Term
| Over the years, business has evolved through a number of "concepts." What do each of these concepts mean, and what concept might be the dominant concept in the future? (Chapter 1) |
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Definition
Production Concept: Consumers are interested in low prices and availability
Product Concept: Consumers want a high quality product
Selling Concept: A marketer is focused on selling the product and not on customer satisfaction. (Used by marketers of unsought goods - life insurance. And also by political parties and firms with excess inventory.) |
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Term
| What is the difference between customer value and customer satisfaction? (Chapter 1) |
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Definition
Customer Value: The difference between what a consumer gets in comparison to what they have to give to get it.
Customer Satisfaction: The degree to which a product conforms to, or exceeds, the customer's expectations.
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Term
| The marketing concept is built on the idea that customer satisfaction should be central to busienss operations. What underlies this theory that loyal customers who return again and again are preferable to new customers who buy infrequently? (Chapter 1) |
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Definition
Because of the strategy of Customer retention:
A company should want to keep loyal customers because not only do they keep purchasing, but also because it is cheaper to keep an existing customer than to attract a new one.
Loyal customers buy more and are less price sensitive.
They also spread positive word of mouth.
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Term
| What are some of the ways digital technology has affected marketing and consumer behavior over the past few decades? (Chapter 1) |
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Definition
Over the past few decades, digital technology has changed the way marketers advertise their products and the way consumers shop.
- Enabled marketers to offer even more products and services
- Wider distribution of goods/services
- Reducing costs/barriers
- Accelerated rate of new competitors entering the market
- Accelerated rate of change of segmentation, targeting and positioning approaches (New business rivals make old approaches obsolete)
- Marketers must ensure every exchange with a customer is part of a customer relationship, not just a transaction.
The three drivers of successful relationships between marketers and customers are customer value, high levels of customer satisfaction and building a structure for customer retention. |
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Term
| Define the term, "Culture." What is the difference between a belief, a value and a custom? What are the various levels of culture? Why is culture important from the standpoint of consumer behavior? (Chapter 2) |
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Definition
Culture is: the sum total of LEARNED beliefs, values and customs that direct consumer behavior in society.
Belief: The very large number of mental or verbal statements that reflect a person's particular knowledge and assessment of something.
Value: Types of beliefs
Differ from other beliefs in these five ways:
- Relatively few in number
- Serve as a guide for culturally appropriate behavior
- Are enduring or difficult to change
- Not tied to specific objects or situations.
- Widely accepted by the members of a society.
Beliefs and values are guides for behavior.
Custom: Culturally approved ways to act
- Everyday or symbolic.
- Usual and acceptable ways of behaving.
Various levels of culture:
Supranational: Affects people of different countries
National Level Culture: Affects only one country
Group Level Culture: Affects members of a reference group.
Culture is important for consumer behavior because it helps explain why products sell well in certain regions/groups.
Also helps explain how consumers use products and how they dispose of them.
Can help company position themselves accordingly in the marketplace. |
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Term
| How is culture LEARNED (somewhere in your answer, discuss the difference between acculturation and enculturation)? (Chapter 3) |
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Definition
Learned through:
- Formal Learning: Taught by parents or others
- Informal Learning: Observation and imitation, also advertising
- Technical Learning: Taught by institutions appointed by culture
- Enculturation: Learning one's own culture
- Acculturation: Learning a new culture
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Term
| What various ways that researchers might go about measuring culture and how do they differ from each other in terms of observer objectivity and involvement? (Chapter 3) |
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Definition
- Content Analysis: focuses on content of communications (used to compare cultural values between countries, markets, industries)
- Consumer Fieldwork: Observation of a small group of people within a culture to draw conclusions. (takes place in a natural environment, sometimes without the subjects awareness. Focuses on observation of behavior.)
- Participant Observer: Researcher becomes active participant in culture being observed.
Content Analysis: Low/No Observer Involvement
Consumer Fieldwork: Medium Observer Involvement
Participant Observer: High Observer involvement |
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Term
| What are the core values of American culture? Give an example of how each one might be used to sell a product (Chapter 3). |
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Definition
- Achievement and Success: achievement = intrinsic reward, success = extrinsic reward
- Activity: important to be active and "on the go."
