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Midterm

Marketing Midterm Review COMPRESSED.docx

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Department
Marketing
Course
MKT 100
Professor
Khalil Rohani
Semester
Winter

Description
Chapter 1 Overview of Marketing Marketing core aspects: - - Help creates values - Require four p’s - Occur in many settings - Satisfy needs and wants - Performed by both individuals and - Entail an exchange organization Product Price Place Promotion (Marketing mix) - set of activities that firm uses to respond to wants of target market - Product: creating value -Place: Delivering Value - Price: transacting value -Promotion: Communication Value Marketing is performed by B2C, B2B,and C2C and shaped by: External forces such as cultural, demographic, social, technological, economic, political and legal changes shape company’s marketing activities. Internals- suppliers, distributors, financial institution Four different marketing orientation/ philosophies: product orientation, sales orientation, market orientation,valued base orientation Product orientation: focus on developing and distributing innovative product with little concern about whether product best satisfy customers needs. Good product sells itself. Retail industry. Company start thinking about product they want to build and sell product after it's developed rather starting with understanding customer needs and then develop. Sales orientation: view marketing as selling function where companies sell as many products as possible rather than focus on making products customer really want . Depend on heavy doses of personal selling and advertising to attract new customers. Believe that if consumers try to sell their projects they will take them. **Market orientation: Focus on what consumer want and need before the design, make, or attempt to sell products and services. Believe customers have choice and make purchase decision based on factors: Quality, convenience, and price. Value based orientation: strategy according to what its customers value. Could include speed, convenience, size, accuracy, price, cost-savings, user-friendliness. Ex. iPhone , Louis Vuitton What is value based marketing? Focus on providing customers with benefits that far exceed cost (money, time, effort) of acquiring and using a product or service while providing a reasonable return to the firm. Service quality, convenience, product quality. How customers become value driven 1) Share info through CRM 2)balancing benefits with cost (cheap flights, no food) 3) build customer relationship Build customer relationship- Transactional orientation- buyer-seller relationship. Customers are not important. No value. Used car Relational orientation- in contrast, buyers and sellers develop long term relationship. UPS and shippers CRM- business philosophy and set of strategies, and system. Focus on building loyalty among valued customers Why is marketing important? Creates mutually valuable relationships between company and its suppliers, distributors, and other external firm involved in firm’s marketing process. Makes it possible for firm to expand globally. Define marketing and explain its core concept Marketing- a set of business practices designed to plan for and present organization’s products/ services in ways that build customer relationships Marketer enhance value of its product and services through various forms of communication (advertising, personal selling) Marketers facilitate the delivery of value by making sure right products and services are available when, where, and qty Recognize loyal customers and strive to develop long-term relationships with them Illustrate how marketers create value for product or service Value represents relationship of benefits to costs. Best firms integrate value orientation into everything they do. Key to true value-based marketing is ability to design products and services that achieve right balance between benefits and cost. Value-based marketers are focused on developing a lasting relationship with their customers Summarize the four orientations of marketing Product-oriented firms- believe good product will sell itself. Manufacturers concerned with product innovation NOT satisfying need of individual customers. Assume people will buy it. Marketing  informing that product exists Sales orientation- rely on sales team to sell. Production maximized; heavy doses of personal selling and advertising help distribute and sell. Marketing  focused on only sale of product Market oriented- celebrated customer. Manufacturers seek to learn customer needs and wants and design product to fit. Marketing  communicate different attributes, or value created by each product. Identify role of customer relationship management in creating value -Build strong relationship w customers; central -collect customers info to target specific promotions concept of relational orientation. or offers to customer who would benefit most -Identifies customers and build strong relationship. -maximizes long term value rather than profit. Explain importance of marketing both within and outside firm -marketing help facilitate smooth flow of goods through supply chain. From raw materials to customers. \ -Marketing is important for society through ethical business practices. Chapter 2 Developing a Marketing Plan and Marketing Strategies Levels of Strategic Planning in Corporations Strategic planning occurs on two levels Functional and Corporate 1) 2) Corporate level (top management) -corporate level planning focus on long term direction -scope: entire firm duration: long term ( 5 yrs)focus: of company define mission, goals, portfolio *3) SBU/ Division planning (large firms with more -focus on overall direction of company than one distinct line of business) -senior managers decide on mission or vision, goals, - scope: single SBU within firm objectives -duration: medium to long range (3-5 years) - focus: set goals and establish portfolio of products products, brands, market and market for business unit -marketing function develops marketing plans for 2) Functional level ( etc. marketing planning) products, brands, and market-marketing function -scope: product portfolio, single product, brand or may involve corporate level and SBU level planning market b/c it focus on creating values for customers and - duration: short term to medium (1-3 yrs) company - focus: develop marketing plans for specific Marketing Plan - written document composed of an analysis of current marketing situation, opportunities, and threats, marketing objecytives in terms of 4 p’s Who’s interested: stakeholders investors, potential investors Three major phases of marketing plan: planning, implementation, and control Planning Phase Step 1: Define the Business Mission and Objective -mission statement: broad description of firm’s objective and scope of activities it plans to undertake. -attempts to answer “what type of business” and “what does it need to do to accomplish its goal and objective” Step 2: Conduct SituationAnalysis - Uses SWOT assess internal ( strength and weakness) external environment (threat