
Next card
Previous card
Mark correct
Mark incorrect
Flip card
Start Over
Shuffle
      Mode:   CARDS LIST       ? pages   PRINT EXIT
"Need" A lack of something useful.
Marketing is "people driven." Meaning it responds to buyers needs.
Synergy Synergy may be defined as two or more things functioning together to produce a result not independently obtainable.

(productive interaction)
Conceptual reason for Marketing "Economics of Distribution"
Generated by Koofers.com
Utilitiy: The benefits or customer value received by users of the product.
Three economic utilities marketing provides?
  1. Time Utility
  2. Place Utility
  3. Ownership Utility
Time Utility: Having the product available when needed.
Place Utility: Having the product available where customers need it.
Generated by Koofers.com
Ownership Utility: (Also known as possession utility)
The value of making an item easy to purchase through the provision of credit cards or financial arrangements.
"Goods" Physical objects such as toothpaste, cameras or computers, that satisfy consumer needs.
"Services" Intangible items such as airline trips, financial advice, or arts museums.
"Ideas" Thoughts about concepts, actions or causes.
Generated by Koofers.com
Ultimate consumers: The people who use goods and services purchased for a household.
Organizational buyers: Those manufacturers, wholesalers, retailers and government agencies that buy goods and services for their own use or for resale.
"Marketing": The activity for creating, communicating, delivering and exchanging offerings that benefit the organization, its stakeholders and society at large. Defined by AMA.
What is needed for marketing to occur?
  1. Two or more parties (individuals or organizations) with unsatisfied needs.
  2. A desire and ability on their part to be satisfied.
  3. A way for the parties to communicate
  4. Something to exchange
Generated by Koofers.com
"Want": A need that is shaped by a person's knowledge, culture and personality.

-The way you satisfy a need at  specific time.
Market: The people with both the desire and ability to buy a specific offering.

-Development and distribution of products for chosen market segment.
Target Market: One or more specific groups of potential consumers toward which an organization develops its marketing program.
The Four Ps?
  1. Product
  2. Price
  3. Promotion
  4. Place
Generated by Koofers.com
1.) Product A good, service, or idea to satisfy the consumer's needs.
2.) Price What is exchanged for the product.
3.) Promotion A means of communication between the seller and buyer.

4.) Place A means of getting the product to the consumer.
Generated by Koofers.com
Marketing Mix: The marketing managers controllable factors - (The Four Ps) - that can be used to solve a marketing problem. 

  • Combination of the four ps that a firm presents to a target market. 
What forces are beyond marketers control? Environmental Forces.
Environmental forces? Those involving social, economic, technological, competitive and regulatory forces.
What forces can marketers control? The marketing mix. - (The four P's)

Product
Price
Promotion
Place
Generated by Koofers.com
Customer Value: The unique combination of benefits received by targeted buyers that includes quality,  convenience, on-time delivery and both before-sale and after-sale service at a specific price.
Relationship Marketing: Developing and maintaining effective customer relationships.

-Linking the organization to is individual customers, employes, suppliers, and other partners for their mutual long-term benefits.
Marketing Program: A plan that integrates the marketing mix to provide a good, service or idea to prospective buyers.
An organization can't satisfy the needs of all consumers, so it must focus on one or more subgroups, which are it's? Target Market
Generated by Koofers.com
Marketing Concept: The idea that an organization should:
  1. Strive to satisfy the needs of consumers
  2. while also trying to achieve the organizations goals.


  • Identify a buyers needs
  • Develop product to satisfy need over long run
  • Ensuring profitability
Production Era? The early years of the US up until the 1920's.
Goods were scarce & buyers were willing to accept virtually any goods that were available.
Sales Era? From the 1920's-1960's.
Manufactures found they could produce more goods than buyers could consume. Competition grew.
Marketing Concept Era? Late 1950's
Marketing became the motivating force among many American firms.
Generated by Koofers.com
Marketing Orientation: Focuses its efforts on:
  1. Continuously collection information about customers' needs.
  2. Sharing this information across departments.
  3. Using it to create customer value.
Customer Relationship Era: 1980's-present
Firms seek continuously to satisfy the high expectations of customers.
Customer relationship management (CRM): The process of identifying prospective buyers, understanding them intimately, and developing favorable long term perceptions of the organization and its offerings so that buyers will choose them in the marketplace.
Customer Experience: The foundation of customer relationship management. (CRM)

The internal response that customers have to all aspects of an organization and its offering.
Generated by Koofers.com
Social marketing concept: The view that organizations should satisfy the needs of consumers in a way that provides for society's well-being.
Macromarketing: The study of the aggregate flow of a nation's goods and services to benefit society. Directly related to Societal marketing concept.
What is directly related to Societal marketing concept? Macromarketing.
Micromarketing: How an individual organization directs its marketing activities and allocates its resources to benefit its customers.
Generated by Koofers.com
What are two key chracteristics of the marketing concept?
  1. That is should strive to satisfy the needs of consumers.
  2. It also should strive to achieve the organizations goals.
Market Segment: Made up of buyers who share some characteristics.
Development of Marketing:
  1. Production orientation
  2. Sales Orientation
  3. Consumer focus
  4. Societal orientation
Consumer Behavior: Process people go through in buying.

