University of Arkansas Marketing 3433 Test 1 Lezon

Marketing
A key organizational function and a set of processes designed to create, communicate, and deliver value to customers.
Activities associated with Marketing
1. Communicating information about those goods and services to prospective buyers.
2. Making the products available when and where
customers want them.
3. Pricing merchandise and services.
4. Providing after-sales service and following-up.
5 eras of Marketing
1. Production
2. Sales
3. Marketing
4. Relationship
5. Social
Production era
Prior to 1920’s “A good product will sell itself”
Sales era
Prior to 1950’s “Creative advertising and selling will overcome consumers resistance and persuade them to buy”
Marketing era
Since 1950’s “The consumer rules! Find a need and fill it.”
Relationship era
Since 1990’s “Long-term relationships with customers and other partners lead to success”
Social era
Since 2000’s “Connecting to consumers via the internet and social media sites is an effective tool.”
Which of the 5 eras has really always been in play?
Relationships
Marketing Myopia
Management’s failure to recognize the scope of its business (product focus vs customer focused); Inability to continue to innovate
Not-for-profit Organizations
Focus is to generate revenue to support the organization’s causes and not on the bottom line.
Gross Domestic Product (GDP)
8 Marketing Functions
1. Buying
2. Selling
3. Transporting
4. Storing
5. Standardizing and Grading
6. Financing
7. Risk-taking
8. Securing marketing information
Buying function
Ensuring that product offerings are available in sufficient quantities to meet consumer demands.
Selling function
Using advertising, personal selling, and sales promotions to match products to consumer needs.
Transporting function
Moving products from their point of production to locations convenient for purchasers.
Storing function
Warehousing products until their needed for sale.
Standardizing and Grading function
Ensure that product offerings meet quality and quantity controls on size, weight, and other variables.
Financing function
Providing credit for channel members (wholesalers and retailers) and consumers.
Risk-taking function
Dealing with uncertainty about future customer purchases.
Securing Marketing Information function
Collecting information about consumers, competitors and channel members for use in making marketing decisions.
Strategic Planning
Determines an organization’s primary objectives; adopting courses of action that will achieve broad objectives; provide long-term direction for decision makers.
Tactical Planning
The implementation of detailed activities in the strategic plan; addresses shorter-term actions that are very specific in nature; focuses on “in the weeds” details of the planning process.
How long is short term?
12 months
How long is long term?
More than 3 years
Porter’s 5 forces model
1. The potential of new entrants
2. The bargaining power of buyers
3. The bargaining power of suppliers
4. The threat of substitute products
5. Rivalry among competitors
Marketing mix elements
1. Product
2. Place
3. Promotion
4. Pricing
Product element strategy
Deciding what goods or services to offer to a group of consumers.
Place element strategy
deciding which classes of trade to sell your products to, and involves:
-Modes of transportation, warehousing, inventory control, order processing, and selection of marketing channels
Involves placement and not supply chain.
Promotion element strategy
Communication link between sellers (companies) and buyers (consumers) Ex. Salespeople, Ads, promotions.
Pricing element strategy
Practice of setting profitable and justifiable prices;
Creates value for customers and shareholders
and builds and strengthens customer relationships with a company, suppliers, and its products.
Is the planning process in marketing temporary or continuous?
Continuous and will NEVER STOP.
Substitute product
A product from another industry that offers similar benefits to the consumer as the product produced by the firms within the industry.
Directly-competitive product
A product in which the consumer will only buy one or the other.
Sprint Campaign
Look over. CHPT 3 slides
Stages of the business cycle
1. Depression
2. Prosperity
3. Recession
4. Recovery
Depression
Consumer spending sinks to its lowest level.
Prosperity
Consumer spending is brisk; growth in services sector.
Recession
Consumers focus on basic, functional products.
Recovery
Consumer purchasing power increases.
Inflation
Devalues money by reducing the products that can be purchased through persistent price increases.
Deflation
A freefall in business profits, lower returns on most investments, widespread job layoffs.
Ethics in promotion
Truth in advertising is the bedrock of ethics in promotions.
EX. If I am told my car has an 18 month warranty bumper to bumper, am I pleased if the dealer finds a reason NOT to repair my vehicle?
Ethics in distribution
Distribution is the total number and classes of trade that sell your products.
Minimum Advertised Price (MAP)
Lowest price a retailer can sell an item for.
Unilateral Pricing Policy (UPP)
This is the legal policy that sets a limit to how cheap a retailer can sell a certain product to preserve worth.
Why do companies use E-marketing?
Reduce costs.
E-commerce
Simply a word that describes a wide range of business activities that take place via Internet applications.
E-marketing
Creating, distributing, promoting, and pricing goods and services over the Internet or through digital tools.
Marketing website
Main purpose is to increase purchases by visitors, showcases all product categories and products within the categories.
-Example: Walmart.com
Corporate website
Designed to increase a firm’s visibility, promote product, and provide information, showcases technology, philanthropy, Corporate Governance, Community involvement.
-Example: Boeing.com
Electronic Data Interchange (EDI)
Exchange of sales information between buyers and sellers, cuts paper flow, speeds the order cycle, and reduces errors, allows companies to set production schedules to better match demand.
What does proprietary mean?
It means it is owned.
Extranet
Used by external customers, suppliers, or other authorized users, secure because there is proprietary information contained within, accessible through the company’s website with security.
Intranet
Secure internal networks that help companies share information among employees.
Private exchanges
A secure website at which a company and its suppliers share all types of data related to e-marketing. Sometimes called c-business
What are some challenges in E-Marketing?
1. Pricing, Promotions (bundling), Product Mix.
2. With regard to copyright issues, it is normally involving a platform holder (itunes) or an artist.
What do you need for a website?
1. Broaden company’s customer base.
2. Provide immediate access to current product line(s).
3. Accept and process orders.
4. Offer personalized customer service.
Promotions on web
1. Banner ad
2. Pop-up ad
3. Point-of-view
4. Search
5. Display ads
6. Online coupons
Most utilized web promotion?
Display Ads
Assessment of site effectiveness
Web-to-store shoppers
-Consumers who use the Internet as research tool and then pick up at store
Click-through rate
-Percentage of people presented with a banner ad who click on it
Conversion rate
-Percentage of visitors to a Web site who make a purchase
Engagement
-Amount of time users spend on sites