directed study 2 marketing

Chapter 1 Questions:

1. List your activities for the first two hours after you woke up this morning. Briefly

indicate how marketing affected your activities.

This morning after I woke up I drove to Chick-fil-A to eat breakfast. When I left I

drove to Baptist Hospital in Montgomery for “Baby Boot Camp” to learn about newborn

babies. Marketing basically deals with the company doing whatever it takes to satisfy the

customer. Chick-fil-A is one of the best quick service restaurants in America and their

customer service is what makes me want to eat there. Because my wife is 38 weeks

pregnant, it was important to her to learn the process of having the baby and postpartum

information.

2. If a producer creates a really revolutionary new product and consumers can learn

about it and purchase it at a website, is any additional marketing effort really

necessary? Explain your thinking.

I think it all depends on if it is a product that people need. If it is a product that

people need, it would sell itself and no additional marketing would be necessary. If not,

and the only way to find out about the new product is a website, then that producer would

have to market the website so people could find out about it.

3. Distinguish between the micro and macro views of marketing. Then explain how

they are interrelated, if they are.

From the macro-marketing viewpoint, all of the marketing functions must be

performed by someone – an individual producer or consumer, an intermediary, a

marketing collaborator, or, in some cases, even a nation’s government. However, from a

micro viewpoint, not every firm must perform all the functions. Rather, responsibility for

performing the marketing functions can be shifted and shared in a variety of ways.

Further, not all goods and services require all the functions at every level of their

production. Regardless of who performs the marketing functions, in general they must be

performed effectively and efficiently or the performance of the whole macro-marketing

system will suffer.

6. Define the functions of marketing in your own words. Using an example, explain

how they can be shifted and shared.

The buying function means looking for and evaluating goods and services. The

selling function involves promoting the product. The transporting function means those

goods are moved from one place to another. The storing function means holding the

goods until the customer needs them. Standardizing and grading involves sorting

products according to size and quality. The financing function provides all the money that

goes into all these functions. Risk taking involves bearing the uncertainties that are a part

of the marketing process. Pure services, like a plane ride, do not need storing. However,

storing is required in the production of the plane and while the plane is not in service.

14. Distinguish between production orientation and marketing orientation, illustrating

with local examples.

Production orientation is making whatever products are easy to produce and then

trying to sell them. They don’t look at the needs of society. A marketing orientation

means trying to carry out the marketing concept. Instead of just trying to get a customer

to buy whatever the firm produces, a marketing-oriented firm tries to offer customers

what they need. You think about a product being sold on the television. The producer

only has that one product as oppose to stores like Target and Wal-Mart that sell a number

of products.


2. Distinguish clearly between mass marketing and target marketing. Use an example.

Target marketing is when a marketing mix is tailored to fit some specific target

customers. Mass marketing vaguely aims at everyone with the same marketing mix. Mass

marketing assumes that everyone is the same and that everyone is a potential customer.

Target marketing is the “rifle approach” while mass marketing is the “shotgun approach”.

The marketing strategy of Herbal Essences hair care products aims at a specific group of

target customers: young ladies in their late teens and early 20’s.

5. Explain, in your own words, what each of the four P’s involves.

The product is the good or service for the target’s needs. It is the features, the

benefits, and the quality level of that good or service. Place deals with reaching the

target. It is concerned with all the decisions involved in getting the “right” product to the

target market’s place. Promotion is telling and selling the customer. It’s concerned with

telling the target market or others in the channel of distribution about the “right” product.

If the customers won’t accept the price, all of the planning effort is wasted.

12. Research has shown that only about three out of every four customers are, on

average, satisfied by a firm’s marketing programs. Give an example of a purchase

you made where you were not satisfied and what the firm could have changed to

satisfy you. If customer satisfaction is so important to firms, why don’t they score

better in this area?

I bought an Otterbox “commuter series” phone case for my iPhone and when I put

it on my phone it did not fit it right. The same case that my brother had for his phone fit

his perfectly and we have the exact same phone. One thing that the firm could have done

was consistently make the product. If it fit my brother’s phone perfect, it should have fit

mine.

I think one reason why firms don’t score better in customer satisfaction is because

they aren’t primarily concerned with the satisfaction of customers. If they can get 75

people to love the product then they don’t have to worry about the other 25 who were not

satisfied.

13. Distinguish between an attractive opportunity and a breakthrough opportunity.

Give an example.

