Murrdock MKT 3343

Description:	Exam 2
Category:	Marketing
Created by:	ar1356 on 2008-10-09

Question	Answer
Industrial/Buisness Markets	reprocess a product or service before selling it again to the next buyer.
Reseller Markets	Wholsalers and retailers that buy physical products and resell them again without any reprocessing.
Government Markets	federal, state, and local agencies that buy goods & services for the constituents they serve
Ultimate consumer	are people who use the goods and services purchased for the household
NAICS	North American Industry Classification System, provides common industry definitions for Canada, Mexico, & the US, which makes the measurment of economic activity, in the 3 member countries of NAFTA, easier. Replaces SIC system. Each given a "zipcode"
NAPCS	North American Product Classification System: classification system for products & services, UN-Central Product Classification System
Derived Demand	means the demand for industrial products/services is derived from, demand for consumer products/services. Example: milk & all it's compnents are now in demand when purchased. Based on future expectations of consumer demand.
Derived Demand v. Organizational Market	demand is always much lower for derived demand
Organizational Buying Criteria	the objective attributes of the supplier’s products & services & the capabilities of the supplier itself.
7 most common Organizational Buying Criteria	1. price, 2. ability to meet required delivery schedules, 3. ability to meet the quality specifications, 4. technical capabilites, 5. warranties & claim polocies 6. past performance, 6. production facilities/capabilities
ISO 9000	International Standards Org: meet exact standards to set standards for quality/ consists of standards for registration & certification of a manufacturer’s quality management & assurance system based on an on-site audit of practices & procedures
Supplier development	the deliberate efforts by a company to build relationships with suppliers to improve their efficency, quality, & costs for an ultimate result for consumer & company
JIT Inventory System	Just In Time…
Reciprocity	an industrial buying practice in which two organizations agree to purchase each other’s products & services. The government frowns on reciprocity because it inhibits market competition. “I buy your stuff, if you agree to buy mine.”
Supply Partnership	exists when a buyer & its supplier adopt mutually beneficial objectives, policies & procedures for the purpose of lowering the costs/increasing the value of products & services delivered to the ultimate consumer.
Buying Center	group of people in an org. who participate in the buying process & share common goals, risks & knowledge important to a purchase decision. AKA Buying Comitee
Roles in the Buying Center	1.Users (use product), 2. Influences(define specifications), 3. Buyers(negotiate terms of contact), 4. Deciders(selects supplier), 5. Gatekeepers(control flow of info)
Buy Classes	consists of three types of buying situations: straight rebuy; modified rebuy; and new buy.
Organizational Buying Behavior	the decision-marking process that organizations use to establish the need for products & services & identify, evaluate & choose among alternative brands & suppliers. (5 steps)
Stage 1 in Organizational Buying Process	Problem Recognition./ (Make-Buy Decision: do we make it or do we buy it?)
Stage 2 in Organizational Buying Process	Information Search./ (Value analysis: a systematic appraisal of the design, quality & performance of a product to reduce purchasing costs.)
Stage 3 in Organizational Buying Process	Alternitave Evaluation./ (Bidder’s List: a list of firms believed to be qualified to supply a given item.)
Stage 4 in Organizational Buying Process	Purchase Decision
Stage 5 in Organizational Buying Process	Postpurchase Behavior
Prominence of Online Buying in OM's	1.timely supplie information, 2. reduces buyer order prcessing costs, 3. can reduce marketing costs
E-Marketplaces	online trading communities that bring together buyers & supplier organizations to make possible the real time exchange of information, money, products & services. AKA: B2B exchanges, e-hubs
Independent E-marketplace	p.158
Traditional Auctions	a seller puts an item up for sale and would-be buyers are invited to bid in competition with each other
Reverse Auctions	a buyer communicates a need for a product or service and would-be suppliers are invited to bid in competition with each other
Countertrade	practice of using barter rather than money for making global sales
Trade Feedback Effect	export creates demand for import, vice versa
GDP	gross domestic product: monetary value of all goods/services produced in a country during one year. US always has the highest GDP, but Unions of countries now create competition.
Blanace of Trade	difference between the monetary value of a nation’s exports & imports. Import>export=deficit, Export>import=surplus.
U.S. Balance of trade	U.S. in deficit& overall volume has decreased. Importers-Canada, China, Mexico, Japan/Exporters-China, Japan, South Korea, Taiwan, Phillipines
Porter's Diamond	explain a nation's competitive advantage. 1. Factor Conditions-natural resources, 2. Demand Conditions-
Economic Espionage Act (1996)	a law that makes the theft of trade secrets by foreign entities a federal crime in the US.
