Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
96 Cards in this Set
- Front
- Back
|
Monopoly vs. Oligopoly
|
Monopoly
-one competitor, total control -many barriers -almost no subs Oligopoly - few competitors (automobile industry) -some barriers (startup costs) -homogeneous or differentiated (real or perceived differences) |
|
|
Target market
|
group of customers on which marketing efforts are focused
-vast # or relatively small group |
|
|
Marketing mix
|
product, distribution, promotion, and price= create and maintain the right mix of these elements
-making product available at right place and price -helps customers determine if product will satisfy their needs |
|
|
Products
|
goods, services, or ideas
- researching customers' needs and wants and designing a product that satisfies them **actual production of tangible goods is not a marketing activity |
|
|
Marketing
|
creating, distributing, promoting, and pricing goods, services, and ideas to facilitate satisfying exchange relationships with customers and marketers benefit
customer- gain a reward or benefit in excess of the cost incurred in a marketing transaction, develops expectations about seller's future behavior marketer- gain price charged for the product in return |
|
|
Limits on how much marketing managers can alter marketing variables
|
economic conditions, competitive structure, government regulations--prevent changing prices
changes in product size, shape, and design--expensive |
|
|
Exchange
|
reason for organizations to engage in marketing
- provision or transfer of goods, services, and ideas in return for something of value **assume individuals expect to gain a reward in excess of the costs incurred |
|
|
Exchange conditions
|
1. 2 or more individuals, groups, or organizations must participate, and each must possess something of value that the other party desires
2. provide a benefit or satisfaction to both parties 3. confidence in the promise of the "something of value" held by the other 4. to build trust, parties must meet expectations |
|
|
Marketing mix most influenced by online shopping?
|
Promotion variable
|
|
|
Easiest variable to change or duplicate?
|
Price
|
|
|
Distribution Variable
|
Producer
Agents Wholesaler Retailers Consumers |
|
|
Stakeholders
|
claims on products, operations, markets, industry, and outcomes
-have the power to provide or withdraw needed resources or influence customer opinion about a firm's marketing strategy and products -developing and maintaining relations is crucial to the long-term growth of an organization and its products |
|
|
Who benefits in exchange relationships?
|
both buyer and seller
|
|
|
Marketing concept
|
an organization should try to provide products that satisfy customers' needs through a coordinated set of activities that also allows the organization to achieve its goals
**customer satisfaction=major focus ***a management philosophy that guides an organization's overall activities, and affects all organizational activities, not just marketing -not philanthropic -management must first establish an information system to discover customers' real needs and then use the information to create satisfying products |
|
|
Evolutions of the marketing concept
|
1. Production Orientation
- second half of 19th century - Industrial Revolution - mass production= limit on what people can produce 2. Sales Orientation -1920s to 1950s -competition -demand subsided, had to "sell" products to buyer 3. Marketing Orientation -WW2 -must determine what customers want, then produce these products -new product innovation -nonmarketing managers must share with marketing managers any information that is pertinent to understanding the customer -responsive to everchanging customer needs and wants |
|
|
Company is most interested in making more products?
