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Marketing- hgilbert

Comm 131

Consumer behaviour Buying behaviour of consumers (individuals) who buy goods and services for their own use and consumption
Consumer Market Individuals in a particular geographic region who are old enough to have their own money and know how to spend it
Model of consumer buyer behaviour: marketing stimuli, buyer's black box, buyer responses marketing - product, price, promotion, place other - economic, technological, social, cultural buyer's characteristics, buyer's decision process buying attitudes/preferences/purchase behaviour/brand company relationship behaviour
Culture and sub factors (influence consumer behaviour) culture: set of basic wants, values, perceptions learned by member of society from family and other important institutions subculture (group of people with same values/shared life experiences) social class (society based on income/occupation/standing
Social and sub factors (influence consumer behaviour) reference groups, family, roles and status *** family is most important - socialization
Personal and sub factors (influence consumer behaviour) age/life cycle stage, occupation, economic situation, lifestyle, personality and self concept (big 5 personality factors)
Psychological (influence consumer bahaviour) beliefs, learning, attitudes, motivation, perception, identity (who are they? mother, runner..)
Maslow's hierarchy of needs 1) physiological needs (hunger/thirst) 2) safety needs (protection) 3) social needs (belonging and love) 4) esteem needs (self esteem and recognition) 5) self actualization (self development/realization)
Belief vs. attitude descriptive thought person holds about something vs. consistant evaluation of or feeling towards object or idea
Consumer buying decision process need recognition - info search - evaluation of alternatives - purchase decision - post purchase behaviour
Categories for adaptation of technology innovators, early adapters, early majority, late majority, laggards
Influences on business buyer behaviour environmental (PESTG) organizational (objectives/policies) interpersonal (authority status empathy) individual (age needs job position)
Segmentation dividing a market into distinct groups with specific needs, characteristics, behaviours, that may require different marketing mixes, based on value
Targeting process of evaluating each market segments attractiveness and selecting one or more to enter (profitably satisfy the segment)
Differentiation differentiating to create superior customer value
Positioning arranging for a market to occupy a clear, distinctive and desirable place in the market relative to competing products in the minds of target consumers (develop positioning and marketing mix for each segment
Why segment? -better satisfy by tailoring to specific needs - such products are valuable - can't satisfy everything
Why not satisfy everything? some needs aren't compatible, consumer perception and recollection (general vs specific)
4 common ways to segment geographical (region/city), demographic (age gender), psychographic (lifestyle and personality), behavioural (benefits sought, usage rate/status, loyalty status)
A good segment is... measurable, accesible, differentiable, actionable (can develop programs), substantial
Levels of segmentation mass marketing (all) segment marketing (2) niche marketing (4) micro marketing (a lot)
SEGMENTATION GRID KEY ELEMENTS Segment name, primary need, age, gender, usage, etc...
Targeting: evaluating segments 1) revenue of segment (size/growth potential) 2) cost of entering (4ps)
Positioning involves creating what associations? psychological - what, how many, how do we create those associations
Unique Selling Proposition focusing on one attribute and promoting itself as being the best benefit
Multiple selling proposition choosing a number of attributes and promoting them all - value proposition
Perceptual Map shows consumers perceptions of their brands versus competing products
Positioning Statement To (target segment and need) our (brand) is (concept) that (point-of-difference)
Product Anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or a need. It could take in any one of the following forms.
Goods vs. Services services - not tangible, variability (quality can vary depending on who does it), cannot be stored, cannot be separated from their "owner"
Levels of Product Core benefit, actual product (packaging, brand name, quality, features) augmented product (after sale service, installation warranty...