-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.
Generated by Koofers.com
Marketing exists because..? People have needs that can be satisfied through products.
Purchase decision process: The stages a buyer passes through in making choices about which products and services to buy. Five stages:
  1. Problem recognition
  2. Information search
  3. Alternative evaluation
  4. Purchase decision
  5. Postpurchase behavior
1.)Problem recognition Perceiving a difference between a person's idea and actual situation big enough to trigger a decision.
2.) Information search:
  • Internal Search: Scan your memory for previous experiences with products or brands

Then may do external search; Sources of external info are
  1. Personal sources
  2. Public Sources 
  3. Marketer-dominated sources


Generated by Koofers.com
3.) Alternative Evaluation:
  • Evaluative criteria: Represent both the objective attributes of a brand (such as display) and the subjective one (such as prestige) you use to compare different products and brands.

  • Consideration Set: 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. 
4.) Purchase Decision: (Buying value)
  1. From whom to buy?
  2. When to buy?
5.) Postpurchase Behavior: After making a purchase, the consumer compares it with his or her expectations and is either satisfied or dissatisfied.

  • Cognitive Dissonance: The feeling of postpurchase psychological tension or anxiety.
Cognitive Dissonance: The feeling of postpurchase psychological tension or anxiety.
-Entails post-decision uncertainty.


'+' Positive (reinforces decision)
'-' Negative (contradicts decision)
Generated by Koofers.com
Sources of Knowledge? Psychology (individuals)
Sociology (groups)
Education (learning)
Economics (Supply & Demand)
Individual Insight
Factors of consumer purchase depends on level of involvement. Level of involvement: The personal, social, and economic significance of the purchase to the consumer.
If a company markets a low-involvement products and its brand is a market leader, attentino is place on?
  1. Maintaining product quality
  2. Avoiding stockout situations so that buyers don't substitute a competing brand
  3. Repetitive advertising messages that reinforce a consumer's knowledge or assure buyers they made the right choice.
Situational Influences:
  1. The purchase task
  2. Social surrounds
  3. Physical surroundings
  4. Temporal effects
  5. Antecedent states
Generated by Koofers.com
What is the first stage in the consumer purchase decision process? Problem recognition: Perceiving a need
What is the term for postpurchase anxiety? Cognitive Dissonance
The brands a consumer considers buying out of the set of brands in a prodcut clss of which the consumer is aware is called the? Alternative Evaluation: Assessing Value
Psychological Influences on consumer behavior? Perception; learning; values, beliefs and attitudes; and lifestyle.
Generated by Koofers.com
Motivation: The energizing force that stimulates behavior to satisfy a need.
Personality: Refers to a person's consistent behaviors or responses to recurring situations.

  • Self-concept: The way people see themselves and the way they believe other see them.
Perception: The process by which an individual selects, organizes and interprets information to create a meaningful picture of the world.

  • Selective Perception: A filtering of exposure, comprehension and retention.
  • Selective exposure: occurs when people pay attention to messages that are consistent with their attitudes and beliefs and ignore messages that are inconsistent.
  •  Select, organize (store, relate), and interpret information.



Perception pt 2.
  • Selective Comprehension: Involves interpreting information so that it is consistent with you attitudes and beliefs.

  • Selective Retention: Means that consumers do not remember all the information they see, read or head, even minutes after exposure to it.

  • Subliminal perception: Means that you see or hear messages without being aware of them.
Generated by Koofers.com
Perceived risk: Represents the anxiety felt because the consumer cannot anticipate the outcomes of a purchase but believes there may be negative consequences.
Learning: refers to those behaviors that result from
  1. repeated experiences
  2. reasoning

Behavioral Learning: The process of developing automatic responses to a situation built up through repeated exposure to it.
  1.  Drive: a need the moves an individual to action
  2. Cue: a stimulus or symbol perceived by consumers
  3. Response: the action taken by a consumer to satisfy the drive
  4. Reinforcement: the reward
Stimulus generalization: occurs when a response elicited by one stimulus is generalized to another stimulus.
Stimulus discrimination: refers to a person's ability to perceive differences in stimuli.
Cognitive learning: Involves making connections between two or more ideas or simply observing the outcomes of others' behaviors and adjusting your own accordingly.
Generated by Koofers.com
Brand Loyalty: A favorable attitude toward and consistent purchase of a single brand over time.
Attitude: A learned predisposition to respond to an object or class of objects in a consistently favorable or unfavorable way.

  • Shaped by our beliefs and values, which are learned.
  • Emotional disposition towards a producct
Beliefs: A consumer's subjective perception of how a product or brand preforms on different attributes.
Lifestyle: 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 of themselves and the world around them.


Generated by Koofers.com
Psychographics: (Lifestyle) The analysis of consumer lifestyles, provides insights into consumer needs and wants. The practice of combining psychology, lifestyle and demographics, is often used to uncover consumer motivations for buying and using products and services.


