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| A process by which companies create value for customers and build strong customer relationships to capture value from customers in return. (Entails an exchange between company and customer) |
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1) Diverse and changing consumer preference
2) Changing environment
3) Intensifying competition |
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| Evolvement of the Marketing Management Philosophy: |
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| Production concept -> Product Concept -> Selling Concept -> Marketing Concept -> Societal Concept |
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| The idea that consumers will favor products that are available or highly affordable |
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| The idea that consumers will favor products that offer the most quality, performance, and features. Organizations should therefore devote its energy to making continuous product improvements. This is risky because you can lose sight of why people are buying the product, underlying needs. |
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| The idea that consumers will not buy enough of the firm's products unless it undertakes a large scale selling and promotion effort. |
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| The idea that achieving organizational goals depend on knowing the needs and wants of the target markets and delivering the desired satisfactions better than competitors do. |
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Starts with factory; takes an inside-out view that focuses on existing products and heavy selling. The aim is to sell what the company makes rather than making what the customer wants. |
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Takes an outside-in approach that focuses on satisfying customer needs as a path to profits. “We don’t have a marketing department, we have a customer department.” |
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| the value of the entire stream of purchases that the customer would make over a lifetime of patronage |
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| the portion of the customer's purchasing that a company gets in its product categories |
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The concept that a company should make good marketing decisions by considering consumers’ wants, the company’s requirements, consumers’ long-term interest, and society’s long-run interests |
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| The art and science of choosing target markets and building profitable relationships with them; what customers will we serve? how can we better serve them? |
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| Product, price, place, promotion |
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| Microenvironment of marketing |
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| All the players that include how you can create value for customers (the company, suppliers, marketing intermediaries, competitors, publics, customers) --> IKEA starts with consumer, works backwards |
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| provide the resources to produce goods and services; treat as partners to provide customer value |
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| help the company to promote, sell, and distribute its products to final buyers --> resellers, physical distribution firms, marketing service agencies, financial intermediaries |
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| Firms are part of alliances; align with suppliers, marketing intermediaries, etc. |
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| Firms must gain strategic advantage by positioning their offerings against competitors' offerings |
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| any group that has an actual or potential interest in or impact on an organization's ability to achieve its objectives (financial publics, media publics, government publics, etc) |
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| Macroenvironment of Marketing |
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| demographic, economic, natural, technological, political, cultural |
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| provides an easily understood snapshot of the typical consumer in a specific target market (population size, age, gender, generations, ethnicity) |
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| Social and cultural environment |
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| the shared meanings, beliefs, morals, values, and customs of a group of people |
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| Consumer incomes, purchasing power, inflation, unemployment, interest rate, consumer confidence/sentiment, recession |
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| Buyer's Decision Making Process |
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| Need recognition -> information search -> evaluation of alternatives -> purchase -> post purchase behavior |
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| Factors influencing the search process |
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| perceived benefits vs. perceived costs |
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| Evoked is smallest inside retrieval and retrieval is inside universal (all encompassing) |
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| Compensatory decision rule |
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| Assumes that the consumer, when evaluating alternatives, trade off one characteristic against another, such that good characteristics compensate for bad characteristics |
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| Non compensatory decision rule |
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| Choose a product or service on the basis of one characteristic or one subset of characteristic, regardless of the values of its other attributes |
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| AKA buyer's remorse, it is the discomfort caused by a post-purchase conflict; firms attempt to minimize this by reinforcing decision (thank you letters, congratulations letters, quality rating) |
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| The satisfaction or dissatisfaction that the consumer feels about the purchase; relationship between consumers expectations and perceived performance; |
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| Ways to increase customer satisfaction: |
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| customer contact, encourage feedback, provide money back guarantee, build realistic expectations, demonstrate correct product use |
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| Factors influencing buyer's decision-making process |
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| psychological factors, social factors, situational factors |
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| the process by which we select, organize, and interpret information to form a meaningful picture of the world |
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| set of options that buyers will seriously consider |
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| selective attention, selective distortion, and selective retention |
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| behavioral, affective, and cognitive pieces |
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| The change in an individual's behavior arising from experiences. It occurs through the interplay of drives, stimuli, cues, responses, and reinforcement. |
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| Pavlov's dog; when people do something good, they are rewarded; expectations |
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| How your behavior changes after initial perception; first restaurant experience determines whether you'll go back |
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| one of more people whom an individual uses as a basis for comparison regarding beliefs, feelings, and behaviors |
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| People within a reference group who exert a social influence on others -> influential, leading adopters -> marketers identify them and use them as brand ambassadors |
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| purchasing situation, shopping situation, temporal state |
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| brand names, packaging, etc to make evaluations |
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| Simple rules of thumb used to aide judgements or decisions |
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| Anchoring and adjustments |
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| Initial values influence judgements or decisions |
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| Anchoring and adjustments |
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| how you frame your packaging (99% fat free vs. 1% fat) |
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| any aspect of the choice architecture that alters people's behavior in a predictable way without forbidding any options or significantly changing their economic consequences |
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| The systematic design, collection, analysis and reporting of data relevant to a specific marketing situation facing an organization; monitoring the environment and detecting trends, identifying and tracing marketing problems, identifying marketing opportunities, supporting a marketing decision |
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| used to gather preliminary information; helps to define problems and suggest hypotheses |
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| used to better describe the market potential for a product or the demographics and attitudes of consumers |
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| used to test hypotheses about cause-and-effect relationships |
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| Technique tapping respondents' deepest feelings by having them project those feelings into an unstructured situation; tapping the subconscious |
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| Ethnographic observation research |
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| the study of human behavior in its natural context involving observation of behavior and physical setting |
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| Ethnographic observation research |
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| the study of human behavior in its natural context involving observation of behavior and physical setting |
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| dividing a market into smaller segments (groups of consumers) with distinct needs, characteristics, or behavior that might require separate marketing techniques |
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| Segmentation by geography |
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| easiest way to segment a market, it divides the market into different geographical units such as nations, regions, states, etc |
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| Segmentation by demographics |
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| divides the market into groups based on variables such as age, gender, family, size, family life cycle, etc. |
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| Segmentation by psychographics |
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| divides buyers into different groups based on social class lifestyle (activities, interests, etc) or personality traits; self-value, self-concepts |
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| Consists of a set of buyers who share common needs or characteristics that the company decides to serve |
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| The way the product is defined by consumers on important attributes -- the place the product occupies in consumers' minds relative to competing products |
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| Shows consumer perceptions of their brands versus competing products on important buying dimensions |
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