MKTG with complete solutions questions and answers

Marketing Social and managerial..... Identifying the needs of consumers and developing appropriate products, the offering this to specific groups of consumers using a systematic plan (marketing mix) The marketing process 1. Understand the market place and customer needs, wants and demands. 2. Design a customer driven market strategy 3. Construct an integrated marketing program that deliver superior value 4. Build profitable relationships and create customer delight 5. Capture value from consumers to create profits and customer equity Four premise of marketing concepts Consumer orientation Continuous marketing research All organisational activities and strategies are interrelated Aims to convert satisfied consumers into loyal consumers Marketing concepts (MECCM) 1. Market offerings - marketing mystopia 2. Exchanges and relationships 3. Customer value and satisfaction 4. Customer needs, wants, demands 5. Markets Marketing management Analysis, planning and implementation and control of programs designed to build and maintain beneficial exchanges with target buyers to achieve organisational goals Demarketing Marketing in which the aim is to temporarily or permanently reduce demand. Seeks to affect level, timing and nature of demand to achieve organisational goals. Marketing mystopis Mistake of paying more attention to the specific product rather than to the benefits and experiences produced by these products Customer value Difference between the benefit the customer gains from buying product and the costs of obtaining it Value proposition an organisation's set of benefits or values it promises to deliver to consumers Production concept Consumer will favour products that are available and highly affordable. Org should hence focus on improving production and distribution efficiency. Can lead to marketing mystopia but still good in competitive and price sensitive markets for simple goods Product concept Consumer will favour products that offer the most quality performance and features. Hence, the organisation should devote itself in making continual product improvements. Leads to marketing mystopia Selling concept Consumer will not buy enough of the product unless it undertakes a large scale selling and promotion effort. Focus on sales rather than relationships. Inside-out approach, starting from factory and eventually to consumers Marketing concept Achieving organisational goals depends on knowing the needs and wants of target markets. Delivering satisfaction is better than building relationship Societal marketing concept Calls for sustainable marketing: environmentally and socially responsible marketing that meets the current needs for both parties as well as the ability for future generations to meet their needs Market-orientated culture The belief that the purpose of business is to create superior customer value Foundation of strong market oriented culture 1. Deep understanding of customers 2. Awareness and knowledge of competitors 3. Strong collaboration across firm 4. Leadership actions that focus on the customer Market Set of all actual and potential buyers of a product Exchanges Acts of obtaining a desired object from someone by offering something in return Transaction Trade between at least two parties that involves at leat two things of value, agreed upon conditions and a time and place of agreement Customer-relationship management Overall process of building and maintaining profitable relationships by delivering superior value and satisfaction. Recognises customer life time value Customer lifetime value The value of the entire stream of purchases that the consumer would make over a lifetime of patronage. This is greater than the cost the org incurs. Factors that affect customer satisfaction Past experiences What seems like fair value Competitors and competing products Information/promises made by the marketing org Methods of measuring customer satisfaction and loyalty Customer satisfaction and loyalty surveys Mystery shopping and customer interviews Lost customer analysis Compliant and suggestion systems Five consumer relationship levels Basic: just a single exchange Reactive: where customers recontact business and business responds Accountable: business contacts customer about Proactive: org contacts customer about possible improvements etc Partnership: org works with customer to create products or make it better Three types of relationship ties Financial ties Structural ties Social ties Steps in conducting competitor analysis 1. Identify competitors 2. What are their objectives 3. Competitor's strategies? 