|
Production Orientation
|
|
|
Profits can be obtained through relationships by:
|
1. acquiring new customers
2. enhancing the profitability of existing customers 3. extending the duration of customer relationships |
|
|
Relationship marketing
|
long term, mutually beneficial arrangements in which both the buyer and seller focus on value enhancement through the creation of more satisfying exchanges
-deepens buyer's trust in the company, which increases firms understanding of the company's needs **optimizing exchange relationship: the relationship between a company's investment in customer relationship and return generated by customers' loyalty and retention |
|
|
Customer Relationship Management (CRM)
|
focuses on using information about customers to create marketing strategies that develop and sustain desirable customer relationships
-increasing customer value over time, increase longterm profitability through customer loyalty - focus on most promising and profitable customers |
|
|
Customer's lifetime value
|
frequency of purchases
average value of the purchases brand-switching patterns *intangible asset |
|
|
Value
|
customer's subjective assessment of benefits relative to costs in determining the worth of a product
value = customer benefits - customer costs - company's perspective= tradeoff between increasing the value offered to a customer and maximizing the profits from a transaction |
|
|
Customer costs
|
-monetary
-nonmonetary: time and effort customers expend to find and purchase product; risk |
|
|
Customer benefits
|
include experiences
|
|
|
Importance of marketing
|
1. Marketing costs consume a sizable portion of buyers' dollars (1/2 buyer's dollar)
2. Used in nonprofit organizations 3. important to business and the economy- money generated can be used to develop innovative products, cannot provide jobs, etc. 4. Fuels our global economy- development of new products, and technologies, fewer political barriers, and desire for higher standard of living have made marketing across national borders commonplace while stimulating global economic growth 5. Marketing knowledge enhances consumer awareness- studying marketing allows us to assess a product's value and flaws and its marketing strategy more effectively, laws that could stop unfair, damaging or unethical marketing practices--can help you be a better consumer 6. Connects people through tecnhology- feedback helps marketers refine and improve their products to better satisfy customer needs 7. Socially responsible marketing: promoting the welfare of customers and society- green marketing 8. Marketing offers many exciting career prospects- 25 to 33% of all civilian workers in the U.S. perform marketing activities |
|
|
Environmental scanning vs. Environmental analysis
|
SCANNING: the process of collecting information about forces in the marketing environment--observation, secondary sources (business, trade, etc.), internet, BUT must know HOW to use that information and DON'T gather TOO much info
ANALYSIS: process of assessing and interpreting the information gathered through the environmental scanning, manager evaluates info for accuracy, resolve inconsistencies in data, assign significance to the findings |
|
|
Types of Competitors
|
1. Brand competitors: market products with similar features and benefits to the same customers at similar prices
ex: Diet Coke vs. Diet Pepsi ***most significant 2. Product Competitors: compete in the same product class but market products with different features, benefits, and prices ex: iced tea, juice, water for thirsty dieter 3. Generic competitors: provide very different products that solve the same problem or satisfy the same basic customer need ex: thirsty dieter has water from tap 4. Total budget competitor: compete for limited financial resources of the same customers ex: diet coke- gum, newspaper, etc. |
|
|
Monopoly
|
# Competitors: One
Entry: many barriers Product: NO substitutes Ex: water utilities |
|
|
Oligopoly
|
# Competitors: Few
Entry: some barriers Product: homogeneous or differentiated Ex: General Motors, oil refining |
|
|
Monopolistic Competition
|
# Competitors: Many
Entry: Few Product: Product differentiation with many substitutes Ex: Levi Strauss |
|
|
Pure Competition
|
# Competitors: Unlimited
Entry: NO barriers Product: Homogeneous Ex: Vegetable farm |
|
|
Buyer Power
|
depends on economic conditions and the size of the resource--money, goods, and services that can be traded in an exchange--that enable the individual to make purchases
financial sources: income, wealth, and credit |
|
|
Income
|
the amount of money received through wages, rents, investments, pensions, and subsidy payments for a given period (month or year), allocated among taxes, spending for goods and services, savings
|
|
|
Disposable income vs. Discretionary income
|
Disposable: after-tax income, used for spending or saving, ready source of buying power
-taxes, wage levels, rate of unemployment, interest rates, dividend rates, etc. Discretionary: disposable income that is available for spending and saving after an individual has purchased the basic necessities of food, clothing, and shelter |
|
|
Credit
|
enables people to spend future income now
-increases buying power at the expense of future buying power |
|
|
Wealth
|
accumulation of past income, natural resources, and financial resources
-exists in many forms= cash, securities, savings accounts, jewelry, real estate -unevenly distributed= high income, little wealth or vice versa - gain buyer power in three ways 1. use wealth to make current purchases 2. generate income 3. acquire large amounts of credit |
