Marketing - Reference Handbook

8/12/2019 Marketing - Reference Handbook

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Ganesh RamkumarEditor of Marketingmagazine

Ramesh GankumarAuthor of The Portable MBA inMarketing

CAPUTO`SUNEDITED PRINT. INTERNAL USE ON


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CHAPTER 1

Utilit!Want-satisfying power of good/service

T"es #$ Utilit!

- %#rm!Raw materials/components to finished goods/services; part of Prodction

- Time!!oods/services available when there is demand for it; part of Marketing

- Pla&e!!oods/services available at convenient " sitable location; part of Marketing

- O'nershi"!#ransfer title of goods/services from company to byer; part of Marketing

?? $ow does organi%ation create a cstomer&

- 'dentifying cstomer needs

- (esigning prodcts/services that meet those needs

- )ommnicating information abot those prodcts/services to prospective byers

* (efine ++ (arketin), An organi%ational fnction and set of processes for creating. commnicating and

delivering vale to cstomers while managing cstomer relationships in ways that benefit the company and its

stakeholders0

E*&han)e Pr#&ess! Activity in which two or more parties give something of vale to each other to satisfy

perceived needs 123ample+ e3changing money for tangible goods like video games and clothes4

!! %#ur Eras in (arketin) Hist#r + %i) 1.1, !!

Pr#-u&ti#n Era 5 A good prodct will sell itself; nothing bt prodction is re6ired

1Before 789:s4 5 (ominated bsiness philosophy for decades

Sales Era 5 )reative advertising/selling will overcome consmers resistance and persade them to

by

1Before 78ind a need in the market and fill it

1?ince 789:s4 5 2mergence of the Marketing concept; shift from a sellers market to a byers market

Relati#nshi" Era5 @ong-term relationships with cstomers and other partners lead to sccess

1?ince 788:s4 5 (evelopment of long-term relationships with sppliers. employees. etc; for mtal benefit

* , ?tronger byers market - need for nsumer #rientati#n+ emphasi%es first determining

nmet consmer needs and then designing a way to satisfy them

(arketin) (#"ia! Managements failre to recogni%e the scope of its bsiness

More byers than

goods and

services; few

companies

More goods and

services than people

willing to by them;

many companies


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!! N#nTra-iti#nal (arketin) + Ta/le 1.0 , !!

PersonMarketing (esigned to draw attention and preference of target market toward a personPlaceMarketing (esigned to attract visitors to particlar area; improve pblic image of city/nation

CauseMarketing 'dentification of a social isse. case or idea; Mothers against (rnk (rivingEventMarketing Marketing of sporting. cltral and charitable activities to target markets

OrganizationMarketing

Marketing of mtal-benefit. government. and non-profit orgs; Red )ross

?hift from transaction-based marketing to relationship marketing+

- Li$etime alueof cstomer+ revenes and benefits that cstomer brings

to org over avg lifetime. mins investment made to attract/keep cstomer

- (evelop repeat. loyal cst - increases lifetime vale - sorce of B%% marketing

- @oyalty @adder + +Cew )st 55 Reglar Byer 55 @oyal ?pporter 55 Advocate ,

!! 2 Uni3ersal (arketin) %un&ti#ns + %i) 1.0 , !!

7 4uin)! 2nsring availability of prodct to meet cstomer needs9 Sellin)! Dsing advertising. personal selling and sales promotion to match prodcts to cstomer needs

E Trans"#rtin)! Moving prodcts from prodction location to convenient prchasing locations

F St#rin)! Warehosing prodcts ntil needed for sale


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CHAPTER 7

* (efine ++ Plannin), Process of anticipating ftre events/conditions and determining the best way to

achieve goals0

- (arket Plannin)!implementing planning activities devoted to achieving marketing obJectives

- 23ample+ (eveloping long-term links with cstomers and sppliers for mtal benefit 1relationship

marketing4

Strate)i& Plannin) 8l#n)term -ire&ti#n9! determining organi%ations primary obJectives and adopting actions

that will achieve these obJs

Ta&ti&al Plannin) 8sh#rtterm -ire&ti#n9! planning that gides implementation of actions in the strategic plan

!! Ste"s in (arketin) Plannin) Pr#&ess !!

CORPORATE LEVEL BUSINESS UNIT LEVEL

(efine firms

(issi#n

(eterminefirms

O/:e&ti3es

Assess

resorces/2vala

te environmental

risks/opport

>ormlate

strategy

1Strate)i&

Plannin)4

'mplement strategy

throgh plans

1Ta&ti&al6O"erati#

nal Plannin)4

Monitor/Adapt

strategies when

needed 1based

on >eedback4

+ !! T##ls an- Te&hni;ues !! ,

P#rter


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CHAPTER 0

En3ir#nmental (ana)ement!Attaining firm obJectives by predicting/inflencing the competitive. political.

economic. technological and social environments

En3ir#nmental S&annin)!Process of collecting information abot e3ternal marketing environment to identify

potential trends; vital component of environmental management

C#m"etiti3e En3ir#nment!'nteractive process that occrs in the marketplace among marketers of directly

competitive prodcts. sbstitte prodcts. and marketers competing for consmers prchasing power

T"es #$ C#m"etiti#n!

