MARKETING 2.

INFORMATION SEARCH
a. INTERNAL
LESSON 3: MARKETING RESEARCH b. EXTERNAL
3. ALTERNATIVE EVALUATION
MARKETING RESEARCH – collects full information about a. OBJECTIVE
consumers; finds out the needs and expectations of consumers; produces b. SUBJECTIVE
goods accdg. to the needs; collects full info. about the competitors 4. PURCHASE DECISION
- Function that links the consumer, customer and public 5. POST-PURCHASE BEHAVIOUR
to the marketer; helps the company and decision makers
BUSINESS MARKET –organizations that buy goods for use in the
LESSON 4: CONSUMER AND BUSINESS ANALYSIS production of other products and services
INTERMEDIARIES – companies that sell both to consumers and
CONSUMER BEHAVIOUR – study of how people make decisions other businesses through channels
on what they buy, want, etc. SERVICE MARKET – offers services
PSCYHOLOGICAL FACTORS – perception of a need/situation; INDUSTRIAL BUSINESSES – sell materials or components to other
person’s ability to understand info. and attitude businesses to manufacture their own products
PERSONAL FACTORS – char. that are specific to a person and may INSTITUTIONAL MARKETS – school, hospital, nursing homes
not relate to other people prisons and provide care
SOCIAL FACTORS – person’s family, social interaction, work or GOVERNMENT MARKET – organizations and people in the
school communities, or any group of people government units

CONSUMER MARKET – buyers who purchased goods for

consumption rather than resale TYPES OF PURCHASE DECISIONS
CHARACTERISTICS: 1. STRAIGHT REBUY – routine ordering
1. DEMOGRAPHIC – gender, age, ethnic background 2. MODIFIED REBUY – products are previously considered and
2. PSYCHOGRAPHIC – interests, activities, opinions now under a reevaluation process
3. BEHAVIOURAL – product usage rates, brand loyalty, user 3. NEW TASK PRUCHASE – purchase that buyer has never or
status rarely made before
4. GEOGRAPHIC – market size, region, density and climate
LESSON 5: MARKETING SEGMENTATION,
CONSUMER PURCHASE DECISION PROCESS TARGETING AND POSITIONING
1. PROBLEM RECOGNITION MARKET – individuals with ability and willingness to purchase
a. INTERNAL STIMULI – need felt by individual MARKET SEGMENT – subdivision or part of the of the overall with
b. CLASSIFICATION OF NEEDS – functional, social and specific characteristics
need for change MARKET SEGMENTATION – grouping of customers into segments
c. MASLOW’S HIERARCHY OF NEEDS that have common need
CRITERIA FOR SEGMENTATION (SMADA)
1. Substantiality
2. Measurability
3. Accessibility
4. Differentiable
5. Actionable
TYPES OF SEGMENTATION
1. DEMOGRAPHIC – gender, age, ethnic background
2. PSYCHOGRAPHIC – personality characteristics, motives,
lifestyles
3. BEHAVIOURAL – knowledge, attitudes uses and responses to
a product
4. GEOGRAPHIC – market size, region, density and climate
MARKET TARGETING – breaking a market into segments and then
concentrating on one or few key segments
1. UNDIFFERENTIATED – assumes all members in the market
have similar needs
2. CONCENTRATED – focuses on single market segments
3. MULTISEGMENT – uses two or more marketing mix to target
two/more market segments
4. CUSTOMIZED – tailoring a particular product to the needs of
customers
MARKET POSITIONING – developing a product and brand image
in the mind of consumers
PERCEPTUAL MAPPING – attempting to determine how different
brands are perceived by consumers
1. ATTRIBUTES – highlight a product feature
2. PRICE AND QUALITY – stress high price = indication of
quality
3. USE OR APPLICATION – stress unique uses
4. PRODUCT USER – personality or type of user
5. PRODUCT CLASS –particular category of products
6. COMPETITOR – explicit/implicit frame of reference of one or
more competitors
7. EMOTION – how the product makes customer feels
POSITIONING STATEMENT – brief description of the target market
with the convincing pictures of how the company wants the market to
perceive the brand
SEGMENTING BUSINESS MARKET
1. GEOGRAPHICAL LOCATION – place where the company
is
2. COMPANY SIZE – whether it is small, medium or large,
depending on number of employees, volume of production and
capitalization
3. USAGE RATE – based on consumption of the product
4. END-USER APPLICATION – products used in the formation
of another product without undergoing any further processing
5. TYPE OF BUYING SITUATION – can be segments on the
basis of buying situation as in straight re-buy, modified and new
task purchase
CHAPTER 4: DEVELOPONG THE MARKETING MIX
LESSON 1: PRODUCT
PRODUCT – form of good, service or idea, may be tangible and
intangible and can be offered to a market that can satisfy a want or need
in exchange of money or something of a value
COMPONENTS OF A PRODUCT:
1. CORE PRODUCT – end benefit for the buyer
2. FORMAL PRODUCT – actual physical or perceived
characteristics including the level of quality, etc.
3. AUGMENTED PRODUCT – support items that complete the
total product offering such as after-sales service, warranty, etc.