  • Combinations of activities, interests and opinions those in a target market practice, aspire to, or identify with.
Attitude-change approaches:
  1.  Changing beliefs about the extent to which a brand has certain attributes.
  2.  Changing the perceived importance of attributes.
  3.  Adding new attributes to the product.
Social Factors: (Personal Influence) "Poverty of Time" Personal Influence:
  • Opinion Leadership: Individuals who exert direct or indirect social influence over others are called opinion leaders.
  • Word-of-mouth:  The influencing of people during conversations is called word of mouth. The most powerful and authentic information source for consumers because it typically involves friends viewed as trustworthy.
Reference groups: people to whom an individual looks as a basis for self appraisal or as a source of personal standards. Affect consumer purchases because they influence the information, attitudes and aspiration levels that help set a consumer's standards.
  • Membership group: One to which a person actually belongs, including fats, sorors, social clubs and the family.
  • Aspiration group: One that a person wishes to be a member of or wishes to be identified with.
  • Dissociative group: One that a person wishes to maintain a distance from because of differences in values or behaviors.
Generated by Koofers.com
Family Influence:
  1. Consumer socialization
  2. Passage throught he family life cycle
  3. Decision making within the family or household
1.) Consumer socilization The process by which people acquire the skills, knowledge, and attitudes necessary to function as consumers.
2.) Family life cycle: Describes the distinct phases that a family progresses through from formation to retirement, each phase bringing with it identifiable purchasing behaviors.
3.) Family decision making: A third influence in the decision-making process occurs within the family.
  • Spouse -dominant: Either the husband or the wife is mostly responsible.
  • Joint decision making: Most decisions are made by both husband and wife.
Generated by Koofers.com
Five roles in family decision making:
  1. Information gatherer
  2. Influencer
  3. Decision maker
  4. Purchaser
  5. User
Social Class: Defined as the relatively permanent, homogeneous divisions in a society into which people sharing similar values, interests and behavior can be grouped.
  • Upper   - old rich, new rich.
  • Middle- young professional, blue collar star
  • Lower: branded convenience items
Culture & Subcluture
  • Subcultures: Subgroups within the larger , or national, culture with unique values and attitudes.
Two primary forms of personal influence?
  1. Word-of-Mouth
  2. Opinion Leaders
Generated by Koofers.com
Marketers are concerneed with which types of reference groups?
  • Aspiration groups
  • Dissociating groups
  • Membership groups
What two challenges must marketers overcome when marketing to Hispanics?
  1. The Hispanic subculture is diverse.
  2. A language barrier exists and commercial messages are frequently misinterpreted when translated to Spanish.
Drive->Cue->Response->Reinforcement
Industrial Marketing:
Generated by Koofers.com
Characteristics of Industrial Buyers:
  1. Multiple buyers (buying committee) or centralized buyer (Approved vendor) (Materials Manager)
  2. Product specs
  3. Formalized paper flow (P.O. System)
  4. Bid System
Types of Buys:
  1. Direct purchase: 2/10, net 60
  2. Lease
  3. "reciprocity" (questionable practice)
Industrial Marketing Mix:
  • Product: is hard to identify. (benefit sought)
  • Price: may differ(vary). Base upon quantity.
    Payment scheme, fright terms, maintenance or promotional agreement. 
  • Promotion: Sales people are impt, advertising is focusing
  • Distribution: (distribution channel) extensive use of wholesalers/distributors

Generated by Koofers.com
Laws: Society's values and standards that are enforceable in the courts.
Ethics: The moral principles and values that govern the actions and decisions of an individual or group.
What are four possible reasons for the present state of ethical conduct in the US?
  1. Increased pressure on businesspeople to make decisions in a society characterized by diverse value systems.
  2. A growing tendency for business decisions to be judged publicly by groups with different values and interests.
  3. The public's expectations of ethical business behavior has increased.
  4. Ethical business conduct may have declined.
Culture: Refers to the set of values, ideas and attitudes that are learned and shared among the members of a group.
Generated by Koofers.com
Business Cultures: "Compromise the effective rules of the game, the boundaries between competitive and unethical behavior, (and) the codes of conduct in business dealings."
Ethics of Exchange:
  • Caveat Emptor
  • Consumer Bill of Rights
  • FTC (Federal Trade Commission)
  • Children's Online Privacy Protection Act (1998)
Caveat Emptor: Before the 1960's the legal concept of Caveat emptor - let the buyer beware- was pervasive in the American business culture.
Consumer Bill of Rights: In 1962 JFK, outlined CBOF that codified the ethics of exchange between buyers and sellers.
The right to:
  1. Safety
  2. To be informed
  3. To choose
  4. To be heard
Generated by Koofers.com
Ethics of Competition:
  1. Economic Espionage
  2. Bribery
Economic Espionage: The clandestine collection of trade secrets or proprietary information about a company's competitors.
  • Practice is illegal and unethical.
  • Most prevalent in high-techhnoloy companies.

Bribery: Two Laws to curb bribery & economic espionage:
  1. Economic Espionage Act (1996)
  2. Foreign Corrupt Practices Act (1917)


Most evident in countries in industries experiencing intense competition and in countries in the earlier stages of economic development.

Corporate Culture: Set of values, ideas and attitudes that is learned and shared among members of an organization.
  • Code of Ethics
  • Ethical Behavior of Top management & co-workers
Generated by Koofers.com
Code of Ethics: A formal statement of ethical principals and rules of conduct.
  • Lack of specificity is a major reason for violation of code of ethics.
Ethical Behavior of Top Management & Co-workers: Reason for violating ethics codes rests in the perceived behavior of top management.
  • Whistle-Blowers: Employees who report unethical or illegal actions or their employers.
Personal Moral Philosophies:
  • Moral Idealism
  • Utilitarianism
Moral Idealism: Considers certain individual rights or duties as universal regardless of the outcome.
  • Exists in consumer bill of rights
Generated by Koofers.com
Utilitarianism: Focuses on "greatest good for greatest number"
by assessing the costs and benefits of the consequences of ethical behavior.
  • If benefits exceed cost, behavior is unethical.
Social Responsibility:
  1. Profit Responsibility
  2. Stakeholder Responsibility
  3. Societal Responsibility
Profit Responsibilitiy: Companies have simple duty- to maximize profits for their owners or stockholders.
Stakeholder Responsibilitiy Focuses on the obligations an organization has to those who can affect achievement of it's objectives.
Generated by Koofers.com
Societal Responsbility: Refers to obligations that organizations have to the preservation of ecological environment, to the general public
  • Triple-bottom line: Recognition of the need for organizations to improve the state of people, the planet, & profit simultaneously if they are to achieve sustainable long-term growth.
  • Green Marketing: Mktg efforts to product, promote & reclaim environmentally sensitive products.
  • Cause Marketing: Occurs when charitable contributions of a firm are tied directly to the customer revenues produced through te promotion of one of its products.
Social Audit: A systematic assessment of a firms objectives, strategies & performance in terms of social responsibility.

