Mngt150 - Principles of Maketing Study Guide Ch.1-9

PRINCIPLES OF MARKETING

STUDY GUIDE CH 1-9

Chapter 1:

1. Stakeholders - The people and groups that supply a company with its productive resources and so have a claim on and stake in the company. (customers, employees, suppliers, and shareholders)

2. Discovering and satisfying consumer needs - The first objective in marketing is discovering the needs and wants of consumers who are prospective buyers and customers. This is not an easy task because consumers may not always know or be able to describe what they need and want. A need occurs when a person feels deprived of basic necessities such as food, clothing, and shelter. A want is a need that is shaped by a person's knowledge, culture, and personality. Effective marketing can clearly shape a person's wants and tries to influence what we buy. The second objective in marketing is satisfying the need of targeted consumers. Because an organization obviously can't satisfy al consumer needs, it must concentrate its efforts in certain needs of a specific group of potential consumers or target market--one or more specific groups of potential consumers toward which an organization directs its marketing program. Having selected its target market consumers, the organization then takes action to satisfy their needs by developing a unique marketing program to reach them.

3. When launching a new product - learn from past failures.

4. Markets include - People with desire and ability to buy a specific offering.

5. Target markets - Specific group of potential consumers towards which an organization directs its marketing programs.

6. Four types of Utility: form, place, time, possession

a. Form utility - The production of the good or service.

b. Place utility - having the offering available where consumers need it

c. Time utility - having it available when needed.

d. Possession utility - The value of making an item easy to purchase through the provision of credit cards or financial arrangements.

e. Marketing creates its utilities by bridging space (place utility) and hours (time utility) to provide products (form utility) for consumers to own and use (possession utility).

Chapter 2:

1. Competencies - are an organization's special capabilities--the skills, technologies, and resources--that distinguish it from other organizations and provide customer value.

2. Strategic Business Units (SBUs) : Cash cows, Stars, Question marks & Dogs

a. Cash cows - are SBUs that generate large amounts of cash, far more than they can invest profitably in themselves. They have dominant shares of slow-growth markets and provide cash to cover the organization's overhead and to invest in other SBUs.

b. Stars - are SBUs with a high share of high-growth markets that may need extra cash to finance their own rapid future growth. When their growth slows, they are likely to become cash cows.

c. Question marks - are SBUs with a low share of high-growth markets. They require large injections of cash just to maintain their market share, much less increase it. The name implies management's dilemma for these SBUs: choosing the right ones to invest in and phasing out the rest.

d. Dogs - are SBUs with low shares of slow-growth markets. Although they may generate enough cash to sustain themselves, they do not hold the promise of ever becoming real winners for the organization. Dropping SBUs that are dogs may be required, except when relationships with other SBUs, competitive considerations, or potential strategic alliances exist.

3. Situation Analysis - taking stock of where a firm or product has been recently, where it is now, and where it is headed.

4. SWOT Analysis - Organization's appraisal of its internal strengths and weaknesses and its external opportunities and threats. (Build on a strength, Correct a weakness, Exploit an opportunity, Avoid a disaster-laden threat)

- Identify trends in the organization's industry.

- Analyze the organization's competitors.

- Assess the organization itself.

- Research the organization's present and prospective customers.

Chapter 3:

1. Demographics - Description of a population according to characteristics such as age, gender, ethnicity, income, and occupation.

2. Culture - Set of values, ideas, and attitudes that are learned and shared among the members of a group.

3. Disposable income - (2nd income component) is the money a consumer has left after paying taxes to use for food, shelter, clothing, and transportation.

4. Two powers that the FTC (Federal Trade Commission) has regarding deceptive or misleading advertising:

a. Issue cease and desist orders - the FTC orders a company to stop practices it considers unfair.

b. Order corrective advertising - the FTC can require a company to spend money on advertising to correct previous misleading ads.

Chapter 4:

1. Slotting Allowances - relating to the right to choose, today many supermarket chains demand "slotting allowances" from manufacturers, in the form of cash or free goods, to stock new products.

2. Whistle-blowers - employees who report unethical or illegal actions of their employers.

3. Utilitarianism - Moral philosophy that focuses on the "greatest good for the greatest number".

4. Green Marketing - Marketing efforts to produce, promote, and reclaim environmentally sensitive products.