- (irect+ Among very similar prodcts

- 'ndirect+ Among prodcts that can be sbstitted for each other

- Prchasing Power + among firms that compete for consmers prchasing power

De3el#"in) m"etiti3e Strate)!

- Sh#ul-we compete&

o (epends on firms obJectives. resorces and e3pected profit potential

- 'f so.'hat markets shold we compete in&

o Re6ires marketers to recogni%e firms limited resorces. and allocating them to areas of

greatest opp

- H#'shold we compete&

o Re6ires marketers to make marketing mi3 decisions 1F Ps4 that give firm competitive

advantage

Time/ase- C#m"etiti#n!?trategy of developing and distribting goods/services more 6ickly than

competitors

!! P#liti&alle)al En3ir#nment++

)omponent of marketing environment consisting of laws that re6ire firms to operate nder fair. competitive

conditions and to protect consmer rights

- )onsists of many >ederal @egislations 123+ )ompetition Act. )opyright Act. $a%ardos Prodcts Act.

etc4

C#m"etiti#n A&t!Most comprehensive legislation in )anada. designed to help both consmers and

bsinesses by promoting a healthy competitive environment

- )overs marketing practices sch as Price >i3ing. Misleading Advertising. #ied ?elling. Refsal to deal.

etc

!! S#&ial&ultural En3ir#nment !!

)omponent of marketing environment consisting of the relationship between the marketer and society and its

cltre

- #o remain competitive. marketers mst consider societys demographic shifts and changing vales

- Affects consmers reactions to diff prodcts and marketing practices

C#nsumerism!?ocial force within environment designed to aid and to protect the consmer by e3erting legal.

moral. and economic pressres on bsiness and govt


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C#nsumer Ri)hts!

- #he right to &h##se $reel. *from a range of goods/services,

- #he right to /e in$#rme-. *enogh prodct information to make edcated bying decisions,

- #he right to /e hear-. *e3press isses/opinions to sellers. assistance grops. cstomer service,

- #he right to /e sa$e. *assrance that goods/services prchased can be sed safely,

!! Ethi&al Issues in (arketin) !!

Pr#-u&tProdct 6ality/safety/warranties

>air packaging/labeling

Polltion

Pla&ement(mping

(ealer Rights

Predatory )ompetition

Pr#m#ti#n

>alse/(eceptive Advertising

Promotional Allowances

Bribery

Pri&in)

Price >i3ing/(iscrimination

(eceptive Pricing

Price 'ncreases

(arketin) Ethi&s!Marketers standards of condct and moral vales

!! S#&ial Res"#nsi/ilit in (arketin) !!Marketing philosophies. policies. procedres. and actions that aim at enhancing societys welfare

Philanthr#"i&.Be a good corporate citi%en

Ethi&al.(o what is right/fair

Le)al.Kbey the law

En#mi&.Be profitable


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CHAPTER =

C#nsumer 4eha3i#ur!Mental and physical activities that occr dring selection/prchase of a prodct

- 'ncldes both individal cstomers who by goods/services. and companies who prchase bsiness

prodcts

- 'nflenced by interactions of+

o interpersonal inflences L cltre. friends. relatives

o personal factors L attitdes. learning. perception

!! C#nsumer De&isi#n Pr#&ess !!

- E3#ke- Set!Cmber of alternatives that consmer actally considers when making a prchase

decision

- E3aluati3e Criteria!>eatres that consmer considers when choosing among alternatives

- C#)niti3e Diss#nan&e!'mbalance between beliefs and attitdes that occrs after an action/decision is

taken. sch as a prchase 123+ After bying car. consmer e3periences dissonance becase another

alternative1s4 has featres that the chosen model does not provide4

!! Inter"ers#nal Determinants #$ C#nsumer 4eha3i#ur !!

- Cultural In$luen&es! ales. beliefs. preferences. and tastes handed down throgh generations in a

society

- S#&ial In$luen&es!Corms that are deemed appropriate in social grop; ?tats of individal in grop;

Role and e3pectations of individal in the grop

o Re$eren&e Gr#u"s!People/instittions to whom a person looks for gidance in their own

vales. behavior and decisions

o O"ini#n Lea-ers!#rendsetters who prchase new prodcts before others in a grop and then

inflence others in their prchases

- %amil In$luen&es!Perhaps the most important determinant of consmer behavior; norms. vales

and roles in a family inflence prchasing decisions

!! Pers#nal Determinants #$ C#nsumer 4eha3i#ur !!

- Nee-!'mbalance between a consmers actal and desired states

T"es 8in #r-er #$ (asl#'


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- Sel$C#n&e"t The#r!A persons mltifaceted pictre of himself/herself 123+ )onsmer seeing himself

as msclar. will likely by tight-fitting shirts4

CHAPTER ?

4usinesst#4usiness 84749 (arketin)! Krgani%ational sales/prchases of goods " services to spport

prodction of other prodcts. for daily company operations. or for resale

!! C#m"#nents #$ 4usiness (arket !!

