Marketing Strategy Fundamentals
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Questions and Answers

What is the primary purpose of market segmentation?

  • To find the cheapest price for a product
  • To consolidate all market actors into a single entity
  • To divide potential buyers into groups according to their needs (correct)
  • To identify all potential buyers in a market

Which of the following is NOT a method of market segmentation?

  • Demographic segmentation
  • Segmentation through product use/application
  • Geographic segmentation
  • Psychological segmentation (correct)

In demographic segmentation for consumer markets, which of the following factors is considered?

  • Income (correct)
  • Size of the business
  • Shipping distance
  • Competitive intensity

Which segment is focused on attitudes toward lifestyle decisions?

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

What influences the product/market selection dramatically?

<p>The value of the product (B)</p> Signup and view all the answers

What factor is least likely to be considered in geographic segmentation?

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

What characteristic defines a market segment?

<p>Customers who perceive and value the product similarly (D)</p> Signup and view all the answers

Why might a segmentation scheme become obsolete as a market grows?

<p>It no longer aligns with buyer behavior changes (A)</p> Signup and view all the answers

What is a key role of marketing strategy in an organization?

<p>To establish a plan for achieving objectives (C)</p> Signup and view all the answers

Which element of marketing strategy involves deciding on channels for product distribution?

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

What is one of the critical elements of marketing strategy that determines pricing structures?

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

In which weeks will there be no lectures?

<p>Weeks 6 and 8 (A)</p> Signup and view all the answers

The crucial first step in forming a marketing strategy involves which of the following?

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

What is meant by product/service management in the context of marketing strategy?

<p>Repairs and maintenance programs for sold products (D)</p> Signup and view all the answers

Which of the following objectives might be defined as part of a marketing strategy?

<p>Increasing brand awareness (C)</p> Signup and view all the answers

Which of the following components is a part of market communications?

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

What is one of the primary responses to price pressures that firms may adopt?

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

Which of the following describes intrabrand competition?

<p>Competition among resellers of the same brand (D)</p> Signup and view all the answers

What characterizes the industry price leader?

<p>Largest firm with cutting-edge technology (B)</p> Signup and view all the answers

How does buyer bargaining power influence pricing strategies?

<p>It puts downward pressure on prices (A)</p> Signup and view all the answers

What is meant by price parallelism in an industry?

<p>Similar prices occurring without collusive agreement (A)</p> Signup and view all the answers

What role does product value play in pricing strategies?

<p>It is central to determining price strategies (B)</p> Signup and view all the answers

What strategy can sellers use to strengthen their negotiating position?

<p>Differentiating their products (C)</p> Signup and view all the answers

Which factor is crucial for the reinforcement of interbrand competition?

<p>Increase in the number of resellers (B)</p> Signup and view all the answers

Which component contributes most to the final mark in this course?

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

What is the minimum grade required on the written exam to pass the course?

<p>4.5 (B)</p> Signup and view all the answers

What is recommended for effective preparation for the exam?

<p>Watching lectures and reading articles (A)</p> Signup and view all the answers

During which weeks are mandatory articles not required for this course?

<p>Weeks 5 to 8 (B)</p> Signup and view all the answers

What percentage of the exam consists of open-ended questions?

<p>30% (A)</p> Signup and view all the answers

What topic is covered in Week 10 of the course?

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

Which element does NOT influence the exam content?

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

How are lectures delivered throughout the course weeks where they are posted?

<p>Once a week on Thursdays (D)</p> Signup and view all the answers

What pricing strategy involves introducing a product at a high price and then lowering it over time?

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

Which of the following conditions must be met for penetration pricing to be successful?

<p>Distribution channels must be available for potential buyers (C)</p> Signup and view all the answers

What phenomenon occurs when low-priced products from one market enter markets with higher price ranges?

<p>Black-market phenomenon (C)</p> Signup and view all the answers

Which factor is likely to lift product prices?

<p>High switching costs (A)</p> Signup and view all the answers

What is a key driver of replacement sales in strong distribution systems?

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

Which of the following statements about functional product differentiation is true?

<p>It supports long-standing price differentiation strategies (C)</p> Signup and view all the answers

Which factor is associated with reducing price levels in a firm?

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

Which pricing strategy is characterized by quickly entering a market with low prices?

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

What is the significance of corporate goals in strategic planning?

<p>They provide a framework for strategic and bottom-up planning. (B)</p> Signup and view all the answers

What is a common mistake made by business managers regarding industry definition?

