Consumer Needs and Marketing Strategies
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Questions and Answers

Eating out is not a need.

True (A)

The purpose of advertising is to...

  • Tease the consumer
  • Inform the consumer
  • Persuade the consumer
  • All of the above (correct)

    • Making the customer do product research is a common market strategy.

    False (B)

    When a company places an ad and offers no interest on your purchase for three years, the cost of the financing is built into the price of the item.

    <p>True (A)</p> Signup and view all the answers

    What is a safe assumption to make regarding companies and their marketing strategies?

    <p>Companies know that competition is fierce for consumer dollars, companies spend millions of dollars and do extensive research on advertising and companies use all angles to aggressively compete for your money.</p> Signup and view all the answers

    The concept best explained by the statement, 'Money spent here cannot be money spent there.' is...

    <p>Opportunity cost</p> Signup and view all the answers

    The method companies use to compete for your money: '90 days same as cash' is...

    <p>Financing</p> Signup and view all the answers

    The method companies use to compete for your money: Reputation for holding its value is...

    <p>Repetition</p> Signup and view all the answers

    The method companies use to compete for your money: Car salesman is...

    <p>Personal Selling</p> Signup and view all the answers

    The method companies use to compete for your money: TV commercials are...

    <p>Media</p> Signup and view all the answers

    Four common marketing tactics are...

    <p>Personal selling, financing, repetition, product positioning</p> Signup and view all the answers

    Dave tells the story of a man who bought his dream car, drove it home, but then returned it the next day after some money calculations. This story is an example of...

    <p>Opportunity cost</p> Signup and view all the answers

    When making a significant purchase, you should consider what 3 things?

    <p>Your buying motives, the opportunity cost and if you can't pay with cash, don't buy it.</p> Signup and view all the answers

    Financing is a form of product positioning.

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

    What are 3 'power over purchase' tactics?

    <p>Consider the opportunity cost, seek counsel and wait overnight.</p> Signup and view all the answers

    A good salesperson will answer a question with a question.

    <p>True (A)</p> Signup and view all the answers

    Never buy something you do not fully understand.

    <p>True (A)</p> Signup and view all the answers

    The amount of stuff a person has is directly related to contentment and happiness.

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

    Young single adults should find an accountability partner with whom to discuss big purchases.

    <p>True (A)</p> Signup and view all the answers

    Inflation has no effect on your buying power.

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

    A budget has little effect on a person's financial success unless he or she also develops power over purchase.

    <p>True (A)</p> Signup and view all the answers

    You should never wait overnight before making a big purchase if there is only one item left.

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

    Teens have cited 'friends' as the strongest influence over their purchase decisions.

    <p>True (A)</p> Signup and view all the answers

    Repetition has proven to be an ineffective marketing technique.

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

    Zero percent financing is nothing more than a really good marketing technique.

    <p>True (A)</p> Signup and view all the answers

    The promotion of a product or service by identifying it with distinct characteristics is called...

    <p>Branding</p> Signup and view all the answers

    To buy an item with credit; paying over time is called...

    <p>Financing</p> Signup and view all the answers

    Referring to the opportunity that is given up because you choose to do something else with your money is called...

    <p>Opportunity cost</p> Signup and view all the answers

    An amount of money you spend, usually $300, that causes some pain to part with is called...

    <p>Significant purchase</p> Signup and view all the answers

    The process of communicating the value of a product or service to customers is called...

    <p>Marketing</p> Signup and view all the answers

    Refers to the public ability to recall and recognize a brand by its logo, jingles, packaging, etc. is called...

    <p>Brand recognition</p> Signup and view all the answers

    Feeling regret or concern after making a large purchase is known as...

    <p>Buyer's remorse</p> Signup and view all the answers

    An economic system based on a free market, profit motive, open competition and private ownership of the means of production is called...

    <p>Capitalism</p> Signup and view all the answers

    The persistent increase in the cost of goods and services or the persistent decline in the buying power of money is known as...

