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Principles of Marketing - BUS 312, Chapter 1
Kerin, Hartley, Rudelius
19
Marketing
Undergraduate 1
01/25/2012

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Term
AMA Definition of Marketing
Definition
An organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.
Term
Previous Definition of Marketing
Definition
A process of planning and implementing the creation, pricing, promotion and distribution of goods, services, or ideas to create exchanges that satisfy individual and organizational objectives.
Term
What is Marketing
Definition

Creating exchanges to enhance utility of each party to make each party better off.

 

ie. I have an apple tree, you have a cow. I exchange some apples for milk. I am better off, you are better off.

Term
Requirements for Marketing to take place
Definition

One party w/unsatisifed need

Another party w/good, service or idea that will satisfy need

Communication (promotion) of the available good, service or idea

A way to make the good, service, idea available where and when it is wanted

A price acceptable to both parties

Term
4P's/Elements of the marketing mix
Definition

Product (good, service, idea to satisfy need)

Price (exchange for the product)

Place (distribution)

Promotion (communication seller/buyer)

 

All are controllable factors (you choose)

Term
Summary
Definition
Find a combination of 4 P's that meets the needs/wants of enough people that is worthwhile (better than anyone else) in a given environment while following laws.
Term
What is a need
Definition
Basic necessities such as food, shelter, clothing
Term
What is a want
Definition

Shaped by a person's knowledge, culture and personality

 

Most people purchase wants unless in a recession then they purchase needs which add to the recession.

Term
Uncontrollable Environmental Factors
Definition

Beyond Marketers control

social (what consumers themselves want/need)

economic (state of the economy expanding/contracting)

technological (changing technology)

competitive (actions that competitors take)

regulatory (government restrictions)

Term
Changing Production
Definition

Middle ages-trade guilds, individuals working to handcraft, could be personalized (ie. musket)

 

Industrialization-precision interchangeable parts, economies of scale, but all rifles the same-need large order of identical rifles (US Army WWII)

Term
Types of Marketing Orientations (approaches)
Definition

Production Orientation

Sales Orientation

Marketing Conept Orientation

Societal Marketing Orientation

Term
Production Orientation
Definition

Creates its own demand (high quality/people will buy)

 

ie. Pillsbury (high quality flour), however it must follow the 4 P's or it will fail like the first satalite phones (Iridium)

Term
Sales Orientation
Definition

Sale what the firm produces or has excess of

 

ie. End of year car sales

Term
Marketing Concept Orientation
Definition

(Consumer Based View)

 

Find needs/wants first, then create product to meet it.

Term
Societal Marketing Orientation
Definition

Marketers should be concerned about both the consumer and profits and potential impact on society.

 

Not clear and hard to do because who decides what the impact on society should be.

Term
Success in Marketing
Definition

Must find and fill needs better than anyone else, big enough to be profitable using the 4P's.

 

Critical concept to success is having a sustainable differential advantage and be able to do it over time. Quality is not always important.

 

ie. McD (cheap/fast), Big Lots (cheap), Motel 6 (cheap/clean) none known for high quality.

Term
How do you find success in marketing
Definition
Fill needs better than anyone else using 4P's having a sustainable differential advantage over long period of time.
Term
Customer Relationship Management (CRM)
Definition

Use information (research) to find needs

Use information (feedback) to determine customer satisfaction, alter 4P's to meet needs, or alter perception of offereing promotion

 

To track individual customers likes and dislikes and try to adopt their product.

Term
Summary
Definition

Create value for customers by using information to find needs or a segment (large enough to be profitable), use 4P's to fill needs better than anyone else, use environmental scanning to understand environment and environmental changes.

 

ie. baby carrots (health needs/convience) example of marketing exchange.

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