  • Sustainable Development
Sustainable Devlopment: Involves conducting business in a way that protects the natural environment while making economic progress.
Companies:
  1. benefit from favorable word of mouth among consumers
  2. Typically outperform less responsible companies on financial performance
Greenwashing: Practice of making an unsubstantiated or misleading claim about the environmental benefits  of a product, service, technology or company practice. kj
Generated by Koofers.com
Environmental Scanning: The process of contrinually acquiring information on events occuring outside the organization to identify and interpret potential trends.
Social Forces: Include the demographic characteristics of the population and its values.
Demographics: Describing a population according to selected characteristics such as age, gender, ethnicity, income and occupation.
Aspects of Marketing Environment:
  1. Social envt
  2. Legal envt
  3. Competitive envt
  4. Technological envt


Envt is largely uncontrollable. It can be influenced though.

Generated by Koofers.com
Electronic commerce: Any activity that uses some form of electronic communication in the inventory, exchange, advertisement, distribution and payment of goods and services.
What are the four forms of competition?
  1. Pure Competition: There are many sellers and they each have a similar product.
  2. Monopolistic competition: Many sellers compete with substitutable products within a price range.
  3. Oligopoly: a common industry structure, occurs when a few companies control the majority of industry sales.
  4. Pure monopoly: occurs when only one firm sells the product.
Sherman Antitrust Act (1890) Federal legislation passed to encourage competition.
Lobbying by farmers in the Midwest against fixed railroad shipping prices led to the passage of this act. It forbids:
  1. Contracts, combinations, or conspiracies in the restraint of trade
  2. Actual monopolies or attempts to monopolize any part of trade or commerce.

Because the law wasn't very successful, the Sherman Act was supplemented with the Clayton Act (1914). 

It made "contracts, combinations or conspiracies" illegal in restraint of trade.

Robinson-Patman Act (1936) Small businesses were threatened, and they lobbied for this.
The act makes it unlawful to discriminate in prices charged to different purchasers of the same product, where the effect may substantially lessen competition or help create a monopoly.
(Price discrimination)
Generated by Koofers.com
Types of Laws:
  1. Pro-competitive or anti-trust laws
  2. Consumers Protection laws
  3. Societal protection laws
Price Discrimination: Charging 2 different buyers two different prices for products of like grade and quality.

  • Illegal in interstate commerce
  • Burden of Proof: is on violator
3 ways of R.P. act?
  1. Justify different prices on basis of cost to serve
  2. Meeting competition in good faith
  3. Buyers in 2 different markets (no advantage provided)
Where marketing fits into the organization?
  • Corporate Level (Board room)
  • Functional Level (Grunt level) 
Generated by Koofers.com
Corporate Levels: Where top management directs overall strategy for the entire organization.
  • Board, Global Decisions
  • Sequence of Decisions:

-Mission

-Goals

-Strategies (plans)

-Tactics

Strategic Business Unit Level (SBU):  A subsidiary, division, or unit of an organization that markets a set of related offerings to a clearly defined group of customers.
  • Managers set a more specific strategic directions for their business to exploit value-creating opportunities.
Functional Level: Groups of specialists actually create value for the organization.
  • Department: referts to these specialized functions such as marketing and finance.
  • At functional level the organizations strategic direction becomes its most specific and focused.
Functional Level continued..: A. Operating Activities - "day to day"
B. Content:

-Marketing/sales

-Production

-Management Information Systems (MIS)

-Control System

-Human resources

Generated by Koofers.com
Market Segmentation: Involves aggregating prospective buyers into groups or segments, that have common needs and will respond similarly to a marketing action.
Market segments: The relatively homogeneous groups of prospective buyers that result from the market segmentation process.
Product Differentiation: Involves a firm using different marketing mix activities, such as product features and advertising to help consumers perceive the product as being different and better than competing products.

Ascribing character to goods that are essentially identical, across vendors.
Marketing Strategy:
  1. Choose a target market

-segment

-select segments


2. Develop a marketing mix for each target market



Generated by Koofers.com
Segmentation: Segmentation is breaking up a market (group of buyers) on the basis of shared characteristics. (The Four P's)
Segmentation Characteristics: 'Bases'
  • Geographic (easy to access)
  • Demographic (homogenous)
  • Psychographic (lifestyle)
  • Behaviorists

-use pattern

-volume used (80:20)

-purpose

-experience level

2/10 net 60

Means that the buyer receives a two percent discount off the purchase price if the product is paid for within 10 days. Te net amount is due within sixty days.

Reciprocity

= trade. No money may be exchanged. May run afoul of the Sherman Antitrust Act. Such arrangements exclude competitors and may thereby be in restraint of trade.

Generated by Koofers.com
How to influence environment? Aspects of the environment interrelate.
Organizations influence lawmakers, judges and regulatory bodies
. In turn, lawyers influence laws, judges and regulators. Many politicians are lawyers, and politicians make laws. Lawyers make laws as legislators, interpret laws as judges and they litigate.
What kind of law is the Sherman Anti-Trust Act?  Antitrust laws.
Consumer Protection laws: Relate to packaging, labeling, content and design of products.
Societal protection laws: Involve the organization and aspects of the environment.
  • Were enacted to protect the ecosystem and progeny (future consumers).
Generated by Koofers.com
Sherman Anti-Trust Act pt. 2: The basis for all American antitrust law.
Arost with the industrial revolution.
Andrew Carnegie, J.P. Morgan George Eastman and Henry Ford arose during the IR.
Conspiracy: Exists when one entity gains assent from another to set price or to control a situations as to hard a third party.
Structure: A unit where two or more people work towards a common goal.
Generated by Koofers.com

List View: Terms & Definitions

  Hide All 151 Print
 
Front
Back
 "Need"A lack of something useful.
 Marketing is "people driven."Meaning it responds to buyers needs.
 SynergySynergy may be defined as two or more things functioning together to produce a result not independently obtainable.