Types of products (4) convenience (minimal effort, cheap), shopping (fewer outlets, higher priced), speciality (high price, exclusive, effort), unsought (little awareness, pricing varies, aggressive advertising)
Individual product attributes (style, features) branding, packaging, labelling, product support
Product line closely related, function in similar manner, sold to same customer groups, same price ranges
Product Mix - Width - Depth - Consistency All product lines/items that seller offers for sale, width= #product lines, depth = # versions offered in each product line, consistency = how closely related the various lines are
Product life cycle (5 stages) product development (neg. profits), introduction, growth, maturity, decline
What is a brand? A name, term, symbol, design, or combination thereof that identifies a seller’s products and differentiates them from competitors’ products. Used for positioning
BRANDS - 3 KEY NOTES symbolize who we are, incorporated into identity, loved, social norms, brands possess personality traits
Value of brand brand is more valuable than the totality of its assets
Brand Equity extent to which customers are willing to pay more, positive differential effect, known customer response
What makes a brand strong? customer needs are focused, centred on needs, stays relevant, consistent... overall managed well
Goals of a brand memorable, positive attitude, specific associations - positioning strategy
3 levels of brand positioning product attributes (easy to copy) benefits (associates name with benefit) beliefs and values (taps into emotions)
Manufacturer brands national brands, share the same name as the manufacturer
Private (store brands) brands established by retailers, manufactured by one company but branded by another
Licensed brands selling the right to apply a brand name, logo, or image to manufactured product
Co branding using two brand names on one product (crest with scope)
Brand Development line extension (existing brand and product) brand extension (new product old brand) multi brand (old product new brand) new brands (new product new brand)
Trademark exclusive right to use a brand or part of a brand (prohibited use without permission)
Advertising form of communication from the marketer to customer (persuade, maintain relationships, promises, entertain - ULTIMATE GOAL = SALES
1/3RD Principle 1- account planning (goals/brand values/audience profile) 2 - creative strategy (tone and manner) 3- media planning (media choices/metrics/scheduling)
Major Advertising Decisions objectives settings, budget decisions, message decisions, media decisions, campaign evaluation
Purpose for advertising inform, compare, persuade, remind, call to action
Setting Budget: factors stage in product life cycle, level of competition, ad clutter, degree of brand differentiation (methods - affordable, percentage of sales..)
Advertising response function underspending/sweet spot/ overspending function of sales and dollars spent on advertising
ACM Model attention, comprehension, memorable
Slice of Life typical people using product in normal setting
Lifestyle shows how product fits with particular lifestyle
fantasy create a fantasy around the product or its use
Mood or image builds mood or image around the product (ie love, beauty, serenity)
Testimonial evidence or endorsement Highly believable or likeable source endorsing the product
Musical someone singing about product
Personality symbol creates a character that represents the product
Technical expertise shows the company's expertise in making the product
Scientific Evidence presents scientific evidence that the brand is better or better liked than another brand
Advertising effects Heart and Mind (rational emotional experiential, brands benefits and values/emotional bond) pocket effects (drive consumer to point of sale) improve financial performance of brand
Message evaluation process understandable, convincing and easy to remember
High Motivation central processing * customers are highly motivated by the factual information of the ad, quality of central arguments in the ad
Low Motivation Peripheral processing * consumer more infleunced by peripheral cues in the ad, unconscious processing that bypasses thoughtful evaluation of ad content
Price amount of money charged for a product or service - seller: revenue, consumer: cost of something
Price and the Marketing Mix only element to produce revenues, most flexible element, can be changed quickly
Cost based pricing standard markup, ignores demand and competition, popular because simple, prices are similar, fair to buyers and sellers,
Price Floor lowest possible price
Price ceiling highest possible price
Cost plus pricing cost is made of of variable and fixed cost per unit, adds a markup to the cost
Breakeven pricing price at which company breaks even on the product
Target profit pricing calculates breakeven price then adds desired profit.