|
|
Pro competitive Legislation
|
to prevent businesses from restraining trade and monopolizing markets
ex: Sherman Antitrust Act |
|
|
Sherman Antitrust Act (1859)`
|
-MONOPOLIZE or attempt to monopolize
-prohibits contracts, combinations, or conspiracies to restrain trade -robber barons were price gauging consumers (Carnegie) |
|
|
Consumer Protection Legislation
|
-consumer safety
-adulteration or mislabeling -information disclosure marketing activities |
|
|
Robinson-Patman Act
|
-prevents PRICE DISCRIMINATION among wholesalers or retailers
-prohibits producers from giving disproportionate services or facilities to large buyers -only prohibits charging different amounts to different buyers on same level (Walmart) -must justify on cost basis |
|
|
Federal Trade Commission Act (FTC)
|
-created FTC
-gives FTC investigatory powers to be used in preventing unfair methods of competition *focuses most on marketing activities -why need legal advice to market products |
|
|
Marketing activities
|
influenced by federal regulatory agencies
-product development -pricing -packaging -advertising -personal selling -distribution |
|
|
FTC
|
most heavily influences marketing activities
-false advertising, misleading pricing, and deceptive packaging and labeling 1. issues complaint 2. cease and desist order for $10,000 a day -corrective advertising |
|
|
Regulatory agencies
|
shift when administration shifts
|
|
|
Self-regulatory Forces
|
-in an attempt to be good corporate citizens and prevent government
-not direct outgrowth of laws, many were established to stop or stall the development of laws and regulatory groups that would regulate the association's marketing practices -trade associations establish ethic codes for members |
|
|
Better Business Bureau
|
system of nongovernmental, independent, local regulatory agencies that are supported by local businesses
|
|
|
National Advertising Review Board (NARB)
|
-self regulatory
-considers cases in which an advertiser challenges issues raised by the NAD about an advertisment |
|
|
Advantages of Self Regulatory Agencies over governmental laws and regulatory agencies
|
- less expensive
-more realistic -reduce need to expand government bureauchracy |
|
|
Limitations of Self Regulatory agencies
|
- nonmember firms do not have to abide
-lack tools or enforcement -less strict * one poor job in Bureau gives negative taste about other member companies |
|
|
Technology
|
the application of knowledge and tools to solve problems and perform tasks more efficiently
-revolutionized products created and offered by marketers and channels by which communicate products--innovations are NOT technology just outgrowth of -grows from research mostly paid by government |
|
|
Technology dynamics
|
the constant change that often challenges the structures of social institutions including social relationships, the legal system, religion, education, business, and leisure
|
|
|
Self-sustaining nature of technology
|
technology acts as a catalyst to spur even faster development
new innovations introduced, stimulate the need for more advancements to facilitate further development multiplier effect |
|
|
Technology assessment
|
procedure where managers try to foresee the effects of new products and processes on their firm's operations, on other business organizations, and on society in general
-decide whether benefits outweigh the costs -determined by degree to which a business is technologically based |
|
|
Protect inventions that stem from research
|
influence the use of technology
how secure a product is from imitation depends on how easily others can copy it without violating its patent |
|
|
Sociocultural forces
|
influences in society and its cultures that bring about changes in people's attitudes, beliefs, norms, customs, and lifestyles
-help determine what, when, where, and how people buy products |
|
|
Socioeconomic changes
|
-increasing proportion of older consumers
-# singles on rise (homes, smaller packages, less furniture, etc.) -baby boom= age 19 or younger but much more diverse than previous generations -increasingly multicultural nature of U.S. society and younger, less from Europe |
|
|
Cultural value
|
major source: family
-health -environment -green marketing: helps establish long-term relationships by maintaining, supporting, and enhancing the natural environment |
|
|
Consumerism
|
involves organized efforts by individuals, groups, and organizations to protect consumers' rights
-write letters or send emails to companies, lobby government agencies, broadcast public service announcements, and boycott companies whose activities they deem irresponsible |
|
|
Social responsibility
|
an organization's obligation to maximize its positive impact and minimize its negative impact on society
-total effect of all marketing decisions on society -indirect long-term benefits |
|
|
Marketing citizenship
|
adoption of strategic focus for fulfilling the economic, legal, ethical, and philanthropic social responsibilities that their stakeholders expect of them
|
|
|
Stakeholder orientation
|
companies that consider the diverse perspectives of stakeholders in their daily operations and strategic planning
-goes beyond customers, competitors, and regulators to include understanding and addressing the needs of all stakeholders, including communities and special interest groups |
|
|
Pyramid of Social Responsibility
|
Most basic to peak:
