Introduction to Marketing Exam #1

marketing
the process by which companies create value for customers and build strong customer relationships in order to capture value from customers in return
the marketing process
a simple, five-step model companies and marketers use to create and capture value from customers which includes
1) understanding the marketplace and customer needs/wants
2) designing a customer driven marketing strategy
3) constructing an integrated marketing program that delivers superior value
4) building profitable relationships and creating customer delight
*these 4 steps combine to make the last step which is…*
5) capturing value from customers to create profits and customer equity
the marketing mix
a set of tools, also known as the 4 P’s, that work together to satisfy customers needs and build customer relationships
1) product = the goods/service combinationthe company offers to a target market
2) price = the amount of money customers must pay to obtain the product
3) place = company activities that make the product available to target consumers
4) promotion = refers to activities that communicate the merits of the product and persuade target customers to buy it
what are the five core customer and marketplace concepts that marketers must understand to be successful?
1) needs/wants/demands
2) market offerings (products/services/experiences)
3) value and satisfaction
4) exchanges and relationships
5) markets
needs
states of felt deprivation
wants
the form human needs take as they are shaped by culture and individual personality
demands
human wants that are backed by buying power
market offerings
some combination of products, services, information, or experiences offered to a market to satisfy a need or want
what must marketers and companies avoid at all costs?
marketing myopia (the mistake of paying too much attention to the product a company offers than to the long term benefits and experiences produced by these products)
exchange
the act of obtaining a desired from someone by offering something in return
market
the set of all actual and potential buyers of a product or service
define marketing management and its orientation strategies
Marketing management is the art and science of choosing target markets and building profitable relationships with them. There are 5 alternative concepts under which companies and organizations design and carry out their marketing strategies which include
1) production concept = consumers will favor products that are available and highly affordable therefore an organization must focus on improving production and distribution efficiency (ex: Henry Ford and the assembly line)
2) product concept = the idea that consumers will favor products that offer the most quality performance and features therefore the company must devote its energy to making continuous product improvements
3) selling concept = the idea that consumers will not buy enough of the firms product’s unless the firm undertakes a large-scale selling and promotion effort
4) marketing concept = a philosophy in which achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desires satisfactions better than competitors do
5) societal marketing concept = the idea that a company’s marketing decisions should consider consumers’ wants, the company’s requirements, consumers’ long run interests, and society’s long run interests (society and consumer centric)
marketing equals…
price and product development
define the 3 components of the strategic triangle
1) customers = wants, needs, and how to generate top satisfaction
2) competitors = focus on what they have/don’t have and capitalize on it to make your brand better
3) company = long and short term goals, strengths and weaknesses (personal AND corporate)
marketers can be…
profit or non profit
markets can be
1) individual consumers
2) groups that live in households
3) profit or non-profit
value equals…
benefits – cost
customer relationship management
the overall process of building and maintaining profitable customer relationships by delivering superior customer value
customer satisfaction
the extent to which a product’s perceived performance matches a buyer’s expectations
customer managed relationships
marketing relationships in which customers, empowered by today’s new digital technologies, interact with companies and with each other to shape their relationships with brands
consumer generated marketing
brand exchanges created by consumers themselves- both invited and uninvited- by which consumers are playing an increasing role in shaping their own brand experiences and those of other consumers
partner relationship management
working closely with partners in other company departments and outside the company to jointly bring greater value to customers
customer equity
the total combined customer lifetime values of all of the company’s customers
customer lifetime value
the value of the entire stream of purcheses a customer makes over a lifetime of patronage
define strategic planning and its steps
the 4 step process of developing and maintaining a strategic fit between the organization’s goals and capabilities and its changing marketing opportunities
1) define the company mission statement
2) set short and long term objectives
3) design a business portfolio
4) develop functional plans
* steps 1-3 are at the corporate level while step 4 is is at the business unit, product, and market levels*
define the mission statement and what should be avoided when developing it
a statement of the organization’s purpose- what it wants to accomplish in the larger environment; marketing myopia must be avoided at all costs when developing
business portfolio
the collection of businesses and the products that make up the company (Parent companies can have portfolios which consist of information on its subsidiaries while subsidiaries can have their own portfolios. example = The Walt Disney Company business portfolio includes information on theme parks, hotels, studio entertainment, consumer products, and media. ESPN, which is owned by Disney, has its own portfolio while still remaining one segment of Disney’s overall business portfolio)
portfolio analysis
the process by which management evaluates the products and businesses that make up the company
the process of creating a customer driven marketing strategy consists of
market segmentation, market targeting, differentiation, and positioning
define positioning in terms of marketing and its strategies
positioning defines where you, your company, and your product stand
markets consist of distinct groups of buyers with different needs, characteristics, or behaviors which leads to
market segmentation
define market segments
consist of consumers who respond in a similar way to a given set of marketing efforts. segments can include
1) geographic
2) demographic
3) psychographic
4) behavioral
marketing environment
the actors and forces outside marketing that affect marketing management’s ability to build and maintain successful relationships with target customers, made up of the micro-environment and macroenvironment
microenvironment
the actors close to the company that affect its ability to serve its customers- the company, suppliers, marketing intermediaries, customer markets, competitors, and publics.
macroenvironment
the larger societal forces that affect the micro-environment- demographic, economic, natural, technological, political, and cultural forces
marketing intermediaries
firms that help the company to promote, sell, and distribute its goods to final buyers
public
any group that has an actual or potential interest in or impact on an organization’s ability to achieve its objectives. Groups can include…
1) financial = influences company ability to gain funds
2) government = marketers consult company lawyer’s on various legal matters
3) media = various print and digital platforms
4) citizen-action = marketing decisions may be questioned by consumer organizations. This is where PR departments come into play to keep in touch with consumer/citizen groups.
5) local = includes neighborhood and community organizations
6) general = reputation among people
7) internal = managerial
demography
the study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics
economic environment
factors that affect consumer purchasing power and spending patterns
environmental sustainability
developing strategies and practices that create a world economy that the planet can support indefinitely
customer insights
fresh understandings of customers and the marketplace derived from marketing information that become the basis for creating customer value and relationships
marketing information system
people and procedures dedicated to assessing information needs, developing the needed information, and helping decision makers to use the information to generate and validate actionable customer and market insights