and opportunities) o Requires firm to undertake critical assessment of its resource, capabilities, organization, strategies, and performance in relation to competitors - Examination of market trends, customer analysis, and competitive analysis & CDSTEP (cultural, demographic, social, technological, economic, and political forces Implementation phase: Step 3: Identify and Evaluate Opportunities by using STP(Segmentation, Targeting, and Positioning) -Identify and evaluate opportunities for increasing sales and profits by STP -with STP, firm must understand customer needs and wants through market researchdivide market in subgroup Segmentation: Firm decides which segments to pursue and how it Market segment- group of consumers who respond wants to be positioned with those segments. Shape similarly to firm’s marketing efforts (Disney target consumers’perceptions regarding their brand or pleasure island-couple) product. Targeting: Market positioning- process of defining marketing Targeting marketing/ targeting- process of evaluating mix variables so target customers have clear, distinct, attractiveness of various segments and deciding which desirable understanding of what product does or to pursue as a market presents in comparison with competing products. Positioning: (A&F defined clothing as cas.luxury) Step 4: Implement Marketing Mix (4 p’s) and Allocate Resources Product and Value Creation: Product valuable enough for consumers to buy (P&G gentle on stomach coffee) Price and Value for Money: Price on the value that the customer perceives Place and Value for Delivery: Place for accessible products Promotion and Value Communication: Through media, seminars Control Phase: Step 5: Evaluate Performance by Using Marketing Metrics Metric: measuring system that quantifies a trend, dynamic, or characteristic - Used to explain why things happened and to project future - Make it possible to compare results across regions, business units, product line, and time period Who is accountable for performance? Commonly used metrics: revenue, profits Managers should be held accountable only for revenues, expenses and profits they can control. Performance evaluations are used to pinpoint problem areas. Performance objectives and metrics- compare firm’s performance over time or to competing firms using financial metrics (sales/profit) or view product/service as portfolio Financial performance metrics – metrics used to evaluate firm vary depending on 1) level of organization at which decision is made 2) resource managers controls Social Responsibility Performance Metrics- impact on environment, ability to diversify workforce, energy conservation,-(Ex: guess warehouse of Fairmont hotel maximizes revenue and brand building) Strategic planning Portfolio analysis- done by SBU or product line level of firm. Evaluates portfolio and allocate resources according to which products expected to be most profitable  Boston Consulting Group PortfolioAnalysis -Circle represent brands, and sizes are in direct proportion to the brands annual sales. -Horizontal axis represents relative market share -Market share used to determine product strength in market (rev, sales, units) -Vertical axis market growth rate measure how attractive market is Stars : occur in high growth markets ad high market Question marks: high growth markets but low market share. Stars require heavy resource investment shares. Often most managerially intensive products; (promotions, prod facilities to fuel rapid growth.As require significant resources to maintain & increase market growth slows, stars will decrease from heavy market share. Infusing resources can turn it into cash users of resources to heavy generator of resources and cows become cash cows. Dogs: low in growth markets and low market share. Cash cows: Low in growth rate high in market share Generate enough resources to sustain themselves. products because products have already received Should be phased out unless needed to compliment heavy investments to develop market share. other product or purposes Growth Strategies Market Penetration Product Development -employs existing marketing mix and focuses firm’s -offers new product or service to firm’s current target efforts on existing customers market Diversification - increase advertising, marketing effort in -Firm introduces new geographical area product already sold product or service to Market Development segment that they are -employs existing marketing offering to reach new currently not serving market segments, whether domestic or international or not used by firm Marketing Strategy and 4 Macro Strategies to Maintain Sustainable Competitive Advantage Marketing strategies identifies: 1)Firms target 2)related marketing mix 3) bases upon firm plan to build sustainable competitive advantage Building sustainable competitive advantage Customer excellence- good customer service and Product excellence- achieving high-quality products loyalty and effective branding and positioning Operational excellence- efficient operation and good Locational excellence- focus on good physical supply chain management location and internet presence Chapter 3 Analyzing the Marketing Environment The marketing environment includes the actors and forces outside marketing that affect marketing management’s ability to build and maintain successful relationships with target customers Microenvironmental Factors (consumers directly influenced, internal, company can control, small) Factors affecting consumers’microenv: Company Capabilities- marketers can use SWOT analysis to categorize opportunity as either attractive or unattractive. - Successful marketing firms focus efforts on satisfying customer needs that match their core competencies Competition- firm uses competitive intelligence (CI) to collect and synthesize (produce) info about their position with respect to their rivals. Enables companies to anticipate changes in marketplace rather than react to them. Includes: -reviewing public materials, including websites, press releases, annual reports -interview customers, supplies, employees -analyzing rival’s marketing tactics, pricing, hiring needs Corporate Partners- work with partners to innovate; alliances; competitors and suppliers Macroenvironmental Factor (consumers influenced indirectly, external, difficult for companies to control) CDSTEP Aspects of external environment Culture is shared meanings, beliefs, morals, values, and customs of a group of people Country Culture- easy-to-spot visible nuances to a country such as dress, symbols, ceremonies, language, food preferences, and more subtle aspects which are trickier to identify Regional subculture- region in which people live affects way they react to different cultural ritual. Ppl in Quebec likes to cook more than people in Ontario so they buy less of prepared meals Demographics- characteristics of human populations and segments (age, gender, ethinicity) Generation cohort- group of people of same generation. Generation X- ages of 36-47 (healthy options, fast food) Have same purchase behaviours.
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