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MKTG101 > midterm flashcards > Flashcards

midterm flashcards

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1
Q

Production Concept
(assumption & marketers’ response)

A

Consumers favour products that are available & highly affordable.

Marketers: Focus on improving production & distribution efficiency

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2
Q

Product Concept
(assumption & marketers’ response)

A

Consumers favour products that offer the most in quality, performance and innovative features

Marketers: Focus on making continuous product improvement

eg. Apply, Dyson

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3
Q

Selling Concept
(assumption & marketers’ response)

A

Consumers will not buy unless it undertakes a large-scale selling & promotion effort

Marketers: Focus on creating sales transactions rather than building on long-term & profitable customer relationships

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4
Q

Marketing Concept
(assumption & marketers’ response)

A

Company needs to know the needs & wants of target customers, and deliver the desired satisfaction better than competitors do.

Marketers: Focus on customers’ needs and wants, and what they value

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5
Q

Societal Marketing Concept
(assumption & marketers’ response)

A

Company to consider consumers’ wants, the company’s requriements, coonsumers’ long-run interests & society’s long-run interest.

Marketers: Focus on sustainable marketing, socially and environmentally responsible marketing

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6
Q

What are the 2 core marketing concepts?

A
  1. Customer Orientation
  2. Value Creation
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7
Q

Customer Orientation (core mkt concept)

A

Concerns the customer’s POV.
Everything starts with the customer.

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8
Q

The 4 types of customer value in value creation (core mkt concept)?

A
  1. Functional Value
  2. Economic Value
  3. Emotional Value
  4. Social Value
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9
Q

Functional Value

A

Product’s performance, quality, taste etc

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10
Q

Economic Value

A

Product is faster, cheaper etc

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11
Q

Emotional Value

A

How it feels to buy, own and use the product eg. aesthetics

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12
Q

Social Value

A

What it means to you and to others to buy and own eg. higher self-esteem

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13
Q

What are the 3 Marketing Principles (3Cs)?

A
  1. Company
  2. Customers
  3. Competitors
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14
Q

6 Environmental Forces

A
  1. Demographic (eg. age distribution)
  2. Economic (eg. economy’s purchasing power)
  3. Socio-cultural (eg. beliefs, values, norms)
  4. Natural (eg. raw materials)
  5. Technology
  6. Legal-Political
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15
Q

Characteristics affecting Consumer Behaviour

A
  1. Cultural (culture, subculture, social class)
  2. Social (reference groups, family, status)
  3. Personal (age, lifestyle, self-concept)
  4. Psychological (motivation, perception, beliefs & attitudes)
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16
Q

Impact of Perception

A

Powerful as many consumer cognitions & behaviours are unconscious, automatic and uncontrollable by the perceiver.

eg. Low quality perception due to chronic discounts

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17
Q

Country of Origin effects (under Perception)

A

Mental associations & beliefs triggered by a country which affects consumer decision making.

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18
Q

Complex Buying Behaviour (buying decision behaviour)

A

Significant difference betw brands; High involvement

eg. expensive items, infrequent purchase

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19
Q

Dissonance-reducing Buying Behaviour (buying decision behaviour)

A

Few difference betw brands; High involvement

(experience regret)
eg. expensive & risky, infrequent purchase

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20
Q

Variety-seeking Buying Behaviour (buying decision behaviour)

A

Significant difference betw brands; Low involvement

eg. brand switching behaviour, seeks for novelty

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21
Q

Habitual Buying Behaviour (buying decision behaviour)

A

Few difference betw brands; Low involvement

eg. low cost, frequent purchase, routine purchase

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22
Q

Buyer Decision Making Process (5 steps)

A
  1. Need recognition
  2. Information search
  3. Evaluation of alternatives
  4. Purchase decision
  5. Postpurchase behaviour
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23
Q

Market Research Process (4 steps)