Protectionism	the practice of shielding one or more industries within a country’s economy from foreign competition through the use of tariffs or quota. What countries engage in to protect their country includes tariffs, quotas, etc. The use of protectionism is declinin
Tariffs	a government tax on goods or services entering a country, primarily serving to raise prices on imports. Screws the customer!
Quota	a restriction placed on amount of a product allowed to enter or to leave a country.
GATT	General Agreement on Tariffs & Trade: to limit trade barriers & promote world trade through the reduction of tariffs. Did not explicitly adress non-tariff trade barriers(e.g.quotas)
World Trade Organization	(WTO) a permanent institution that sets rules governing trade between its members through panels of trade experts who decide on trade disputes between members & issue binding decision. Ultimate goal of the WTO is to eliminate tariffs & quotas. WTO is an o
European Union	27 countries with a common currency (Euro), no protectionism within their borders.
North American Free Trade Agreement	NAFTA: lifted many tade barriers between Canada, Mexico, & US. Extended many advantages with CAFTA-DR
Asian Free Trade Agreement	have reduced tariffs among countries & promoted trade. To liberate East Asia from Japan & "The Four Little Dragons"
Global Competition	exists when firms originate, produce & market their products & services worldwide.
Strategic Alliances	agreements among 2+ independent firms to cooperate for the purpose of achieving common goals.
Types of Global Companies	International, Multinational, Transnational
International Firm	same product, marketing program, etc. everywhere, selling the same idea (ex. Coke)
Multinational Firm	changes whats needed for other countries markets (ex: breathe right)
Transnational Firm	change mkt strategy where needed keep same where can.
Multidomestic Marketing Strategy	used by multinational firms that have as many different product variations, brand names & advertising programs as countries in which they do business.
Global Marketing Strategy	used by transnational firms that employ the practice of standardizing marketing activities when there are cultural similitarties & adapting them when cultures differ.
Global brand	brand marketed under the same name in multiple countries with similar & culturally coordinated marketing programs.
Global consumers	consists of customer groups living in many different countries or regions of the world who have similar needs or seek similar features & benefits from products/services. People around the world have a lot in common
Cross-cultural analysis	involves the study of similiarities & differences among consumers in 2+ nations or societies. For effective marketing programs
Values	a society’s personally or socially preferable modes of conducts/states of existence that tend to persist over time.
Customs	what is considered normal & expected about the way people do things in a specific country.
Foreign Corrupt Practices Act (1977)	a law, amended by the International Anti-Dumping & Fair Competition Act (1998), that makes it a crime for US corporations to bribe an official of a foreign government or political part to obtain/retain business in a foreign country.
Cultural symbols	things that represent ideas or concepts.
Semiotics	a field of study that examines the correspondence between symbols & their role in the assignment of meaning for people. Semiotics are the study of symbols. Example is that
Back translation	when a translated word/phrase is retranslated into the original language by a different interpreter to catch errors
Customer ethnocentrism	the tendency to believe that it is inappropriate, indeed immoral, to purchase foreign made products.
Bottom of the Pyramid	largest, but poorest socioeconomic group in the world, mostly landlocked countries, it's to our advantage to help these coutries (Trade)
Economic Infrastructure	a country's communication, transportation, financial, & distribution systems. Critical for determining weather to enter a country's market.
Microfinance	practice of offering small, collateral-free loans to individuals who otherwise would not hav access to the capital necessary to participat in an income generating activity
Currency exchange rule	the price of one country’s currency expressed in terms of another country’s currency.
Exporting	producing goods in one country & selling them in another country.
Indirect Exporting	sell to a country through an intermediary
Direct Exporting	sell directly from us to them
Liscencing	A company offer the right for items of intellectual property for a royalty fee, in other countries however they lose all control of it's product, may lose profit, or create competition with their company.
Contact Assembley	contacts for a foreign company to ASSEMBLE parts for the prodcut.
Contact Manufacturing	US may contract with a foreign form for them to manufacture product to specifications
Joint venture	when a foreign country & a local firm invest together to create a local business
Direct investment	entails a domestic firm actually investing in & owning a foreign subsidiary or division
Dumping	when a firm sells a product in a foreign country below its domestic price or below its actual cost.
Gray market	a situation where products are sold through unauthorized channels of distribution. Also called parallel importing
Marketing research	the process of defining a marketing problem & opportunity, collecting data to try & fix the problem.
Difficulties of Marketing Research	Consumers do not know about new products, lying, purchase behavior could be different.
Decision	a conscious choice from among 2+ alternatives
5 Step Marketing Research Approach	1.Define the Problem: set research objectives & possible solutions, 2.Develop the Research Plan: constraints, data, 3.Collect Relevent Data, 4.Develop Findings: analyze data, 5. Take Mkt Action: implement
Exploratory research	gives ideas about a vague problem, used for many new products
Descriptive research	frequency or relationship of 2 factors
Casual Research	how much one thing occuring effects another thing occuring.
