Basic Marketing Concepts and Strategies
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Questions and Answers

Which stage of the product life cycle (PLC) is characterized by rapid market acceptance and increasing profits?

  • Maturity
  • Growth (correct)
  • Introduction
  • Decline

What is a 'fad' in the context of product cycles?

  • A period of temporarily high sales due to intense consumer enthusiasm. (correct)
  • A widely accepted style in a particular field.
  • A long-lasting trend in the market.
  • A basic and distinctive mode of expression.

In the maturity stage of the PLC, what is a common strategy that companies might use to extend the product's life?

  • Finding new consumer segments or modifying the product. (correct)
  • Increase pricing substantially to maximize profits.
  • Reduce marketing efforts and allow sales to decline naturally.
  • Drop the product from their line.

What is the primary focus of customer value-based pricing?

<p>The consumer’s perception of the product's value. (D)</p> Signup and view all the answers

During which stage of the product life cycle are profits typically the lowest?

<p>Introduction stage (B)</p> Signup and view all the answers

Which of the following represents a 'style' according to the text?

<p>A basic and distinctive mode of expression (D)</p> Signup and view all the answers

What is the role of price within the marketing mix?

<p>It is the only element which generates revenue. (D)</p> Signup and view all the answers

In the context of international product introductions, what does the passage suggest is important besides ensuring correct translation on packaging?

<p>Understanding subtle differences for logos and symbols. (B)</p> Signup and view all the answers

What is the primary goal of differentiating a market offering?

<p>To create superior customer value (A)</p> Signup and view all the answers

Which element of the marketing mix refers to activities that communicate the benefits of a product?

<p>Promotion (D)</p> Signup and view all the answers

In a SWOT analysis, what do 'weaknesses' refer to?

<p>Internal limitations of the company (B)</p> Signup and view all the answers

What is the purpose of marketing implementation?

<p>To turn marketing strategies into marketing actions (B)</p> Signup and view all the answers

What does 'operating control' primarily focus on within marketing control?

<p>Checking performance against the annual plan (B)</p> Signup and view all the answers

What is the formula for calculating the return on marketing investment (marketing ROI)?

<p>Net return from marketing investment divided by the cost of investment (B)</p> Signup and view all the answers

Which of the following is NOT a component of the microenvironment?

<p>Large scale economic forces affecting the entire economy (D)</p> Signup and view all the answers

Which phrase best describes the marketing environment?

<p>The actors and forces that affect the company's marketing ability (C)</p> Signup and view all the answers

Which of the following best describes the concept of 'consumer buyer behavior'?

<p>The buying actions of final consumers for personal consumption. (A)</p> Signup and view all the answers

What does the term 'consumer market' represent?

<p>All individuals and households that purchase or acquire goods and services for personal use. (D)</p> Signup and view all the answers

Which of the following is the best definition of 'culture' in the context of consumer behavior?

<p>The basic values, perceptions, wants, and behaviors learned from society. (A)</p> Signup and view all the answers

What are 'subcultures' characterized by?

<p>Groups with similar values and behaviors, based on shared experiences. (A)</p> Signup and view all the answers

How are 'social classes' best described in relation to consumer behavior?

<p>Relatively permanent and ordered societal divisions with similar values. (A)</p> Signup and view all the answers

What is the main purpose of 'buzz marketing'?

<p>To create opinion leaders and act as brand ambassadors. (A)</p> Signup and view all the answers

What distinguishes a 'membership group' from a 'reference group'?

<p>Membership groups are places a person belongs to, while reference groups act as comparison points. (D)</p> Signup and view all the answers

Why do marketers try to identify 'opinion leaders'?

<p>Because they tend to have strong social influence on others. (B)</p> Signup and view all the answers

What is the primary goal of 'idea screening' in the new product development process?

<p>To filter out non-viable product ideas efficiently to save resources. (A)</p> Signup and view all the answers

Which of the following best describes 'concept testing'?

<p>Presenting a group of target consumers with detailed versions of the product idea to gauge their interest. (C)</p> Signup and view all the answers

Which of these is NOT a component of 'marketing strategy development'?