1. Economic: -to be profitable so can provide a return on investment to their owners and investors, create jobs for the community, and contribute goods and services to the economy -employees= wages, equal opportunity, job safety -compete fairly= size gives advantage (economies of scale) 2. Legal: -law is society's codification of right and wrong, play by the rules -special interest groups, elected reps -fraud = charges may result 1&2= failure to consider these may mean that a marketer is not around long enough to engage in ethical or philanthropic activities 3. Ethical -obligation to do what is right, just, and fair 4. Philanthropic: -contribute resources to the community, improve quality of life -go beyond marketing ethics = are not required but promote human welfare or goodwill |
|
|
Marketing ethics
|
principles and standards that define acceptable conduct in marketing as determined by various stakeholders, including the public, government regulators, private-interest groups, consumers, industry, and the organization itself
-goes far beyond legal issues= ethical decisions foster trust which helps build long term marketing relationships |
|
|
Cause-related marketing
|
link products to a particular social cause on an ongoing or short-term basis
-strategic approach to philanthropy |
|
|
Strategic philanthropy
|
the synergistic use of organizational core competencies and resources to address key stakeholders' interests and achieve both organizational and social benefits
-both financial and nonfinancial contributions to stakeholders (employee time, goods/services, technology) but also benefits the company |
|
|
Social responsibility issues
|
1. Green marketing
2. Consumerism 3. Community relations |
|
|
Green Marketing
|
strategic process involving stakeholder assessment to create meaningful long-term relationships with customers while maintaining, supporting, and enhancing the natural environment
some believe should implement these goals: 1. eliminate the concept of waste- question is not what to do with the waste, it is how to make things without waste 2. reinvent the concept of a product- -consumables (eaten or placed into ground) -durable goods: made, used, returned to manufacturer in closed loop system (cars, tvs, computers, fridge) -unsalables: belong to makers responsible for full life cycle (radioactive, heavy materials, toxins) 3. make prices reflect the cost: cost of air, water and soil 4. make environmentalism profitable: consumers are beginning to recognize that competition in the marketplace should not occur between companies that harm and save environment |
|
|
JFK's Consumer bill of rights
|
1. right to safety
2. right to be informed: all info before buying it 3. right to choose: variety of products and services at competitive prices 4. right to be heard |
|
|
Community relations
|
individual communities expect marketers to make philanthropic contributions to civic projects and institutions and be "good corporate citizens"
|
|
|
ethical issue
|
an identifiable problem, situation, or opportunity that requires an individual or organization to choose from among several actions that must be evaluated as right or wrong, ethical or unethical
-failure to disclose information -false advertising -price fixing, predatory pricing, failure to disclose full price (drugs needed to live) -middlemen/intermediaries=distribution, manipulating products availability (stuffing-shipping surplus inventory to wholesalers and retailers at an excessive rate before end of quarter) |
|
|
Factors influencing ethical decision-making process
|
1. Individual- daily lives, base decisions on their own values and principle of right or wrong (through socialization by family members, social groups, religion, and formal education)
2. Organizational relationships -more influence than indiv. most often made jointly, in work groups and committees or in conversations and discussions with coworkers -strength of each individual's personal values, opportunity for unethical, and exposure to others 3. Opportunity: conditions that limit barriers or provide rewards (act unethically and not punished or rewarded may repeat actions) -codes of conduct: prescribing acceptable behaviors |
|
|
Organizational/Corporate culture
|
set of values, beliefs, goals, norms, and rituals that members of an organization share
expressed formally (codes of conduct) or informally (work habits, anecdotes) -CEO or VP of marketing sets tone -exposure: more likely you are to behave unethically -organizational pressure |
|
|
Improving ethical conduct
|
bad apple: some people always do things in their own self interest, regardless of organizational goals or accepted moral standards-- screening techniques
bad barrels: individuals aren't unethical but pressures to survive and succeed create conditions that reward unethical behavior--redesign organization's image and culture -top management develops and enforces ethical and legal compliance -ethics programs (written standards, training) -top managers talk about importance -hotlines |
|
|
Reasons for International Marketing
|
-provides tremendous opportunities for growth
|
|
|
Social forces
|
beliefs and values regarding family, religion, education, health, and recreation
ex: no beef or pork in India, soccer in Europe and Latin America |
|
|
Cultural forces
|
U.S. and Taiwanese- more attuned to own companies
Polish- U.S. sales management techniques successful **product's brand image and country of origin influence purchases is subject to considerable variation based on national cultural characteristics **acceptance of product is more likely if similarities exist between the two cultures |
|
|
Economic differences
|
differences in standards of living, credit, buying power, income distribution, national resources, exchange rates, etc.