Measures of success	criteria or standards used in evaluating proposed solutions to a problem, how we know if our research tells us anything
Constraints	in a decision are the restrictions placed on potential solutions to a problem. Boundaries/limits on types of things trying to figure out, so not too broad.
Methods of Collecting Data	Sampling, Probability Sampling, Nonprobability Sampling, Statistical Inference
Sampling	involves selecting representative elements from a population. Involves making judgments about whole by what you know about a few.
Probability sampling	random sample
Nonprobability sampling	involves using arbitrary judgments to select the sample so that the chance of selecting a particular elements by an unknown or 0. A random sample w/ consraints, can't get statistical inference
Statistical inference	involves drawing conclusions about a population from a sample taken from that population. Drawing conclusions from information gotten from research.
Data	the facts & figures related to the problem, & are divided into 2 main parts: secondary data & primary data.
Secondary data	facts & figures that have already been recorded before the project at hand. The advantage is that it is inexpensive & fast. The disadvantages are that it’s not specific to your problem. (Internal & external)
Primary data	facts & figures that are newly collected for the project. The advantages are that it is specific to the problem. The disadvantage is that it’s time consuming & expensive. (Observation, Questionarre)
Observational data	the facts & figures obtained by watching, either mechanically or in person, how people actually behave. More truthful.
Questionnaire data	the facts & figures obtained by asking peple about their attitudes, intentions & behaviors.
"Fuzzy Front End"	try to id trends before typical consumers have recognized them themselves.
Question Formats	1.Open ended, 2. fixed alt., 3.Dichotomous(Y/N), 4. Semantic Differential(Y/N scale), 5.Likert(agrrement scale)
Data mining	the extraction of hidden predictive information from large databases.
Information technology	involves a computer & communication system to satisfy an organization’s needs for data storage, processing & access. There is lots of statistical information available.
Market Segmentation	putting prospective buyers into groups that 1. have common needs, 2. will respond simarlarly to the market action
Market segments	the relatively homogeneous groups of prospective buyers that result from the market segementation process.
Product differentation	a strategy that involves a firm’s using different marketing mix activities to help consumers perceive the product as being different & better than competing products.
Market-product grid	a framework to relate the market segments of potential buyers to products offered or potential marketing actions by the firm.
Synergy	the increased customer value achieved through performing organizational functions more efficicently. Customers are the reason companies do things more efficicently & that benefit goes back to the customer through customer value.
Usage rate	the quantity consumed or patronage (store visits) during a specific period of time. An example is frequent flier miles.
80/20 Rule	concept that suggests 80% of a firm’s sales are obtained from 20% of its customers. And 20% of business from 80% of customers
Product positioning	refers to the place an offering occupies in consumers’ minds on important attributes relative to competitive products.
Product repositioning	involves changing the place an offering occupies in a consumer’s mind relative to competitive’s products
Perceptual map	a means of displaying or graphing in 2 dimensions the location of products or brands in the minds of consumers to enable a manager to see how consumers to enable a manager to see how consumers perceive competing products or brands relative to its own & th
Market/Industry potential	the maximum total sales of a product by all firms to a segment during a specified time period under specified environmental conditions & marketing efforts of the firm. Also called industry potential
Sales/Company forecast	refers to the total sales of a product that a firm expects to sell during a specified time period under specified environmental conditions & its own marketing efforts. Also called company forecast.
Direct forecast	involves estimating the value to be forecast without any intervening steps. The best guess of a person who’s selling based on what they think.
Lost horse forecast	making a forecast using the last known value & modifying it according to positive or negative factors expected in the future. When bring products back when they’ve phased it out for a while. Go from where product last was & go from there (the closest know
Survey of Buyers’ Intention Forecast	asking prospective customers if they are likely to buy the product during a coming period.
Trend Extrapolation	extending a pattern observed in past data into the future
Linear Trend Extrapolation	using a straight line to extend a pattern observed in past data into the future
Product	a good, service, or idea consisting of a bundle of tangible & intangible attributes that satisfies consumers & is received in exchange for money or some other unit or value
Product line	group of products that are closely related b/c they satisfy a class of needs, are used together, are sold to the same customer group, are distributed through the same type of outlets, or falls within a given price range.
Product mix	the number of product lines offered by a company
Consumer goods	products purchased by the ultimate consumer
Business goods	products that assist directly or indirectly in providing products for resale. Also called as B2B goods, industrial goods or organizational goods.