<p>Creating a physical prototype of the product. (B)</p> Signup and view all the answers

What does 'business analysis' primarily seek to determine?

<p>If the estimated sales, costs, and profits align with the company’s goals. (D)</p> Signup and view all the answers

What is the crucial outcome of 'product development' in the new product process?

<p>A physical product that is ready to be sold in test markets. (D)</p> Signup and view all the answers

What is the primary purpose of 'test marketing' in new product development?

<p>To evaluate the product's initial marketability and performance in realistic conditions. (D)</p> Signup and view all the answers

What is a key characteristic of 'customer-centred new product development'?

<p>Focusing on finding new ways to solve customer problems. (B)</p> Signup and view all the answers

In the context of new product development, what does a 'team-based approach' emphasize?

<p>Close collaboration and overlapping steps across company departments to speed up development. (A)</p> Signup and view all the answers

What is the primary function of a company's mission statement?

<p>To define the organization's purpose. (D)</p> Signup and view all the answers

In the context of the Boston Consulting Group (BCG) matrix, what characterizes a 'cash cow'?

<p>Low growth but high market share, producing cash. (C)</p> Signup and view all the answers

Which of the following best describes the core concept of strategic planning?

<p>Ensuring alignment between the organization's goals and its evolving marketing opportunities. (C)</p> Signup and view all the answers

How does the Internet primarily impact marketing, according to the text?

<p>It provides new ways to track customers and create products based on their needs. (D)</p> Signup and view all the answers

What is the main purpose of portfolio analysis in a business?

<p>To evaluate the different products and businesses that make up a company. (D)</p> Signup and view all the answers

According to the provided content, what is a key difference between Web 1.0 and Web 2.0?

<p>Web 1.0 was primarily about information, while Web 2.0 facilitated connections between people. (A)</p> Signup and view all the answers

In a growth-share matrix, what investment strategy should be considered for 'question mark' SBUs?

<p>To build share through strategic investment as these could be profitable. (D)</p> Signup and view all the answers

Which units are classified as 'dogs' in the growth-share matrix?

<p>Units with low growth and low market share. (A)</p> Signup and view all the answers

What does managing service productivity entail?

<p>Guaranteeing employees are skilled while harnessing the potential of technology. (A)</p> Signup and view all the answers

Which of the following defines brand equity?

<p>The differential impact of brand recognition on a customer's buying decision. (D)</p> Signup and view all the answers

What is the main purpose of brand valuation?

<p>To determine the overall financial worth of a brand in monetary terms. (D)</p> Signup and view all the answers

Which of these is NOT a critical factor in choosing a brand name?

<p>The name should be commonly used to ensure easy translation. (D)</p> Signup and view all the answers

What are 'store brands' primarily associated with?

<p>Brands that are exclusively created and owned by retail sellers. (A)</p> Signup and view all the answers

What is the essence of 'co-branding'?

<p>The joint use of two different brand names on a single product. (B)</p> Signup and view all the answers

What does 'line extension' involve in the context of branding?

<p>Introducing variations of an existing product, using the same brand. (C)</p> Signup and view all the answers

What is the primary aim of 'new product development'?

<p>To create novel items, updates to existing products, and new brands. (D)</p> Signup and view all the answers

Flashcards

Strategic planning

The process of devising and maintaining alignment between a company's objectives, capabilities, and changing market possibilities.

Mission statement

A brief statement that declares the purpose of an organization.

Business portfolio

The collection of businesses and products that constitute a company.

Portfolio analysis

The process by which management examines the products and businesses within the company.

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Stars (BCG Matrix)

High-growth, high-share units requiring significant investment.

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Cash cows (BCG Matrix)

Low-growth, high-share units that generate substantial cash.

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Question marks (BCG Matrix)

Low-share units in high-growth markets, requiring cash but potentially unprofitable.

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Dogs (BCG Matrix)

Low-growth, low-share units delivering low profit.