(productive interaction)
 Conceptual reason for Marketing"Economics of Distribution"
 Utilitiy:The benefits or customer value received by users of the product.
 Three economic utilities marketing provides?
  1. Time Utility
  2. Place Utility
  3. Ownership Utility
 Time Utility:Having the product available when needed.
 Place Utility:Having the product available where customers need it.
 Ownership Utility:(Also known as possession utility)
The value of making an item easy to purchase through the provision of credit cards or financial arrangements.
 "Goods"Physical objects such as toothpaste, cameras or computers, that satisfy consumer needs.
 "Services"Intangible items such as airline trips, financial advice, or arts museums.
 "Ideas"Thoughts about concepts, actions or causes.
 Ultimate consumers:The people who use goods and services purchased for a household.
 Organizational buyers:Those manufacturers, wholesalers, retailers and government agencies that buy goods and services for their own use or for resale.
 "Marketing":The activity for creating, communicating, delivering and exchanging offerings that benefit the organization, its stakeholders and society at large. Defined by AMA.
 What is needed for marketing to occur?
  1. Two or more parties (individuals or organizations) with unsatisfied needs.
  2. A desire and ability on their part to be satisfied.
  3. A way for the parties to communicate
  4. Something to exchange
 "Want":A need that is shaped by a person's knowledge, culture and personality.

-The way you satisfy a need at  specific time.
 Market:The people with both the desire and ability to buy a specific offering.

-Development and distribution of products for chosen market segment.
 Target Market:One or more specific groups of potential consumers toward which an organization develops its marketing program.
 The Four Ps?
  1. Product
  2. Price
  3. Promotion
  4. Place
 1.) ProductA good, service, or idea to satisfy the consumer's needs.
 2.) PriceWhat is exchanged for the product.
 3.) PromotionA means of communication between the seller and buyer.

 4.) PlaceA means of getting the product to the consumer.
 Marketing Mix:The marketing managers controllable factors - (The Four Ps) - that can be used to solve a marketing problem. 

  • Combination of the four ps that a firm presents to a target market. 
 What forces are beyond marketers control?Environmental Forces.
 Environmental forces?Those involving social, economic, technological, competitive and regulatory forces.
 What forces can marketers control?The marketing mix. - (The four P's)

Product
Price
Promotion
Place
 Customer Value:The unique combination of benefits received by targeted buyers that includes quality,  convenience, on-time delivery and both before-sale and after-sale service at a specific price.
 Relationship Marketing:Developing and maintaining effective customer relationships.

-Linking the organization to is individual customers, employes, suppliers, and other partners for their mutual long-term benefits.
 Marketing Program:A plan that integrates the marketing mix to provide a good, service or idea to prospective buyers.
 An organization can't satisfy the needs of all consumers, so it must focus on one or more subgroups, which are it's?Target Market
 Marketing Concept:The idea that an organization should:
  1. Strive to satisfy the needs of consumers
  2. while also trying to achieve the organizations goals.


  • Identify a buyers needs
  • Develop product to satisfy need over long run
  • Ensuring profitability
 Production Era?The early years of the US up until the 1920's.
Goods were scarce & buyers were willing to accept virtually any goods that were available.
 Sales Era?From the 1920's-1960's.
Manufactures found they could produce more goods than buyers could consume. Competition grew.
 Marketing Concept Era?Late 1950's
Marketing became the motivating force among many American firms.
 Marketing Orientation:Focuses its efforts on:
  1. Continuously collection information about customers' needs.
  2. Sharing this information across departments.
  3. Using it to create customer value.
 Customer Relationship Era:1980's-present
Firms seek continuously to satisfy the high expectations of customers.
 Customer relationship management (CRM):The process of identifying prospective buyers, understanding them intimately, and developing favorable long term perceptions of the organization and its offerings so that buyers will choose them in the marketplace.
 Customer Experience:The foundation of customer relationship management. (CRM)

The internal response that customers have to all aspects of an organization and its offering.
 Social marketing concept:The view that organizations should satisfy the needs of consumers in a way that provides for society's well-being.
 Macromarketing:The study of the aggregate flow of a nation's goods and services to benefit society. Directly related to Societal marketing concept.
 What is directly related to Societal marketing concept?Macromarketing.
 Micromarketing:How an individual organization directs its marketing activities and allocates its resources to benefit its customers.
 What are two key chracteristics of the marketing concept?
  1. That is should strive to satisfy the needs of consumers.
  2. It also should strive to achieve the organizations goals.
 Market Segment:Made up of buyers who share some characteristics.
 Development of Marketing:
  1. Production orientation
  2. Sales Orientation
  3. Consumer focus
  4. Societal orientation
 Consumer Behavior:Process people go through in buying.

