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Questions and Answers

What is the primary goal of marketing?

  • To maximize profit for the organization
  • To maintain existing relationships with suppliers
  • To innovate products without considering consumer feedback
  • To understand and meet customer needs to create value (correct)

Which of the following is NOT a buying role of consumers?

  • Payer
  • Influencer
  • Contributor (correct)
  • Initiator

What defines market orientation in a company?

  • A focus on reducing production costs
  • An organization-wide belief in delivering customer value (correct)
  • Creating products that do not require consumer feedback
  • The ability to predict market trends without research

How does customer centricity differ from general marketing strategies?

<p>It targets a specific group of loyal customers (C)</p> Signup and view all the answers

What role does psychological influence play in marketing?

<p>It includes understanding consumer behavior and motivations (B)</p> Signup and view all the answers

Which application of marketing is an example of a service?

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

What factor increases a buyer's bargaining power?

<p>Ability to backward integrate (B)</p> Signup and view all the answers

Which best describes the 'Blue Ocean Strategy'?

<p>Creating uncontested market space (C)</p> Signup and view all the answers

Which of the following best describes the concept of exchange in marketing?

<p>Gaining an object from someone by offering something in return (D)</p> Signup and view all the answers

What is one of the influences of industrial economics on marketing?

<p>Theories of income distribution and monopoly (D)</p> Signup and view all the answers

In the context of the Boston box, which category represents offerings with high market share but requiring significant investment?

<p>Stars (C)</p> Signup and view all the answers

What is a primary goal of a marketing audit?

<p>Evaluate marketing health and identify weaknesses (B)</p> Signup and view all the answers

Which term refers to the segment of an organization that operates independently with its own mission and objectives?

<p>Strategic Business Unit (SBU) (B)</p> Signup and view all the answers

What is the role of price-sensitivity in buyer behavior?

<p>Measures how responsive buyers are to price changes (C)</p> Signup and view all the answers

Which category in the Boston box typically generates negative cash flow?

<p>Dogs (C)</p> Signup and view all the answers

What does the marketing performance metric aim to achieve?

<p>Track the performance of marketing campaigns (C)</p> Signup and view all the answers

What is the primary focus of sales compared to marketing?

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

Which aspect of marketing is primarily concerned with generating customer insights?

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

Which of the following factors is NOT considered part of the economic environment?

<p>Cultural norms and values (A)</p> Signup and view all the answers

What does the term 'global consumer culture' refer to?

<p>A unified consumption experience shared across different cultures (C)</p> Signup and view all the answers

What does customer value primarily depend on?

<p>The perceived benefits versus costs (D)</p> Signup and view all the answers

Which of the following is NOT a component of the extended marketing mix?

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

Which of the following is NOT a green marketing strategy?

<p>Aggressive profit maximization (A)</p> Signup and view all the answers

Which benefit of relationship marketing highlights its focus on consumer retention?

<p>Lower marketing costs (D)</p> Signup and view all the answers

Which component of the political-legal environment refers to how companies influence regulations?

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

What does CRM stand for in marketing?

<p>Customer Relationship Management (A)</p> Signup and view all the answers

What does the term 'glocalization' refer to in the context of consumer culture?

<p>Adapting global products to meet local tastes (D)</p> Signup and view all the answers

What is a key characteristic of service-dominant logic?

<p>Services only become valuable upon use by the consumer (B)</p> Signup and view all the answers

In Porter’s five forces model, which factor pertains to the threat of new competitors entering the market?

<p>Economies of scale (D)</p> Signup and view all the answers

Which of the following is a component of the socio-cultural environment affecting consumer behaviors?

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

What is NOT considered an outcome of creating customer value?

<p>Negative word-of-mouth (D)</p> Signup and view all the answers

What term describes innovations that create new market and value networks, disrupting existing ones?

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

Which element of the marketing mix focuses on how a product is delivered to customers?

<p>Place (C)</p> Signup and view all the answers

Which of the following describes the relationship between suppliers and companies according to the bargaining power of suppliers?

