Term
| The definition of a brand. |
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Definition
| A name, phrase, design, symbol, person, or combination intended to represent an offering an differentiate it from competitors. |
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Term
| Brands can be represented through: |
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Definition
| logos, phrases, people, symbols, etc. |
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Term
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Definition
| Signify quality, create barriers to entry, serve as competitive advantage, secure price premium |
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Term
| How to use the strength of brand against itself through a ‘poison parasite.’ |
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Definition
| Poison (strong counter-information) parasite (association between counter claims and rival position) |
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Term
| What brand equity is and its importance. |
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Definition
| The differential effect that brand knowledge has on consumer response on exposure to that brand. |
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Term
| The 2 components of brand equity. |
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Definition
| Brand awareness, brand image. |
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Term
| Know what brand awareness and brand image are. |
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Definition
Awareness: Whether a brand name comes to mind when consumers think about a particular product category, and the ease with which the name is evoked.
Image: Reflexive associations that come to the mind of the consumer on exposure to that brand. Strong, unique, favorable. |
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Term
| The importance of consistency in brand management. |
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Definition
| Build loyalty, shape brand image, secure price premium. |
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Term
| What the product life cycle is and how it changes brand management. |
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Definition
| Intro: Gain awareness. Growth: Stress differentiation. Maturity: Maintain Loyalty. Decline: Harvesting and Deletion |
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Term
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Definition
| The economic cost of a purchase. Includes incentives, allowances, fees, and transaction costs, not convenience. |
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Term
| The importance of pricing. |
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Definition
| Price has the greatest impact on Profit. (1% in Price = 33% on Profit) |
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Term
| Some common pricing mistakes |
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Definition
1) Determine costs and take traditional industry margins
2) Failure to revise price based on market changes
3) Setting price independently of the rest of marketing mix
4) Focusing too much on competitors
5) Prices too low |
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Term
| That the lowest price is not always the best price. |
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Definition
| Only 15-35% of customers are price sensitive. 65- customer support, 58- on time delivery, 19- price |
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Term
| 5 steps in the pricing process. |
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Definition
| 1- Pricing Objective 2- Demand and Revenue 3- Cost Relationships 4- Competitive Context 5- Pricing approach |
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Term
| Be able to identify pricing objectives. |
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Definition
| What is objective? Profit? Sales? Volume? Market share? Survival? Social responsibility? |
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Term
| Be able to recognize a pricing curve and differentiate between moving along a curve and shifting a curve. |
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Definition
| Price vs. demand (think econ!) |
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Term
| Know what price elasticity is and that marketing is often interested in shifting the demand curve. |
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Definition
| Elasticity- more = more change in demand vs. change in price. Shift in demand curve caused by external factors (more favorable conditions). |
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Term
| Know what fixed costs, variable costs, and contribution are. Be sure you can calculate a contribution. |
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Definition
Fixed cost: Do not change with more units (factory, exec salaries)
Var cost: Change as more units produced (Ink, paper)
Contribution: Money left over after paying var costs that contributes to paying fixed costs (Price - Var costs) |
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Term
| Be able to calculate a breakeven. |
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Definition
| Break even = fixed costs / unit contribution = # of units |
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Term
| 2 common pricing strategies (skimming and penetration) |
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Definition
Skim: Set price high to ‘skim’ the profits; demand likely inelastic, will not attract competition, production or mktg costs unknown, capacity constraint exists, orgo wants funds quickly, high value product
Penetration: demand likely elastic, offering not unique (not protected from competitions), competitors will enter mkt quickly, possibility of cost savings with large volume of sales, orgo wants large market share |
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Term
| 3 approaches to pricing (cost-based, competition-based, and value pricing). |
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Definition
| Cost: cost of production, competition: competitor prices, value: customer focused pricing (value of a dry field for a farmer?) |
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Term
| What pricing approach I recommend |
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Definition
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Term
| Know the 4 categories of behavioral pricing that I discussed. |
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Definition
| Reference prices (standard comparison), Price-quality inferences, Price endings, Price cues |
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Term
| What a reference price is, why we use odd price endings, and what price-quality differences are. |
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Definition
Reference Price: The standard to which consumers compare the stated price.