-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.
 Marketing exists because..?People have needs that can be satisfied through products.
 Purchase decision process:The stages a buyer passes through in making choices about which products and services to buy. Five stages:
  1. Problem recognition
  2. Information search
  3. Alternative evaluation
  4. Purchase decision
  5. Postpurchase behavior
 1.)Problem recognitionPerceiving a difference between a person's idea and actual situation big enough to trigger a decision.
 2.) Information search:
  • Internal Search: Scan your memory for previous experiences with products or brands

Then may do external search; Sources of external info are
  1. Personal sources
  2. Public Sources 
  3. Marketer-dominated sources


 3.) Alternative Evaluation:
  • Evaluative criteria: Represent both the objective attributes of a brand (such as display) and the subjective one (such as prestige) you use to compare different products and brands.

  • Consideration Set: 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. 
 4.) Purchase Decision:(Buying value)
  1. From whom to buy?
  2. When to buy?
 5.) Postpurchase Behavior:After making a purchase, the consumer compares it with his or her expectations and is either satisfied or dissatisfied.

  • Cognitive Dissonance: The feeling of postpurchase psychological tension or anxiety.
 Cognitive Dissonance:The feeling of postpurchase psychological tension or anxiety.
-Entails post-decision uncertainty.


'+' Positive (reinforces decision)
'-' Negative (contradicts decision)
 Sources of Knowledge?Psychology (individuals)
Sociology (groups)
Education (learning)
Economics (Supply & Demand)
Individual Insight
 Factors of consumer purchase depends on level of involvement.Level of involvement: The personal, social, and economic significance of the purchase to the consumer.
 If a company markets a low-involvement products and its brand is a market leader, attentino is place on?
  1. Maintaining product quality
  2. Avoiding stockout situations so that buyers don't substitute a competing brand
  3. Repetitive advertising messages that reinforce a consumer's knowledge or assure buyers they made the right choice.
 Situational Influences:
  1. The purchase task
  2. Social surrounds
  3. Physical surroundings
  4. Temporal effects
  5. Antecedent states
 What is the first stage in the consumer purchase decision process?Problem recognition: Perceiving a need
 What is the term for postpurchase anxiety?Cognitive Dissonance
 The brands a consumer considers buying out of the set of brands in a prodcut clss of which the consumer is aware is called the?Alternative Evaluation: Assessing Value
 Psychological Influences on consumer behavior?Perception; learning; values, beliefs and attitudes; and lifestyle.
 Motivation:The energizing force that stimulates behavior to satisfy a need.
 Personality:Refers to a person's consistent behaviors or responses to recurring situations.

  • Self-concept: The way people see themselves and the way they believe other see them.
 Perception:The process by which an individual selects, organizes and interprets information to create a meaningful picture of the world.

  • Selective Perception: A filtering of exposure, comprehension and retention.
  • Selective exposure: occurs when people pay attention to messages that are consistent with their attitudes and beliefs and ignore messages that are inconsistent.
  •  Select, organize (store, relate), and interpret information.



 Perception pt 2.
  • Selective Comprehension: Involves interpreting information so that it is consistent with you attitudes and beliefs.

  • Selective Retention: Means that consumers do not remember all the information they see, read or head, even minutes after exposure to it.

  • Subliminal perception: Means that you see or hear messages without being aware of them.
 Perceived risk:Represents the anxiety felt because the consumer cannot anticipate the outcomes of a purchase but believes there may be negative consequences.
 Learning:refers to those behaviors that result from
  1. repeated experiences
  2. reasoning

 Behavioral Learning:The process of developing automatic responses to a situation built up through repeated exposure to it.
  1.  Drive: a need the moves an individual to action
  2. Cue: a stimulus or symbol perceived by consumers
  3. Response: the action taken by a consumer to satisfy the drive
  4. Reinforcement: the reward
Stimulus generalization: occurs when a response elicited by one stimulus is generalized to another stimulus.
Stimulus discrimination: refers to a person's ability to perceive differences in stimuli.
 Cognitive learning:Involves making connections between two or more ideas or simply observing the outcomes of others' behaviors and adjusting your own accordingly.
 Brand Loyalty:A favorable attitude toward and consistent purchase of a single brand over time.
 Attitude:A learned predisposition to respond to an object or class of objects in a consistently favorable or unfavorable way.

  • Shaped by our beliefs and values, which are learned.
  • Emotional disposition towards a producct
 Beliefs:A consumer's subjective perception of how a product or brand preforms on different attributes.
 Lifestyle: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 of themselves and the world around them.


 Psychographics: (Lifestyle)The analysis of consumer lifestyles, provides insights into consumer needs and wants. The practice of combining psychology, lifestyle and demographics, is often used to uncover consumer motivations for buying and using products and services.


