Chapter 13 Review

Marketing
The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large
Focus of Marketing
In the past, marketing was focused on helping the seller sell. Today is is helping the buyer buy.
Marketing involves helping the buyer buy through: (3)
1) Websites that help buyers find the best price, identify product features, and question sellers.
2) Blogs and social networking sites that cultivate consumer relationships
3) Virtual tours that allow the consumer to experience what they are about to buy
Production Era
The general philosophy was “Produce what you can because the market is limitless.”
Selling Era
After mass production, the focus turned from production to persuasion.
Marketing Concept Era
After WWII, a consumer spending boom developed. Businesses knew they needed to be responsive to consumers if they wanted their business.
Customer Relationship Era
Organizations seek to enhance customer satisfaction building long-term relationships.
The Marketing Concept (3)
Customer Orientation
Service Orientation
Profit Orientation
Customer Orientation
Finding out what customers want and then providing it.
Service Orientation
Making sure everyone in an organization is committed to customer satisfaction.
Profit Orientation
Focusing on the goods and services that will earn the most profit.
Customer Relationship Management (CRM)
Learning as much as you can about customers and doing what you can to satisfy or exceed their expectations. CRM allows companies to to enhance customer satisfaction and stimulate long-term customer loyalty (Ex. frequent flyer programs).
Newest forms of fostering customer relationships:
Social media, online communities and blogs
The increase and improvements in technology has caused…
marketing to switch from being always “on” to “on demand.” Consumers are constantly demanding new information regarding products through searchable technology that allows consumers to compare different products
As technology improves, consumer demands are going to rise in four areas:
Now – Consumers want to be able to interact at any time
Can I? – Consumers want to know if they can actually purchase or perform something
For me? – Consumers data is stored to provide relevant advertisements or promotions
Simple – Consumers want this process to be easy
The cost of acquiring a new customer is 5x the cost of retaining one. How to keep them: (6)
Build trust, emphasize the long term, listen, treat your customers like stars, show appreciation, and remember employees are customers too!
Nonprofit marketing tactics include: (6)
Fundraising, Public Relations, Special Campaigns, Ecological practices, Changing public opinions and attitudes, Increasing organizational membership
Nonprofit marketing strategies include: (6)
Determine the firm’s goals and objectives, Focus on long-term marketing, Find a competent board of directors, Exercise strategic planning, Train and develop long-term volunteers, and Carefully segment the target market
THE FOUR P’s (Marketing mix)
“Designing a want-satisfying product, setting a price for the product, putting the product in a place where people will buy it, and promoting the product”
Product, Price, Place, Promotion
Product
A good, service, or idea that satisfies a consumer’s want or need
Pricing a Product (4 Factors)
Pricing products depends on many factors:
• Competitors’ prices
• Production costs
• Distribution
• High or low price strategies
Placing a Product
Middlemen are important in place strategies because getting a product to consumers is critical.
Promotion (what is it and what does it include)
All the techniques sellers use to inform people about their products and motivate them to purchase those products. Get customers emotional about your product.
Includes: Advertising, Personal selling, Public relations, Word of mouth, Sales promotions (coupons and rebates)
Test Marketing
Testing product concepts among potential product users.
Brand Name
A word, letter, or a group of words or letters that differentiates one seller’s goods from a competitor’s.
Marketing research
Analyzing markets to determine challenges and opportunities, and finding the information needed to make good decisions.
Research is use to…
identify products consumers have used in the past and what they want in the future. It uncovers market trends and attitudes help by company insiders and shareholders
Four steps in Market Research process:
Defining the problem or opportunity and determining the present situation.
Collecting research data.
Analyzing the data.
Choosing the best solution and implementing it.
Primary data (definition & example)
In-depth information gathered by marketers from their own research.
Ex) Telephone, online and mail surveys, personal interviews, and focus groups are ways to collect primary data.
Secondary data (definition & procon)
Existing data that has previously been collected by sources like the government.
Pro – incurs no expense and easily accessible
Con – Doesn’t always provide all the needed info for marketers
Three things marketers must do:
1) turn data into useful info
2) use their analysts to plan strategies and recommendations
3) Must evaluate their actions and determine if further research is needed
5 Benefits of market research:
1)Analyze customer needs and satisfaction.
2)Analyze current markets and opportunities.
3)Analyze the effectiveness of marketing strategies.
4)Analyze marketing process and tactics currently used.
5)Analyze the reasons for goal achievement or failure.
5 ways to find out how costumers think:
1)Conduct informal consumer surveys
2)Host a customer focus group
3)Listen to competitor’s customers
4)Survey your sales force
5)Become a phantom customer
Environmental Scanning (list 5 factors)
process of identifying factors that affect marketing success.
1)global
2)technological
3)sociocultural
4)competitive
5)economic
Consumer market
All the individuals or households that want goods and services for personal use and have the resources to buy them
Business-to-Business (B2B)
Individuals and organizations that buy goods and services to use in production or to sell, rent, or supply to others.
B2B marketers include: (4)
Manufacturers
Wholesalers and retailers
Hospitals, schools and charities
Government
In a B2B market, products are often sold and resold several times before reaching final consumers. (TorF)
true
In a B2B market, there are more customers, with smaller purchases (TorF)
false, exact opposite
In a B2B market, buyers are geographically located, and selling is direct (TorF)
true
Market segmentation
Divides the total market into groups with similar characteristics.
Target marketing
Selecting which segments an organization can serve profitably.
Geographic segmentation
Dividing the market by cities, counties, states, or regions.
Demographic segmentation
Dividing the market by age, income, education (demographic variables).
Psychographic Segmentation
Dividing the market by group values, attitudes, and interests.
Benefit Segmentation
Dividing the market according to product benefits the customer prefers.
Volume (Usage) Segmentation
Dividing the market by the volume of product use.
Niche marketing
Identifies small but profitable market segments and designs or finds products for them.
One-to-one marketing
Developing a unique mix of goods and services for each individual consumer.
Mass marketing
Developing products and promotions to please large groups of people.
Relationship marketing
Rejects the idea of mass production and focuses toward custom-made goods and services for customers.
Building Effective Relationships: (3)
Open communication; Consistently reliable service
Staying in contact with customers
Trust, honesty, and ethical behavior
Key Factors in Consumer Decision Making: (5)
Learning
Reference Groups
Culture
Subcultures
Cognitive Dissonance