- Efficiency and Practicality: Saving time, effort, solving problems (Time is considered critically important)
- Progress: We can always improve ("New and Improved" - marketing)
- Material Comfort: "The Good Life"
- Individualism: self reliance, self-interest, self-confidence, self-esteem, self-fulfillment
- Freedom
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Term
| Define the term "subculture." What are the dominant ethnic subcultures in the USA? Describe these ethnic subcultures in terms of size, values and consumer characteristics that make each different from the cominant culture. (Chapter 3) |
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Definition
Subculture: A distinct cultural group that exists as an indentifiable segment within a larger, more complex society.
Hispanic Subcultures: Largest nationality subculture in the US:
- 14% of Pop.
- Fast Growing
- Younger on average
- Most likely to live in extended family households
- Subgroups: Mexican, Puerto Rican, Cuban
- Prefer well-established brands
- Shop at smaller stores
- Variance in language preference
African American Subculture: 2nd largest minority in US
- 14% of Pop.
- Urban North, Urban and Rural South
- Diverse, numerous sub-groups
- Tend to spend heavily on visible goods (apparel, personal care products and jewelry)
Asian-American Subculture: Fastest growing minority
- 5% of Pop.
- 6 Different Ethnicities: Chinese, Filipino, Indian, Vietnamese, Korean, Japanese
- Family-oriented, industrious, driven to achieve.
- Education oriented
- Western Urban Areas
- Computer literate
- Value high quality and reliability
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Term
| What are the main groups and cohorts concerning age subcultures in the US? Describe these cohorts in terms of size, values and consumer characteristics that make each different from the dominant culture. (Chapter 3) |
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Definition
Four Age Groups and Seven Cohorts
- Generation Y: (Tweens (8-12), Teens (13-18) & Twixters (19-29))
- Grown up in a media-saturated environment
- Very marketing aware
- Internet is medium of choice
-2nd to Boomers in size
- Trust parents and may still live at home after graduation.
- Instant gratification
- Generation X: (Age 30-40)
- Don't like insincere marketing
- No rush to start families
- Not as ambitious as older cohorts
- Value work quality more than money
- 37% "latchkey" kids and that affected values
- High internet usage rate
- Baby Boomers: (Post-War Cohort (52-62) & Hand-Me-Down Cohort (40-52))
- 40+% of Pop.
- Trying hard to look/feel young
- Have money and willing to spend
- Yuppies buy conspicuously
- Intend to work into retirement
- $20+ trillion in assets
- 12% of Pop.
- Spend money on cars, alcohol, vacations
- Mental age might differ from actual age
- Active internet users
- Tend to be more brand loyal and store loyal |
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Term
| How has family structure been evolving in the US over the past several decades? What are primary categories of household types? Which ones are growing and shrinking? (Chapter 4) |
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Definition
| Over the past several decades, the family structure has been evolving |
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Term
| What are the stages of the traditional family life cycle? What non-traditional categories might exist? (Chapter 4) |
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Definition
Traditional:
Stage 1: Bachelorhood
Stage 2: Honeymooners
Stage 3: Parenthood
Stage 4: Postparenthood
Stage 5: Dissolution
Nontraditional:
- Single-Parent, divorced or never married
- Divorced, no children
- Never married singles and couples
- Gay, Lesbian co-habs. |
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Term
| Explain what is meant by the term "Social Class." What is "Social Comparison Theory?" What is the difference between "Conspicuous Consumption" and "Status Consumption?" (Chapter 4) |
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Definition
Social Class: A hierarchy of groups within society based on social status.
Social Comparison Theory: People comparing their own posessions with those of others to determine their own social standing
Conspicuous Consumption: Buying to display status to others
Status Consumption: Buying to attain status |
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Term
| What are some of the various ways researchers might go about measuring social class? How many classes are there in the US? Approximately what percentage of the population is in each class? How is the structure evolving over time? (Chapter 4) |
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Definition
Subjective Measure: Class Consciousness: ask people to self-identiy social class (tends to cause too many to classify themselves as middle class)
Reputational Measures: Use community information
Objective Measures: Occupation, Income, Education, Geodemographic, Neighborhood Clustering.