Attractive opportunities are those that the firm has some chance of doing

something about – given its resources and objectives. Breakthrough opportunities are

those that help innovators develop hard-to-copy marketing strategies that will be very

profitable for a long time. Breakthrough opportunities make your strategies best. They

make your product stand out by themselves and make it hard for competitors to copy

them. An example of a breakthrough opportunity would be the idea of the Swiffer

Sweeper. The innovators understood that people had to deal with two products instead of

one and the Swiffer solved that problem.

17. Explain why a firm may want to pursue a market penetration opportunity before

pursuing one involving product development or diversification.

Market penetration means trying to increase sales of a firm’s present products in its

present markets – probably through a more aggressive marketing mix. I think one reason

why they would pursue this opportunity before the others is because market penetration

deals with trying to strengthen relationships with customers to increase rate of use or

repeat purchases. I believe that a good relationship with your customers is so important

when marketing a product.


1. Do you think it makes sense for a firm to base its mission statement on the type of

product it produces? For example, would it be good for a division that produces

electric motors to have as its mission: “We want to make the best (from our

customers’ point of view) electric motors available anywhere in the world”?

A good mission statement should focus on a few key goals rather than embracing

everything. I don’t think it’s a bad idea base the mission statement on the product.

However, you could take it a step further and add a relationship building element in that

mission statement. When you do that you are showing that you care for the customer and

not just the product.

2. Explain how a firm’s objectives may affect its search for opportunities.

Particular marketing objectives should be set within the framework of larger

company objectives. Firms need a hierarchy of objectives – moving from company

objectives to marketing department objectives. For each marketing strategy, firms also

need objectives for each of the four P’s – as well as more detailed objectives.

4. Explain how a firm’s resources may limit its search for opportunities. Cite a specific

example for a specific resource.

Some opportunities require large amounts of capital just to get started. Money

may be required for R&D, production facilities, marketing research, or advertising before

a firm makes its first sale. So the lack of financial strength is often a barrier into an

attractive market. Smaller firms can be at a great cost disadvantage if they try to win

business from larger competitors. On the other hand, new – or smaller – firms sometimes

have the advantage of flexibility.

5. In your own words, explain how a marketing manager might use a competitor

analysis to avoid situations that involve head-on competition.

Avoiding pure competition is sensible and certainly fits with the emphasis on

finding a competitive advantage. As a marketing manager, you can’t just adopt the same

“good” marketing strategy being used by other firms. One of the best ways for a

marketing manager to avoid head-on competition is to find new or better ways to satisfy

customers’ needs and provide value.

Using the competitor analysis, you want to identify and compare the strengths and

weaknesses of your current target market and marketing mix with what competitors are

currently doing or are likely to do in response to your strategy. You also want to identify

your potential competitors. Identifying competitors helps marketing managers understand

the different ways customers are meeting needs and sometimes points to new

opportunities.

6. The owner of a small hardware store - the only one in a medium-size town in the

mountains - has just learned that a large home improvement chain plans to open a

new store nearby. How difficult will it be for the owner to plan for this new

competitive threat? Explain your answer.

I’m not sure how easy or hard it would be, but whenever possible, marketing

managers should seek to develop a sustainable competitive advantage, a marketing mix

that some customers see as better than competitors and cannot be easily copied. An

example of this would be Coca-Cola. They use their brand name to keep customers. The

owner of the hardware store should have developed relationships that were going to last

regardless the competition coming into town.


1. Distinguish between a generic market and a product-market. Illustrate your answer.

A generic market is a market with broadly similar needs – and sellers offering

various, often diverse, ways of satisfying those needs. In contrast, a product-market is a

market with very similar needs and sellers offering various close substitute ways of

satisfying those needs. A generic market description looks at markets broadly and from a

customer’s point of view.

2. Explain what market segmentation is.

Market segmentation is a two-step process of (1) naming broad product-markets

and (2) segmenting these broad product-markets in order to select target markets and

develop suitable marketing mixes.

7. Identify the determining dimension or dimensions that explain why you bought the

specific brand you did in your most recent purchase of a (a) soft drink, (b) shampoo,

(c) shirt or blouse, and (d) larger, more expensive item, such as a bicycle, camera, or

boat. Try to express the determining dimension(s) in terms of your own personal

characteristics rather than the product’s characteristics. Estimate what share of the

market would probably be motivated by the same determining dimension(s).