  • Combinations of activities, interests and opinions those in a target market practice, aspire to, or identify with.
 Attitude-change approaches:
  1.  Changing beliefs about the extent to which a brand has certain attributes.
  2.  Changing the perceived importance of attributes.
  3.  Adding new attributes to the product.
 Social Factors: (Personal Influence) "Poverty of Time"Personal Influence:
  • Opinion Leadership: Individuals who exert direct or indirect social influence over others are called opinion leaders.
  • Word-of-mouth:  The influencing of people during conversations is called word of mouth. The most powerful and authentic information source for consumers because it typically involves friends viewed as trustworthy.
 Reference groups:people to whom an individual looks as a basis for self appraisal or as a source of personal standards. Affect consumer purchases because they influence the information, attitudes and aspiration levels that help set a consumer's standards.
  • Membership group: One to which a person actually belongs, including fats, sorors, social clubs and the family.
  • Aspiration group: One that a person wishes to be a member of or wishes to be identified with.
  • Dissociative group: One that a person wishes to maintain a distance from because of differences in values or behaviors.
 Family Influence:
  1. Consumer socialization
  2. Passage throught he family life cycle
  3. Decision making within the family or household
 1.) Consumer socilizationThe process by which people acquire the skills, knowledge, and attitudes necessary to function as consumers.
 2.) Family life cycle:Describes the distinct phases that a family progresses through from formation to retirement, each phase bringing with it identifiable purchasing behaviors.
 3.) Family decision making:A third influence in the decision-making process occurs within the family.
  • Spouse -dominant: Either the husband or the wife is mostly responsible.
  • Joint decision making: Most decisions are made by both husband and wife.
 Five roles in family decision making:
  1. Information gatherer
  2. Influencer
  3. Decision maker
  4. Purchaser
  5. User
 Social Class:Defined as the relatively permanent, homogeneous divisions in a society into which people sharing similar values, interests and behavior can be grouped.
  • Upper   - old rich, new rich.
  • Middle- young professional, blue collar star
  • Lower: branded convenience items
 Culture & Subcluture
  • Subcultures: Subgroups within the larger , or national, culture with unique values and attitudes.
 Two primary forms of personal influence?
  1. Word-of-Mouth
  2. Opinion Leaders
 Marketers are concerneed with which types of reference groups?
  • Aspiration groups
  • Dissociating groups
  • Membership groups
 What two challenges must marketers overcome when marketing to Hispanics?
  1. The Hispanic subculture is diverse.
  2. A language barrier exists and commercial messages are frequently misinterpreted when translated to Spanish.
 Drive->Cue->Response->Reinforcement
 Industrial Marketing: 
 Characteristics of Industrial Buyers:
  1. Multiple buyers (buying committee) or centralized buyer (Approved vendor) (Materials Manager)
  2. Product specs
  3. Formalized paper flow (P.O. System)
  4. Bid System
 Types of Buys:
  1. Direct purchase: 2/10, net 60
  2. Lease
  3. "reciprocity" (questionable practice)
 Industrial Marketing Mix:
  • Product: is hard to identify. (benefit sought)
  • Price: may differ(vary). Base upon quantity.
    Payment scheme, fright terms, maintenance or promotional agreement. 
  • Promotion: Sales people are impt, advertising is focusing
  • Distribution: (distribution channel) extensive use of wholesalers/distributors
  
 Laws:Society's values and standards that are enforceable in the courts.
 Ethics:The moral principles and values that govern the actions and decisions of an individual or group.
 What are four possible reasons for the present state of ethical conduct in the US?
  1. Increased pressure on businesspeople to make decisions in a society characterized by diverse value systems.
  2. A growing tendency for business decisions to be judged publicly by groups with different values and interests.
  3. The public's expectations of ethical business behavior has increased.
  4. Ethical business conduct may have declined.
 Culture:Refers to the set of values, ideas and attitudes that are learned and shared among the members of a group.
 Business Cultures:"Compromise the effective rules of the game, the boundaries between competitive and unethical behavior, (and) the codes of conduct in business dealings."
 Ethics of Exchange:
  • Caveat Emptor
  • Consumer Bill of Rights
  • FTC (Federal Trade Commission)
  • Children's Online Privacy Protection Act (1998)
 Caveat Emptor:Before the 1960's the legal concept of Caveat emptor - let the buyer beware- was pervasive in the American business culture.
 Consumer Bill of Rights:In 1962 JFK, outlined CBOF that codified the ethics of exchange between buyers and sellers.
The right to:
  1. Safety
  2. To be informed
  3. To choose
  4. To be heard
 Ethics of Competition:
  1. Economic Espionage
  2. Bribery
 Economic Espionage:The clandestine collection of trade secrets or proprietary information about a company's competitors.
  • Practice is illegal and unethical.
  • Most prevalent in high-techhnoloy companies.

 Bribery:Two Laws to curb bribery & economic espionage:
  1. Economic Espionage Act (1996)
  2. Foreign Corrupt Practices Act (1917)


Most evident in countries in industries experiencing intense competition and in countries in the earlier stages of economic development.

 Corporate Culture:Set of values, ideas and attitudes that is learned and shared among members of an organization.
  • Code of Ethics
  • Ethical Behavior of Top management & co-workers
 Code of Ethics:A formal statement of ethical principals and rules of conduct.
  • Lack of specificity is a major reason for violation of code of ethics.
 Ethical Behavior of Top Management & Co-workers:Reason for violating ethics codes rests in the perceived behavior of top management.
  • Whistle-Blowers: Employees who report unethical or illegal actions or their employers.
 Personal Moral Philosophies:
  • Moral Idealism
  • Utilitarianism
 Moral Idealism:Considers certain individual rights or duties as universal regardless of the outcome.
  • Exists in consumer bill of rights
 Utilitarianism:Focuses on "greatest good for greatest number"
by assessing the costs and benefits of the consequences of ethical behavior.
  • If benefits exceed cost, behavior is unethical.
 Social Responsibility:
  1. Profit Responsibility
  2. Stakeholder Responsibility
  3. Societal Responsibility
 Profit Responsibilitiy:Companies have simple duty- to maximize profits for their owners or stockholders.
 Stakeholder ResponsibilitiyFocuses on the obligations an organization has to those who can affect achievement of it's objectives.
 Societal Responsbility:Refers to obligations that organizations have to the preservation of ecological environment, to the general public
  • Triple-bottom line: Recognition of the need for organizations to improve the state of people, the planet, & profit simultaneously if they are to achieve sustainable long-term growth.
  • Green Marketing: Mktg efforts to product, promote & reclaim environmentally sensitive products.
  • Cause Marketing: Occurs when charitable contributions of a firm are tied directly to the customer revenues produced through te promotion of one of its products.
 Social Audit:A systematic assessment of a firms objectives, strategies & performance in terms of social responsibility.