A
  1. Define problems, decision alternatives & research objectives (most important)
  2. Develop research plan for collecting information
  3. Implementing the research plan - collecting & analysing data
  4. Interpreting and recording the findings
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24
Q

Observational Research (primary data collection)

A

Observe relevant people, actions and situations to gather primary data

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25
Ethnographic Research (primary data collection)
Sending trained observers to watch and interact with consumers in their 'natural environments'
26
Survey Research (primary data collection)
Ask people questions about their knowledge, attitudes, preferences and buying behaviour
27
Experimentation (primary data collection)
Selecting matched groups of subject, give them different treatments while controlling related factors and checking for differences in group responses
28
Focus Groups - Qualitative Research
Small group of people guided by a moderator through an unstructured, spontaneous discussion about some topic
29
Advantages of quantitative research
1. Gather a wide range of information from a large number of people 2. Can represent population of interest with correct sampling
30
Disadvantages of quantitative research
1. Surface information 2. Causality can not be established 3. Subject to biases if not careful
31
Best research approach for causal research?
Experimentation: X causes Y (cause & effect relationships) Two critical aspects: - Random assignment - Tight control
32
What is Causal Research mainly used for?
1. Test marketing 2. Effects of change in marketing mix eg. Does a price reduction cause sale increase? Does endorsement by New Jeans cause increase in brand liking for McD?
33
Why is STP needed (2 reasons)?
1. Increasing customer sophistication (variation in customer preferences, easy access to product information) 2. Tougher competition
34
Geographic Measurement (Segmentation - Ease of Cost of Measurement)
Easy and low cost; Low predictability of behaviour
35
Demographic Measurement (Segmentation - Ease of Cost of Measurement)
2nd in rank Relatively low cost; Relatively low predictability of behaviour
36
Psychographic Measurement (Segmentation - Ease of Cost of Measurement)
3rd in rank Relatively difficult & high cost; Relatively high predictability of behaviour
37
Behavioural Measurement (Segmentation - Ease of Cost of Measurement)
Highest rank. Difficult & high cost; High predictability of behaviour
38
5 threats posed by competitive forces that determine the long-run attractiveness of a market (Michael Porter's 5 forces)
1. Intense segment rivalry 2. New entrants 3. Substitute products 4. Buyers' growing bargaining power 5. Suppliers' growing bargaining power
39
Marketing Mix Strategy (4Ps)
Product, Price, Place, Promotion
40
Core Benefit, Actual Product, Augmented Product
Core benefit: Fundamental service or benefit the customer is really buying Actual product: Features, brand name, packaging & other attributes Augmented product: Additional customer services and benefits built around the core & actual products
41
Product Line
A group of products closely related as they: - Function in a similar manner - Sold to the same customer groups - Marketed through the same type of outlets / fall within given price ranges
42
Upward Stretching (product line) + reasons
Low or mid-priced brand introduces high-end items to compete in the higher-end market. Reasons: 1. Higher growth rate & margins 2. Can position company as full-line manufacturer (producing wide range of products within a specific category to meet different customer needs)
43
Problems with Upward Stretching
1. Higher-end competitors may attack company's new product 2. Prospective customers may not believe that lower-end company can produce high-quality products 3. Salespersons and distributors lack talent & training to serve higher-end market 4. Existing retailers may not be able to handle new product
44
Downward Stretching (product line) + reasons
High-end brand introduces a lower-priced version of its product line to attract price-sensitive customers. Reasons: 1. Attacked by competitors 2. Slower growth at higher end 3. Intend to roll down 4. Plug a market hole that would attract a new competitor
45
Problems with Downward Stretching
1. New low-end item may steal sales from high-end product 2. Provoke competitors to counteract 3. Company's dealers may not be willing / able to handle the lower-end items
46
Two-way Stretching (product line) + reasons
Stretching company's line in both directions. Reasons: 1. Complete its product line and compete with competitors 2. Take market share away from competitors
