Chapter 5 & 6 – Principles of Marketing

What does the acronym CRM stand for?
Customer Relationship Management
Define CRM.
A systematic tracking of consumers’ preferences and behaviors over time in order to tailor the value proposition as closely as possible to each individual’s unique wants and needs. CRM allows firms to adjust elements of their marketing programs in light of how each customer reacts.
One-on-One Marketing Steps
1. Get to know the customer
2. Differentiate among those customers (categorize them)
3. Interact (engage) with the customer to find ways to be cost efficient and effective
4. Customize a product for a particular customer
CRM Characteristics
Share of customer
Lifetime value of a customer
Customer equity
Customer priortization
What is Big Data?
Big data is massive amounts of data that is hard to process using traditional database techniques
Name the four data mining applications for marketers
a. Customer acquisition
b. Customer retention and loyalty
c. Customer abandonment
d. Market basket analysis
What is marketing analytics
Technologies and processes that make it possible for marketers to measure the effectiveness of their marketing efforts.
What does the acronym SEO stand for?
Search Engine Optimization
a. A systematic process of ensuring that your firm comes up at or near the top of lists of typical search phrases related to your business.
Define customer behavior
A process that individuals go through to select, purchase, use and dispose of products (good/service) that satisfies needs.
Name the five steps in the consumer decision-making process
a. Problem (Need) Recognition
b. Information Search
c. Evaluation of Alternatives
d. Product choice
e. Post-Purchase Evaluation
Decision Making Steps
1. Problem (Need) Recognition
2. Information Search
3. Evaluation of Alternatives
4. Product Choice
5. Post-Purchase Evaluation
Habitual decision-making
consists of little conscious effort; purchases that are generally made out of habit
Extended problem solving
consist of a lot of conscious effort; takes a lot of time and deliberation
Limited problem solving
takes some work/time to make a decision but NOT a great deal
Define perception
The process by which we interpret information from the outside world through our 5 senses
What are the three stages of perception?
a. Exposure
b. Attention
c. Interpretation
Define learning
A relatively permanent change in behavior caused by acquired information or experience.
Behavioral learning theories
Theories of learning that focus on how consumer behavior is changed by external events or stimuli (learn through doing)
Cognitive learning theory
Theory of learning that stresses the importance of internal mental processes and that views people as problem solvers who actively use information form the world around them to master their environment (learn through mental processes)
Internal influences
1. Perception
2. Motivation
3. Learning
4. Attitudes
5. Personality
6. Age Groups
7. Lifestyle
External influences
1. Social
2. Situational
Social (External) Influences
1. Cultural
2. Lifestyle Trends
3. Age Groups
4. Group Memberships
Situational (External) Influences
(how, when and where)
1. Physical Surroundings
2. Effects of mood and behavior
Behavioral targeting
tracking the use of a consumers interaction on the internet
CRM’s purpose
creates programs to track (follow) customer’s preference and behavior.
What does the acronym MIS stand for?
Marketing Information System
Define MIS
Marketing information system a process that first determines what information-marketing managers’ need and then gathers, sorts, analyzes, stores, and distributes relevant and timely marketing information to system users.
Name the three components of MIS
1. Data
2. Computer hardware and software to analyze the data and to create reports
3. Output for marketing decision makers
Name and define the four types of company data
a. Internal company data
b. Marketing intelligence
c. Marketing research
d. Acquired database