CONSUMER PRODUCTS – wide array of manufactured goals
purchased for personal, family or household purposes
INDUSTRIAL PRODUCTS – goods sold to other businesses and used
to produce other goods
CATEGORIES OF CONSUMER PRODUCTS:
1. CONVENIENCE PRODUCT – consumed on routine with
little thought and purchased frequently
2. SHOPPING PRODUCT – consumes products on the less
frequent schedule compared to convenience product
3. SPECIALTY PRODUCT – carry a high price tag relative
4. UNSOUGHT PRODUCT – purchased are unplanned by the
consumer but take place as a result of marketer’s decision
CATEGORIES OF INDUSTRIAL PRODUCTS
1. RAW MATERIALS – obtained through mining, harvesting,
fishing and other trades
2. PROCESSED MATERIALS – created through processing of
basic raw materials
3. EQUIPMENT – used to help with production or operation
activities
4. BASIC COMPONENTS – used within more advanced
components
5. ADVANCED COMPONENTS – apply the basic components
to produce products that offers important function required
6. PRODUCT COMPONENTS – used in the assembly of a final
product; can stand alone
7. MRO PRODUCTS – used to assist with the operation of the
organization but not directly used in producing goods and
services
FEATURES OF SERVICE
1. INTANGIBLE – not physical objects and exist in connection
with other things
2. HETEROGENEOUS – multifaceted different experience from
a single type of service
3. INSEPARABLE – inextricably linked with customers
4. PERISHABLE
PRODUCT LIFE CYCLE
1. INTRODUCTION STAGE – launching the product in the
market
2. GROWTH STAGE – strong growth in sales and profits
3. MATURITY STAGE – product is established and the
manufacturer’s aim is to keep the market share that they built
4. DECLINE STAGE – market of product will start to get smaller
STRATEGIES IN EXTENDING THE LIFE OF A PRODUCT
1. Re-packaging
2. Discounting
3. Re-branding
4. Expanding abroad
THE PRODUCT MIX – product assortment; total number of product
lines that a company offers
PRODUCT LINE – products grouped together based on similar
characteristics
PRODUCT MIX DECISION – decision about adding a new or getting
rid of any existing product from the prod. mix, adding a new product
line, etc.
PRODUCT STRATEGY – roadmap of a product; outlines the end-to-
end vision of the product and what it will become
1. PRODUCT POSITIONING – placing a brand in that market
where it will have an approving acceptance compared to
competing brands
2. PRODUCT ELIMINATION – cuts in the company’s product
portfolio by pruning the number of products within a line
 3. PRODUCT REPOSITIONING – reviewing the current 1. SKIMMING – marketer sets relatively high price for a
position of the product product at first, then lowers price over time
4. NEW PRODUCT – new in the business or market, product 2. PENETRATION – setting low initial entry price often
modification, imitation or innovation lower than the market price to attract new customers
5. PRODUCT OVERLAP – strategy in competing against one’s 3. PRESTIGE – sets prices of luxury products to the
brand through introduction of products, use of private labels, etc. expectations of a niche class o customers that associate high
6. DIVERSIFICATION – developing unfamiliar products prices with superior quality
through concentric, horizontal and conglomerate diversification 4. PRICE-LINING – products in a specific group are set
7. PRODUCT SCOPE – taking into account the overall mission at different price points
of the business unit 5. ODD-EVEN – psychological pricing where price is set
8. VALUE MARKETING – delivering on promises made for the based on customer’s perception of a difference in the cost of a
products and services whole number value and slightly below this whole number
9. PRODUCT DESIGN – standardization of a product 6. TARGET – identifying the price at which a product will
be competitive in the marketplace
LESSON 2: PRICING 7. BUNDLE – sell the package for a lower price than they
would charge if the customer bought all of them separately
PRICE – amount of money charged for a product; key element relating 8. YIELD MANAGEMENT – understanding,
to total revenue and profit of the organization anticipating and influencing consumer behavior to maximize
yield/profits
PRICE DETERMINATION
A. INTERNAL FACTORS B. COST – ORIENTED APPROACHES
1. MARKETING STRATEGY – depends on overall 1. COST PLUS PRICING – adding a percentage to cost in
marketing for the product/service order to fix the price
2. OBJECTIVES – pricing plays an essential function in 2. BREAK – EVEN PRICING – sales revenue is equal to the
helping to achieve company’s at many levels cost of goods sold
3. MARKETING MIX – price choices must be harmonized 3. EXPERIENCE CURVE PRICING – more producers do
with product design, distribution and promotion something, the easier and better they do it
4. OTHER ORGANIZATIONAL CONSIDERATIONS
B. EXTERNAL FACTORS C. PROFIT – ORIENTED APPROACHES
1. NATURE OF THE MARKET 1. TARGET PROFIT – seller sets prices with the purpose to
2. DEMAND make a certain amount of money
3. ECONOMY 2. TARGET RETURN ON SALES
4. OTHER ENVIRONMENTAL FACTORS 3. TARGET RETURN ON INVESTMENT