<p>Incorrectly defining the industry, leading to misaligned strategies. (A)</p> Signup and view all the answers

Why did the U.S. Railroad Industry struggle despite a rising demand for transportation?

<p>They defined their business as railroad instead of transportation. (B)</p> Signup and view all the answers

What should a product/market strategy prioritize?

<p>Assessing feasibility and fit of new opportunities. (D)</p> Signup and view all the answers

What type of analysis evaluates both the economic factors and potential risks involved in a market opportunity?

<p>Break-even analysis. (B)</p> Signup and view all the answers

How did Hollywood initially misdefine its industry?

<p>By seeing itself as part of the entertainment industry rather than solely the movie industry. (D)</p> Signup and view all the answers

What does marketing myopia primarily refer to?

<p>A narrow definition of the industry leading to strategic pitfalls. (B)</p> Signup and view all the answers

Which analysis is NOT typically associated with assessing product/market opportunities?

<p>Product differentiation analysis. (B)</p> Signup and view all the answers

Flashcards

Marketing Strategy

A plan of action designed to achieve specific business objectives, such as sales volume, growth rate, or return on investment (ROI).

Product/Market Selection

The decision about what products and services a company will offer and what markets it will target.

Price

The amount customers pay for a product or service. It includes pricing strategies, such as discounts and payment plans.

Distribution Systems

The channels through which products and services reach customers, such as sales forces, distributors, or online platforms.

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Market Communications

Methods of communicating with target customers, such as advertising, public relations, and social media.

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Product Service

Programs offering repair, maintenance, and support for products after purchase.

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Core Competencies

Unique strengths and capabilities a company possesses that give it a competitive advantage.

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Limitations

Constraints or weaknesses that hinder company performance, such as resource scarcity or market regulations.

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Market Segmentation

Dividing a market into distinct groups of customers who share similar needs, preferences, and buying behavior.

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Market Segment

A group of potential customers with similar characteristics who value the product in the same way, have similar buying behaviors, and use the product similarly.

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Demographic Segmentation

Dividing the market based on characteristics like age, income, gender, ethnicity, and education for consumer markets or business size, type, and profit status for industrial markets.

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Geographic Segmentation

Dividing the market based on location-related factors like market potential, competitive intensity, shipping costs, and customer proximity.

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Psychographic Segmentation

Dividing the market based on customer lifestyles, attitudes, values, and beliefs about things like work, family, and self-expression.

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Segmentation through Product Use/Application

Dividing the market based on how the product will be used or applied by consumers or businesses. Customers may have different buying behavior depending on how they will use the product.

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Value of the Product

The importance or perceived worth that customers place on a product. It's crucial to focus on segments that value the product the most.

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Product/Market Selection Factors

Factors like price and the value of the product that influence which market segments and applications are chosen for a product or service.

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Coherence Premium

The value added to a product or service when its various elements (design, functionality, brand message, etc.) work together seamlessly and consistently, creating a cohesive and satisfying customer experience.

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Strategic Insight in Three Circles

A framework for analyzing a company's competitive position by considering three overlapping circles: customer needs, company capabilities, and competitor offerings. The sweet spot where all three circles overlap represents the company's unique value proposition.

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Marketing Myopia

A short-sighted focus on selling products or services rather than understanding and meeting customer needs. This can lead to companies losing sight of the bigger picture and failing to adapt to changing market conditions.

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Customer Value Propositions in Business Markets

Statements that clearly explain the value a company provides to its business customers. It outlines the unique benefits and advantages of a product or service compared to competitors, addressing the specific needs and priorities of business buyers.

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Branding in The Digital Age

Building and managing a brand in the digital environment, leveraging online channels like social media, websites, and search engines to create awareness, engagement, and loyalty among customers.

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Segmenting the Base of The Pyramid

A marketing strategy focusing on reaching and serving low-income consumers, who often represent a significant and untapped market segment, by developing products and services tailored to their specific needs and affordability.

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Strategic Channel Design

The process of choosing and managing the distribution channels that will effectively deliver a product or service to the target market. Considerations include factors like cost, reach, efficiency, and customer convenience.

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Consumer Neuroscience

The study of how consumer behavior is influenced by brain activity and psychological processes. This field utilizes neuroscience tools like fMRI and EEG to understand consumer preferences, decision-making, and emotional responses to marketing stimuli.

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Price Competition

The rivalry between companies to offer the lowest prices for similar products.

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Product Differentiation

Creating unique features or benefits for your product to stand out from competitors.

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Intrabrand Competition

Competition between resellers of the same brand.