- C#mmer&ial (arket!'ndividals and firms that ac6ire prodcts to spport prodctions of other

goods/services. directly or indirectly

- Tra-e In-ustries!Retailers or wholesalers that prchase prodcts for resale to others; known as

resellers. marketing intermediaries

!! Se)mentin) Cust#mers #$ 474 (arkets !!

- Cust#mer/ase- Se)mentati#n!(ividing B9B market into homogeneos grops based on byers

prodct specifications

- En-use A""li&ati#n Se)mentati#n!?egmenting B9B market based on how indstrial prchasers willse prodct

- Pur&hase Cate)#ries Se)mentati#n!(ividing B9B market based on the stage of relationship

between bsiness and cstomer

!! Chara&teristi&s #$ a 474 (arket !!

- !eographic market concentration

- ?i%es and nmbers of byers

- Prchase decision procedres

- Byer-seller relationships

Gl#/al S#ur&in)! Prchasing goods and services from sppliers worldwide

!! 4usiness (arket Deman- !!

- Deri3e- Deman-!(emand for resorce that reslts from demand for goods/services that are prodced

with that resorce

- #latile Deman-!(emand that creates instability in market; even small shifts greatly affect the

bsiness

- @#int Deman-!(emand for a prodct that depends on the demand for another prodct sed in

combination with it

- Inelasti& Deman-!(emand that. throghot an indstry. will not change significantly de to price

change

- In3ent#r A-:ustments!)hanges in inventory and policies that can affect bsiness demand 123+

?dden increase in demand for bsiness when inventory has been set low will case its spplier to be

bombarded with orders4

O$$sh#rin)!Movement of high-wage Jobs from )anada to lower-cost overseas locations

Nearsh#rin)!Moving Jobs to vendors in contries close to the bsinesss home contry

Outs#ur&in)!Dsing otside vendors to prodce goods and services formerly prodce in-hose


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Analsis T##ls (to improve buyers purcase !ecisions"!

- alue Analsis!?ystematic stdy of components of a prchase to determine whether to delete item or

replace it with a more cost-effective sbstitte

- en-#r Analsis! Assessment of spplier performance in areas sch as price. back orders. delivery

time. and attention to special re6ests

4uin) Centre!Participants in an organi%ational bying decision


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CHAPTER

123clded for editing prposes L will be pblished in ftre editions4


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CHAPTER B

(arket Resear&h!Process of collecting and sing information for marketing decision-making

!! The (arket Resear&h Pr#&ess !!

7 (efine problem

9 )ondct e3ploratory research

E >ormlate a hypothesis

F )reate research design


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CHAPTER 2

(arket!!rop of people with sfficient prchasing power. athority. and willingness to by

T"es #$ (arkets!

- C#nsumer "r#-u&ts!Prodcts boght by ltimate consmers for personal se

- 4usiness "r#-u&ts!!oods/services boght for se in prodction of other goods/services. directly or

indirectly

(arket Se)mentati#n!(ivision of total market into smaller. relatively homogeneos grops

- Attempts to isolate the traits that distingish certain grop of consmers from overall market

!! Criteria $#r E$$e&ti3e Se)mentati#n !!

- ?egment mst present measrable prchasing power and si%e

- Marketers mst find a way to promote effectively and to serve market segment

- Marketers mst identify segments that are sfficiently large to give them good profit potential

- >irm mst aim for segments that match its marketing capabilities

!! Di$$erent Se)mentati#n A""r#a&hes !!

- Ge#)ra"hi& Se)mentati#n!(ivision of an overall market into grops based on their locations

- Dem#)ra"hi& Se)mentati#n!(ivision of market into grops based on variables sch as gender. age.

income. occpation. edcation. hosehold si%e. etc 1also called &$ocioeconomic $egmentation'4

- Ps&h#)ra"hi& Se)mentati#n!(ivision of market into grops that have similar psychological

characteristics. vales and lifestyles 1'nflences. family. motives. perceptions. Job. cltre. social

stats/activities. etc4

- Pr#-u&tRelate- Se)mentati#n!(ivision of overall market into grops based on their relationships to

the prodct;can take different approaches+

o Based on benefits that people seek when they by the prodct

o Based on sage fre6ency for the prodct

o Based on consmers brand loyalty toward the prodct


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CHAPTER

Transa&ti#n/ase- (arketin)!Byer and seller e3changes with limited commnication and little/no ongoing

relationship between parties

Relati#nshi"(arketin)!(evelopment and maintenance of long-term. cost-effective relationships with

individal cstomers. sppliers. employees. and other partners for mtal benefit

Internal (arketin)!Marketing that addresses internal cstomers L employees/departments within

organi%ation whose sccess depends on the work of other employees/departments

- 23ample+ ?alesperson sells a prodct; individal who boght the prodct is the e3ternal cstomer. and

the person processing an order for a new piece of the prodct is the internal cstomer

Elements #$ relati#nshi" marketin)!

