MKT 300 Exam 1

The relationship between benefits and the sacrifice necessary to obtain those benefits.

Example: Lexus adopted a customer-driven approach, with particular emphasis on service. Lexus stresses product quality with a standard of zero defects in manufacturing. The service quality goal is to treat each customer as one would treat a guest in one's home, to pursue the perfect person-to-person relationship, and to strive to improve continually.

The idea that the social and economic justification for an organization's existence is the satisfaction of customer wants and needs while meeting organizational objectives.

The idea that an organization exists not only to satisfy customer wants and needs and to meet organizational objectives, but also to preserve or enhance individuals' and society's long-term best interests.

Example: Duracell and Eveready battery companies have reduced the levels of mercury in their batteries and will eventually market mercury-free products.

Defining a business in terms of good and services rather than in terms of the benefits that customers seek.

Example: Wrigley defined its mission as a gum manufacturer

A strategy that focuses on keeping and improving relationships with current customers.

A company-wide business strategy designed to optimize profitability, revenue, and customer satisfaction by focusing on highly defined and precise customer groups.

The process by which learned information from customers is centralized and shared in order to enhance the relationship between customers and the organization

All areas of a business where customers have contact with the company and data might be gathered.

• - Customer registering for a particular service
• - Customer communicating with customer service for product information
• - Customer completing and returning the warranty information card for a product
• - Customer talking with salespeople

Used to find hidden patterns and relationships in the customer data stored in the data warehouse.

Search the data warehouse, categorize significant characteristics, and develop customer profiles.

Companies must analyze the data to identify and profile the best customers, calculate their lifetime value, and ultimately predict purchasing behavior through statistical modeling.

A data manipulation technique that projects the future value of the customer over a period of years using the assumption that marketing to repeat customers is more profitable than marketing to first-time buyers

It costs more to find a new customer in terms of promotion and gaining trust than to sell more to a customer who is already loyal.

The managerial process of creating and maintaining a fit between the organization's objectives and resources and evolving market opportunities

• The goal of strategic planning is long-run profitability and growth.
• Addresses two questions: What is the organization's main activity at a particular time? How will it reach its goals?

A statement of the firm's business based on a careful analysis of benefits sought by present and potential customers and an analysis of existing and anticipated environmental conditions.

• Answers the question, "What business are we in?"
• The way a firm defines its business mission profoundly affects the firm's long-run resource allocation, profitability, and survival.

Product-oriented: Wrigley defining itself as a gum manufacturer

Market-oriented: Our objective is to increase market share from 30 to 40 percent in 2009 by increasing promotional expenditures by 14 percent

Identifying internal strengths (S) and weaknesses (W) and also examining external opportunities (O) and threats (T)

The set of unique features of a company and its products that are perceived by the target market as significant and superior to the competition.

An advantage that cannot be copied by the competition

Each SBU has its own rate of return on investment, growth potential, and associated risk. Management must find a balance among the SBUs that yields the overall organization's desired growth and profits with an acceptable level of risk.

A tool for allocating resources among products or strategic business units on the basis of relative market share and market growth rate.

Fast-growing market leader. They have large profits but needs lots of cash to finance growth

SBU that generates more cash than it needs to maintain its market share. This product has dominant share in a low-growth market

Also called a question mark - shows rapid growth but poor profit margins. It has a low market share in a high-growth industry.

Has low growth potential and a small market share. Most dogs eventually leave the marketplace.

A written document that acts as a guidebook of marketing activities for the marketing manager

People or organizations with needs or wants and the ability and willingness to buy.

A subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs.

A defined group most likely to buy a firm's product.

A unique blend of product, place, promotion, and pricing strategies designed to produce mutually satisfying exchanges with a target market.

Business's concern for society's welfare.

Managers must alter the marketing mix because of changes in the environment. They cannot control elements in the external environment that continually mold and reshape the target market, such as:

Economic, technological, and political factors.

• - Improve existing products and introduce new ones
• - Maintain and expand customer services
• - Emphasize top-of-the-line products and promote product value

Unless marketing managers understand the external environment, the firm cannot intelligently plan for the future. Many organizations assemble a team of specialists to continually collect and evaluate environmental information to identify future market opportunities and threats. Market managers must react to changes in the external environment.

Adopting a global vision can be very lucrative for a company.

Global Marketing Strategy: Product, Place, Promotion, Price


First step in creating a marketing mix is developing a thorough understanding of the global target market

A tax levied on the goods entering a country.

The sale of an exported product at a price lower than that charged for the same or a like product in the "home" market of the exporter.

A limit on the amount of a specific product that can enter a country.

Companies request quotas as a means of protection from foreign competition.

• - Culture
• - Economic and Technological Development
• - Political Structure and Actions

Exporting - Selling domestically produced products to buyers in another country.


Licensing - Legal process whereby a licensor agrees to let another firm use its manufacturing process, trademarks, patents, trade secrets, etc.

Joint Venture - When a domestic firm buys part of a foreign company or joins with a foreign company to create a new entity -- These can be very risky, and many fail.

• Global marketing standardization.
• Developing a single product for all markets and promoting it the same way all over the world.

Slightly alter a basic product to meet local conditions.

To maintain the same basic product but alter the promotional strategy

Creating a new product or drastically changing an existing product.

• - Cultural
• - Social
• - Individual
• - Psychological

• - Need recognition
• - Information search
• - Evaluation of alternatives
• - Purchase
• - Post purchase behavior

Culture influences a product's perception and use.

Language - When translating slogans, product names, etc. a firm must be careful not to convey the wrong message

• Social class often indicates which medium to use for advertising.
• Knowing which products appeal to which social classes can help marketers determine where to best distribute their products.

Driving forces that cause a person to take action to satisfy specific needs.

• - Psychological needs: Hunger, thirst
• - Safety needs: Security, protection
• - Social needs: Sense of belonging, love
• - Esteem needs: Self-esteem, recognition, status
• - Self-actualization needs: Self-development, self-realization