4. Assess their strengths and weaknesses Market leaders Have largest market share which also gives them the ability to lead in price changes, new product and promotional spend. Market challengers Usually the 2nd/3rd largest firm on the market who tries aggressively to expand market share by attacking the market Market followers Allows dominant firms to lead the way and keeps close tabs on the leaders activities in order to copy their product releases and marketing efforts Market nicher Serves small segments not served by other firms and has a slow but growing rate of sales and market share. relatively low market impact, aims to attract minimal attention of competition the market. Strategic planning Process of developing and maintaining a strategic fit between the organisation's goals and capabilities in the light of changing marketing opportunities. It sets the stage for the rest of the company's planning Steps to develop a strategy for long term growth and survival 1. Defining the company mission 2. Setting objectives and goals 3. Designing a business portfolio 4. Developing functional plans Business portfolio Collection of businesses and products that make up the company - strategic business units Most effective are portfolios that bests fits company's strengths and weaknesses to opportunities in the environment. Portfolio analysis Tool that helps management identify and evaluate the various businesses that make up the company. Most evaluate the SBUs on two dimensions: the attractiveness of the SBU's market and the strength of the SBU's position in the market Characteristics of a good brand name Short and simple Suggestive of product benefits Adaptable to packaging/labelling Legally available to use 5 levels of brand familiarity Rejection Non-rejection Brand recognition Brand preference Brand insistence Internal factors affecting consumer behaviour Psychological (motivation, self-concept, learning, beliefs and attitudes, perceptions) Personal (age and lifecycle, occupation, education, economic situation, lifestyle and personality) External factors affecting consumer behaviour Cultural, social, financial, environments, legal and political The buyer decision process 1. Need recognition 2. Information search 3. Evaluation of alternatives 4. Purchase decisions 5. Post-purchase behaviour Adoption process of new products 1. Awareness 2. Interest 3. Evaluation 4. Trial 5. Adoption The five different consumer buying roles Initiator: person who first suggests the idea of buying a particular product or service Influencer: person whose views or advice carry some weight in the final buying decision Decider: person who ultimately makes the buying decision Buyer: person who make the actual purchase User: person who consumes the product/service Business market Compromises of all organisations that buy goods for use in the production process or for the purpose of reselling/renting them to others at a point. Fewer but larger and more geographically concentrated Steps in business buying process 1. Problem recognition 2. General need description 3. Product specification 4. Supplier search 5. Proposal application 6. Supplier selection 7. Order-routine 8. Specification and performance review Marketing objectives need to be Specific Measurable Achievable Realistic Timely Micro factors in a marketing organisation 1. The marketing organisation 2. Suppliers 3. Marketing intermediaries 4. Customers 5. Competitors 6. Publics Macro factors 1. Demographics 2. Economic 3. Natural 4. Technological 5. Political/social 6. Cultural How do industries grow 1. More customer buy products 2. Higher volumes of purchase by existing customers 3. Price increase while volume stays steady How do industries shrink 1. Fewer customers continue buying 2. Same number of customers buy less 3. Price decrease but volume doesn't increase Maximum market potential factors Awareness Trialability Availability Ability to use and ease of use Attractiveness Affordability Three stages of market orientation 1. Mass marketing 2. Product variety marketing 3. Target marketing Steps in target marketing 1. Market segmentation 2. Market targeting 3. Market positioning Product Anything that can be offered to a market to satisfy a need or want. It includes physical objects, services, persons, places, ideas and organisations. Core product Problem solving product or core benefit that consumers are really buying Actual product The brand name, activities and processes that combine to deliver one core benefit Augmented product Additional customer benefits built around the core and augmented product Consumer product Products brought by final consumers for personal consumption Convenience product Frequent purchases bought with minimal buying effort and little comparison shopping. Low price, wide spread distribution. Shopping good Less frequent purchases requiring more shopping and effort and comparisons. Higher price that convenience goods and selective distribution in fewer outlets Unsought goods Little product awareness and knowledge. Pricing and distribution varies. Often aggressive advertising Specialty Strong brand preference and loyalty, requires more special purchase effort, little brand comparisons. Low price sensitivity, high price and exclusive distribution Service An activity, benefit or satisfaction offered for the sale that is essentially intangible and does not result in the ownership of anything. Five characteristics distinguish it from a good. Five service characteristics Intangibility Variability Perishable Synchronous delivery and consumption Lack of ownership