- !ather information abot cstomers

- Analy%e data collected and se it to cstomi%e marketing mi3 to target individal cstomers

- Monitor interactions with cstomers and assess levels of satisfaction

- Dse knowledge of cstomers " their preferences to orient every part of organi%ation towards bilding

strong bonds with cstomers 1sing Cu$tomer Reation$hi( Management )CRM*?oftware4

!! 4uerSeller Relati#nshi" (arketin) Le3els !!

- Le3el 1!>ocs on Price

- Le3el 7!?ocial 'nteractions 123+ commnication. cstomer service. owner of store chatting with

cstomers4

- Le3el 0!'nterdependent Partnership 1member programs with disconts for cstomers4

!! (easurin)6Enhan&in) Cust#mer Satis$a&ti#n !!

- Dnderstand cstomer needs.

- Kbtain cstomer feedback.

- Measre and 2nsre satisfaction on an ongoing basis

!! 4uil-in) 4uerSeller Relati#nshi"s !!

- )onsmers form contining relationships becase of their desire to redce choices

- Retaining cstomers is far more profitable than losing them or finding new ones

- Bchance of selling again to same cstomer

- 7=chance of winning back e3-cstomer

- ?7chance only. of converting prospect to new cstomer

- %re;uen& (arketin)!>re6ent byer marketing programs that reward cstomers with cash. rebates.merchandise. or other premims

- A$$init (arketin)!Marketing effort that promotes/re6ests involvement by individals who share

common interests/activities 123+ Affinity credit cards with logo of organi%ation/prodct of interest to the

ser4

- Data/ase (arketin)!Dse of software to analy%e marketing information. to identify and target specific

grops of potential cstomers


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CHAPTER 1

>hat is "r#-u&t

Pr#-u&t! Bndle of physical. service. and symbolic attribtes designed to satisfy a cstomers wants and

needs

Ser3i&e! 'ntangible task that satisfies the needs of consmer and bsiness sers

G##-! #angible prodcts that cstomer can see. hear. smell. taste. or toch

Classi$in) )##-s an- ser3i&es $#r nsumer an- /usiness markets

C#n3enien&e "r#-u&t! 'mplse items sch as maga%ines. disposable camera. ?nack foods

Sh#""in) "r#-u&ts! $omogeneos prodct sch as airplane flights

S"e&ialit "r#-u&ts! Dni6e characteristics that case byers to pri%e those particlar brands

Uns#u)ht "r#-u&ts! Marketed to consmers who may not yet recogni%e any need for them

C#nsumer $a&t#r )onvenience prodct ?hopping prodct ?pecialty prodcts

Planning time

involved in prchase

ery little )onsiderable 23tensive

Prchase fre6ency >re6ent @ess fre6ent 'nfre6ent

'mportance of

convenient location

)ritical 'mportant Dnimportant

)omparison of price

and 6ality

ery little )onsiderable ery little

(arketin) (i*

%a&t#rs

Price @ow Relative high $igh

'mportance of sellers

image

Dnimportant ery important 'mportant

(istribtion channel @ong Relative short ery short

Cmber of sales

otlets

Many >ew ery few

Promotion Advertising and

promotion by

prodcer

Personal selling and

advertising by both

prodcer and retailer

Personal selling and

advertising by both

prodcer and retailer

Fualit as a "r#-u&t strate)

T#tal ;ualit mana)ement! )ontinos effort to improve prodcts and work processes with the goal of

achieving cstomer satisfaction and world Lclass performance4en&hmarkin)! ?et performance standards

Ser3i&e ;ualit is -etermine- / ? 3aria/les

7 #angibles

9 Reliability

E Responsiveness

F Assrance


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De3el#"ment #$ a "r#-u&t

Pr#-u&t line! ?eries of related prodcts offered by one company

Desire t# )r#'!)ompany limits its growth when it concentrates on single prodct. so the company show have

motive to come ot with different line of prodcts

Pr#-u&t mi*

Pr#-u&t mi*!'s the assortment of prodct lines and individals prodct offerings that the company sellsPr#-u&t mi* len)th! #he length of a prodct mi3 refers to the nmber of different prodct a firm sells

Pr#-u&t De"th+ ariations in each prodct that a firm markets in its mi3

Line e*tensi#n! introdction of a new prodct that is closely related to other prodcts in the firms e3isting line

Pr#-u&t li$e &&le

Pr#-u&t li$e &&le! Progression of a prodct throgh introdction. growth. matrity. and decline stage

Intr#-u&t#r sta)e! the beginning stage of the prodct life cycle. a firm works to stimlate demand for the new

market entry

Gr#'th sta)e! ?ales volme rapidly increases when new cstomers make initial prchases and early byers

reprchase the prodct(aturit sta)e! ?ales of a prodct category contine to grow and reaches its ma3imm potential

De&line! 'nnovations or shift in consmer preferences bring abot an obsolete decline in indstry sales