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Differentiation

Tailoring a company's offerings to provide exceptional value for its customers.

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Marketing Mix

The blend of marketing tools like product, price, place, and promotion used to reach target customers.

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SWOT Analysis

A formal evaluation of a company's internal strengths and weaknesses and external opportunities and threats.

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Marketing Implementation

The process of putting marketing plans and strategies into action to achieve specific objectives.

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Marketing Control

The measurement and evaluation of marketing results, along with corrective actions to ensure objectives are met.

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Marketing ROI

The net return from a marketing investment divided by the cost of that investment, measuring the effectiveness of marketing spending.

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Marketing Environment

The actors and forces outside marketing that influence a company's ability to build relationships with its target customers.

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Microenvironment

Includes factors close to the company that affect its ability to serve its customers, such as suppliers, competitors, and the company itself.

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Crowdsourcing

Inviting a wide range of people, including customers, employees, and even the public, to contribute to the new product development process.

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Brand Equity

The added value a brand name gives to a product or service, influencing customer responses.

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Idea screening

Evaluating new product ideas to identify strong contenders and eliminate weak ones early on.

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Brand Valuation

The process of evaluating the overall financial worth of a brand.

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Brand Positioning

A strategic marketing approach that positions a brand in the minds of consumers.

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Product concept

A detailed description of a new product idea presented in terms that consumers understand.

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Concept Testing

Testing new product concepts with a group of target consumers to gauge their appeal and potential success.

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Store Brand

Creating and owning a brand by a reseller to differentiate their products.

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Licensing

Lending a brand name to other manufacturers for a fee.

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Marketing Strategy Development

Formulating an initial marketing strategy for a new product, outlining the target market, value proposition, budget, and long-term marketing mix.

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Co-branding

Combining two established brand names on a single product

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Business analysis

Analyzing the projected sales, costs, and profits of a new product to determine if they align with the company's goals.

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Product Development

Transforming a product concept into a tangible physical product, ensuring the idea can be turned into a marketable offering.

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Line Extension

Extending an existing brand name to new versions of the same product category (e.g., different flavors, sizes).

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Brand Extension

Extending a current brand name to entirely new product categories (e.g., a clothing brand launching shoes).

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Test marketing

Testing a new product and its marketing plan in real-world settings to assess its potential success.

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Consumer Buyer Behavior

The buying behavior of individuals and households that purchase goods and services for personal use.

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Culture (In Consumer Behavior)

The set of values, beliefs, and behaviors learned by members of a society through family and other institutions.

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Subculture

A group of people within a culture who share distinct values and beliefs based on common life experiences.

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Social Classes

Relatively permanent and ordered groups in society where members share similar values, interests, and behaviors.

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Groups (In Consumer Behavior)

Two or more people who interact to achieve individual or mutual goals.

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Reference Group

A group a person belongs to and directly compares themselves to, affecting their behavior and choices.

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Opinion Leader

A person within a reference group who influences others' behavior due to skills, knowledge, personality, or other characteristics.

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Buzz Marketing

Creating opinion leaders to act as brand ambassadors and spread positive word-of-mouth.

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Introduction Stage of the PLC

The initial stage of a product's life cycle characterized by low sales, high costs, and little to no profit. The product is introduced to the market for the first time.

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Growth Stage of the PLC

The period when a product's sales grow rapidly, the market begins to accept it, and profits increase. The company focuses on expanding market share and creating brand awareness.

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Maturity Stage of the PLC

The stage when a product's sales plateau or slow down. Competition intensifies, and the company focuses on maintaining market share, attracting new customers, or modifying the product to stay relevant.

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Decline Stage of the PLC

The stage where a product experiences declining sales and profits. Consumers may lose interest or prefer newer alternatives. Companies may decide to maintain, reposition, or drop the product.

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Style

A basic and distinctive mode of expression that endures over time, often inspiring trends and fads.

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Fashion

A currently accepted or popular style in a specific field, often characterized by its transient nature.

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Fad

A temporary period of immense popularity for a product or brand, driven by consumer excitement and a perceived need for it.

