Midterm Review 1

Question 1

what is marketing? and what is the aim?

Answer 1

managing profitable customer relationships

- aim is to make selling unnecessary

Question 2

what are the 2 core activities of marketing?

Answer 2

1. attract new customers by promising superior value

2. keep and grow current customers by delivering satisfaction and building long term relationships

Question 3

what is value?

Answer 3

perceived benefits - perceived costs = value

Question 4

what is marketing strategy?

Answer 4

process where a company determines who to sell to and how to offer their product to that group

• involves:
• segmentation
• targeting
• positioning

Question 5

what are marketing tactics?

Answer 5

collection of marketing activities that satisfy customer needs and build customer relationships (4 P’s)

Question 6

what are the 4 P’s or “product mix”

Answer 6

• product
• price
• place (distribution)
• promotion

Question 7

what are market offerings?

Answer 7

some combination of products, services, information or experience offered to a market to satisfy a need or want

Question 8

what is a market?

Answer 8

set of actual or potential buyers of a product or service

Question 9

what is a need?

Answer 9

state of felt deprivation including physical social and individual needs

Question 10

what is a want?

Answer 10

specific form of a need that is shaped by culture and personality

Question 11

what are demands?

Answer 11

a want backed by buying power

Question 12

what is value proposition?

Answer 12

the set of benefits that the marketer promises to deliver to the customer to satisfy their needs

Question 13

what must the value proposition do?

Answer 13

differentiate themselves from the competition and build customer value and satisfaction

Question 14

what is positioning? what question does positioning essentially answer?

Answer 14

arranging a product to occupy a clear, distinctive and desirable place relative to competing products in the minds of consumers
- why should I choose your brand rather than the competitors?

Question 15

what is production concept?

Answer 15

creating a product people want

Question 16

what is selling concept?

Answer 16

strong push or people won’t buy the product

• the need is not realized until later
• ex. graveyard plot or insurance

Question 17

what is product concept?

Answer 17

the improvement of a product to be the best alternative that satisfies customer needs
- ex. mouse trap replaced with poisons

Question 18

what is marketing concept?

Answer 18

satisfies a need for customers and explains how it is better than the competition

Question 19

what is societal marketing concept?

Answer 19

addition to marketing concept that makes sure needs are sustainable in the long run

Question 20

what is marketing myopia?

Answer 20

when a company focuses on selling a product instead of fulfilling customers needs
- lose sight of benefits and experience of the product

Question 21

what are basic customer relationships?

Answer 21

customer purchases product; there is no lasting relationship

Question 22

what are full customer partnerships?

Answer 22

the customers become to brand

- ex. harley davidson

Question 23

true or false it is cheaper to get a new customer than to keep and existing customer?

Answer 23

false, it costs 5-10 times more to attract a new customer than keep a current satisfied customer

Question 24

why is loyalty not always good?

Answer 24

loyal high volume customers know their worth to the company and may exploit the business to get premium services and discounts

Question 25

what are the types of customer relationships? what are their profit potential?

Answer 25

1. butterflies; high profit potential 2. true friends; highest profit potential 3. strangers; lowest profit potential 4. barnacles; low profit potential

Question 26

what is customer lifetime value?

Answer 26

the dollar value of all the purchases of a particular product/ brand/retailer that a customer will make in their lifetime

Question 27

what is share of customer?

Answer 27

the portion of a particular customers purchasing in the marketers product category

Question 28

what is customer equity?

Answer 28

the total combined customer lifetime value of all the company's customers

Question 29

what are the 4 steps in marketing planning?

Answer 29

1. learn about the environment 2. define objectives 3. design a strategy to achieve those objectives 4. measure results to determine if you achieved your objectives

Question 30

what is the purpose of a SWOT analysis?

Answer 30

to build understanding of the internal and external situations of a company

Question 31

what does SWOT stand for?

Answer 31

strengths; internal capabilities that may help a company reach its objectives weaknesses; internal limitations that may interfere with a compacts ability to reach its objectives opportunities; external factors that the company may be able to exploit to its advantage threats; current and emerging external factors that may challenge the company performance

Question 32

what is environmental analysis?

Answer 32

actors and forces inside and outside the company that affects management ability to build and maintain relationship with target customers

Question 33

what is mircoenvironment?

Answer 33

actors close to the company that affect its ability to serve its customers

Question 34

what is macroenvironment?

Answer 34

larger forces that affect microenvironment and are considered to be beyond control of the organization

Question 35

what is objective setting?

Answer 35

the mission of the organization is translated into detailed, quantifiable objectives that fit the SMART goals

Question 36

what does SMART stand for?

Answer 36

``` specific measurable achievable relevant timely ```

Question 37

what is in business portfolio BGC matrix?

Answer 37

``` stars; - high profit potential - attracts competition - may need heavy investment question marks; - build into stars or phase out - requires cash to build market share cash cows; - established and successful - no serious investments dogs; - low profit, usually discontinued ```

Question 38

what are the outcomes of product market expansion grid?

Answer 38

- existing products + existing market = market penetration - existing products + new markets = market development - new products + existing markets = product development - new products + new markets = diversification

Question 39

what is segmentation? what is the purpose

Answer 39

dividing a market into distinct groups according to consumers needs, or related characteristics and behaviours - purpose: develop separate marketing mixes to better satisfy customer by creating products tailored to their specific needs

Question 40

what are common ways to segment?

Answer 40

1. benefit; identify combination of benefits - most important segment 2. geographic; dividing a market into different geographic units - ex. countries, cities 3. demographic; diving the market into groups based on observable demographic characteristics - ex. age, gender, income 4. psychographic; dividing a market into different groups based on shared attitudes, lifestyles and values - ex. personality; sensing vs. intuition, personality type 5. behavioural; didvdi market into groups based on consumers brand related behaviour such as knowledge, attitudes or response to a product - ex. user status, loyalty status

Question 41

what makes a good segment?

Answer 41

- measurable - accessible - sustainable - differentiable - actionable

Question 42

what is target market selection?

Answer 42

set of buyers sharing common needs that the company decides to serve

Question 43

what are the 9 criteria for evaluating segments?

Answer 43

1. size; market potential, current market penetration 2. growth; past growth, potential social changes 3. competition; barriers to entry and exist 4. protectability; patentability 5. risk; economic, political and technological change 6. fit; coherence with company's strengths and image 7. relationship with other segments; image transfers 8. profitability; entry costs, return on investment 9. costs; cost to develop, promote and distribute product

Question 44

what is product position?

Answer 44

how the product is defined by consumers relative to competing products

Question 45

what are the types of differentiation?

Answer 45

- product differentiation; consistency, reliability - service differentiation; speed, convenience - channel differentiation; coverage, expertise - brand image differentiation; convey benefits, positioning - people differentiation; hiring, training

Question 46

what is a positioning statement?

Answer 46

summarizes company or brand positioning

Question 47

what is the formate of a positioning statement?

Answer 47

to (target segment and need) our (brand) is (concept) that (point of difference)

Question 48

what is repositioning?

Answer 48

an attempt to change the image consumers have of a brand or company

Question 49

what are the 5 steps in consumer decision making?

Answer 49

step 1. problem recognition (perceiving a need) step 2. information search (seeking value) step 3. alternative evaluation (assessing value) step 4. purchase decision (buying value) step 5. post purchase behaviour (use value)