    <p>Inflation</p> Signup and view all the answers

    A spur-of-the-moment, unplanned decision to buy a product or service is called...

    <p>Impulse buy</p> Signup and view all the answers

    Why is financing a purchase a bad idea?

    <p>Going into debt for any reason is a bad idea because it puts you at financial risk, causes you to pay more than the cost of the item, and prevents you from building wealth.</p> Signup and view all the answers

    Why should you always consider the opportunity cost when making a significant purchase?

    <p>Because money spent in one place cannot be spent in another. Considering opportunity cost is just one of the steps needed to have power over purchase.</p> Signup and view all the answers

    What are the five steps you should take before making a significant purchase?

    <p>Wait overnight, consider your buying motives, make sure you understand what you are buying, consider the opportunity cost, and seek wise counsel.</p> Signup and view all the answers

    What effect does inflation have on purchasing power?

    <p>Inflation means that your dollars buy less than they did in the past.</p> Signup and view all the answers

    Summarize factors that influence consumer decisions.

    <p>Marketing, peer influence, brand recognition, opportunity cost, a drive from others, immaturity, contentment, time, whether the item/service is wanted or needed, etc.</p> Signup and view all the answers

    Explain why consumer awareness is such an important part of a healthy financial plan.

    <p>We live in the most marketed-to culture in the world. In order to have financial peace, you need to develop power over purchase and resistance to marketing.</p> Signup and view all the answers

    Identify ways companies compete for your money.

    <p>Personal selling, creative financing, repetition and product positioning (which includes color, packaging, branding and shelf position).</p> Signup and view all the answers

    Study Notes

    Consumer Needs and Marketing

    • Eating out is classified as a luxury, not a necessity.
    • Advertising aims to tease, inform, and persuade consumers.
    • Significant market strategies do not typically rely on customers conducting their own product research.

    Financial Strategies and Sales Techniques

    • Zero-interest financing, like "90 days same as cash," incorporates financing costs into product pricing.
    • Companies extensively research and spend millions on marketing due to fierce competition for consumer dollars.
    • Opportunity cost highlights that money allocated to one expense cannot be used for another.

    Power Over Purchase Tactics

    • Prior to making a significant purchase, consider your buying motives, opportunity cost, and prioritize cash payments.
    • Effective strategies to maintain power over purchases include waiting overnight, seeking trusted advice, and evaluating opportunity costs.

    Personal Selling and Marketing Tactics

    • Common marketing tactics include personal selling, financing options, product repetition, and effective product positioning.
    • A good salesperson often answers inquiries with follow-up questions to engage the consumer.

    Consumer Behavior Insights

    • Teens recognize friends as a primary influence on their purchase decisions.
    • Repetitive marketing has successfully proven to be effective in influencing consumer choices.
    • Consumer awareness is vital for financial well-being; understanding marketing techniques protects against overspending.

    Economic Concepts

    • Inflation decreases the purchasing power of money, necessitating consideration for future expenses and retirement planning.
    • Significant purchases are typically any expenditure above $300 that causes discomfort in spending.
    • Impulse buys are unplanned, spontaneous purchases that can disrupt budget management.

    Brand and Market Awareness

    • Branding helps products stand out through distinct characteristics, enhancing public perception and recall.
    • Marketing encompasses the communication of product value to customers, an essential component of successful sales.

    Insights on Decision Making

    • Always evaluate potential regret or buyer's remorse associated with large purchases.
    • Following a methodical approach to significant purchases—waiting, reflecting, understanding, and seeking advice—can help avoid regret.

    Importance of Financial Discipline

    • Financing purchases can lead to debt, which undermines financial stability and wealth accumulation.
    • Maintaining awareness of marketing strategies is crucial to avoid unnecessary spending motivated by advertising pressures.

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    Description

    This quiz explores various aspects of consumer needs and marketing strategies. It covers topics like the classification of eating out as a luxury, the role of advertising, and the importance of understanding financial strategies in sales. By understanding these concepts, individuals can better navigate consumer behavior and make informed purchasing decisions.

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