Marketing Quiz on Product and Pricing Strategies

Marketing

• Definition: Process of creating value for customers and building strong relationships to capture value in return.
• Activities involve creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society.
• Organizations that do not need a marketing strategy: monopolies and commodity firms, but specifically some not-for-profit firms, and firms in industries associated with negative externalities like tobacco, alcohol, gambling, or weapons manufacturing
• Organizations that typically benefit from marketing efforts: healthcare, because it affects Public Health and Safety considerations, ethical implications [misinformation and emotional exploitation], and regulatory considerations and legal liability
• Profits are calculated as: π = (p − v) × q where π = Profits, p = Price Per Unit, v = Variable Cost Per Unit, q = Quantity sold in units, and f = Fixed Costs of production (eg. advertising)

Creating and Capturing Customer Value

• Needs: States of deprivation (basic physical needs, social needs for belonging/affection or self-expression)
• Wants: Shaped by culture and individual personality; desires for objects to satisfy needs
• Demands: Wants backed by buying power; desires for products/services with greatest value
• Customer Value and Satisfaction: Expectations about value & satisfaction lead to buying decisions
• Market Offerings: combinations of products, services, information, or experiences offered to a market to satisfy a need or a want.

Sustainable Marketing Practices

• Increasing trend companies spending more on sustainability or climate issues
• Companies use marketing elements to address climate issues (i.e. changing products or services, partners, marketing promotions, distribution, and market selection).
• Calls for socially and environmentally responsible actions.

Relationship Building

• Create customer loyalty and retention to capture customer lifetime value
• Grow share of customer (getting a larger portion of customer's purchasing)
• Build customer equity (total combined lifetime values of all customers)

Customer Value-Driven Marketing Strategy

• Ask yourself: What customers will we serve (target market)?
• How can we best serve them (value proposition)?
• Differentiation and Positioning
  • Brand's value proposition: set of benefits or values promised to satisfy needs
  • Value proposition: Solving the "Why should I buy from you than other competitors?"

Selling Vs. Marketing Concepts

• Selling concept: focuses on creating sales volume through promoting existing products
• Marketing concept: focuses on satisfying customer needs & wants via integrated marketing

The Social Marketing Concept

• This concept is based on long-term welfare rather than just short-term wants for customers.

Role of Marketing in Strategic Planing

• Developing and maintaining a strategic fit between the organization's goals and capabilities and its changing marketing opportunities.
  • Defining company's mission
  • Setting company objectives and goals
  • Designing the business portfolio
  • Planning marketing and other functional strategies
• Product Orientation emphasizes "What's in it for you", and customers' needs- Market Orientation emphasizes "What do we want in return?"

Customer Value-Driven Marketing Strategy and the Marketing Mix

• Product: Variety, Quality, Design, Features, Brand Name, Packaging, Services
• Price: List price, Discounts, Allowances, Payment Period
• Place: Channels, Coverage, Locations
• Promotion: Advertising, Personal Selling, Sales Promotion, Public Relations, Direct and Digital

The Marketing Mix and Marketing Strategy

• Effective marketing: creates customer value and profitable customer relationships
• Marketing Strategy: the marketing logic by which the company hopes to create customer value and achieve profitable customer relationships.
• Key questions: what customers will we serve (target market)? How we can best serve them (value proposition)?
• Difference between Product vs. Market Orientation:
  • Product: emphasizes customer wants not customer needs. Market: emphasizes making products meet customer needs
• Strategies:
  • Production Concept: consumers want available and affordable products
  • Product Concept: products have high quality, performance, and innovative features

Ethics in Marketing

• Do no harm: consciously avoiding harmful actions or omissions
• Foster trust: fair dealing, ethical communication & proper product/service delivery
• Embrace ethical values: honesty, responsibility, fairness, respect, transparency, and citizenship

Sustainable Marketing Practices

• Increased spending on sustainability/climate-related issues
• Companies apply strategies to address issues relating to climate (changing products/services, etc)
• Actions that benefit present consumer needs while still positively impacting future generations.

Marketing Strategy and the Market Analysis

• Microenvironment: actors close to the company impacting service delivery (company, suppliers, marketing intermediaries, competitors, publics)
• Macroenvironment: larger social forces affecting the microenvironment (demographic, economic, natural, technological, political, cultural forces)

Company and Marketing Strategy

• Role of marketing in strategy planning: aligning the company's goals, capabilities with changing marketing opportunities.
• Key elements: Defining the company's mission, setting company objectives and goals, designing the business portfolio, planning marketing and other functional strategies.

Consumer Analysis and Buying Behavior

• Consumer Markets: buyers for personal use, often with elastic & variable demand
• Business Markets: organizations buying for use in production, often with inelastic & derived demand
• Buyer behaviors are driven by: Cultural factors, Social factors, Personal factors, Psychological factors
• Buying Process stages: Need recognition; Information search, evaluation of alternatives, purchase decisions, and post-purchase behavior
• Types of decisions: Routine, Extensive, Limited, or Complex

Market Research

• Big data: massive, complex datasets
• Customer insights: fresh, deep understanding of customers' needs and wants
• Difficulties accessing, maintaining, interpreting, and analyzing big data (lack of skills, resources)
• Importance of customer insights (understanding, improving offerings, & effective campaigns)
• Importance of customer insight teams: holistic view, analyzing data from multiple sources, and customer satisfaction and loyalty
• Methodologies: Exploratory, descriptive, and causal.

The Marketing Mix

• Product: a good, service or idea offered to the market for exchange
• Price: the amount of money charged for the product or service
• Place: the activities to make the product or service accessible to the target customer
• Promotion: the process to communicate the value proposition to the target customer
• Understanding product and service life cycles
• Applying concepts relating to product, brand, and customer segments