My most recent purchase of a soft drink was a coke. I bought the coke because of

the Coca-Cola name brand, the taste, and the fact that it is the best. I reason why I buy

Garnier Fructis shampoo is mainly because I am a creature of habit. It doesn’t do

anything special to my hair or make me feel good. I have just been using it for forever. I

buy a lot of dri-fit t-shirts because they fit me the best, they feel really good, and I can be

very active in them. Recently I bought a Chicco car seat for my baby. I made this

purchase because I did a lot of research and this brand seemed very reliable, safe, and

long lasting.

I would think that the purchases I made are pretty normal and that there is not a

particular share of the market that would buy the same products. Someone with a dry and

itchy scalp might want to buy Garnier Fructis’ shampoo that is aimed towards that.

Somebody who is very active and wants to feel good while participating in sports may

buy a bunch of dri-fit t-shirts.

1. Explain how positioning analysis can help a marketing manager identify target

market opportunities.

Positioning refers to how customers think about proposed or present brands in a

market. A positioning analysis helps managers understand how customers see their

market. It is the visual aid to understanding a product-market. A positioning analysis

usually focuses on specific product features and brands that are close competitors in the

product-market. It is a product-oriented approach.


2. Explain what is meant by a hierarchy of needs and provide examples of one or more

products that enable you to satisfy each of the four levels of need.

The hierarchy of needs starts at the lowest level which is your physiological

needs. Those are your needs for food, liquid, rest, and sex. The next level is your safety

needs. They are concerned with protection and physical well-being. Examples of those

are exercise, financial security, and medicine. Above those needs are your social needs.

They are concerned with love friendship, status, and esteem. Examples of those are things

that involve your interaction with others. Finally at the top are your personal needs.

Those are concerned with the individual need for satisfaction. An example of this would

be the need for a better world or fun, freedom, and relaxation.

7. Explain psychographics and lifestyle analysis. Explain how they might be useful for

planning marketing strategies to reach college students, as opposed to average

consumers.

Psychographics or lifestyle analysis is the analysis of a person’s day-to-day

pattern of living as expressed in that person’s activities, interests, and opinions. Single

and young people seem to be more willing to try new products and brands. It’s important

to understand what a person is into because then it would be easier to come out with a

product that best fits that person.

8. A supermarket chain is planning to open a number of new stores to appeal to

Hispanics in Southern California. Give some examples that indicate how the four Ps

might be adjusted to appeal to the Hispanic subculture.

For the product, you want something that would appeal to Hispanics and not just

to everybody. Maybe you would offer more types of Hispanic foods. When it comes to

place you want to locate your store near a Hispanic location rather than another area. Not

all Hispanic can speak English so it is very important that when you promote your

product, you want to make sure they can understand what you are saying and that they

can understand what they getting. When finding the right price, you just want to make

sure that the products are affordable.

9. How should social class influences affect the planning of a new restaurant in a large

city? How might the four Ps be adjusted?

You have to understand which social class dominates the area where that

restaurant is going. You need to make sure that the product is something demanded by

that social class and that it is not just another thing. You have to make sure that you have

reasonable prices but at the same time you are giving them a quality product in return.

10. Illustrate how the reference group concept may apply in practice by explaining how

you personally are influenced by some reference group for some product. What are

the implications of such behavior for marketing managers?

A reference group is the people to whom an individual looks when forming

attitudes about a particular topic. Why do people drink so much Gatorade and Powerade?

Because people like Kobe Bryant and Lebron James are telling us that we will be better

athletes if we drink it. We shave with a Gillete Fusion because Tiger Woods shaves with

it too. There will be good and bad implications. While one group might view owning a

fur coat as awesome, a group of animal lovers may see it as murder.

12. Give an example of a recent purchase in which you used extensive problem solving.

What sources of information did you use in making that decision?

Consumers are extensive problem solving when they put much effort into

deciding how to satisfy a need – as is likely for a completely new purchase or to satisfy

an important need. When my wife and I were looking a car seat for a new baby, we

looked at a lot of different car seats to see which one was the best. We wanted to make

sure our son would be safe. We also wanted a car seat that he could be in for while so we

made sure it had good weight capacity. Finally, we wanted it to be inexpensive but not

cheap.


2. Compare and contrast the buying behavior of final consumers and organizational

buyers. In what ways are they most similar and in what ways are they most

different?

Like final consumers, organizations make purchases to satisfy needs.

Organizational buyers buy goods and services that will help them meet the demand for

the goods and services that they in turn supply to their markets. Organizations typically

focus on economic factors when they make purchase decisions and are usually less

emotional in their buying than final consumers.

