Essay about Midterm Study Guide

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Marketing Midterm 2011 Review Sheet

• Definition of marketing is the activity of for creating, communicating, delivering, and exchanging offerings that benefit the organization, its stakeholders and society at large; It stresses the importance of delivering genuine benefits in the offering of goods, services, and ideas marketed to customers; The organization doing the marketing, the stakeholders affected (such as customers, suppliers, and shareholders), and society should all benefit; marketing seeks (1) to discover the needs and wants of prospective customers and (2) satisfy them • Exchange is the trade of things of value between buyer and seller so that each is better off after the trade • Four factors are required for marketing to occur are (1) two or more parties (individuals or organizations)with unsatisfied needs, (2) a desire and ability on their part to be satisfied, (3) a way for the parties to communicate, and (4) something to exchange. • Needs versus wants: 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. • Marketing mix are the marketing manager’s controllable factors-product, price, promotion, and place-that can be used to solve a marketing problem. • Relationship marketing is the hallmark of developing and maintaining effective customer service; linking the organization to its individual customers, employees, suppliers, and other partners for their mutual long-term benefits. • Profit is the money left after a business firm’s total expenses are subtracted from its total revenues and is the reward for the risk it undertakes in marketing its offering. • Goal or objectives are statements of an accomplishment of a task to be achieved, often by a specific time; business firms can pursue several different types of goals: profit, sales, market share, quality, customer satisfaction, employee welfare, and/or social responsibility • Market share is the ratio of sales revenue of the firm to the total sales revenue of all firms in the industry, including the firm itself; a firm may choose to maintain or increase its market share, sometimes at the expense of greater profits if industry status or prestige is at stake. • BCG Matrix: The Boston Consulting Group (BCG), a nationally known management consulting firm, uses business portfolio analysis to quantify performance measures and growth targets to analyze its clients’ strategic business units (SBU) as though they were a collection of separate investments. The purpose of the tool is to determine the appeal of each SBU or offering and then determine the amount of cash, if any, each should receive. The BCG analysis can also be applied at the offering, product, or brand level; more than 75% of the largest U.S firms have used this analytical tool; the BCG has given specific names and descriptions to the four resulting quadrants in its growth-share matrix based on the amount of cash they generate for or require from the organization: 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 organizations overhead and to invest in other SBUs; Stars are SBUs with 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; 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; 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