GENERAL PRICING APPROACHES D. COMPETITION – ORIENTED APPROACHES

A. DEMAND – ORIENTED APPROACHES
 1. CUSTOMARY – some products tradition, a standardized 1. PRINT – printed on paper
channel of distribution or other competitive factors dictate 2. GUERILLA – unconventional, encourages customer to
2. ABOVE, AT OR BELOW – subjective feel for the participate/interact with the piece
competitor’s price/market price 3. BROADCAST – mass-market form of communication; tv and
3. LOSS LEADER – sells a product below its customary price radio
to attract attention to it 4. PUBLIC SERVICE – to enlighten and educate instead of to sell
a product
LESSON 3: DISTRIBUTION 5. OUTDOOR- gets to the consumers when they are outside of
home
DISTRIBUTION CHANNELS – physical access points where the 6. PRODUCT PLACEMENT – promotion within the context of
product is provided to customer and methods of transporting/storing a show or movie
goods before making them available 7. CP AND MOBILE – uses portable electronic devices
8. ONLINE – via internet
PRODUCER – provider of g/s
CUSTOMER – buyer of g/s SALES PROMOTION – persuading a possible customer to purchase
WHOLESALER – offer to customer products in bulk the product
PERSONAL SELLING – salesperson uses skills and techniques for
FUNCTION OF THE DISTRIBUTION CHANNEL building personal relationships with another party
- Information provider PUBLIC RELATION – on-going activities to ensure the over-all
- Price stability company has a strong public image
- Promotion DIRECT MARKETING – business address customers through a
- Financing multitude of channels including mail, e-mail, etc.
- Title
- Help in Production function
- Matching demand and supply
- Pricing
- Standardizing transactions
- Matching buyers and sellers

LESSON 4: PROMOTION

PROMOTION – entire set of activities that communicate the product

to users

ADVERTISING – bringing a product to the attention of potential and

current customers