Marketing Final Exam Review (COMM 131, Brower)

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Published on 15 Apr 2013
Marketing (Comm 131) Final Exam Review
Chapter 1 Marketing: Creating and Capturing Customer Value
Marketing the process by which companies create value for customers and build
strong customer relationships in order to capture value from customers in return.
Marketing is managing profitable customer relationships
5 core customer & marketplace concepts:
1. Needs, wants, and demands
2. Market offerings (products, services, experiences)
3. Value & satisfaction
4. Exchanges & relationships
5. Markets
Needs states of felt deprivation
Wants the form human needs take as shaped by culture and individual personality
Demands human wants that are backed by buying power
Marketing process: (steps 1-4 are creating value for customers and building
customer relationships)
Value = customer benefits perceived costs
Market set of actual and potential buyers of a product/service
Market Offering - some combination of products, services, information or
experiences, etc. offered to a market to satisfy a need or want.
Marketing management the art and science of choosing target markets and
building profitable relationships with them (there is customer management and
demand management)
Production concept the idea that consumers will favour products that are
available and highly affordable and that the organization should therefore focus on
improving production and distribution efficiency
and customer
needs and
design a
Construct and
program that
superior value
and create
Capture value
customers to
create profits
and customer
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Product concept the idea that consumers will favour products that offer the most
quality, performance, and features and that the organization should therefore
devote its energy to making continuous product improvements
Selling concept the idea that consumers will not buy enough of the firm’s
products unless it undertakes a large scale selling and promotion effort
Marketing concept the marketing management philosophy that holds that
achieving organizational goals depends on knowing the needs and wants of target
markets and delivering the desired satisfactions better than the competitors do
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
Customer relationship management the overall process of building and
maintaining profitable customer relationships by delivering superior customer
value and satisfaction
Customer perceived value the customer’s evaluation of the difference between
all the benefits and all the costs of a market offering relative to those of competing
Customer satisfaction the extent to which a products perceived performance
matches a buyer’s expectations
Customer managed relationships marketing relationships in which customers
empowered by todays new digital technologies interact with companies and each
other to shape their relationships with brand
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
Partner relationship management working closely with partners in other
departments and organizations to jointly bring greater value to customers
Customer lifetime value the value of the entire stream of purchases that the
customer would make over a lifetime of patronage
Share of customer the portion of the customer’s purchasing that a company gets
in its product categories
Customer equity the total combined customer lifetime values of all the company’s
customers. Measure of future value of company’s customer base
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Chapter 2 Company and Marketing Strategy: Partnering to build customer
Strategic planning the process of developing and maintaining a strategic fit
between the organization’s goals and capabilities and its changing marketing
Mission Statement a statement of the organization’s purpose – what it wants to
accomplish in the larger environment. Are often product-oriented (i.e. We run
theme parks) but to be effective, should be market-oriented (i.e. We create fantasies
a place where dreams come true and America still works the way it’s supposed to)
Business portfolio the collection of businesses and products that make up the
Portfolio analysis the process by which management evaluates the products and
businesses that make up the company
-look at SBUs (strategic business units a company division, a product line, or
sometimes a single product or brand) and assess their attractiveness and how much
support each one needs
Growth-share matrix - this is the Boston Consulting Group approach, in which a
company plans its portfolio by evaluating a company’s SBUs in terms of market
growth rate and relative market share:
Stars high growth, high share businesses or products. Often need heavy
investments to finance their rapid growth, and will eventually slow and
become cash cows
Cash cows low growth, high share businesses or products. These
established and successful SBUs need less investment to hold their market
share, and produce a lot of cash that the company uses to pay its bills and
support other SBUs
Question marks low share business units in high growth markets. They
require a lot of cash to hold their share, let alone increase it. Management
has to think hard about which question marks it should try to build into stars
and which should be phased out
Dogs low growth, low share businesses and products. May generate enough
cash to maintain themselves but have low potential
Steps in Strategic Planning
^Corporate Level ^ Corporate Level ^
Business unit, product,
and market level
and goals
and other
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