Marketing Final Review

Chapters 1 &2
Marketing Oriented Philosophy Cost Competitive Advantage Competitive Advantages Ansoffs Strategic Opportunity Matrix Market Penetration Components of a Marketing Plan Business Mission SWOT Analysis Marketing Objectives Marketing Strategy Implementation, Evaluation, & Control Cost Niche Internal External Price Star Variable Cost Fixed Cost Marginal Cost Markup Pricing Market Development Cash Cow Yield Management Systems

-Philosophy that assumes that a sale does NOT depend on an aggressive sales force but rather on a customers decision to purchase a product. -Synonymous with the Marketing Concept Being the low-cost competitor in industry while maintaining satisfactory Profit Margin. Can result from obtaining inexpensive raw materials, creating an efficient scale of plant operations, designing products for ease of manufacturer, controlling overhead costs, & avoiding marginal customers. Strengths & Weaknesses -Opportunities & Threats -The advantage achieved when a firm seeks to target & effectively serve a small segment of the market. Matches products with markets. -Product -Place -Promotion -Marketing Stategy that tries to INCREASE Market Share among existing customers. Marketing Strategy that entails attracting NEW customers to EXISTING products.

Dog Keystoning Product Development Diversification BCG Portfolio Matrix

A tool for allocating resources among products or strategic business units on the basis of Relative Market Share & Market Growth Rate. A business unit that is a fastgrowing market leader. A business unit that has low growth potential & a small market share. A business unit that usually generates more cash than it needs to maintain its market share. Technique for adjusting prices that uses complex mathematical software to profitably fill unused capacity by discounting early purchases, limiting early sales at discount prices, & overbooking capacity. The practice of marking up prices by 100%, or doubling the cost. Cost that varies with changes in level of output. Cost that does NOT change as output INCREASES/DECREASES. Change in TC associated with oneunit change in output. Cost of buying the product from producer PLUS amounts for profit & for expenses otherwise NOT accounted for. Strategy that entails the creation of NEW products for CURRENT customers. Strategy of INCREASING Sales by introducing NEW products into NEW markets.

Chapters 3 14
Code Of Ethics Ideal Self-Image Strategic Business Unit(SBU) Multiplier Effect(Accelerator Principle) Logistics Inseparability Persuasive Labeling Informational Labeling 2 Types Of Package Labeling Probability Sample Usage-Rate Segmentation Benefit Segmentation

A guideline to help marketing managers & other employees make better decisions. The way an individual would like to be. -Subgroup of a single business or a
collection of related businesses within a larger organization. -Phenomenon in which a small INCREASE/DECREASE in consumer demand can produce a much larger change in demand for the facilities & equipment needed to make the consumer product.

-Process of grouping customers into market

segments according to the benefits they seek from the product. - Dividing a market by the amount of product bought or consumed.

A sample in which every element in the

population has a known statistical likelihood of being selected. Type of package labeling designed to help consumers make proper product selections and lower their cognitive dissonance after the purchase. Type of package labeling that focuses on a promotional theme or logo with consumer information being secondary.

-The inability of the production & consumption of a service to be separated. -Consumers must be present during production. -The efficient and cost-effective forward & reverse flow as well as storage of goods, services, & related info, into, through, and out of a channel member company.
-Functions typically include transportation & storage of assets, as well as their sorting, accumulation, consolidation, &/or allocation for purpose of meeting customer requirements.

Chapter 16
Promotional Strategy Promotion Mass Communication Interpersonal Communication Channel Noise Feedback Integrated Marketing Communication(IMC) Fragmentation Promotional Mix 3 Types Of Promotional Goals

A medium of communication such as voice, radio, or newspaper- for transmitting a message. Anything that interferes with, distorts, or slows down the transmission of information. The receivers response to a message. The careful communication of all promotional messages for a product or service to assure the consistency of messages at every contact point where a company meets a customer. Emergence of new segments(in a previously homogenous market) which have their own distinct needs, requirements, and preferences. -Reduce the effectiveness of mass marketing techniques & erode brand loyalty. the combination of promotional tools incl. Advertising, PR, PS, and Sales Promotion- used to reach the target market & fulfill the organizations overall goals. Direct, face-to-face communication between 2+ people. -The communication of concept or message to large audiences. A plan for the optimal use of the elements of promotion. -Advertising -PR -Personal Selling(PS) -Sales

customers the product may be needed in 1. Inform INCREASING awareness of a new brand, product class, or product attribute. - Explain how product works. - Suggest new uses for product. - Build a company image. 2. Persuade Encourage brand switching - Change customers perception of product attributes. - Influence customers to BUY NOW. - Persuade to call 3. Remind Remind near future. - Remind where to buy - Maintain consumer awareness AIDA Concept(Attention-InterestDesire-Action) A model that outlines the process for achieving promotional goals in terms of stages of consumer involvement with the message.

Chapter 17
Advertising Impersonal, one-way mass communication about a product or organization that is paid for by a marketer. 2 Major Types Of Advertising 1. Institutional Form of advertising designed to enhance a companys image rather than promote a particular good. 2. Product Form of advertising that touts the benefits of a specific good or service. 3 Phases Of Advertising 1. Pioneering Form of advertising designed to stimulate primary demand for a new product or product category.