3. Briefly discuss why a marketing manager should think about who is likely to be

involved in the buying center for a particular purchase. Is the buying center idea

useful in consumer buying? Explain your answer.

I think it is important because the buying center is all the people who participate

in or influence a purchase. Because different people may make up a buying center from

one decision to the next, the salesperson must study each case carefully.

6. Why would an organizational buyer want to get competitive bids? What are some of

the situations when competitive bidding can’t be used?

A competitive bid is the terms of sale offered by the supplier in response to the

purchase specifications posted by a buyer. If different suppliers’ quality, dependability,

and delivery schedules all meet the specs, the buyer will select the low-price bid. A buyer

might just routinely buy from one vendor with whom it already has a good relationship.

8. Discuss the advantages and disadvantages of just-in-time supply relationships from

an organizational buyer’s point of view. Are the advantages and the disadvantages

merely reversed from the seller’s point of view?

Business customers often require operational linkages to reduce total inventory

costs, maintain adequate inventory levels, and keep production lines moving. On the

other hand, keeping too much inventory is expensive. Suppliers can provide just-in-time

delivery – getting product to customers just before they need them. Closer relationships

between buyers and sellers involve operational linkages that lower cost and increase

efficiency.

10. Would a tool manufacturer need a different marketing strategy for a big retail

chain like Home Depot than for a single hardware store run by its owner? Discuss

your answer.

I don’t think they necessarily would. You might think that the Home Depot would

bring in more customers than the single hardware store, but that may not be the case. If

the single hardware store built up good enough relationships with buyers it might get

better business than the Home Depot. However the single hardware store may not need as

big a strategy that the Home Depot would use.


1. Discuss the concept of a marketing information system and why it is important for

marketing managers to be involved in planning the system.

In many companies, marketing managers routinely get help from a marketing

information system, which is an organize way of continually gathering, accessing, and

analyzing information that marketing managers need to make ongoing decisions.

Marketing mangers set the firm’s marketing objectives and know what data they’ve

routinely used in the past. Careful communication and coordination with these experts

will assure that research and a marketing information system are useful in marketing

strategy planning.

8. With so much secondary information now available free or at a low cost over the

Internet, why would a firm ever want to spend the money to do primary research?

In most primary data collection, the researcher tries to learn what the customers

think about some topic or how they behave under some conditions. Qualitative research

seeks in-depth, open ended responses, not yes or no answers. The depth of the qualitative

approach gets at the details – even if the researcher needs a lot of judgment to summarize

it all.

9. If a firm were interested in estimating the distribution of income in the state of

California, how could it proceed? Be specific.

In quantitative research, this step usually involves statistics. Statistical packages –

easy- to-use computer programs that analyze data – have made this step easier. Cross-

tabulation is one of the most frequently used approaches for analyzing and interpreting

marketing research. It shows the relationship of answers to two different questions.

13. Distinguish between qualitative and quantitative approaches to research - and give

some of the key advantages and limitations of each approach.

Qualitative research seeks in-depth, open ended responses, not yes or no answers.

The depth of the qualitative approach gets at the details – even if the researcher needs a

lot of judgment to summarize it all. The real advantage of this approach is depth. I think

one of the disadvantages of this is that you seem to rely on someone’s opinion and not

exactly fact. In quantitative research, this step usually involves statistics. It seeks

structured responses that can be summarized in numbers, like percentages, averages, or

other statistics.

14. Define response rate and discuss why a marketing manager might be concerned

about the response rate achieved in a particular survey. Give an example.

The response rate is the percent of people contacted in a research sample who

complete the questionnaire. A big problem with questionnaires is that many people don’t

complete them. Mail, e-mail, and online surveys are economical if a large number of

people respond. But they may be quite extensive if the response rate is low. Worse, the

results may be misleading if the respondents are not representative.


4. Consumer services tend to be intangible, and goods tend to be tangible. Use an

example to explain how the lack of a physical good in a pure service might affect

efforts to promote the service.

Take a restaurant like a Chick-fil-A for example. They are known for their

excellent customer service and their food. If you take the food out of the picture, the

customer service is still there but there is no reason to come to the restaurant to get that

great service.

8. Suggest an example of a product and a competitive situation where it would not be

profitable for a firm to spend large sums of money to establish a brand.

Soda is a big thing. If I wanted to create a new brand of soda that had the same

flavor of coke, sprite, etc, it probably would be a bad idea because Coca-Cola is already

leading that market. It would not make sense for me to spend a lot of money on a name

brand for this soda because I’m never going to beat Coca-Cola.