Convenience goods	items that the consumer purchases frequently, conveniently & with a minimum of shopping effort.
Shopping goods	items for which the consumer compares several alternatives on criteria, such as price, quality or style.
Specialty goods	items that a consumer makes a special effort to search out & buy.
Unsought goods	items that the consumer either does not know about or knows about but does not initially want
Production goods	items used in the manufacturing process that become part of the final product
Support goods	items used to assist in producing other goods & services
Protocol	a statement that, before product development begins, identifies: 1) a well-defined target market 2) specific customers’ needs, wants & preferences 3) what the product will be & do
New-product Strategy Development	the stage of the new product process that defines the role for a new product in terms of the firm’s overall corporate objectives.
Six sigma	means to “delight the customer” by achieving quality through a highly disciplined process to focus on developing & delivering near-perfect products & services.
Idea generation	the stage of the new-product process that involves developing a pool of concepts as candidates for new products
Screening & evaluation	the stage of the new-product process that involves internal & external evaluations of the new-product ideas to eliminate those that warrant no further effort
Business analysis	the stage of the new-product process that involves specifying the product features & marketing strategy & making necessary financial projections needed to commercialize a product.
Development	stage of the new-product process that involves turning the idea on paper into a prototype.
Market testing	stage of the new-product process that involves exposing actual products to prospective consumers under realistic purchase conditions to see if they will buy
Commercialization	stage of the new-product process that involves positioning & launching a new product in full-scale production & sales
Slotting fee	payment a manufacturer makes to place a new item on a retailer’s shelf.
Failure fee	penalty payment a manufacturer makes to compensate a retailer for sales its valuable shelf space failed to make.
product life cycle	describes the stages a new product goes through in the marketplace: introduction, growth, maturity & decline
Product class	the entire product category or industry. Example: string trimmers, like a weed eater
Product form	pertains to variations of a product within the product class. Example: weed eater: gas, electric, fat string, skinny string, etc.
Product modification	altering a product’s characteristic, such as its quality, performance or appearance, to try to increase the product’s sales
Market modification	a strategy in which a company tries to find new customers, increase a product’s use among existing customers or create new use situations.
Trading up	involves adding value to a product (or line) through additional features or higher-quality materials
"Trading down	reducing the number of features, quality or price.
Downsizing	reducing the content of packages without changing package size & maintaining or increasing the package price.
Branding	a basic decision in marketing products in which an organization uses a name, phrase, design or symbols, or combination of these to identify its products & distinguish them from those of competitors
Brand name	in any word, device (design, shape, sound, or color), or combination of these used to distinguish a seller’s goods or services
Trade name	a commercial, legal name under which a company does business
Trademark	identifies that a firm has legally registered its brand name or trade name so the firm has its exclusive use, thereby preventing others from using it.
Brand personality	a set of human characteristics associated with a brand name.
Brand equity	the added value of a given brand name gives to a product beyond the functional benefits provided
Brand licensing	contractual agreement whereby one company (licensor) allows its brand name(s) or trademark(s) to be used with products or services offered by another (license) for a royalty or fee
Multi-product Branding	a branding strategy in which a company uses one name for all its product in a product class
Co-branding	a branding strategy that involves the practice of the pairing of 2 brand names of 2 manufacturers on a single product
Multi branding	branding strategy that involves giving each product a distinct name when each brand is intended for a different market segment
Private branding	branding strategy used when a company manufactures products but sells them under the brand name of a wholesaler or retailer. Also called private labeling or reseller branding
Mixed branding	a branding strategy where a firm markets products under its own name(s) and that of a reseller because the segment attracted to the reseller is different from its own market
Packaging	component of a product that refers to any container in which it is offered for sale & on which label information is conveyed.
Label	integral part of the package that typically identifies the product or brand, who made it, where & when it was made, how it is to be used, & package contents & ingredients
Warranty	statement indicating the liability of the manufacturer for product deficiencies.
Business marketing	is the marketing of goods and services to companies, government, or non-profit organizations for the use in the creation of goods and services that they can produce and market to others
Organizational buyers	are those manufacturers, wholesalers, retailers, and government agencies that buy goods and services for their own use or for resale. There are 3 different markets.
3 markets of organizational buyers	1. Industrial/Buisness Markets, 2. Reseller Markets, 3.Gevernment Markets
Primary Demand	A demand for a class of products
Selective Demand	A brand of a class of products
Skimming Strategy	Enter market at highest price for as long as possible
Penetration Pricing	Enter Market at low price to reach as many people as possible & create a brand loyalty
Introduction of a Product	trying to increase primary demand, use pricing strategies
Growth of a Product	rapid sales, repeat purchasers, new features, broader distribution and gain competitors