<p>More options typically lead to lower supplier power (C)</p> Signup and view all the answers

What is the primary purpose of environmental scanning in marketing?

<p>To gather data on external factors affecting business (A)</p> Signup and view all the answers

What is the primary concern of the ecological environment as outlined in the content?

<p>Consumer concerns about companies' environmental impacts (B)</p> Signup and view all the answers

Which of the following factors does NOT typically affect customer behavior?

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

What is the primary role of context marketing?

<p>Delivering messages based on consumer behavior and situation (B)</p> Signup and view all the answers

What role do intermediaries play in the performance environment?

<p>They serve as direct connections between producers and consumers (A)</p> Signup and view all the answers

Which is a defining characteristic of co-creation in marketing?

<p>Involvement of consumers in the design process (C)</p> Signup and view all the answers

In the context of industry analysis, what does 'internal rivalry' refer to?

<p>Competition among existing companies in the industry (C)</p> Signup and view all the answers

Which of the following is NOT a factor affecting buyer bargaining power?

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

What distinguishes the traditional marketing approach from relationship marketing?

<p>Focus on acquiring new customers rather than retaining them (C)</p> Signup and view all the answers

Flashcards

What is Marketing?

The process of understanding and meeting customer needs to create value. It involves building and maintaining relationships with stakeholders through the creation and exchange of products and value.

What is Exchange?

The act of obtaining a desired object from someone by offering something in return. It's a fundamental principle in marketing, where value is exchanged between parties.

Who is a Consumer?

The person who uses the product or service. This can be different from the person who buys it.

Who is a Decider?

The person who actually makes the purchase decision. They may not always be the consumer or the payer.

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What is Market Orientation?

A strategic approach that prioritizes identifying and addressing customer needs and desires to create new product offerings. It focuses on understanding and fulfilling customer expectations.

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What is Customer Centrism?

The belief that focusing efforts on a specific group of loyal customers is more effective than trying to please everyone. It involves understanding and catering to the needs of a defined target market.

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What are Psychological Influences on Marketing?

The study of how people make decisions about buying and using goods and services. It considers factors like motivation, information processing, and persuasion.

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What are Industrial Economics Influences on Marketing?

The economic principles of supply and demand, focusing on factors like price, quantity, and how income is distributed. It provides a framework for understanding the economic dynamics of markets.

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Economic Environment

Factors affecting consumer buying power and spending patterns, like disposable income, GDP, and inflation.

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Cultural Norms and Values

Shared beliefs and practices within a society that shape values, perceptions, and behavior.

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Global Consumer Culture

A global consumer culture emerges when people share similar preferences for brands, entertainment, and products.

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Glocalization

A strategy where global brands adapt their products and marketing to local cultures and preferences.

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Technological Environment

Forces that create new technologies, products, and market opportunities.

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Disruptive Innovation

Innovation that disrupts existing markets by creating new ones through new value networks.

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Ecological Environment

Trends in sustainability and environmentally conscious practices.

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Eco-efficiency

A green marketing strategy focused on reducing costs through resource efficiency and waste reduction.

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Beyond Compliance Leadership

Green marketing strategy involving going beyond legal requirements to demonstrate environmental responsibility.

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Eco-branding

A green marketing strategy where products are differentiated to highlight their environmental benefits.

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Environmental Cost Leadership

Green marketing strategy offering environmentally friendly products at lower prices.

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Political-Legal Environment

Laws, government agencies, and pressure groups that influence and limit organizations and individuals.

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Performance Environment (Micro-environment)

Actors close to the company that affect its ability to serve customers, including suppliers, intermediaries, and stakeholders.

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Intermediaries

Organisations that act as links between different parties, facilitating operations for other companies.

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Stakeholders

Individuals or groups with an interest or influence on the organization, including customers, investors, and the media.

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Industry

All suppliers of a specific product, including their size, growth, competitiveness, and profitability.

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Porter's Five Forces Model

A framework for analyzing the competitive forces within an industry to understand its attractiveness and profitability.

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Buyer concentration vs. firm concentration

In a market with more buyers than suppliers, the buyers have greater bargaining power.

