Mkt 220 Test One Review
Chapter 1 Marketing – The process of creating, distributing, promoting, and pricing goods, services, and ideas to facilitate satisfying exchange relationships with customers and develop and maintain favorable relationships with stakeholders in a dynamic environment. Customers – the purchasers of organizations products; the focal point of all marketing activities. Target Market – a specific group of customers on whom an organization focuses its marketing efforts.
Marketing Mix – four marketing activities; Price, Product, Distribution, Promotion that a firm can control to meet the needs of customers within its target markets. Product – a good, service, or idea. Exchange – the provision or transfer of goods, services, or ideas in return for something of value. Stakeholders – constituents who have a stake or claim in some aspect of a company’s products, operations, markets, industry, and outcomes. Marketing Environment – the competitive, economic, political, legal and regulatory, technological, and sociocultural forces that surround the customer and affect the marketing mix.
Marketing Concept – a philosophy that an organization should try to provide products that satisfy customers’ needs through a coordinated set of activities that also allows the organization to achieve its goals. It is a management philosophy guiding an organization’s overall activities. Marketing Orientation – an organization wide commitment to researching and responding to customer needs. Relationship Marketing – establishing long-term, mutually satisfying buyer-seller relationships.
Customer Relationship Marketing (CRM) – using information about customers to create marketing strategies that develop and sustain desirable customer relationships. Value – a customer’s subjective assessment of benefits relative to costs in determining the worth of a product. Marketing Management – the process of planning, organizing, implementing, and controlling marketing activities to facilitate exchanges effectively and efficiently. Chapter 3 Environmental Scanning – the process of collecting information about forces in the marketing environment.
Environmental Analysis – the process of assessing and interpreting the information gathered through environmental scanning. Competition – other organizations that market products that are similar to or can be substituted for a marketer’s products in the same geographic area. Brand Competitors – firms that market products with similar features and benefits to the same customers at similar prices. Product Competitors – firms that compete in the same product class but market products with different features, benefits, and prices.
Generic Competitors – firms that provide very different products that solve the same problem or satisfy the same basic customer need. Total Budget Competitors – firms that compete for the limited financial resources of the same customers. Monopoly – a competitive structure in which an organization offers a product that has no close substitutes, making that organization the sole source of supply. Oligopoly – a competitive structure in which a few sellers control the supply of a large proportion of a product.
Monopolistic Competition – a competitive structure in which a firm has many potential competitors and tries to develop a marketing strategy to differentiate its product. Pure Competition – a market structure characterized by an extremely large number of sellers, none strong enough to significantly influence price or supply. Business Cycle – a pattern of economic fluctuations that has four stages: prosperity, recession, depression, and recovery. Prosperity – a stage of the business cycle characterized by low unemployment and relatively high total income, which together ensure high buying power.
Recession – a stage of the business cycle during which unemployment rises and total buying power declines, stifling both consumer and business spending. Depression – a stage of the business cycle when unemployment is extremely high, wages are very low, total disposable income is at a minimum, and consumers lack confidence in the economy. Recovery – a stage of the business cycle in which the economy moves from recession or depression toward prosperity. Buying Power – resources, such as money, goods, and services that can be traded in an exchange.
Income – for an individual, the amount of money received through wages, rents, investments, pensions, and subsidy payments for a given period. Disposable Income – after-tax income. Discretionary Income – disposable income available for spending and saving after an individual has purchased the basic necessities of food, clothing, and shelter. Wealth – the accumulation of past income, natural resources, and financial resources. Willingness to Spend – an inclination to buy because of expected satisfaction from a product, influenced by the ability to buy and numerous psychological and social forces.
Federal Trade Commission (FTC) – an agency that regulates a variety of business practices and curbs false advertising, misleading pricing, and deceptive packaging and labeling. Better Business Bureau – a system of nongovernmental, independent, local regulatory agencies supported by local businesses that helps settle problems between customers and specific business firms. National Advertising Review Board (NARB) – a self-regulatory unit that considers challenges to issues raised by the National Advertising Division (an arm of the Council of Better Business Bureaus) about an advertisement.
Technology – the supplication of knowledge and tools to solve problems and perform tasks more efficiently. Sociocultural Forces – the influences in a society and its culture that change people’s attitudes, beliefs, norms, customs, and lifestyles. Consumerism – organized efforts by individuals, groups, and organizations to protect consumers’ rights. Chapter 9 Market Research – the systematic design, collection, interpretation, and reporting of information to help marketers solve specific marketing problems or take advantage o marketing opportunities.
Research Design – an overall plan for obtaining the information needed to address a research problem or issue. Hypothesis – an informed guess or assumption about a certain problem or set of circumstances. Exploratory Research – research conducted to gather more information about a problem or to make a tentative hypothesis more specific. Conclusive Research – research designed to verify insights through objective procedures and to help marketers in making decisions. Descriptive Research – research conducted to clarify the characteristics of certain phenomena to solve a particular problem.
Experimental Research – research that allows marketers to make causal inferences about relationships. Reliability – a condition existing when a research technique produces almost identical results in repeated trials. Validity – a condition existing when a research method measures what it is supposed to measure. Primary Data – data observed and recorded or collected directly from respondents. Secondary Data – data compiled both inside and outside the organization for some purpose other than the current investigation.