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Price Leadership

When a large company with strong market power sets prices for an industry.

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Price Parallelism

When companies in an industry independently set similar prices for their products.

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Buyer Bargaining Power

The ability of buyers to demand lower prices from sellers.

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Value to Potential Customers

The perceived worth that buyers assign to a product.

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Switching Costs

The cost for customers to change from one supplier to another.

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Black Market Phenomenon

When a product priced low in one market is sold at a higher price in another market, creating an unauthorized trading channel.

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Skimming Pricing

Starting with a high price for a new product and gradually lowering it over time to maximize initial profits and market understanding.

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Penetration Pricing

Using a low price to quickly capture market share and build volume, aiming to achieve economies of scale.

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Factors Lifting Price

Elements that increase the price of a product, such as strong brand, high demand, or limited supply.

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Factors Reducing Price

Elements that decrease the price of a product, like high buyer bargaining power or intense competition.

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Installed Base

The number of customers currently using a particular brand's product, a key driver of replacement sales.

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Corporate Goals

Overall objectives a company aims to achieve that guide strategic planning and limit what's possible.

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External Environment

Factors outside a company's control that influence its success, like economic trends and competitor actions.

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Business Unit Strengths & Weaknesses

Internal capabilities and limitations that affect the company's ability to compete in the market.

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Product/Market Opportunities

Potential for growth or expansion based on internal capabilities and external market trends.

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Market Analysis

The process of studying the target audience, competitors, and market trends to understand customer needs and opportunities.

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Product/Market Strategies

Plans for addressing opportunities by developing, marketing, and selling products that meet specific customer needs.

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Customer Orientation vs. Product Orientation

Customer orientation focuses on meeting customer needs, while product orientation focuses on improving and selling the product.

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Study Notes

Table of Contents

  • Preface: page 1
  • Table of Contents: page 2
  • Information about the course: page 2
  • Week 1: Marketing Strategy, Marketing Myopia, Strategic Insight: page 3
  • Week 2: The Coherence Premium, Are You Ignoring Trends?, Strategies to Fight Low-Cost Rivals, Branding in the Digital Age: page 4
  • Week 3: Consumer Market Segmentation: page 5
  • Week 4: Analyzing Consumer Perceptions, Principles of Product Policy: page 7
  • Week 9: How to Stop Customers from Fixating on Price: page 11
  • Week 10: The One Thing You Must Do Right When Building a Brand: page 15
  • Strategical Insight in Three Circles diagram: page 17
  • Marketing Strategy (Week 1): page 18
  • Product/Market Selection (Product): page 19
  • Factors Influencing Product/Market Selection: page 20
  • Pricing Decisions (Factors): page 20
  • Competition (Factor 3): page 21
  • Buyer Bargaining Power (Factor 4): page 21
  • Product Value to Potential Customers (Factor 5): page 21
  • Distribution Channels (Place): page 23
  • Market Communications (Promotion): page 25
  • A Model for Formulating the Marketing Strategy: page 27
  • Marketing Myopia discussion: page 27
  • Shadow of Obsolescence discussion: page 28
  • Condition 1: Population Myth discussion: page 29
  • Condition 2: The Idea of Indispensability discussion: page 29
  • Strategies to Fight Low-Cost Rivals: page 29
  • The Sustainability of Low-Cost Businesses: page 30
  • The Futility of Price Wars: page 32
  • When Differentiation Works: page 32
  • Switching to Conquer: page 33
  • Branding in the Digital Age: page 35
  • The Consumer Decision Journey: page 35
  • Practical Implications: page 36
  • The Different Stages of CDJ: page 36
  • Launching a Pilot: page 37
  • A Customer Experience Plan: page 38
  • Consumer Market Segmentation (Week 3): page 39
  • Segmenting the Base of the Pyramid: page 41
  • Rediscovering Market Segmentation discussion: page 42
  • Principles of Product Policy: page 44
  • Product Mix and other product related concepts: page 46
  • The Product Life Cycle: page 48
  • Strategic Brand Valuation: page 49
  • The Case Method of Instruction & Working with Cases: page 52
  • For Mobile Devices, Think Apps, Not Ads: page 56
  • Consumer Neuroscience: page 60
  • Practice Exam (Multiple Choice): page 65
  • Answers to Practice Exam: page 67

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Description

Test your knowledge on the key concepts of market segmentation and marketing strategy. This quiz covers various methods of segmentation, the role of marketing in organizations, and critical elements of forming effective marketing strategies. Perfect for students studying marketing concepts and frameworks.

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