2. Competitive Form of advertising designed to influence demand for a specific brand. 3. Comparative Form of advertising that compares 2+ specifically named or shown competing brands on one or more specific attributes. DAGMAR(Defining Advertising Goals for Measured Advertising Results) - A method of setting objectives that should precisely define the target audience, the desired % change in some specified

measure of effectiveness, & time frame in which that change is to occur. - Advertising Campaign follows once objectives are stated. o Often follows AIDA Model Attribute Simply a feature of the product. Benefit What consumers will receive or achieve by using the product. Unique Selling Position A desirable, exclusive, and believable advertising appeal selected as a theme for a campaign. Advertising Appeal A reason for a person to buy a product.

Chapter 18
Sales Promotion A marketing communications activity other than Advertising, PR, or PSthat stimulate consumer buying & dealer effectiveness. 2 Types Of Sales Promotion 1. Consumer Targets the ultimate consumer.

2. Trade Targets a channel member, such as a wholesaler or retailer. Good Of Sales Promotion Influence BEHAVIOR NOT ATTITUDE. Premium An extra item offered to the consumer, usually in exchange for some proof of purchase of the product. Loyalty Marketing Program A promotional program designed to build longterm, mutually beneficial relationships between a company and its key customers. Frequent Buyer Program Loyalty program in which loyal

customers are rewarded for making multiple purchases of a particular good or service. Sweepstakes Depends on chance or luck, & participation is free. Contest Promotions in which participants use some skill or ability to compete for prizes. Personal Selling Importance People must sell themselves and their ideas to just about everyone with whom they have a continuing relationship & to many other people they only see once or twice. Referral A recommendation to a sales person from a customer or business associate. Networking A process of finding out about potential clients from friends, business contacts, coworkers, acquaintances, and fellow members in professional & civic organizations. Retailing All the activities directly related to the sale of goods and services to the ultimate consumer for personal, non-business use. Independent Retailers Retailers owned by a single person or

partnership & not operated as part of a larger retail institution. Gross Margin The amount of money the retailer makes as a % of sales after COGS is SUBTRACTED. Departmentalization Manner or practice in which related individual tasks & their allocation to work groups is combined to form a specialized functional area that is distinct from other functional areas in an organization. Scrambled Merchandising the tendency to offer a wide variety of

nontraditional goods or services under one roof. Convenience Store A miniature supermarket, carrying only a limited line of high-turnover convenience goods. Full-Line Discount Store A retailer that offers consumers very limited service and carries a broad assortment of well-known, nationally branded Hard Goods. Mass Merchandising A retailing strategy using moderate to low prices on large quantities of merchandise & lower service to stimulate high turnover of products. Category Killers Specialty discount stores that heavily dominate their narrow merchandise segment. Business Format Franchise Arrangement where a franchisee (in addition to the right to sell goods or services) the franchisers designs, quality control & accounting systems, operating procedures, group advertising & promotions, training, & (for hotels & travel agencies) worldwide

reservation systems. Product & Trade Name Franchise Arrangement in which a supplier(franchi ser) supplies a product family to a dealer(franchise e) who may also take identity (brand name) of the franchiser. - Usually exclusive brand-name stores.

Expenses Price - That which is given up in an exchange to acquire a good or service. 3 Major Types of Pricing Objectives 1. Profit Oriented Includes profit maximization, satisfactory profits, & target return on investment. 2. Sales Oriented Based either on Market Share or on Dollar Per Unit Sales. 3. Status Quo Seeks to maintain existing prices or meets the competitions prices. Profit Maximization A method of setting prices that occurs when MR=MC. Status Quo Maintaining/meeting competitors prices. Equilibrium Demand = Supply Elasticity Consumers responsiveness/sensitivity to changes in price. Inelasticity INCREASE/DECREASE in price will NOT change demand for

Chapter 19
Revenue = Price of Goods * Quantity Sold Profit = Revenue

product. Unit Elasticity Total Revenue remains the same when prices change. Demand The quantity of a product that will be sold in the market at various prices for a specified period. Supply The quantity of a product

that will be offered to the market by a supplier at various prices for a specified period. 4 Factors That Affect Elasticity 1. Price Relative To Purchasing Power 2. Product Durability 3. Products Other Uses 4. Rate Of Inflation

Price Skimming A pricing policy whereby a firm charges a high introductory price, often coupled with heavy promotion. Price Fixing An arrangement between 2+ firms on the price they will charge for a product. Price Discrimination Selling the same product to different buyers at different prices depending on order/size lot &/or their geographical location. Predatory Pricing The practice of charging a very low price for a product with the intent of driving competitors out of business or out of a market. Resale Pricing Maintenance A manufacturer, & its distributors, agree that retailers will sell products at a certain price floor. Base Price The general price level at which the company expects to sell a good or service. Quantity Discount A price reduction offered to buyers buying in multiple units or above a specified dollar amount.

Chapter 20
Penetration Pricing A pricing policy whereby a firm charges a relatively low price for a a product initially as a way to reach the mass market.

Cash Discount A price reduction offered to a consumer, an industrial user, or a marketing intermediary in return for prompt payment of the bill. Function/Trade Discount A discount to wholesalers & retailers for performing channel functions. Seasonal Discount A price reduction for buying merchandise out of season. FOB Shipping Point Freight charges are paid by the customer before the customer receives products or services.

Zone Pricing A modification of uniform delivered pricing that divides the U.S. (or total market) into segments or zones & charges a flat freight rate to all customers in a given zone. Flexible Pricing A price tactic in which different customers pay different prices for essentially the same merchandise bought in = quantities. Professional Services Pricing Used by people with lengthy experience, training, & of certification by a licensing board. Leader Pricing A price tactic in which a product is sold near or even below cost in the hope that shoppers will buy other items once they are in the store.