10. Explain family brands. Should Best Buy carry its own dealer brands to compete

with some of the popular manufacturer brands it carries? Explain your reasons.

Branders for more than one product use a family brand – the same brand name for

more than one product. Examples of family brands are Keebler snack food products and

Sears Kenmore appliances. A lot of people want the name rather than product itself so it

probably would be a bad idea for Best Buy to carry its own dealer brands.

12. What does the degree of brand familiarity imply about previous and future

promotion efforts? How does the degree of brand familiarity affect the Place and

Price variables?

Brand familiarity means how well customers recognize and accept a company’s

brand name. The degree of brand familiarity affects the planning for the rest of the

marketing mix - especially where the product should be offered and what promotion is

needed. If a restaurant delivers an enjoyable time (good food and service at a reasonable

price), then more customers are likely to develop brand preference.

19. Cite two examples of business products that require a substantial amount of service

in order to be useful.

One example would be air conditioning. In order for you to have air in your house

you have to have someone set up, fix, or repair the unit. Another example would be a car

manufacturer. Without the experts that fix and maintain a car, you would not be able to

drive it.


1. Explain how industry sales and industry profits behave over the product life cycle.

In the market introduction stage, the industry sales are low as a new idea is first

introduced to a market. The customers aren’t exactly looking for the product. In the

market growth stage, industry sales grow fast – but industry profits rise and then start

falling. The innovator begins to make big profits as more and more customers buy.

In the market maturity stage industry sales level off and competition gets tough.

Industry profits go down throughout the maturity stage because promotion costs rise and

some competitors cut prices to attract business. During the sales decline stage, new

products replace the old. Price competition from dying products becomes more vigorous

– but firms with strong brands may make profits until the end because they have

successfully differentiated their products.

5. Discuss the life cycle of a product in terms of its probable impact on a

manufacturer’s marketing mix. Illustrate using personal computers.

Let’s take a company like Dell for example. It puts out a new laptop and nobody

knows about it but it is the next big thing. Everybody begins to like this new laptop and

sales are increasing and profits are going up. Unfortunately these Dell laptops start

getting viruses and they are tearing up easily. Not long after that Apple just launched

their new MacBook that viruses can’t touch and that have long lasting batteries. After all

of this, Dell becomes a mediocre laptop company that some people like and some people

don’t.

6. What characteristics of a new product will help it to move through the early stages

of the product life cycle more quickly? Briefly discuss each characteristic -

illustrating with a product of your choice. Indicate how each characteristic might

be viewed in some other country.

A new product can quicker through the early stages of the life cycle if it can

follow 5 steps:

The first step is idea generation. Take the iPhone for example. People want a

phone where they can talk to people, search the internet, and listen to all their favorite

kinds of music. In the screening stage you come up with all of its strengths and

weaknesses. It is a phone that is made by apple so you don’t have to worry about viruses,

but apple requires you to have an iTunes account.

In the idea evaluation step, you get more reactions from customers about the

phone. Are people going to want to pay the price for this item? The fourth step is the

development stage. This is when a prototype is made and tests are run on the phone to see

what kinks they can work out and what they can make better about the phone. Finally, in

the commercialization stage, they market the product and sell it.

11. If a firm offers one of its brands in a number of different countries, would it make

sense for one brand manager to be in charge, or would each country require its own

brand manager? Explain your thinking.

I think it would be important for all countries to have its own brand manager. The

reason behind this is that it would be hard for one person to know how to market the

same product in different locations. Something marketed in South America might be

marketed another way in China. I’m not saying that one person could not do it, but it

would not be an easy task.


1. Review the Dell case at the beginning of the chapter and then discuss the

competitive advantages that Barnes & Noble would have over a small bookshop.

What advantages does a small bookshop have?

I think Barnes and Noble hit the nail on the head when they decided to put a

coffee shop inside their store. They realized that people enjoyed a cup of coffee while

they read their book. Another advantage that they would have is the size of their store.

They can carry more books and hold more people. They also have a better chance of

bringing in a well-known author for a book signing because of their fame and their name.

I think that one advantage a small bookstore would have over one like Barnes and Noble

would be they have a better chance of have rare books or limited edition versions of a

book. Also people might like the smaller bookstore rather than a big bookstore that they

could get lost in.