--dictate many of the adjustments firms must make in marketing internationally ex: economic instability can disrupt the markets for U.S. products in places that otherwise might be excellent marketing opportunities, competition from China or India can disrupt U.S. products |
|
|
Gross Domestic Product (GDP)
|
an overall measure of a nation's economic standing
-the market value of a nation's total output of goods and services for a given period -does not take population into account (GDP per capita) |
|
|
Political forces
|
political climate determined by the people via elections or leaders assume power by law
political climate, officials, officials in charge of trade agreements directly affect the legislation and regulations |
|
|
import tariff
|
any duty levied by a nation on goods bought outside its borders and brought into the country
-raise prices of foreign goods = impede tariffs -raise revenue or protect domestic products |
|
|
quota
|
a limit on amount of goods an importing country will accept for certain product categories in a specific period of time
-makes price of imported goods more expensive ex: Japanese cars in U.S. |
|
|
embargo
|
a government's suspension of trade in a particular product or with a given country
-specific goods or countries -political, health, or religious reasons ex: U.S. on Iran and Cuba -not effective--others countries can sell in Cuba |
|
|
exchange controls
|
government restrictions on the amound of a particular currency that can be bought or sold
-force to buy or sell foreign products through a central agency -foreign currency exchange rates |
|
|
balance of trade
|
the difference in value between a nation's exports and its imports
-U.S. has negative balance = harmful because U.S. dollars are supporting foreign economies |
|
|
ethical forces
|
U.S. trade and corporate policy and law- prohibits direct involvement in payoffs and bribes, U.S. companies may have hard time competing with foreign firms that engage in these practices--indirect payoffs by forced to hire local consultants, pr firms, etc.
|
|
|
Other countries lack of forming intellectual property rights
|
China and Vietnam--conflicts for marketers of computer software, music and books
|
|
|
Cultural forces
|
SRC- Self reference criterion: unconscious reference to one's own cultural values, experiences, and knowledge
-when confronted with a situation we react on the basis of knowledge we have accumulated over a lifetime--grounded in our culture/religion -reaction based on meanings, values, symbols --when in rome, do as the romans do |
|
|
Cultural relativism
|
the concept that morality varies from one culture to another and that business practices are therefore differentially defined as right or wrong by particular cultures
|
|
|
Business for Social Responsibility (BSR)
|
tracks emerging issues and trends, provides information on corporate leadership and best practices, conducts educational workshops and training, and assists organizations in developing practical business ethic tools
|
|
|
Legal forces
|
legislation is enacted, legal decisions are interpreted, regulatory agencies are operated by elected or appointed officials
-direct reflection of political climate in country -laws and regulations have direct effects on firm's operations in a country |
|
|
Technological forces
|
advances in technology have made marketing much easier
-in many developing countries that lack technological infrastructure found in U.S., marketers are beginning to capitalize on opportunities to leapfrog existing technology |
|
|
North American Free Trade Agreement (NAFTA)
|
Canada, Mexico, U.S.
|
|
|
European Union (EU)
|
European community or Common Market
27 members |
|
|
Common Market of the Southern Cone (MERCOSUR)
|
Argentina, Brazil, Paraguay, Uruguay
|
|
|
Asia-Pacific Economic Cooperation (APEC)
|
open trade and technical cooperation
-Australia, Canada, Indonesia, Japan, Korea, etc. |
|
|
World Trade Organization (WTO)
|
promotes free trade
a global trade association that promotes free trade among 149 member nations -successor of General Agreement on Tariffs and Trade (GATT) -prevent dumping: selling of produts at unfairly low prices -agreements that provide legal ground rules for international commerce and trade policy |
|
|
Leap frogging
|
don't need to take steps of developed countries have taken, can just jump over that
|
