COMM 180-marketing
Terms
undefined, object
copy deck
- mission statement
- direction for short-term and long-term, market-(not product)oriented
- relative market share
- market share compared to market leader
- Boston consulting group growth-share matrix
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top right-most want to promote
industry growth |
|
|
-----------------------------
rel. market |
share |
| - marketing plans
-
1.summary
2.market analysis
3.SWOT analysis - SWOT analysis
-
strengths opportunities
x
weakness threats
(see sheet) - SBU
- strategic business unit
- post hoc segmentation
- sell product, analyze, change product
- a priori segmentation
- make changes first, then sell
- benefits sought
- what public wants from product
- perceptual map
- map of consumer perception
- psychographic testing
- hard to use b/c difficult to measure and compare attributes
- seller's market
- demand exceeds supply
- buyer's market
- supply exceeds demand
- Customer relationship management (also called CRM)
- the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction.
- lifetime value of the customer
- It costs 5 to 10 times MORE to attract a new customer than it does to keep a current customer satisfied.
- 4 types of utility
- ownership, place, time, form
- Form Utility
- Transformation of raw materials and/or labor into a finished good and/or service that the consumer desires.
- Place Utility
- Availability of a good and/or service where the consumer wants or needs it.
- Ownership Utility
- Transferring title of a good and/or service from producer to consumer.
- Time Utility
- Availability of a good and/or service when consumer wants/needs it.
- Marketing as an Exchange Process
- Process by which one or more parties give something of value to each other to satisfy perceived needs.
- marketing mix
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Product,Place
(Distribution), Promotion, Price - Product
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Refers to goods, services, people, places and ideas
Household consumers
Business-to-business customers -
Place
(Distribution) - the network of organizations that create time, place and ownership utilities for household consumers and business customers.
- Integrated Marketing Communication (IMC)
-
System of management and integration of marketing communication elements
Advertising, publicity, sales promotion, personal selling, sponsorship marketing, and point-of-purchase communications - Price
- based on: Customer demand, costs, information availability, competition, profit motives, product considerations, and legal considerations
- Strategic planning
- The process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities
- Fundamentals of Strategic Planning
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1.Establishing the Organizational Mission
2. Defining Strategic Business Units
3. Specifying Organizational Objectives
4. Analyzing Strategic Business Unit Performance
5. Assessing Organizational Growth Opportunities
6. Developing Marketing Plans - Strategic Business Units (SBU's)
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smaller divisions, to facilitate planning and general operations
setup within a company to provide independent entities for strategic evaluation. - Well developed organizational objectives should be SMART
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Specific
Measurable
Achievable
Relevant
Time-bound - Analyzing Strategic Business Unit Performance
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high ind. growth & high rel. market share: star
high ind. growth & low rel. market share: problem child
Low ind. growth rate & high rel. market share: cash cow
Low in. growth & low rel. market share: dog - Problem Child
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Low market share
Poor profit margins
Strategy: Either invest to earn market share or consider disinvesting. - Star
-
High market share
High market growth
Generates substantial cash flows
Requires large investment
Strategy: Invest profits for future growth - Cash Cow
-
High market share
Low market growth
Generates profits and cash flows
Maintains superiority
Strategy: Use profits to finance new products and growth elsewhere. - Dog
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Low market share
Low market growth
Generates little profits
Strategy:
Focus on one segment or
Harvest the product or
Divest the product or
Eliminate the product - Intensive Growth Strategies aka product/market expansion grid
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Market penetration—sell more of existing products to existing markets
Market development—find new markets for existing products
Product development—develop new products for existing markets
Product diversification—develop new products for new markets - Situational Analysis
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Internal Analysis
organization’s
strengths and
weaknesses
External Analysis
opportunities and threats that confront a brand at a point in time. - Consumer behavior
- the process by which individuals or groups select, use, or dispose of goods, services, ideas, or experiences to satisfy needs and wants.
- Users
- consumers who are concerned about product features and how successfully the product can be used.