6. Insurance agents are intermediaries who help other members of the channel by

providing information and handling the selling function. Does it make sense for an

insurance agent to specialize and work exclusively with one insurance provider?

Why or why not?

I think it makes perfect sense for an insurance agent to exclusively work for one

insurance provider. If you think about it, most insurance providers are competing against

each other. Why would you work for Allstate and then on the side work for one of their

competitors State Farm. I don’t think that a company would want you working for them

and their competitor.

8. Give an example of a producer that uses two or more different channels of

distribution. Briefly discuss what problems this might cause.

When GameStop started selling used video games, game publishers were

concerned the move would steal sales from new games. Not only would revenue from

new games go down, but the game publishers would not earn any revenue on used game

sales.


3. Briefly describe a purchase you made where the customer service level had an effect

on the product you selected or where you purchased it.

Chick-fil-A is a quick service restaurant known for their unbelievable customer

service. There have been many times that I have eaten there and their service has

influenced me to upsize my meal, try a different side item, or get dessert. I think one of

the main reasons they are so persuasive is because their positivity. I have never been to

Chick-fil-A when they are not smiling or greeting you as soon as you walk in. it’s all

about the experience. They want you to have the “first time” experience every time you

eat there and that is what influences people to go back.

10. Explain the total cost approach and why it may cause conflicts in some firms. Give

examples of how conflicts might occur between different departments.

The total cost approach involves evaluating each possible physical distribution

(PD) system and identifying the cost of each alternative. This approach uses the tools of

cost accounting and economics. Costs that otherwise might be ignored – like inventory

carrying costs – are considered. The possible costs of lost sales due to a lower customer

service level may also be considered. One of the reasons this could cause conflicts is that

management is different in firms. One manager may not want to look at alternatives

while the other manager may want to look at all the alternatives.

13. Discuss some of the ways that air transportation can change other aspects of a Place

system.

Place is defined as making goods and services available in the right quantities and

locations, when customers want them. Using planes may reduce the cost of packing,

unpacking, and preparing goods for sale and may help a firm reduce inventory cost by

eliminating outlying warehouses.


4. Discuss a few changes in the market environment that you think help to explain why

telephone, mail-order, and Internet retailing have been growing so rapidly.

I think one change in the environment is that people are becoming lazier. People

don’t want to get off of the couch and go shopping at the store anymore. People are all

about convenience. Whatever is easier is best. The telephone, mail-order, and the internet

are all convenient ways to shop. When using those three ways, you don’t have to worry

about lines and other customers.

6. Apply the wheel of retailing theory to your local community. What changes seem

likely? Will established retailers see the need for change, or will entirely new firms

have to develop?

The wheel of retailing theory says that new types of retailers enter the market as

low-status, low-margin, low-price operators and then, if successful evolve into more

conventional retailers offering more services with higher operating costs and higher

prices. New fast food restaurants will come in with cheaper products to test the market. If

the market is good to them, then they can be successful and begin price increases.

Because people like the products they will continue to buy the restaurant’s foods.

12. How do you think a retailer of Maytag washing machines would react if Maytag set

up a website, sold direct to consumers, and shipped direct from its distribution

center? Explain your thinking.

I don’t think it would be a big deal, but I believe it would be different. You would

have your people who know the Maytag product and like it. This would be good for those

people. But if you are not familiar with Maytag and you do not know the product, you

would have to rely on word rather that getting to see and feel the product itself. So, I

think you would have your folks who don’t mind it and the people who don’t like it. I

believe they would lose some business.

13. What risks do merchant wholesalers assume by taking title to goods? Is the size of

this risk about constant for all merchant wholesalers?

When you take title to a product, you can be setting yourself up in a bad way if

the product fails or is a bad product in general. When customers get a hold of your bad

product your credibility goes down the drain. Customers won’t want your products

regardless of what you sell because the other products could be just as bad. The worst

part of it is that your name is on it.


2. In your own words, discuss the integrated marketing communications concept.

Explain what its emphasis on “consistent” and “complete” messages implies with

respect to promotion blends.

Integrated marketing communications is basically taking your different

promotions methods and putting them together to make the big picture. Not just make the

big picture, but to make it make sense. To get effective coordination, everyone involved

with the promotion effort must clearly understand the plan for the overall marketing

strategy. They all need to understand how each promotion method will contribute to

achieve specific promotion objectives.

3. Relate the three basic promotion objectives to the four jobs (AIDA) of promotion

using a specific example.