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CHAPTER 11

(ana)in) /ran-s $#r m"etiti3e a-3anta)e

4ran-! Came. term. sign. symbol design. or some combination that identifies the prodcts of one firm while

differentiating them from the competitions

4ran- re)niti#n! )onsmer awareness and identification of a brand

4ran- "re$eren&e! )onsmer reliance on previos e3periences with a prodct to choose that prodct again

4ran- insisten&e! )onsmer refsal of alternatives and e3tensive search for desired merchandise

T"es #$ /ran-

Generi& "r#-u&ts! Prodcts characteri%ed by plain labels. no advertising. and the absence of brand names

(anu$a&turer


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4ran- e*tensi#n! ?trategy of attaching a poplar brand name to a new prodct in an nrelated category

4ran- li&ensin)! Where growing nmber of firms have athori%ed other companies to se their brand names

Pr#-u&t -e3el#"ment strate)

Pr#-u&t -e3el#"ment

(arket "enetrati#n strate)! seeks to increase sales of e3isting prodcts in e3isting markets

Pr#-u&t "#siti#nin)! refers to consmers perception of a prodcts attribtes. se. 6ality. andadvantages and disadvantages relative to competing brands

(arket -e3el#"ment strate)!)oncentrates in finding new markets for e3isting prodct

Pr#-u&t -e3el#"ment!Refers to the introdction of new prodcts into identifiable or established

markets

Pr#-u&t -i3ersi$i&ati#n strate)!>ocses on developing entirely new prodcts for new markets

C#nsumer a-#"ti#n "r#&ess

A-#"ti#n "r#&ess! ?tages those consmers go throgh in learning abot a new prodct. trying it. and

deciding whether to prchase it again

Sta)es in a-#"ti#n "r#&ess

7 A'areness!'ndividals first learn of the new prodct. bt they lack fll information abot it

9 Interest! Potential byers begin to seek information abot it

E E3aluati#n!#hey consider the likely benefits of the prodct

C#nsumer inn#3at#rs! People who prchase new prodcts almost as soon as the prodcts reach the market

Di$$usi#n "r#&ess! Process by which new goods/services are accepted in the marketplace

Ne' "r#-u&t -e3el#"ment "r#&ess

7 'dea !enerating

9 ?creening

E Bsiness Analysis

F (evelopment


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H#ri5#ntal n$li&t! $ori%ontal conflict sometimes reslts from disagreements among channel members at the

same level

erti&al n$li&t! ertical relationships may reslt in fre6ent severe conflict

Gre )##-s! !oods prodced for sale in one market and then diverted to another market

erti&al market sstem8(S9! Planned channel system designed to improve distribtion efficiency and cost

effectiveness by integrating varios fnctions throghot the distribtion chain

- C#r"#rate marketin) sstem! M? that achieve channels coordination when a dominant channel

member e3ercises its power

- C#ntra&tual marketin) sstem! M? that coordinates channel activities throgh formal agreement

among participants

Phsi&al -istri/uti#n+

7 )stomer service+ What level of cstomer service the distribtion activities shold spport9 #ransportation+ $ow the firm shold ship its prodcts

E 'nventory control+ $ow mch inventory the firm shold maintain at each level

F Protective packaging and material handling+ $ow the firm can package and efficiently handle goods in

the factory. warehose. and transport terminals


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CHAPTER 10

Retailin)! Activitiesinvolved in selling merchandise to ltimate consmers

>heel #$ retailin)! $ypothesis that each new type of retailer gains a competitive foothold by offering lower

prices than crrent otlets charge; the reslt of redcing or eliminating services

7 Cew form of retail otlet appears with low level of service. low profit margins. low prices to consmer

9 Kvertime level of service increases. profit margin increases and prices to consmer increases

E More time level if service contines to increase. profit margin contine to increase and prices to

consmer contine to increase

Retail Strate)

Tar)et market! Retail starts to define its strategy by selecting a target market to certain demographics

(er&han-isin) strate)! A retailers merchandising strategy gides decisions regarding the items it will offer

Cate)#r mana)ement! )ategory managers oversees an entire prodct line for both vendors and

retailers and is responsible for the profitability of the prodct grop

St#&k kee"in) Units 8SU9!Kffering within a prodct line sch as a specific si%e of li6id detergent

Cust#merser3i&e strate)! ?ome stores bild their retailing strategy arond heightened cstomer services

for shopper for e3ample gift wrapping. alternation etc

Pri&in) strate)! Prices reflect a retailers marketing obJectives and policies

(arku"! Amont that a retailer adds to the cost of a prodct to determine its selling price

(ark-#'n!Amont by which a retailer redces the original selling price of a prodct

L#&ati#n6-istri/uti#n strate)! Retail e3perts often cite location as a potential determining factor in the

sccess or failre of a retail bsiness

Planne- sh#""in) &entre! !rop of retail stores planned. coordinated. and marketed as a nit

Pr#m#ti#nal strate)! #o establish store image the entice more shoppers. retailer se a variety of

promotional techni6es sch as locations. merchandise selection. hors of operation etc

St#re atm#s"here! While store location. merchandise selection. cstomer service. pricing. and promotional

activities all contribte to stores consmer awareness

T"es #$ retailers!