Single Variable: Occupation, Education, Income, Wealth
Composite: Some combination of above |
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Term
| How do the upper classes and lower classes differ from each other in terms of how they view themselves, the world around them, and the future? How does this manifest itself into consumer behavior? (Chapter 4) |
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Definition
Upper classes are more optimistic about themselves. Lower classes have narrow view, as middle and upper classes have a broader view.
The target market for many companies is the working class and lower-middle class. (McDonalds, Walmart, Dollar Store)
Lower classes focus on revolving credit, while middle-upper classes tend to pay it off each month.
Most people do not dress to fit their self-image to social class.
Lower-middle class consumers have the preference for clothing with an external point of identification such as a sports team logo.
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Term
| Define: Consumer Behavior |
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Definition
| The behavior that consumers display in searching for, purchasing, using, evaluating and disposing of products that they expect will satisfy their needs. |
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Term
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Definition
- To be successful, a company must determind the needs of its customers and satisfy those needs better than the competition.
- Market Segmentation: Markets can be divided into groups of consumers with similar needs.
- Marketing Targeting: The process of singling out one or more segments for application of marketing efforts.
- Positioning: Development of a specific image
- The Marketing Mix: The 4 P's (Product, Price, Promotion, Place)
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Term
Define: Customer Value
(and Value Proposition)
Define: Customer Satisfaction
(Loyalists, Apostles, Defectors, Terrorists, Hostages and Mercenaries) |
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Definition
Customer Value: The Ratio between the customer's perceived benefits and the resources used to obtain them.
Value Proposition: The firms positioning. (source of differentiation)
Customer Satisfaction: The degree to which a product conforms to, or exceeds, the consumer's expectations.
- Loyals keep purchasing
- Apostles provide positive word of mouth
- Defectors are neutral and stopped purchasing
- Terrorists spread negative word of mouth
- Hostages stay but are unhappy due to monopoly
- Mercanaries are satisfied but not loyal
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Term
| Define: Customer Retention |
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Definition
Having the objective of continously satisfying customers so that they stay with the firm rather than switching.
Why is this important?
- Loyal customers buy more and are less price sensitive
- It is cheaper to keep an existing customer than to attract a new one.
- Loyal customers also spread positive word of mouth.
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Term
Customer Retention
Customer-Profitability Focused Marketing
(Four Tiers) |
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Definition
- Platinum Tier: Heavy users, not price sensitive
- Gold Tier: Heavy users, more price sensitive
- Iron Tier: Volume does not warrant extra effort
- Lead Tier: More trouble than they are worth
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Term
| Marketing Ethics: Societal Marketing Concept |
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Definition
Marketers should engage the marketing concept in ways that improve society as a whole.
Short Term Orientation Deters managers
Long Term Perspective Maintaining long-term satisfied customers is better for both the company and society as a whole.
Many companies and industries maintain rigorous codes of ethics. |
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Term
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Definition
Culture is the sum total of LEARNED beliefs, values and customs that direct the consumer behavior of a particular society.
Beliefs can be expressed as a verbal statement that reflects a person's assessment of something.
Values are a type of belief and are relatively few in number, serve as a guide for behavior, are enduring and difficult to change, not tied to specific situations, and are widely accepted in society
Customs are culturally approved ways to act. and can be everyday or symbolic. |
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Term
| Three Levels of Subjective Culture |
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Definition
- Supranatural - Affects people of different countries
- National Level Culture - Affects only one country
- Group Level Culture - Affects members of a reference group (ex. students cramming the night before an exam)
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Term
Culture is learned
Define: Formal Learning, Informal Learning, Technical Learning, Enculturation and Acculturation |
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Definition
- Formal Learning: Taught by parents or others
- Informal Learning: Observation and imitation
- Technical Learning: Taught by institutions appointed by culture
- Enculturation: Learning one's own culture (Family is a vital element)
- Acculturation: Learning a new culture
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