Informing consumers means getting their attention and making consumers aware

of the company’s offering. Holding interest gives the communication a chance to build

the consumer’s interest in the product. Persuasion tends to arouse desires and that affects

the evaluation process, perhaps building preference. Reminding people of the product and

obtaining action includes gaining trial, which may lead to a purchase decision.

6. Promotion has been the target of considerable criticism. What specific types of

promotion are probably the object of this criticism? Give a particular example that

illustrates your thinking.

Critics raise concerns about the use of celebrities in advertisements. A person who plays

the role of an honest and trustworthy person on a popular TV series may be a credible

message source in an ad, but is using such a person misleading to consumers? The most

common criticisms of promotion relate to exaggerated claims. If an ad or a sales person

claims that a product is the “best available,” is that just a personal opinion or should

every statement be backed up by proof? Some promotions do misrepresent the benefits of

a product.

13. Explain how opinion leaders affect a firm’s promotion planning.

Early adopters are well respected by their peers and often are opinion leaders.

They tend to be younger, more mobile, and more creative than later adopters. Of all the

groups, this one tends to have the greatest contact with salespeople. They can help the

promotion effort by spreading word-of-mouth information and advice among the other

consumers.


1. What strategy decisions are needed in the personal selling area? Why should the

marketing manager make these strategy decisions?

Your strategy decisions are things like structure, sales technology, selecting and

training, and compensating and motivating. Managers should make these decisions

because structure helps you develop teams. Getting up to date on the latest technology

can help your sales knowledge grow. Selecting and training can take teams that you

create and teach them how to be better salespeople. Finally, compensating and motivating

can help you to get the team to do a better job by offering incentives and things like that.

6. Compare and contrast missionary salespeople and technical specialists.

Missionary salespeople are supporting sales people who work for producers –

calling on intermediaries and their consumers. They try to develop goodwill and

stimulate demand, help intermediaries train their sales people, and often take orders for

delivery by intermediaries. Technical specialists are supporting salespeople who provide

technical assistance to order-oriented salespeople. They are often science or engineering

graduates with the know-how to understand the customer’s applications and explain the

advantages of the company’s product.

10. Explain how a compensation plan could be developed to provide incentives for

experienced salespeople and yet make some provisions for trainees who have not yet

learned the job.

It is as easy as developing contests within a company. You have the contests for

the experienced workers and the contests for the newer workers that are learning. Public

recognition, sales contests, and simple personal recognition for a job well done can be

highly effective in encouraging greater sales effort.


1. Identify the strategy decisions a marketing manager must make in the advertising

area.

A marketing manager has to have specific objectives in advertising. They must

help position the firms brand or marketing mix by informing and persuading target

customers or intermediaries about its benefits. They help obtain desirable outlets and tell

customers where they can buy a product. They can prepare the way for salespeople by

presenting the company’s name and the merits of its products. And they can build more

trusting relationships with customers.

3. List several media that might be effective for reaching consumers in a developing

nation with low per capita income and a high level of illiteracy. Briefly discuss the

limitations and advantages of each medium you suggest.

TV and cable has a wide reach and cable can be selective, but clutter – ads can

compete for attention. Direct mail is highly targeted. It is flexible – messages can be

longer. However, this medium is relatively expensive per contact. The newspaper is good

because it hits a local market. But, there can be poor photo reproduction. The internet is

great because ads can link to more detailed website, but this medium only is good for

computer users.

9. Discuss the use of testimonials in advertising. Which of the four AIDA steps might

testimonials accomplish? Are they suitable for all types of products? If not, for

which types are they most suitable?

Testimonials may persuade a consumer that other people with similar needs like

the product. Testimonials are generally used in the Arousal step of the AIDA. Clorets has

used graphic images in its ads to highlight the effectiveness of its mints.

13. Is it unfair to criticize a competitor’s product in an ad? Explain your thinking.

I don’t think it is unfair, but I do think it is wrong. People should want to buy your

product because they like it, not because you said that the other products are bad because

of this reason and that reason.When you criticize a competitor’s product, it shows what

kind of person you are.

19. Indicate the type of sales promotion that a producer might use in each of the

following situations and briefly explain your reasons:

a. A firm has developed an improved razor blade and obtained distribution,

but customers are not motivated to buy it.

Based on what has been on TV, they could get a popular celebrity to make

commercials using this razor. That’s why I used the Gillette Fusion, Because

Tiger Woods and Roger Federer used it.

b. A competitor is about to do a test market for a new brand and wants to

track sales in test market areas to fine-tune its marketing mix.