%#rm #$ #'nershi"! )orporate chain independent retailer

Sh#""in) e$$#rt e*"en-e- / &ust#mers!)onvenience retailers. shopping stores. and speciality

otlet

Ser3i&e "r#3i-e- $#r &ust#mers!?elf-self service. self-selection. limited-service

Pr#-u&t line!?pecialty retailer. limited-line retailer. general merchandise retailer

L#&ati#n #$ retail transa&ti#n!Retail stores. non store and internet retailing


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>h#lesalin) interme-iaries

>h#lesaler! )hannel intermediary that takes title to goods it handles and then distribtes these goods to

retailers. other distribtors. or B9B cstomers

>h#lesalin) interme-iaries! )omprehensive term that describes wholesalers as well as agents and brokers

T"es #$ 'h#lesalin) interme-iaries!

Dire&t marketin)! (irect commnications. other than personal sales contacts. other than personal sales

contacts. between byer and seller. designed to generate sales. information re6ests or store or website visits

Wholesaling intermediaries

Merchandise

Kwned

'ndependent

wholesaling

intermediaries

Retail owned

)ooperatives

and bying

Merchandise

wholesaler

1take title4

Agent and

brokers 1do

not take title4

>ll fnction @imited

fnction

Broker selling

agents

)ommission

Merchants

Action hose


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CHAPTER 1=

Inte)rate- marketin) mmuni&ati#n! )oordination of all promotional activities to prodce a nified

cstomer-focsed promotional message

Pr#m#ti#n! )ommnications link between byers and sellers >nction of informing. persading. and

inflencing a consmers prchase decision

(arketin) mmuni&ati#n!Messages that deal with byer-seller relationships

C#mmuni&ati#n "r#&ess!

AIDA n&e"t! ?teps throgh which an individal reaches a prchase decision+ attention. interest. desire and

action

7 't gains the receivers attention

9 't achieves nderstanding by both receiver and sender

E 't stimlates the receivers needs and sggests an appropriate method of satisfying them

O/:e&ti3es #$ "r#m#ti#n

7 Provide information to consmers and others

9 'ncrease demand

E (ifferentiate a prodct

F Accentate a prodcts vale


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Pullin) an- "ushin) "r#m#ti#nal strate)

Pullin) strate)! Promotional effort by the seller to stimlate final-ser demand. which then e3erts pressre

on distribtion channel

Pushin) strate)! Promotional effort by the seller directed to members of the marketing channel rather than

final sers


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CHAPTER 1?

A-3ertisin)! Paid. non-personal commnication throgh varios media abot a bsiness firm. not-for-profit

organi%ation. prodct. or idea by a sponsor identified in a message that is intended to inform or persade

members of a particlar adience

T"es #$ a-3ertisin)!

Pr#-u&t a-3ertisin)! Co personal selling of a particlar good or service

Instituti#nal a-3ertisin)! Promotion of a concept. idea. philosophy. or goodwill of an indstry.

company organi%ation. person geographic location. or government policy

O/:e&ti3es #$ a-3ertisin)!

In$#rmati3e a-3ertisin)! Promotion that seeks to develop initial demand for a good. service.

organi%ation. person. place. idea. or case

Persuasi3e a-3ertisin)!Promotion that attempts to increase demand for an e3isting good. service.organi%ation. person. place. idea. or case

Remin-er a-3ertisin)!Advertising that reinforces previos promotional activity by keeping the name

of a good. service. organi%ation. person. place. idea. or case before the pblic

A-3ertisin) strate)

C#m"arati3e a-3ertisin)! Advertising strategy that emphasi%es messages with direct or indirect promotional

comparisons between competing brands

Cele/rit testim#nial! A poplar techni6e for increasing advertising readership in a clttered promotional

environment and improving overall effectiveness of a marketing message involves the se of celebrity

spokesmanC##"erati3e a-3ertisin)! ?trategy in which retailer shares advertising cost with a manfactrer or wholesaler

Intera&ti3e a-3ertisin)! 'nvolves two-way promotional messages transmitted throgh commnication

channels that indce message recipients to participate actively in the promotional effort

Creatin) an a-3ertisement

A-3ertisin) &am"ai)n! ?eries of different bt related ads that se a single them and appears in different

media within a specified time period

Elements #$ a-3ertisin) "lannin) "r#&ess

7 Resear&h in"uts! )onsmer research. prodct research. market analysis9 Strate)i& -e&isi#ns!?etting obJectives. identifying and selecting target market. selecting message and

media strategy

E Ta&ti&al e*e&uti#n!2stablish advertising bdget. establish controls. write and prodce ads and

commercials

F (easurin) a-3ertisin) e$$e&ti3eness!Dse post test to determine the effectiveness of advertising