Population – all the elements, units, or individuals of interest to researchers for a specific study. Sample – a limited number of units chosen to represent the characteristics of a total population. Sampling – the process of selecting representative units from a total population. Probability Sampling – a sampling technique in which every element in the population being studied has a known chance of being selected for study. Random Sampling – a type of probability sampling in which all units in a population have an equal chance of appearing in the s ample.
Stratified Sampling – a type of probability sampling in which the population of interest is divided into groups according to a common attribute and a random sample is then chosen within each group. No probability Sampling – a sampling technique in which there is no way to calculate the likelihood that a specific element of the population being studied will be chosen. Quota Sampling – a nonprobability sampling technique in which researchers divide the population into groups and then arbitrarily chose participants from each group. Mail Survey – a research method in which respondents answer a questionnaire sent through the mail.
Telephone Survey – a research method in which respondents answers to a questionnaire are recorded by an interviewer on the phone. Online Survey – a research method in which respondents answer a questionnaire via e-mail or on a website. Personal Interview Survey – a research method in which participants respond to survey questions face to face. In-home (door-to-door) interview – a personal interview that takes place in the respondent’s home. Focus Group Interview – a research method involving observation of group interaction when members are exposed to an idea or a concept.
Customer Advisory Boards – small groups of actual customers who serve as sounding boards for new product ideas and offer insights into their feelings and attitudes toward a firm’s products and other elements of marketing strategy. Telephone Depth Interview – an interview that combines the traditional focus group’s ability to probe with the confidentiality provided by telephone surveys. Shopping Mall Intercept Interviews – a research method that involves interviewing a percentage of individuals passing by “intercept” points in a mall.
On-site Computer Interview – a variation of the shopping mall intercept interview in which respondents complete a self-administered questionnaire displayed on a computer monitor. Statistical Interception – analysis of what is typical or what deviates from the average. Marketing Information System (MIS) – a framework for managing and structuring information gathered regularly from sources inside and outside the organization. Single-Source Data – information provided by a single marketing research firm.
Marketing Decision Support System (MDSS) – customized computer software that aids marketing managers in decision making. Chapter 10 Undifferentiated targeting strategy – a strategy in which an organization defines an entire market for a particular product as its target market, designs a single marketing mix, and directs it at that market. Homogeneous Market – a market in which a large proportion of customers have similar needs for a product. Heterogeneous Market – a market made up of individuals or organizations with diverse needs for products in a specific product class.
Market Segmentation – the process of dividing a total market into groups with relatively similar product needs to design a marketing mix that matches those needs. Market Segment – individuals, groups, or organizations sharing one or more similar characteristics that cause them to have similar product needs. Concentrated Marketing Strategy – a market segmentation strategy in which an organization targets a single market segment using one marketing mix. Differentiated Targeting Strategy – a strategy in which an organization targets two or more segments by developing a marketing mix for each segment.
Segmentation Variables – characteristics of individuals, groups, or organizations used to divide a market into segments. Market Density – the number of potential customers within a unit of land area. Geographical Segmentation – a method of market segmentation that clusters people in zip code areas and smaller neighborhood units based on lifestyle and demographic information. Micromarketing – an approach to market segmentation in which organizations focus precise marketing efforts on very small geographic markets.
Benefit Segmentation – the division of a market according to benefits that consumers want from the product. Market Potential – the total amount of product that customers will purchase within a specified period at a specific level of industrywide marketing activity. Company Sales Potential – the maximum percentage of market potential that an individual firm within an industry can expect to obtain for a specific product. Breakdown Approach – measuring company sales potential based on a general economic forecast for a specific period and the market potential derived from it.
Buildup Approach – measuring company sales potential by estimating how much of a product a potential buyer in a specific geographic area will purchase in a given period, multiplying the estimate by the number of potential buyers, and adding the totals of all the geographic area considered. Product Positioning – creating and maintaining a certain concept of a product in customers’ minds. Sales Forecast – the amount of a product a company expects to sell during a specific period at a specified level of marketing activities.
Executive Judgment – a sales forecasting method based on the intuition of one or more executives. Customer Forecasting Survey – a survey of customers regarding the quantities of products they intend to buy during a specific period. Sales Force Forecasting Survey – a survey of a firm’s sales force regarding anticipated sales in their territories for a specified period. Expect Forecasting Survey – sales forecasts prepared by experts outside the firm, such as economists, management consultants, advertising executives, or college professors.
Delphi Technique – a procedure in which experts create initial forecasts, submit them to the company for averaging, and then refine the forecasts. Time Series Analysis – a forecasting method that uses historical sales data to discover patterns in the firm’s sales over time and generally involves trend, cycle, seasonal, and random factor analyses. Trend Analysis – an analysis that focuses on aggregate sales data over a period of many years to determine general trends in annual sales. Cycle Analysis – an analysis of sales figures for a period of three to five years to ascertain whether sales fluctuate in a consistent, periodic manner.
Seasonal Analysis – an analysis of daily, weekly, or monthly sales figures to evaluate the degree to which seasonal factors influence sales. Random Factor Analysis – an analysis attempting to attribute erratic sales variations to random, nonrecurring events. Regression Analysis – a method of predicting sales based on finding a relationship between past sales and one or more independent variable, such as population or income. Market Test – making a product available to buyers in one or more test areas and measuring purchases and consumer responses to marketing efforts.