Value Based Pricing buyer's perceptions of value rather than seller's costs to set price, measuring perceived value can be difficult
Everyday low pricing pricing strategy that charges comparatively low prices all the time with few sales (wal mart)
Competition based pricing based of competitors pricing, going rate, same level, below or above
Market Skimming Prices high initial price for new product to skim market, high layer o revenues, few but more profitable sales, costs of volume are not so high, competitors cannot enter market easily, no undercutting of low price, ex stereos mp3
Market Penetration Pricing low initial price to penetrate market (ie display) attract large number of buyers quickly and win a large market share, highly price sensitive, must keep out compeition, or effects are only temporary
Prestige Pricing Unlike to set prices for luxury products, unlike skimming strategy high prices in the beginnibg renain as hey were
Segmented Pricing Different prices for the same good or service ie airline tickets
Psychological Pricing High Price = high quality, reference points, ending with a .99, odd even pricing
Price Changes: Price Cuts/Price increases Cuts: excess capacity, falling market share, wants to be a market share leader. Increase: increased profit, faces inflation, faces greater demand than supply
Pricing Objectives Survival, current profit maximization, market share leadership, product quality leadership, partial or full cost recovery for non profit organization, social pricing.
External: Types of markets pure competition, monopolistic, oligopolistic competition, pure monopoly (demand curve, price elasticity)
Competitors Pricing consider impact of online comparisons, consider competition when setting price, pricing strategy influences the nature of competition, price matching "we will not be undersold"
External: Environmental Factors government, social considerations, reseller reactions, economic conditions that influence buyer perceptions of price and value
Distribution Channel Set of interdependent organizations involved in the process of making a product or service available for use or consumption by consumer or business user.
What flows through distribution channel? Customer Relations, transactions, information, products, channel functions
Direct Channel no intermediaries - manufacturer to consumer
Indirect channel one or more intermediaries - manufacturer - wholesaler - retailer - consumer
Advantages of intermediaries lower number of contacts, less chances to mess up, efficiency, specialization, create value, competitive advantage
Intensive Distribution many outlets, less market control, convenience goods, purchased frequently
Selective Distribution Several outlets, balanced market coverage and control, shopping and some speciality goods, several visits
Exclusive Distribution few outlets, limited coverage but great market control, speciality goods, industrial equipment, willing to travel and high service
Vertical Conflict manufacturer to retailer problems/mis communication
Horizontal Conflict retailer to retailer disagree on roles, activities etc.
Marketing Communications mix blend of ads, sales promo, personal selling and direct marketing company uses to pursue its ad/marketing objectives
Integrated Marketing Communications approach under which a company carefully integrates/ coordinates its many communications channels to deliver a clear consistent and compelling message about the organization and its products
Push Strategy Promotion strategy that calls for using the sales force and trade promotion to push the product through the channels
Pull Strategy Promo Strategy that calls for using ads and consumer promotion to build customer demand
Media Vehicle specific newspaper, magazine, television program, radio station, or website that will carry ad message
POP Promotion point of purchase displays or promotions that take place where you would buy the object/service
Product development process idea generation, idea screening, concept development, marketing strategy development, business analysis, product development, test marketing, commercialization
NPD new product development
Morphological Analysis builds on attributes to improve product - ie. physical (colour weight shape odor) psychological (appearence symbolism) functional (uses applications how it does stuff) misc. (cost rep origin class definition)
Style Product life cycle stays in growth/mature stage over long period of time, stable flucuations
Fashion arc shaped, peaks over time to decline
Fad very fast introduction, sharp peak, steep and fast decline
Personal Selling custom made product, expensive, technically complex, few customers, concentrated, high value
Direct Marketing Direct connections with carefully targeted individual consumers to obtain an immediate response and cultivate lasting customer relationships.
Media Fragmentation Specialty channels, magazine proliferation, events, sponsorships, buzz – scattering of audiences
Marketing Myopia mistake of focusing too much on product and not enough on customer wants and needs
Segmentation Grid Segment / Need / Age / Gender / Occupation etc.. usage rate / usage type
Cognative Dissonance buyer discomfort caused by post purchase conflict, affects major purchases, consumer follow up programs designed to reduce this problem
Segmentation Factors Demographic, psychographic, behavioural, geographic
Needs Based Segmentation (benefits) idea that consumers should be segmented based on their needs. labels/bases (light snackers, healthy eaters..) with their descriptors (ie usage rate, loyalty...) demographic, psychographicq
Cannibalization targeting two very similar segments (ie Gap Old Navy and Banana Republic)
Evaluation of Segments - must consider revenue potential and cost of entering segment
Created by: hayleygilbert77