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4anners!Advertisement on a web page that link to an advertisers site. are the most common type of

advertising on the web

A-3ertisin) #r)ani5ati#n

A-3ertisin) a)en&! >irm whose marketing specialists assist advertisers in planning and preparing

advertisement

Pu/li& relati#n

Pu/li&it! Con-personal stimlation of demand for a good. service. place or organi%ation by npaid placement

of significant news regarding the prodct in a print or broadcast medim

Cr#ss "r#m#ti#n! Promotional techni6e in which marketing partners share the cost of a promotional

campaign that meets their mtal needs

(easurin) "r#m#ti#nal e$$e&ti3eness

(e-ia resear&h! assesses how well a particlar medim delivers the advertisers message. where and when

to place the advertisement. and the si%e of the adience(essa)e resear&h! tests consmer reactions to an advertisements creative message


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CHAPTER 1

Pers#nal sellin)! 'nterpersonal inflence process involving a sellers promotional presentation condcted on a

person-to-person basis with the byer

>ocs on cstomers need and problems. and offer soltions

(evelop knowledge abot the indstry in general as well as their own firms goods and services

!o to the e3tra mile #his means making an e3tra effort to flfill cstomers needObeyond their

e3pectation

%#ur sales &hannels

O3er the unter sellin)! Personal selling condcted in retail and some wholesale locations in which

cstomers come on the sellers place of bsiness sch as retail

%iel- sellin)! ?ales presentation made at prospective cstomers locations on a face to face basis

Telemarketin)! Promotional presentation involving the se of the telephone on an otbond basis by

salespeople or on an inbond basis by cstomers who initiate calls to obtain information and place ordersInsi-e sellin)! ?elling by phone. mail. and electronic commerce

Tren- in "ers#nal sellin)

Relati#nshi" sellin)! Reglar contacts between sales representatives and cstomers over an e3tended

period to establish a sstained sellerObyer relationship

C#nsultati3e sellin)! Meeting cstomer needs by listening to cstomers. nderstanding their problem. paying

attention to details. and following throgh after the sale

Team sellin)! ?elling sitation in which several sales associates or other members of the organi%ation are

recrited to assist the lead sales representative in reaching all those who inflence the prchase decision

Sales tasks

Or-er "r#&essi#n! ?elling. mostly at the wholesale and retail level that involve

7 'dentify cstomer needs

9 Point ot need to the cstomer

E )omplete the order

Creati3e sellin)! Personal selling that involves sitations in which a considerable degree of analytical decision

making on the byers part reslts in the need for skilfl proposals of soltions for the cstomers needs

(issi#nar sellin)! 'ndirect type of selling in which speciali%ed salespeople promote the firms goodwill

among indirect cstomers. often by assisting cstomers in prodct se

The sales "r#&ess

7 Prospecting and 6alifying L determine is the prospect a potential cstomer

9 Approach L Who am ' approaching and what are their Jobs within the company&

E PresentationOconvey yor message to the potential cstomer

F (emonstrationOopportnity to demonstrate the prodct

ollow-pOkeep toch with the cstomers


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C#m"ensati#n

C#mmissi#n! 's a payment tied directly to the sales or profits that a salesperson achieve

Salar!'s a fi3ed payment made periodically to an employee

Sales ;u#ta!?pecified sales or profit targets that the firm e3pects salespeople to achieve

Sales "r#m#ti#n!Sales "r#m#ti#n! Marketing activities other than personal selling. advertising. and pblicity to enhance

consmer prchasing and dealer effectiveness

C#u"#n! Kffer disconts on the prchase price of goods and services

Re$un-s #r re/ates! Kffer cash back to consmers who send in proof of prchasing one or more prodcts

!ives more control to the manfactrer

Sam"lin)!Refers to the free distribtion of a prodct in an attempt to obtain ftre sales

4#nus "a&k! ?pecially packaged item that gives the prchaser a larger 6antity at the reglar price

Premium! 'tems given free or at redced cost with prchases of other prodct

C#ntest! Re6ire entrants to complete a task sch as solving a p%%le or answering 6estions in trivia 6i%.

and they may also re6ire proof of prchasesS'ee"stakes! )hoose winners by chance. so no prodct prchase is necessary

S"e&ialit a-3ertisin)! ?ales promotion techni6e that places the advertisers name address. and advertising

message on sefl articles that are then distribted to target consmers

Tra-e #riente- "r#m#ti#n

Tra-e "r#m#ti#n! ?ales promotion that appeals to marketing intermediaries rather than to consmers

P#int#$"ur&hase 8POP9 a-3ertisin)! (isplay or other promotion located near the site of the actal bying

decision


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CHAPTER 1B

Pri&e! 23change vale of a good or service

C#m"etiti#n a&t! the most comprehensive legislation in )anada. designed to help both consmers and

bsinesses by promoting a healthy competitive environment

Pri&e -is&riminati#n! Kccrs when some cstomers pay more than others for the same prodct. dates back

to the very beginning of trade and commerce

Pri&e $i*in)! >orm of collsion in which sellers get together to collde to set prices higher than they wold

otherwise be in a free market

4i- ri))in)! Kccrs when sellers get together to collde to set prices with respect to one or more re6ests for

competitive proposals

Pre-at#r "ri&in)! Kccr when companies set process below their cost for a sfficiently long period of time to

discorage or eliminate competition and then raise their prices or otherwise interfere with competition