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Backward Integration

The ability for a buyer to produce the product or service themselves, reducing reliance on suppliers and increasing bargaining power.

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Competitors

Companies that deliver offerings that meet the same market needs.

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Blue Ocean Strategy

Creating a new market space with no direct competition and offering unique value.

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Value Innovation

Matching innovation with price, cost, and customer needs to create a unique market position.

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Strategic Business Unit (SBU)

Part of an organization with its own mission and objectives, operating independently from other activities.

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The Boston Box

A tool for analyzing business units based on market growth rate and market share.

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Marketing Audit

A comprehensive assessment of a company's marketing activities, strengths, and weaknesses. It considers internal, external, and customer environments.

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Environmental Scanning

The process of gathering and analyzing information about the external environment. It helps companies identify opportunities and threats, and make informed decisions.

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Demographic Environment

A study that examines population traits like size, density, location, age, income, and composition. It helps marketers understand consumer demographics and tailor their strategies accordingly.

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Exchange

The act of getting something you desire by offering something in return. It's the foundation of marketing, where value is exchanged between parties.

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Customer Value

The customer's perception of a product's ability to satisfy their needs. It's the value they assign based on their perceived benefits and costs.

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Relationship Marketing

The ability to attract and retain customers in the long term by building strong, durable relationships. It prioritizes nurturing existing relationships over just acquiring new ones.

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Service-Dominant Logic

A marketing approach that focuses on customer value, believing that services gain value through their use. It emphasizes co-creation and interaction with customers.

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Co-creation

A process where customers contribute their ideas during product or service design from start to finish. It embraces customer co-creation and participation.

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Customer Lifetime Value

The total value a business expects to receive from a customer over their entire relationship. It includes all purchases, referrals, and other contributions.

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CRM (Customer Relationship Management)

An organized approach to managing customer relationships by gathering detailed information about each individual. It aims to deliver superior value through personalization and interaction.

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Marketing Mix (4Ps)

A collection of marketing tools and techniques that businesses use to reach their target market effectively. The 4Ps include Product, Price, Place, and Promotion.

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Extended Marketing Mix (7Ps)

An extension of the 4Ps, adding three more elements relevant to services. It emphasizes physical evidence, processes, people, and personalization in service offerings.

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Customer Centrism

A marketing approach that emphasizes targeting a specific group of loyal customers who generate the most value for the business.

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Study Notes

Marketing Principles and Practice

  • Marketing is a social and managerial process focusing on understanding and meeting customer needs to create value. It builds and maintains relationships with stakeholders.
  • Exchange is obtaining a desired object from someone by offering something in return.
  • Marketing applications encompass physical products, services, retail, experiences, events, media, places, ideas, charities, and people.

Customer vs. Consumer

  • Different roles in the buying process:
    • Initiator: starts the idea
    • Influencer: persuades
    • Decider: final decision-maker
    • Buyer: makes the purchase
    • Payer: finances the purchase
    • User: consumes the product
    • Gatekeeper: controls access to the decision process
  • Example: School director decides on party decorations and assigns Amelia to make the purchase. Decider: director, Buyer: Amelia, Payer: school.

Market Orientation

  • Market orientation focuses on understanding customer needs and desires to define new products.
  • A market-oriented company prioritizes customer needs.
  • Components of market orientation:
    • Organization-wide belief in delivering customer value.
    • Understanding customer needs better than customers themselves.
    • Creating products meeting existing and latent needs.
  • Customer centricity: targeting loyal customer segments, not pleasing everyone.

Marketing's Intellectual Roots

  • Influences include industrial economics (supply/demand, income distribution, monopoly), psychology (consumer behaviour, motivation, persuasion), sociology (group behaviour, communication), anthropology (qualitative research), and computer science (digitalization).

Sales vs. Marketing

  • Sales: product-centric, short-term focus on acquiring customers (product push).
  • Marketing: customer-centric, long-term focus on value and demand stimulation (product pull).
  • Marketing aims for selling to become unnecessary.