  • Sustainable Development
 Sustainable Devlopment:Involves conducting business in a way that protects the natural environment while making economic progress.
Companies:
  1. benefit from favorable word of mouth among consumers
  2. Typically outperform less responsible companies on financial performance
 Greenwashing:Practice of making an unsubstantiated or misleading claim about the environmental benefits  of a product, service, technology or company practice. kj
 Environmental Scanning:The process of contrinually acquiring information on events occuring outside the organization to identify and interpret potential trends.
 Social Forces:Include the demographic characteristics of the population and its values.
 Demographics:Describing a population according to selected characteristics such as age, gender, ethnicity, income and occupation.
 Aspects of Marketing Environment:
  1. Social envt
  2. Legal envt
  3. Competitive envt
  4. Technological envt


Envt is largely uncontrollable. It can be influenced though.

 Electronic commerce:Any activity that uses some form of electronic communication in the inventory, exchange, advertisement, distribution and payment of goods and services.
 What are the four forms of competition?
  1. Pure Competition: There are many sellers and they each have a similar product.
  2. Monopolistic competition: Many sellers compete with substitutable products within a price range.
  3. Oligopoly: a common industry structure, occurs when a few companies control the majority of industry sales.
  4. Pure monopoly: occurs when only one firm sells the product.
 Sherman Antitrust Act (1890)Federal legislation passed to encourage competition.
Lobbying by farmers in the Midwest against fixed railroad shipping prices led to the passage of this act. It forbids:
  1. Contracts, combinations, or conspiracies in the restraint of trade
  2. Actual monopolies or attempts to monopolize any part of trade or commerce.

Because the law wasn't very successful, the Sherman Act was supplemented with the Clayton Act (1914). 

It made "contracts, combinations or conspiracies" illegal in restraint of trade.

 Robinson-Patman Act (1936)Small businesses were threatened, and they lobbied for this.
The act makes it unlawful to discriminate in prices charged to different purchasers of the same product, where the effect may substantially lessen competition or help create a monopoly.
(Price discrimination)
 Types of Laws:
  1. Pro-competitive or anti-trust laws
  2. Consumers Protection laws
  3. Societal protection laws
 Price Discrimination:Charging 2 different buyers two different prices for products of like grade and quality.

  • Illegal in interstate commerce
  • Burden of Proof: is on violator
 3 ways of R.P. act?
  1. Justify different prices on basis of cost to serve
  2. Meeting competition in good faith
  3. Buyers in 2 different markets (no advantage provided)
 Where marketing fits into the organization?
  • Corporate Level (Board room)
  • Functional Level (Grunt level) 
 Corporate Levels:Where top management directs overall strategy for the entire organization.
  • Board, Global Decisions
  • Sequence of Decisions:

-Mission

-Goals

-Strategies (plans)

-Tactics

 Strategic Business Unit Level (SBU): A subsidiary, division, or unit of an organization that markets a set of related offerings to a clearly defined group of customers.
  • Managers set a more specific strategic directions for their business to exploit value-creating opportunities.
 Functional Level:Groups of specialists actually create value for the organization.
  • Department: referts to these specialized functions such as marketing and finance.
  • At functional level the organizations strategic direction becomes its most specific and focused.
 Functional Level continued..:A. Operating Activities - "day to day"
B. Content:

-Marketing/sales

-Production

-Management Information Systems (MIS)

-Control System

-Human resources

 Market Segmentation:Involves aggregating prospective buyers into groups or segments, that have common needs and will respond similarly to a marketing action.
 Market segments:The relatively homogeneous groups of prospective buyers that result from the market segmentation process.
 Product Differentiation:Involves a firm using different marketing mix activities, such as product features and advertising to help consumers perceive the product as being different and better than competing products.

Ascribing character to goods that are essentially identical, across vendors.
 Marketing Strategy:
  1. Choose a target market

-segment

-select segments


2. Develop a marketing mix for each target market



 Segmentation:Segmentation is breaking up a market (group of buyers) on the basis of shared characteristics. (The Four P's)
 Segmentation Characteristics:'Bases'
  • Geographic (easy to access)
  • Demographic (homogenous)
  • Psychographic (lifestyle)
  • Behaviorists

-use pattern

-volume used (80:20)

-purpose

-experience level

 2/10 net 60

Means that the buyer receives a two percent discount off the purchase price if the product is paid for within 10 days. Te net amount is due within sixty days.

 Reciprocity

= trade. No money may be exchanged. May run afoul of the Sherman Antitrust Act. Such arrangements exclude competitors and may thereby be in restraint of trade.

 How to influence environment?Aspects of the environment interrelate.
Organizations influence lawmakers, judges and regulatory bodies
. In turn, lawyers influence laws, judges and regulators. Many politicians are lawyers, and politicians make laws. Lawyers make laws as legislators, interpret laws as judges and they litigate.
 What kind of law is the Sherman Anti-Trust Act? Antitrust laws.
 Consumer Protection laws:Relate to packaging, labeling, content and design of products.
 Societal protection laws:Involve the organization and aspects of the environment.
  • Were enacted to protect the ecosystem and progeny (future consumers).
 Sherman Anti-Trust Act pt. 2:The basis for all American antitrust law.
Arost with the industrial revolution.
Andrew Carnegie, J.P. Morgan George Eastman and Henry Ford arose during the IR.
 Conspiracy:Exists when one entity gains assent from another to set price or to control a situations as to hard a third party.
 Structure:A unit where two or more people work towards a common goal.
36, "/var/app/current/tmp/"