%alse #r mislea-in) "ri&e re"resentati#ns! Kne form of misleading advertisement

Profit Q Revene L 23penses

Revene Q Price Santity sold

Pr#$it ma*imi5ati#n! Point at which the additional revene gained by increasing the price of a prodct e6als

the increase in total cost

Tar)et return #/:e&ti3es! ?hort-rn or long-rn pricing obJectives of achieving a specified retrn on either

sales or investment

Resear&h im"a&t #$ (arket Strate)ies!Research that discovered a strong positive relationship between a

firms market share and prodct 6ality and its retrn on investment

alue "ri&in)! Pricing strategy emphasi%ing benefits derived from a prodct in comparison to the price and

6ality levels of competing offerings

(eth#-s #$ -eterminin) "ri&es!

Cust#mar "r#&ess! #raditional prices that cstomers e3pect to pay for certain goods and services

aria/le sts! )hanges with the level of prodction sch as raw materials and labor cost

%i*e- sts! Remain stable at any prodction level within a certain range

The n&e"t #$ elasti&it in "ri&in) strate)

Elasti&it! Measre of responsiveness of prchasers and sppliers to a change in price

4reak e3en analsis! Pricing techni6e sed to determine the nmber of prodcts that mst be sold at a

specified price to generate enogh revene to cover total cost4reake3en "#int in unit T#tal $i*e- st6"er unit ntri/uti#n t# $i*e- st

4reake3en "#int in -#llars T#tal $i*e- st6 1 3aria/le st "er unit "ri&e


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Tar)et return!Althogh breakeven analysis indicates the sales level at which the firm will incr neither profits

nor losses. most firms managers inclde a targeted profit in their analysis

4reake3en "#int 'ith -#llar tar)et return 8T#tal $i*e- st J Pr#$it #/:e&ti3e96"erunit ntri/uti#n

(#-i$ie- /reake3en analsis! Pricing techni6e sed to evalate consmer demand by comparing the

nmber of prodcts that mst be sold at a variety of prices to cover total cost with estimates of e3pected sales

at the varios price

Yiel- mana)ement! Pricing strategy that allows marketers to vary prices based on sch factors as demand.

even thogh the cost of providing those goods or services remains the same


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CHAPTER 12

Skimmin) "ri&in) strate)! Pricing strategy involving the se of an initial high price relative to competitive

offerings Price is dropped in incremental steps as spply begins to e3ceed demand. or when competition

catches p

Penetrati#n "ri&in) strate)! Pricing strategy involving the se of a relatively low entry price compared with

competitive offerings. based on the theory that this initial low price will help secre market acceptance

E3er-a l#' "ri&in) strate)! A strategy devoted to continos low prices as opposed to relying on short-

term. price-ctting tactics sch as cents-off copon. rebate and special sales

C#m"etiti3e "ri&in) strate)! Pricing strategy designed to de-emphasi%e price as a competitive variable by

pricing a good or service at the general level of comparable offerings

Pri&e ;u#tati#n

List "ri&es! #he normal rate 6oted to potential byer

(arket "ri&e! #he amont that a consmer pay. this may or may not e6al the list price

All#'an&e! ?pecified dedction from list price. inclding a trade-in or promotional allowance

%O4 "lant! Price 6otation that does not inclde shipping charge

%O4 #ri)inK $rei)ht all#'e-! Price 6otation system that allows the byer to dedct shipping e3penses from

the cost of prchases

Uni$#rme--eli3ere- "ri&e! Pricing system for handling transportation costs nder which all byers are

6oted the same price. inclding transportation e3penses sometimes known as postage-stmp pricing

#ne "ri&in)! Pricing strategy for handling transportation costs nder which the market is divided into

geographic regions and a different price is set in each region

Pri&in) "#li&ies

Pri&in) "#li&ies! gideline that reflects marketing obJectives and inflences specific pricing decisions

Ps&h#l#)i&al "ri&in)! Pricing policy based on the belief that certain prices or price ranges make a good or

service more appealing than others to byers

Pri&e $le*i/ilit! #he decision of whether to set one price that applies to every byer or to permit variable

prices for different cstomers

Pr#-u&t line "ri&in)! 's the practice of setting a limited nmber of prices for a selection of merchandise

Pr#m#ti#nal "ri&in)! Pricing policy in which a lower than normal price is sed as a temporary ingredients in a

firms marketing strategy

L#ss lea-er! Prodct offered to consmers at less than cost to attract them to stores in the hope that they will

by other merchandise at reglar prices

C#m"etiti3e /i--in)! Many government and organi%ational procrement department determine the lowestprices available for items that meet specification throgh this method

The trans$er "ri&in) -ilemma

Trans$er "ri&e! #he price for moving goods between profit centres. which are any part of the organi%ation to

which revene and controllable costs can be assigned

Canni/ali5ati#n! @oss of sales of an e3isting prodct de to competition from a new prodct in the same line

4un-le "ri&e! Kffering two or more complementary prodcts and selling them for a single price


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Marketing - Reference Handbook

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