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Marketing Test 2

CH 7,8,9

80/20 rule 80% of your sales account from 20% of your customers
Demographic segmentation Easiest way to go (breaking down into different demographics) Based on some objective, physical, measurable, or other classification attribute (gender,race,age,income,birth era,occupation) EX: unclear age demographic with baby boomer era (age denial)
Geographic segmentation Where you live has a big factor of what you do and what you consume. 2 main segments are Climate, and taste & preferences. Oldest way to segment market.
Volume Segmentation How much you consume (heavy, light/moderate, or non-user Can't forget about heavy user Must encourage light/moderate users to consume more Don't market towards non-users
Psychographic segmentation Hardest segmentation strategy, requires most research Newest way to segment. Quantitative conduct AIO research (activities,Interests,opinions) lifestyle Ads will appeal to people who lead that lifestyle and the people who want to lead that lifestyle
convenience goods Inexpensive with wide distribution, requires little effort to buy Non willing or unnecessary to compare prices EX) toothpaste, ketchup
Sampling: probability vs. non-probability Probability- everyone in population has an equal chance to be chosen to participate in survey Non-probability- not everyone in population has same and equal chance to participate
Characteristics of services: inseparability, intangibility ********** Inseparability- impossible to separate the service you buy and the person providing the service Intangibility- difficult to understand/evaluate by customers not physical product, must tangibalize it EX) doctor graduate certificate
Characteristics of services: variability, perishability Perishability- unable to physically store a service must watch the demand and create a demand management plan EX) airlines can't make money on empty seats once plane is gone Variability- varying or different levels of service each time
Primary vs. Secondary data Primary data- go research and create data yourself Secondary data- researching on data already created (do first) - not category specific or problem specific
Observation Weakest technique and only measures physical behavior Can be qualitative and quantitative
Focus Group a group discussion about to gather information and opinions on products
In-depth interview one-on-one interview and qualitative
Ethnographic research researchers go into the natural habitat and study in it (observation and qualitative
Likert scale 1-5 attitude measurement scale Most used in marketing research
Semantic differential scale 1-7 attitude measurement scale (not as popular as Likert) quantitative
Open-ended vs Close-ended Open-ended questions: your own opinion, in your own words, used with qualitative data Close-ended questions: researchers give answers for you to choose and quantitative
Experiment least used technique and quantitative
Benefit Segmentation Segments naturally evolve in the market place (naturally form) Based on benefits people seek when buying Sometimes marketer can misidentify benefits people seek Some problems aren't worth solving
Hybrid segmentation using more than one way to segment markets (majority of marketers use this)
MARS Measurability, Accessibility, Responsiveness, and Substantialness
(M)easurability (MARS) how many markets exist and how they differ?
(A)ccessibility (MARS) economic- enough money to compete legal- can you legally pursue target market? distribution channel- how a product is delivered to the market
(R)esponsiveness (MARS) will target market respond favorably? buy and keep buying
(S)ubstantialness (MARS) is it large enough for company to reach sales and profitability goals?
Majority Fallacy "The biggest market is always the best to target" not true because market is already saturated with competition
AIO research Activities,interests, opinions Lifestyle ads will appeal to people who lead that lifestyle and to people who want that lifestyle Not all products are lifestyle products, lifestyle products are what people see
Positioning strategies (1-3) 1) product differences, how is your products different from the rest 2) Features and benefits 3) Positioning by product user (lifestyle segmentation used along with this)
Positioning strategies (4-5) 4) Products Usage, how to/when to use product 5) Positioning against competition comparative advertising, usually done by underdog
Test Market Most popular type of experiment Going to a real city and measuring changes "what happens in Denver if we decrease price of upgrade product"
5 reasons NOT to test market 1) product is a Fad 2) short success life 3) getting burned by sabotage in the past 4) cannot afford to test market 5) easily copied by competition
Concentrated segmentation have segmented market and several segments exist, but you decide to concentrate only on 1 segment
Mass customization Customize your product the way that customers want it. Treating single customer as market Most popular with Generation Y
Multiple Segmentation Pursues many different segmentations with many different markets. Always the way to go because you want to dominate all categories.
Problem inventory analysis Need to figure out what's motivating people to buy Asking what people don't like about the product rather than what they do like Find the weakness within the product
Projective technique requires a lot of creativity for researcher to use When to use: - when respondents don't give an honest answer - when asking very personal questions - when asking what someone else would do in a certain situation Most famous is ink blot and cartoon
Positioning research steps 1) research and determine most important product characteristics chosen by customers 2) based on these characteristics, how do competitors rank 3) how do we rank on those characteristics
Mass Marketing (Undifferent Marketing There is no difference in how consumers want their product. Want product exact same way and not a good marketing strategy
Multiple segmentation many products pursuing many different product markets Different uses for the same product
Services defined: Generic- no difference between product and service offered Business- service an act or performance that is tangible and has no lasting results Continuum- What we buy is a combination of a good and service
Internal Marketing marketing towards your employees
Technical base vs Functional base Technical base- how well was the service provided Functional base- attitude of the service provider
shopping goods Going to look around for specific style/type/price Comparing with other similar products More expensive and more important to buyer
specialty goods Luxury, more expensive, more exclusive Brand loyalty, no substitutes (this brand or no brand) Most time and effort looking for best product and price
Unsought goods Something needed in the future, but have not thought about it EX) a will, funeral plans for self, graveyard plot, going to dentist
Stages in the new product development process (1-2) 1) Idea Generation- Employees generate ideas for new product No ideas are bad ideas so all are kept 2) Screen Ideas- Decide to go through or get rid of ideas Screening criteria must be generated to decide if the product will be successful or not
Stages in the new product development process (3-4) 3) Business analysis- Forecasting of sales and profitability concept testing- product not yet made but detailed drawings made 4) Product Development- Develop model or prototype of product Create more of prototype but not yet full scale production
Stages in the new product development process (5-6) 5) Test marketing- Can be extremely costly The only step that can be skipped in process 6) Commercialization (most expensive step)- Full scale production, mass advertisement, distribution around country/world 50/50 chance the product fails
Steps in marketing research process in notes
Created by: Thomas.Siu