What Marketers Do

  • Place customers at the center of the organization.
  • Marketers generate customer insights, develop marketing strategy, but don't control all aspects of the marketing mix.
  • Marketing involves all organizational departments.

Marketing as Exchange

  • Exchange results in value creation, providing more choices.
  • Customer value: assessment of a product's ability to meet needs, determined by the perceived benefits vs. costs.
  • Exchange of value relates to trading money for services or goods.
  • Outcomes include repeat purchases, positive word-of-mouth, loyalty increase, market share growth, and increased customer equity.

Marketing Mix (4Ps)

  • Product
  • Price
  • Place (distribution)
  • Promotion

Extended Marketing Mix (7Ps)

  • Product
  • Price
  • Place
  • Promotion
  • Physical Evidence (tangible aspects)
  • Process (smooth delivery)
  • People (interactions)

Context Marketing

  • Delivers messages based on customer situation and behavior.
  • Key elements: real-time data, personalization, relevance, timing, and channels.

Relationship Marketing

  • Shift from acquiring to retaining customers.
  • Customer retention is more valuable than acquisition.
  • Loyal customers increase purchases, are less expensive to promote, and refer others.

CRM (Customer Relationship Management)

  • Acquires detailed customer information to manage relationships.
  • Touch points are interactions with the brand.

Marketing Automation vs. CRM

  • Marketing automation automates marketing tasks and measures interactions.
  • CRM precedes marketing automation.

Selective Relationship Management

  • Focusing on high-value customers.

Customer Lifetime Value

  • Prediction of total value from a customer relationship.

Service-Dominant Logic

  • Value of a product/service is realized during consumption.

Co-creation

  • Consumers contribute to product/service design.

Marketing's Impact on Society

  • Marketing can be criticized for ethical concerns, manipulation, and creating artificial wants.

The Marketing Environment

  • Actors and influences outside marketing affecting relationships.
  • Three levels of analysis.

Understanding the External Environment

  • Environmental scanning gathers data on external factors influencing the organization.

Demographic Environment

  • Changing population characteristics (size, density, age, location, income).

Economic Environment

  • Factors affecting consumer spending (income, GDP, debt).

Socio-cultural Environment

  • Values, perceptions, and behaviors of society.
  • Global consumer culture: standardized brands and products across cultures.
    • Glocalization: adapting global strategies to local markets.
    • Health and fitness: growing consumer interest.

Technological Environment

  • Forces creating new technologies, products, and market opportunities.
  • Disruptive innovation creates new markets and displaces existing ones.

Ecological Environment

  • Changes in sustainability concerns.
    • Consumer awareness about environmental impact.
    • Government regulations and policies affecting sustainability.
    • 4 Green Marketing Strategies: Eco-efficiency, Beyond Compliance Leadership, Eco-Branding, Environmental Cost Leadership.
  • Laws, government agencies, and pressure groups impacting organizations.
  • Business-government relations influence competitive advantage.
  • Ethical and social responsibility concerns.
  • Trade relationships, lobbying, and public relations.

Understanding the Performance Environment (Micro-environment)

  • Competitors, suppliers, intermediaries, and stakeholders shape business operations.
  • Intermediaries (resellers, logistics providers, marketing services, financial intermediaries) connect companies with customers.
  • Stakeholders have interests in the organization's operations.

Analyzing Industries (Porter's Five Forces)

  • Threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat of substitutes, rivalry among existing competitors.

Competitors

  • Understanding competitor goals, strengths, weaknesses, and responses to changes.

Blue Ocean Strategy

  • Creating new market spaces in previously uncontested areas.

Understanding the Internal Environment

  • Factors within the organization impacting operations, performance, and culture.

Strategic Business Units (SBUs)

  • Independent parts of an organization with specific missions and objectives.

Boston Box

  • Visual tool analyzing cash flow and investments for SBUs (Stars, Question Marks, Cash Cows, Dogs).

Marketing Audit

  • Holistic review of the marketing environment to identify strengths and weaknesses.
  • Involves performance metrics to track campaign effectiveness.

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