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Price

The amount of money customers pay for obtaining a product or service. It's the only element in the marketing mix that generates revenue for the company.

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Study Notes

Basic Marketing Concepts

  • Marketing is managing profitable relationships by attracting new customers and keeping current ones satisfied. It's about satisfying customer needs, creating value for customers, and building strong relationships.
  • Customer needs, wants, and demands: Human needs are states of deprivation, wants are the form needs take in a given culture, and demands represent wants backed by buying power.
  • Market offerings are combinations of products, services, and experiences offered to satisfy needs or wants; may include tangible and intangible components; market myopia is focusing on products instead of customer needs.
  • Value and satisfaction build customer relationships. Exchanges are obtaining desired items through reciprocation. A market comprises potential and actual buyers of a product or service. Marketing involves serving target customers in a competitive environment.

Designing a Customer-Driven Marketing Strategy

  • Marketing management is choosing target markets and building profitable customer relationships.
  • A value proposition is the set of benefits a company promises to deliver. Five popular marketing concepts are production, product, selling, marketing, and societal.

Constructing an Integrated Marketing Plan

  • A marketing strategy includes targeting desired customers and how to deliver value. Integrated marketing plans provide tools for implementing these strategies; these tools include the four Ps: product, price, place (distribution), and promotion.
  • CRM (Customer Relationship Management) is the process of building and maintaining profitable relationships with customers through superior value and satisfaction. Customer-perceived value is a key measure.
  • Customer relationships vary from basic to full partnerships. Today's marketing embraces two-way communications and consumer-generated content. Companies work with various partners to develop relationships.

Capturing Customer Value

  • Customer lifetime value is the cumulative value of future purchases. Customer equity is the combined customer lifetime values for all customers. Building relationships should involve targeting the right customers.
  • Different customer types are described in a matrix (e.g., butterflies, true friends, barnacles, and strangers).

The Marketing Environment

  • Factors outside the company that affect marketing management's ability to build and maintain successful customer relationships.
  • The microenvironment includes the company, suppliers, distributors, marketing intermediaries (like resellers, marketing service agencies, and financial intermediaries), competitors, and publics. The macroenvironment includes demographic, economic, natural, technological, political, and cultural forces.
  • Key forces in the macroenvironment include demographics (population trends), economic conditions (consumer spending), and cultural factors (values and beliefs).

Consumer Buyer Behavior

  • Consumer buyer behavior is the buying behavior of individuals and households that buy goods and services for personal consumption. Various factors influence buying behavior (cultural, social, personal and psychological).
  • Cultural factors include culture (basic values, perceptions and behaviors), subculture, and social class.
  • Social factors include groups (membership and reference), word-of-mouth influence, and opinion leaders.
  • Personal factors include age and life cycle stage, occupation, economic situation, lifestyle, and personality.
  • Psychological factors include motivation (needs), perception, learning, and beliefs and attitudes.

The Product Life Cycle

  • New product development involves a multi-step process: idea generation, idea screening, concept development and testing, marketing strategy development, business analysis, product development, test marketing, and commercialization. The product life cycle (PLC) has five distinct stages: development, introduction, growth, maturity, and decline.

Marketing Strategies

  • Market segmentation divides a market into distinct groups of buyers. Common segmentation bases include geographic, demographic, psychographic, and behavioral.
  • Target market selection focuses on choosing segments to serve.
  • Positioning involves placing a product in the minds of consumers relative to competing products. Differentiation is creating superior customer value. Companies use different value propositions (e.g., more for more, more for the same, less for much less, etc).
  • Pricing strategies include cost-based, competition-based, and value-based pricing; pricing strategies also take into account pricing and cost for various product mix situations

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Related Documents

Cap 1-3, 5, 7-11: Marketing Concepts PDF

Description

Explore fundamental concepts of marketing, including the importance of managing customer relationships and understanding needs, wants, and demands. This quiz covers how to design customer-driven marketing strategies and the significance of value and satisfaction in building strong customer connections.

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