Odd price endings: discount perceptions; Even: value |
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Term
| Understand price-quality inferences. |
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Definition
| High price = high quality, Low price = low quality / weight / rarity |
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Term
| That price endings (i.e. prices that end with a 9 like $29.99) work and why. |
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Definition
| Read left to right. Even = Value, Odd = Discount |
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Term
| Be able to generally describe the ‘Conceptual Orientation to Pricing’ graphic that I showed. |
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Definition
| Range = Pricing discretion. Bottom = price floor, Top = Price ceiling. Up = Var Costs, Objectives, Regulatory constraints. Down = Competitive factors. Initial discretion = up, Final pricing = down. |
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Term
| What IMC is and that it is the 4th ‘P’ |
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Definition
| Integrated Marketing Communications. P: Promotion. Communication program: 1) coordinates all promotional activities. 2) Provides consistent message to all audiences. 3) Build brand equity. |
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Term
| The relationship of IMC to brand equity. |
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Definition
| IMC uses all advertising and communication to raise brand equity. (Ads, Sales promo, Sponsor events, Publicity, direct marketing, personal selling, website) |
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Term
| That the individual pricing tactics may work on their own or may have synergistic effects with other tactics. Remember that I discussed and example of direct-to-consumer advertising from the Pharma industry. |
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Definition
| DTC + Salesperson detailing are synergistic- detail raises sensitivity to higher prices, DTC increases overall category sales (detailing does not). At higher DTC, detailing is more effective. |
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Term
| The fundamentals of communication (remember the example of tying a tie). I also showed a graphic of the communication process. |
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Definition
| Source > Encode > Channel of Comms (message) > Decode > Receiver > Response > Feedback. Requires similar understanding and knowledge base that can be applied to the message. |
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Term
| 3 classes of communications & how they are different. |
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Definition
Mass communication: impersonal, undifferentiated, must pay, difficult to get feedback.
Customized communication: targeted at segment, focused message, more expensive, one-shot message, transactional feedback.
Interactive communication: individual level, iterative, most costly, more complex info transmission, immediate and individual feedback. |
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Term
| Examples from each of the classes. Know what each example means and be able to recognize examples of that type of marketing communication. |
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Definition
| Mass: Ads (communication). PR. Publicity (presentation). Spam. Customized: Direct Marketing. Sales Promo (coupons, short term). Public Relations (seeks to influence feelings, opinions, beliefs of group). Social “Viral” Mktg (internet enabled, fw messages). Interactive: Personal selling. Online mktg. |
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Term
| The long tail as it relates to Online Experience Management. |
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Definition
| OEM: managing the customer experience during their interaction on the orgo’s website. (The Marketplace) Sales volume high, decreases with increasing variety. |
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Term
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Definition
| Two way flow of communication between buyer and seller, often face to face, designed to influence a person or group’s purchase decision |
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Term
| The kinds of personality traits that are associated with people who work in personal selling. |
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Definition
The kinds of personality traits that are associated with people who work in personal selling.
Empathetic, competitive, goal oriented, adaptive, customer oriented, enthusiastic, organized, self-motivated |
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Term
| The 6 steps of personal selling, what each step involves. |
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Definition
| Prospecting (search for potential cust.), Pre-approach (gather info, decide how to approach prospect- personal obs, other cust, publically available info), approach (initial meeting, gain attention, stimulate interest, build foundation for working rshp and sales presentation), presentation (stimulus-response, formula selling, need-satisfaction), close, follow-up |
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Term
| 3 selling formats and 2 types of need satisfaction selling formats. |
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Definition
Stimulus - Response: Series of appeals- do you want fries with that?
Formula selling: Prepared, canned sales presentation
Need-Satisfaction: A) Adaptive: adjust presentation to fit situation. Know when to adapt vs. ask for info. B) Consultative: focus is on problem identification. Offer novel solutions once you agree on the problem. |
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Term
| Know that objections are a good thing. |
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Definition
| Acknowledge and convert. Postpone. Agree and neutralize. Accept objection. Denial. Ignore. |
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Term
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Definition
| Closing: ask for business. A) Trial close: decision on some aspect of purchase (blue or red?) B) Assumptive close: assume business (when do you want delivered?) C) Urgency close: Refer to timeliness of purchase |
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Term
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Definition
| Ensure that customer is satisfied with purchase (for major purchases, underutilized) |
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