Marketing Chapter 3, 4 & 5

Chapter 3
Mission statement
sets out the organization’s basic purpose of being. It should focus on a few key goals rather than embracing everything. It should apply guidelines that help managers determine which opportunities to pursue
Competitive environment
affects the number and types of competition
the marketing manager faces and how they may behave
Sustainable Competitive advantage
a marketing mix that customers See as better than a competitor’s mix and cannot be quickly or easily copied
Competitor Analysis
an organized approach for evaluating the strengths and weaknesses of current potential competitors’ marketing strategies
Competitive Rivals
firms that will be closest competitors
Competitor Matrix
an organized table that compares the and weaknesses of a company with those of its competitive rivals
Economic environment
refers to macro-economic factors including national income, economic growth and inflation that affects patterns of consumer and business spending
the application of science to convert an economy’s resources to output (it creates opportunities for new products and for few new processes)
an emphasis on a country’s interests before everything else—affect how macro-marketing systems work
North America Free Trade Agreement (NAFTA)
lays out a plan to reshape the rules of trade among the US, Canada and Mexico (enlarges free trade pact)
Cultural and Social Environment
affects how and why people live and behave as they do – which affects customer buying behavior and eventually the economic, political, and legal environments
Gross Domestic Product (GDP)
the total market value of all goods and services provided in a country’s economy in a year by both residents and nonresidents of that country
• GDP does not include foreign income
Gross National Income (GNI)
is a measure that is similar to GDP but GNI does not include income earned by foreigners who own resources in that nation.
Generation X
fewer in number, sometimes called GenX refers to the generation born immediately following the baby boomers from 1965-1977 (less of them than baby boomers)
Generation Y
sometimes called the Millennials refers to those born from 1978-1994, emerged from echo boom
the idea that it’s important to meet present needs without compromising the ability of future generations to meet their own needs
Chapter 4
is a group of potential customers with a similar needs who are willing to exchange something of value with sellers offering various goods and services – that is ways of satisfying those needs
Generic Market
is a market with broadly similar—needs and seller offering various, often diverse, ways of satisfying those needs
Product Market
is a market with very similar needs and seller offering various close substitute ways of satisfying those needs
Market Segmentation
is two-step process 1. Naming broad product-markets 2. Segmenting these broad product-markets in order to select target markets and develop suitable marketing mixes
as an aggregation process – clustering people with similar needs into a “market segment”
Market Segment
is a (relatively) homogenous group of customers who will respond to a marketing mix in a similar way
Single Target Market approach
segmenting the market and picking one of the homogenous segments as the firm’s target market
Multiple Target Market approach
segmenting the market and two or more segments and then treating each as a separate target market needing a different marketing mix
Combined Target Market approach
combining two or more submarkets into one larger target market as a basis for one strategy
try to increase the size of their target markets by combining two or more segments
aim at one or more homogenous segments and try to develop a different marketing mix for each segment
Qualifying Dimensions
are those relevant to including a customer type in a product-market
Determining Dimensions
are those that actually affect the customer’s purchase of a specific product or brand in a product market
Best Practice Approach to Segmenting Product-Markets
• 1. Select the abroad product-market
• 2. Identifying potential customers needs
• 3. Form homogeneous submarkets—narrow product-markets
• 4. Identifying dimensions
• 5. Name (nickname) the possible product-markets
• 6. Evaluating why product-market segments behave as they do
• 7. Make a rough estimate of the size of each product-market segment
Clustering techniques
try to find similar patterns within sets of data
Customer relationship management (CRM)
the seller fine-tunes the marketing effort with information from a detailed customer database.
refers to how customers think about proposed or present brands in a market
Chapter 5
Gross Domestic Product
the total market value of all goods and services provided in a country’s economy in a year by both residents and nonresidents of that country
the number of babies born per 1,000 people – has fluctuated greatly in the last 65 years
people born between 1946 and 1964
Metropolitan Statistical Area (MSA)
Which is an integrated economic and social unit with a large population nucleus
Real income
income that is adjusted to take out the effects of inflation on purchasing power
Disposable Income
what is left after taxes
Discretionary income
what is left of disposable income after paying necessities
people whose children are grown and who are now able to spend their money other ways
Senior citizens
people over 65