Marketing Study Guide.doc

Marketing Study Guide 7 Ps of service-pg 309-312 READ • Product Elements – All components of the service performance that create value for the customer • Place and Time – Management decisions about when, where, and how to deliver services to customers. • Price and Other User Outlays – Expenditures of money, time, and effort that customers incur in purchasing and consuming services. • Promotion and Education – All communication activities and incentives designed to build customer preference for a specific service or service provider • Process – A particular method of operations or series of actions, typically involving steps that need to occur in a defined sequence. • Physical Environment – The appearance of everything physically related to a firm • People – Customers and employees who are involved in service production Brand Equity – pg 188-189 • Brand equity is the dollar amount attributed to the value of the brand, based on all the intangible qualities that create that value. • A measure of brand equity is the extent to which people are willing to pay more for the brand • Brand equity is valued along four consumer perception dimensions: Differentiation, Relevance, Knowledge, and Esteem • Brand Equity and brand value, in monetary terms, is important because it means brands can be bought and sold by companies, and frequently are. Competition-based pricing (services) – pg 376 • The last leg of the pricing tripod is competition. Firms with relatively similar services need to monitor what competitors are charging and try to price accordingly. When customers see little or no difference between competing offerings, they may just choose what they think is the cheapest. • The firm with the lowest cost per unit of service enjoys a market advantage, and often assumes price leadership. • Price competition increases with increasing number of competitors, increasing number of substituting offers, wider distribution of competitor/substitute offers, and increasing excess capacity in the industry. Consumer buyer behaviour • Difference comes down to value (notes not filled out) • Buyer decision making process o Need Recognition and problem awareness o Information Search o Evaluation of Alternatives o Purchase o Post-Purchase Evaluation Consumer surplus Consumerism – pg 45-46 • The concept that an ever-expanding consumption of goods is advantageous to the economy • Consumerism, bolstered by advertising, encourages people to judge themselves and others by what they own rather than by who they are. To be considered successful, some people believe they must own a large home, two cars, and the latest high tech gadgets. Conventional distribution channel vs vertical marketing system pg 255-258 • Conventional distribution channel – Simple distribution method, goes from producer to wholesaler to retailer to the consumer • Vertical Marketing System – A distribution channel structure in which producers, wholesalers, and retailers act as a unified system. One channel member owns the others, has contracts with them, or has so much power that they all cooperate. Core product & Supplementary services (flower of service) pg 353-360 • Flower of Service – A visual framework for understanding the supplementary service elements that surround and add value to the product core. • The supplementary services are Information, Consultation, Order Taking, Hospitality, Safekeeping, Exceptions, Billing, and Payment • Should read this section for understanding of the above Criticisms of marketing • Marketing leads to high prices • Unnecessary advertising (Ex. Ads in washrooms above urinals) • High Pressure Selling (Ex. Limited Time Deal) • Deceptive Advertising (Ex. Vacation Prices) • Creating False Needs (Ex. Cologne/Perfume) • Planned Obsolescence CRM (Customer Relationship Management) Strategies pg 470-473 • Better to read from text Cycle of failure, mediocrity, success Demand management approaches Demand Management Strategies Differentiation Strategies pg 163-166 • Positioning begins with actually differentiating the company’s marketing offer so that it will give consumers ore value than competitors offers do. • A company or market offer can be differentiated along the lines of product, services, channels, people, or brand image. • Product Differentiation – Two ends of the differentiation spectrum, some physical products are tough to differentiate such as chicken, while some are extremely easy, such as automobiles. Similarly, companies can differentiate their products on attributes such as consistency, durability, reliability, or reparability. • Service Differentiation – Beyond differentiating its physical product, a firm can also differentiate the services that accompany the product. For example, CIBC paired with Loblaws to form President’s Choice Banking, which is very convenient because of their location. • Channel Differentiation - Dimensions of service quality Distribution channel conflict Environmentalism pg 50-55 • Group of citizens, businesses and government agencies that… o Protect and improve the living environment o Maximize life quality, rather than consumption, choice or satisfaction o Strive for environmental sustainability o Enact government regulations to support these goals. Establishing service levels Four categories of service People Possessions Tangible Actions People Processing- Possession Processing- (services directed at peoples (Services directed at bodies) physical possessions) -Barbers/health care -Refueling/Disposal Intangible Actions Mental Stimulus Information Processing- Processing-(Services (services directed at directed at peoples minds) intangible assets) -Education -accounting/banking -Advertising/PR Four service focus strategies Front and back stage personnel Gaps in service design and delivery General Pricing Approaches • Read Notes Good vs. Service High vs. Low involvement products Important vs determinant attributes Jack Trout’s four principles of positioning Marketing communications mix Marketing concepts Marketing Environment • The factors and forces outside the marketing’s direct control that affect marketing managements ability to develop and maintain successful transactions with target customers. • Factors include the microenvironment – (The Company, Suppliers, Marketing intermediaries, Customers, Competitors, and Policies • Forces include the macro environment – (Demographic forces, economic forces, Natural Forces, Technological Forces, Political Forces, and Cultural Forces. • Demographics – Marketers track changing age and family structures, geographic population shifts, educational characteristics, and population diversity. • Economic Environment – All those factors that affect consumer buying power and spending patterns. These include income levels and distribution, the necessity of products, changes in trends and consumer spending patterns, and economies of different nations. • Cultural Environment – The institutions and other forces that affect a society’s basic values, perceptions, preference and behaviours. Cultural values are highly present. Learned from family and community. This includes core beliefs and values are passed on from parents to children and are reinforced by schools, churches, business and government. Secondary beliefs and values are more open to change. • International Trades Issues can also have an impact, these include trade restrictions such as tariffs and quotas, the world trade organization has a say in this and economic communities are important Marketing Intelligence Marketing Mix • The set of controllable, tactical marketing tools that the firm blends to