47
Problems with Two-Way Stretching
1. Competitors may reduce their prices and encourage price war if there are few differences between the company's low-end product & competitors' existing products 2. Consumers may be confused with company's image 3. Success depends on the availability of company resources & management performance
48
What is Product Mix?
A total set of product lines and individual products that a company offers to consumers, including all variations & products across different categories to help serve different customer needs and expand market reach.
49
Line Extension
Adding new variation of an existing product within the same product line to appeal to different customer preferences
50
4 characteristics that limit expansion of services
1. Intangibility 2. Inseparability 3. Variability (limits the most) 4. Perishability
51
3 marketing strategies for service firms
1. Service-profit chain 2. Internal marketing 3. Interactive marketing
52
Service-profit chain (marketing strategy)
Links service firm's profits with employee and customer satisfaction
53
Internal marketing
Service firm orient and motivate its customer-contact employees & supporting service people to work as a team to provide customer satisfaction
54
Interactive marketing
Service quality depends heavily on the quality of the buyer-seller interaction during the service encounter
55
What is Brand Equity?
The differential effect that knowing the brand name has on customer response to the product or its marketing.
56
What is Brand Value?
Total financial value of a brand
57
4 brand development strategies
1. Line extension 2. Brand extension 3. Multibrands 4. Ingredient branding
58
Brand Extension (brand development)
Using a successful brand name to launch new or modified products
59
Multibrands (brand development)
Markets multiple brands in the same product category
60
Ingredient Branding (brand development)
Marketing strategy where a component or an ingredient of a product or service is pulled into the spotlight and given its own identity
61
Product Life Cycle Stages
1. Product Development 2. Introduction 3. Growth 4. Maturity 5. Decline
62
3 competitive strategies for market leader
1. Expand the total market 2. Protect (or defend) current market share 3. Increase market share
63
3 marketing metrics
1. Market share % 2. Market size US$ (TAM, SAM, SOM) 3. CAGR %
64
Comparison of profit levers (Ranking the impact of each lever improvement is to profit improvement)
1. Price 2. Variable cost 3. Sales volume 4. Fixed cost
65
3 major pricing strategies
1. Cost-based pricing 2. Value-based pricing 3. Competition-based pricing
66
Cost-based pricing
Determine product costs and set price based on cost
67
Value-based pricing
Assess customer needs & value perceptions and set target price to match customer perceived value
68
Competition-based pricing
Sets prices based on competitors' pricing rather than focusing on production costs or customer demand
69
2 new-product pricing strategies
1. Market-skimming pricing 2. Market-penetration pricing
70
Market-skimming pricing
High initial prices to skim profits from early customers with the expectation of lowering prices later. - Quality & image must support price - Inelastic demand - High BTE where competitors cannot enter market easily
71
Market-penetration pricing
Low initial prices to penetrate into market quickly and deeply. - Price-sensitive market - Need EOS to offer low prices - Low prices must keep competition out of the market
72
Product line pricing
Setting different prices for various products within the same product line, creating a tiered pricing structure
73
Captive pricing (tying arrangement)
Pricing for two items that must be used together
74
Two-part pricing
Fixed fee upfront + variable fee based on usage
75
Optional pricing
Pricing of optional products or accessories
76
Product bundle pricing
Combining several products offering the bundle at a reduced price
77
Dynamic pricing
Continuously adjusting prices based on demand, supply, competitors prices etc
78
Customer-segment pricing
Different customers pay different prices for the same product
79
Product-form pricing
Different versions of product are priced differently but not according to differences in their cost eg. different packaging of same drink
80
Location pricing
Different prices for different locations
81
Time-based pricing
Prices vary by season
82
Psychological factors in price setting
1. Competitive reference 2. Extremeness aversion (prefer not too cheap but not too expensive) 3. Switching costs 4. Difficult comparison 5. End benefit 6. Price-quality 7. Expenditure 8. Shared cost 9. Fairness

MKTG101 (2 decks)

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