You try to find each market to figure out which one your target market will be and

that will bring in the most income.

c. A big grocery chain won’t stock a firm’s new popcorn-based snack product,

because it doesn’t think there will be much consumer demand.

Hopefully the firm will do something different to their promotion to stimulate

change. Maybe lower the price at a competitor store.


1. Identify the strategy decisions a marketing manager must make in the Price area.

Illustrate your answer for a local retailer.

The strategy decisions in the price area need to be profit-oriented, sales-oriented,

and status quo-oriented. Profit-oriented strategies deal with target return which sets a

specific level of profit as an objective. Sales-oriented seeks some level of unit sales,

dollar sales, or share of market – without referring to profit. Finally the status quo-

oriented strategy is the don’t rock-the-boat. The main objective is to stabilize prices, or

meet competition, or even avoid competition.

2. How should the acceptance of a profit-oriented, a sales-oriented, or a status quo-

oriented pricing objective affect the development of a company’s marketing

strategy? Illustrate for each.

Profit-oriented strategies deal with target return which sets a specific level of

profit as an objective. Sales-oriented seeks some level of unit sales, dollar sales, or share

of market – without referring to profit. Finally the status quo-oriented strategy is the

don’t rock-the-boat. The main objective is to stabilize prices, or meet competition, or

even avoid competition.

3. Distinguish between one-price and flexible-price policies. Which is most appropriate

for a hardware store? Why?

One-price policy means offering the same price to all customers who purchase

products under essentially the same conditions and in the same quantities. Flexible-price

policy means offering the same product and quantities to different customers at different

prices. I would think you would use the one-price policy in the hardware store mainly to

maintain goodwill among customers.

14. Cite two examples of continuously selling above the market price. Describe the

situations.

One example would be overpricing gas. If the market price was $3.15, it would be you

consistently selling it for $3.16 or higher.


1. Why do many department stores seek a markup of about 30 percent when some

discount houses operate on a 20 percent markup?

I think some stores do that to make more than a profit. They do this so when they

“discount” the price on a product they aren’t really discounting anything. They are just

being dishonest. But ultimately they want to make a profit.

8. Distinguish between leader pricing and bait pricing. What do they have in common?

How can their use affect a marketing mix?

Leader pricing means setting some very low prices – real bargains – to get

customers into retail stores. Bait pricing is setting some very low prices to attract

customers but trying to sell more expensive models or brands once the customer is in the

store. The main thing that both of these have in common is that there goal is to get

customers into the store by offering low prices. Baiting takes it a step further by trapping

customers into buying other things too.

10. Cite a local example of psychological pricing and evaluate whether it makes sense.

Psychological pricing means setting prices that have special appeal to target

customers. It basically means that the price of something just seems right to a customer

and that lowering the price won’t always increase sales. In fact sometimes increasing that

price can increase sales which doesn’t really make sense.

11. How does a prestige pricing policy fit into a marketing mix? Would exclusive

distribution be necessary?

Prestige pricing is setting a rather high price to suggest higher quality or high

status. Some target customers want the best, so they will buy at a high price. If the price

is cheap, the customer worries about quality of the product and won’t buy. I don’t think

exclusive distribution would be necessary because like it says above, “people want the

best.” This means that even if they can’t afford it, there is still a good chance they will

buy it.


4. Discuss the conflict of interests among production, finance, accounting, and

marketing executives. How does this conflict affect the operation of an individual

firm? The economic system? Why does this conflict exist?

Conflict arises when all these components don’t match up well. You cannot

produce if you do not have any money to invest in the production. This is what can cause

conflict among marketing executives. It effects the operation of an individual firm

because you can’t produce without money. This hurts the economy because when you

don’t have money you don’t have jobs and unemployment is high.

8. Comment on the following statement: “Ultimately, the high cost of marketing is due

only to consumers.”

This is true because when you put money into the economy this means business

firms are investing more. When businesses invest more they spend more money, this

creates more demand. When more demand are created, more jobs are needed. When more

jobs are created, unemployment is low and inflation is high. This means costs go up.

9. Distinguish clearly between a marketing strategy and a marketing plan. If a firm

has a really good strategy, does it need to worry about developing a written plan?

The marketing plan is a written statement of a marketing strategy and the time-

related details for carrying out the strategy. The marketing strategy specifies a target

market and a related marketing mix. I think you can’t carry out the plan without the

strategy. The two go together to carry out the ultimate plan.

directed study 2 marketing

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