- Payers
- consumers who pay for a product and are concerned with the price of the product and the inherent financial considerations.
- Buyers
- consumers who are focused on the logistics of purchasing the product.
- Factors Affecting the Consumer Buying Decision Process
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1. cultural
2. social
3. personal
4. psychological - reference groups
-
All the formal and informal groups that affect a consumer’s purchase decision
Three types:
Membership groups
Aspirational groups
Dissociative groups - Membership groups-
- groups to which the consumer belongs.
- Aspirational groups-
- groups that a consumer wants to belong to.
- Dissociative groups-
- groups that consumers do not want to be associated with.
- Psychological Bases of Consumer Behavior
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Perception
Learning
Motivation
Attitude
Psychographics - Perception
- the process by which an individual senses, organizes, and interprets the information he or she receives from the environment.
- Learning
- is a change in the content of long-term memory.
- Motivation
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the state of drive or arousal that drives behavior toward a goal-object.
Two components:
Drive or arousal
A goal-object - Attitude
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Consumers evaluate products in terms of various attributes of the competing brands.
Attitudes are learned.
Attitudes are predispositions.
Attitudes cause consistent response. - Fishbein Model
-
n
Ao = Σ wj* boj
j=1
Where: Ao = overall attitude toward object/brand o
Wj = weight of attribute j
Boj = belief that object/brand o is satisfactory on attribute j
n = number of attributes evaluated - lifestyle
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The way we live
Lifestyle is a function of:
Activities
Interests
Opinions - Three Primary Motivations
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Ideals: guided by knowledge and principles
Achievement: guided by products that demonstrate success to peers
3. Self-Expression: guided by desire for social or physical activity, variety, and risk -
Resources Innovation
(vertical dimension) - A person’s tendency to consumer products extends beyond age, income, and education. Energy, self-confidence, intellectualism, novelty seeking, innovativeness, impulsiveness, leadership, and vanity play a critical role.
- Consumer profile: Thinkers
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Motivated by ideals
Mature, satisfied, comfortable, and reflective
Well educated and informed
Open to new ideas - Customer profile: Achievers
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Desire for achievement
Goal-oriented lifestyles
Deep commitment to career and family
Respect authority, and favor the status quo
Image is important - Experiencers
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Motivated by self-expression
Young, enthusiastic, and impulsive consumers
Seek variety and excitement
Sports, outdoor recreation, and social activities are important - Believers
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Motivated by ideals
conservative, conventional people with traditional values
Brand loyal
Favor American-made products - Strivers
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Trendy and fun loving
Motivated by achievement
Concerned about opinions and approval of others
Shopping is a social activity - Makers
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Motivated by self-expression
Self-sufficient group
Practical with little interest in most material possessions
Buy basic products - Innovators
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Successful, sophisticated, take-charge people with high self-esteem
Receptive to new ideas and technologies
Image is an important expression of innovativeness - Survivors
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Narrowly focused lives
Few resources
Believe the world is changing too quickly
Cautious consumers who are brand loyal - Problem recognition
- occurs when consumers realize that they need to do something to get back to a normal state of comfort.
- Needs
- unsatisfactory conditions of the consumer that prompt him or her to an action that will make the condition better.
- Wants
- desires to obtain more satisfaction than is absolutely necessary to improve an unsatisfactory condition.
- Brands:awareness set
- consists of brands of which a consumer is aware.
- Brands:evoked set
- consists of the brands in a product category that the consumer remembers at the time of decision making.
- Brands:consideration set.
- Of the brands in the evoked set, those considered unfit are eliminated right away. remaining brands
- choice models:
- The process and steps involved in evaluating products
- Compensatory
- the consumer arrives at a choice by considering all of the attributes of a product and mentally trading off the alternative’s perceived weakness on one or more attributes for its perceived strength on other attributes.
- Noncompensatory
- the consumer arrives at a choice by considering only some of the attributes of a product and does not trade-off some attributes for others.
