MKT 400- Final Exam Guide - Comprehensive Notes for the exam ( 36 pages long!)

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Published on 1 Dec 2017
Department
Course
Professor
Ryerson
MKT 400
FINAL EXAM
STUDY GUIDE
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MKT400 Lecture 1
Understand Marketing Ethics and Consumer Misbehaviour
Marketing Ethics and Consumer Misbehaviour
o Ethics: refers to standards or moral codes of conduct to which a person, group, or organization adheres;
determines how much tolerance one has for actions that take advantage of others
Marketing Ethics: consists of societal and professional standards of right and fair practices that are
expected of managers as they develop and implement marketing strategies
o Manipulative marketing practices, deceptive advertising, and corporate scandals upset the value equation
associated with a given exchange
Effect of Corporate Misbehaviour
o Ultimately, consumers “vote with their wallets” when companies engage in unethical behaviour
Understand the Meaning of Consumption and Consumer Behaviour
Consumer behaviour can be defined from two different perspectives:
o Human Thought and Action
o A Field of Study (Human Inquiry) that is developing an accumulated body of knowledge
Consumer Behaviour as Human Behaviour
o Consumer Behaviour: the set of value-seeking activities that take place as people go about addressing
needs; when a consumer comes to realize that something is needed, a chain reaction (which involves
psychological processes, including thoughts, feelings, and behaviour) begins as the consumer sets out to
find desirable ways to fill this need
The Basic Consumption Process:
o Need -> want -> exchange -> costs and benefits -> reaction -> value
o Want: a specific desire that spells out a way a consumer can go about addressing a recognized need
o Exchange: the acting out of a decision to give something up in return for something of greater value
o Costs: the negative results of consumption; involves more than just the price of the product (i.e. time spent
both shopping for/learning how to use the product, physical effort, etc.)
o Benefits: positive results of consumption
Consumption: represents the process by which goods, services, or ideas are used and transformed into value; if
the product performs well, a great deal of value may result
Consumer Behaviour as a Field of Study
Consumer Behaviour as a Field of Study: represents the study of consumers as they go about the consumption
process; in this sense, consumer behaviour is that science of studying how consumers seek value in an effort to
address real needs
Economics and Consumer Behaviour
o Economics: the study of production and consumption; marketing has its origins in economics, particularly
with respect to the production and distribution of goods
Economic studies often involve things like commodity consumption of nations over time; may involve
tracking changes in consumption, with different price levels enabling price elasticity to be determined
o Macro or Micro?
Economists study consumer behaviour from a macro, or broad perspective
Consumer behaviour researches study consumer behaviour on a micro, or more individual, level
Psychology and Social Psychology
o Psychology: the study of human reactions to their environment, including behaviour and mental processes;
seeks to explain the thoughts, feelings, and behaviours that represent human reaction; can be divided into
several sub-disciplines -> social and cognitive psychology
Social Psychology: focuses on the thoughts, feelings, and behaviours that people have as they interact
with other people (group behaviour)
Cognitive Psychology: deals with the intricacies of mental reactions involved in information processing
Marketing
o Marketing: involves the multitude of value producing seller activities that facilitate exchanges between
buyers and sellers; activities include the production, promotion, pricing, distribution, and retailing of goods,
services, ideas, and experiences that provide value for the consumers and other stakeholders
Consumer Behaviour and Other Disciplines
o Sociology: the study of groups of people within a society; relevant to consumer behaviour because
consumption often takes place within group settings/is affected by group behaviour
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o Anthropology: allows researchers to interpret the relationships between consumers and the things they
purchase, the products they own, and the activities in which they participate
o Geography and the medical sciences overlap with consumer behaviour because they draw some of the
same theories and/or research approaches
Consumer Behaviour and Closely Related Disciplines
Competition and Consumer Orientation
Consumer (Customer) Orientation: a way of
doing business in which the actions and decision
making of the institution prioritize consumer value
and satisfaction above all other concerns; a key
component of a firm with market-oriented culture
Market Orientation: an organizational culture
that embodies the importance of creating value for
customers among all employees; stresses the need
to monitor and understand competitor actions in the
marketplace and the need to communicate
information about customers and competitors
throughout the organization
Relationship Marketing
Relationship Marketing: activities based on the belief that the firm’s performance is enhanced through repeat
business; the recognition that customer desires are recurring and that a single purchase act may be only one
touch-point in an ongoing series of interactions with a customer
Touch-Points: direct contacts between the firm and a customer; contact is made by phone, email, text
messaging, and face-to-face
Consumer Behaviour’s Role in Business and Society
Consumer Behaviour (CB) is important in at least three ways:
o 1. CB provides an input to business/marketing strategy
o 2. CB provides a force that shapes society
o 3. CB provides an input to making responsible decisions as a consumer
Consumer Behaviour and Marketing Strategy
o Resource Advantage Theory: a theory that helps explain why companies succeed or fail; the firm goes about
obtaining resources from consumers in return for the value the resources create; companies succeed by
acquiring more resources from consumers and in turn using those resources to gain advantages in physical
and intellectual capital
What Do People Buy?
o Attributes: a product feature that delivers a desired consumer benefit
o Product: a potentially valuable bundle of benefits
Ways of Doing Business
o Corporate cultures fall roughly into one of several categories representing different ways of doing business,
which often guide a firm’s market segmentation practices
Undifferentiated marketing: a plan wherein the same basic product is offered to all customers; mass
merchandisers typify undifferentiated marketers in that they rely on selling high volume to be successful;
they focus on serving very large segments in which consumers do not have specific desires
Product Orientation: approach where in innovation is geared primarily toward making the production
process as efficient and economic as possible; emphasis is on serving customers while incurring
minimum costs
Differentiated Marketers: firms that serve multiple market segments, each with a unique product offering;
emphasis is on matching a product with a segment
One-to-One Marketing: plan where in a different product is offered for each individual customer so that
each customer is treated as a segment of one (e.g. Build-A-Bear)
Niche Marketing: plan wherein a firm specializes in serving one market segment with particularly unique
demand characteristics
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