- Cognitive dissonance-
- the doubt and regret the buyer may feel about the purchase choice.
- Market
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Individuals or organizations who:
Are willing, able, and capable of purchasing a firm’s product
Segmentation is critical because demand is often heterogeneous - Target Marketing (pros and cons)
-
Advantages
Tailoring of products to market
Assessment of demand potential
Identify competing products
Increased sales effectiveness and cost efficiencies
Product positioning and easy identification of opportunities
Disadvantages
Increased marketing costs
Personalization can become burdensome to manage
Segmentation may be viewed cynically
Narrow segmentation can impact brand loyalty
Ethics and stereotyping issues - Undifferentiated targeting strategy
- Companies might develop one marketing mix strategy that is appropriate for all members of the total market (mass marketing).
- Concentrated strategy
- Only one marketing mix is developed and directed toward a few, or perhaps one, profitable market segments.
- Differentiated strategy
- Exists when a firm develops different marketing mix plans specially tailored for each of two or more market segments.
- Profile
- paints a clear picture of the typical customer for the company’s product using all applicable segmentation variables.
- Positioning
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Attempts to build or occupy
mental niche in relation to
competitor - Perceptual Mapping-
- creating a visual depiction about consumer perceptions of a product on two or more dimensions in relation to competitors.
- marketing offer
- combination of products, services, info, or experience offered to market to satisfy a want or need
- marketing management
- choosing target markets and building profitable relationships with them
- demarketing
- reduce # of customers/demand
- production concept
- consumers favor highly affordable and available products
- product concept
- consumers favor products w/ the most quality
- marketing concept
- must know needs and wants of target markets
- customer-drivinig marketing
- understanding cust. needs better than customers do. telling customers what they need
- societal marketing concept
- questions whether pure marketing chooses customer's short-run wants, over long-term welfare. ethical
- 4 P's of marketing
- product, price, place, and promotion
- Partner relationship management
- marketers must work closely w/ other marketing partners
- supply chain
- channel streching from raw materials to components to final products to final buyers
- share of customer
- amount/percentage each customer is spending
- customer equity
- combined discounted customer lifetime values of all current and potential customers
- Customers: butterflies
- profitable but not loyal
- Customers: good friend...
- profitable and loyal
- Customers: barnacles
- loyal but not profitable
- social marketing campaigns
- campaigns aimed at helping people, ethical
- value chain
- chain of departments in company
- marketing control
- evaluating marketing strategies, making changes.
- operating control
- checking ongoing performance v. annual plan
- strategic control
- determining if company's basic strategies are well-matched to its opportunities
- marketing audit
- tool for reassessing approach to the marketplace. comprehensive, systematic, independent, and periodic examination of company's objectives to determine problem areas/ opportunities.
- Return on marketing (marketing ROI)
- net return on marketing investment divided by the costs of investment
- motion/drive
- need that is sufficiently pressing to direct person to seek satisfaction
- selective distortion
- people screen out most info exposed to them
- complex buying behavior
- consumers involved in expensive, infrequent purchase w/ little differentiation b/w brands
- habitual buying behavior
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purchase doesn't matter much, no brand stands out
eg. salt - variety-seeking behavior
- low consumer involvement, major brand differences
- alternative evaluation
- how consumer evaluates brand names
- adaption process
- time for consumer to accept new product and become regular user of it
- behavioral segmentation
- divided by knowledge, attitudes, uses and responses, may be best indicator
- occasion segmentation
- buyers grouped by when they decide to, and actually make purchases, and when they use the product
- benefits segmentation
- finding major benefits people look for in product
- PRIZM system
- system by claritas, uses multiple demographic factors
- intermarket segmentation
- companies find people from different markets by needs and behavior
- undifferentiated marketing
- mass-marketing, no segmentation
- differentiated
- provide different products for dif. segments
- concentrated marketing
- firm goes after large share of small segment
- micromarketing
- local and individual marketing
- Unique selling position (USP)
- company should position itself as #1 in some category