EXAM 2 Study Guide

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University of Central Florida **We aren't endorsed by this school
Course
MAR 3203
Subject
Marketing
Date
Apr 24, 2023
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4
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EXAM 2 - - Study Guide - Chapters 6, 7 and 8 MAR 3023 Chapter 6: Consumer Behavior 1. Consumer Decision Process - Know all aspects thoroughly a. Need recognition i. Functional vs Psychological Needs 1. Thirst—Water (Basic, functional); Type of drink (Psychological) 2. Shoes—Protect your feet (Basic, functional); Fashionability (Psychological) b. Search for information i. Internal vs External Search 1. What to eat for lunch (think about what you ate yesterday): Internal a. Internal locus of control: more search activities (personal justification) 2. Buying a car (don't have that much information ask a friend): External a. External locus of control: Fate, external factors (decision is already made) ii. Factors affecting Consumers' Search Process 1. Actual or Perceived Risk (ex: buying a car) a. Performance risk (will it work the way it should) b. Financial risk (will the car break down immediately) c. Social risk (how you might be perceived) d. Physiological risk (recalled car will it be safe) e. Psychological risk (will a nice car get stolen) c. Evaluation of Alternatives i. Universal, Retrieval and Evoked Sets 1. Universe: Every car in the universe—most consumers don't know every product ever made in the universe 2. Retrieval: How many cars a person can name—consumers need to know your existence 3. Evoked: What car is bought—what consumers are willing and able to purchase ii. Ignore the "consumer decision rules" section d. Purchase and consumption i. Conversion rate: Going from purchase intention to purchase behavior/action 1. Reduce real or virtual abandoned carts 2. Merchandise in stock 3. Reduce the actual wait time e. Post purchase i. Customer Satisfaction ii. Post purchase Cognitive Dissonance iii. Customer Loyalty iv. Negative word of Mouth 2. Factors Influencing the Consumer Decision Process a. The Marketing Mix (Product, Price, Place, and Promotion) b. Psychological factors i. Motives—Maslow's Hierarchy of Needs ii. Attitude—Cognitive (Strong belief in a quality product); Affective (Emotional); Behavioral iii. Perception—Selection; Organization; Interpretation iv. Learning and Memory (Learning affects both attitudes and perceptions; Memory involves encoding, storage, and retrieval) v. Lifestyle (Involves decisions in spending time and money) 1. Actual vs. Perceived c. Social Factors i. Family ii. Reference Groups (Family, Friends, Coworkers, Celebrities Provide information and self-image) iii. Culture (Shared meaning, beliefs, morals, values, and customs of a group of people)
d. Situational Factors i. Purchase Situation: Work—Delivering pizza vs. Going to a Career Fair; Buying a gift for a coworker vs. Buying a gift on Mother's Day ii. Sensory Situation: Good sensory Better experience 1. Visual 2. Auditory 3. Olfactory 4. Tactile 5. Taste iii. Temporal State: Time of day, type of person, etc. (Mood swings can alter behavior) 3. Involvement and consumer buying decisions a. High Involvement vs low involvement i. High: Buying cars (Will put in more effort and attention) 1. Greater attention and deeper processing Develop strong attitudes with purchase intentions ii. Low: Buying lunch (Retained purchase, done often) 1. Less attention and peripheral processing Generate weak attitudes and increased use of cues b. Extended vs Limited Problem Solving i. Limited: Impulse Buying; Habitual Decision Making 1. Grocery shopping—most people start to the right Chapter 7: Business-to-Business Marketing 1. The four different types of B2B markets a. Manufactures b. Resellers c. Institutions d. Government 2. The B2B buying Process -Know all aspects thoroughly a. Need Recognition: The buying organization recognizes that it has an unfulfilled need. b. Product Speciation: Develops a list of potential specifications after considering alternative solutions c. RFP Process: Request for Proposals; Organizations invite alternative vendors to bid on supplying their required components (Smaller companies might not be able to attract attention to their requests, so they might turn to a web portal like Yahoo!) d. Proposal analysis, Vendor Negotiation, and Selection: Evaluates proposals narrow down to a few suppliers negotiation more considerations (delivery, payment plans, warranty) e. Order Specification: Firm places the order with its preferred supplier; exact details of the purchase are specified; all terms are detailed including payment f. Vendor Performance Assessment: After receival, over time, more evaluation of the vendor will be done—was the product true to word, customer service, etc. 3. Factors Affecting the Buying Process a. Buying Center Roles: Initiator, Influencer (Influences the purchase); Decider (Department Chair that decides on what the purchase will be); User; Gatekeeper (Controls flow in/out) b. Organizational Culture: Democratic (Majority rules); Consultative (Discussion with final decision); Consensus (Everyone must agree); Autocratic (Only leader makes decision) c. Buying Situation: New buy (Purchasing for the first time, usually quite involved; switching from Dell laptops to iPads); Straight rebuy (Exact same model buy); Modified rebuy (Same item, but more developed)
Chapter 8: Global Marketplace 1. 4 components of Country Market Assessment - Know Thoroughly a. Economic Analysis Using Metrics i. Gross Domestic Product: Everything a country makes in the sales of its product/services; Understated if a country has a larger global reach ii. Gross National Income: GDP + net income from investments abroad iii. Purchasing Power Parity: Big Mac Index exchange rates should adjust to equalize the cost of a basket of goods around the world 1. Market Size and Population Growth Rate: a. Strong demand in BRIC (Brazil, Russia, India, and China) nations b. Distribution of the population within a particular region: rural vs. urban iv. Trade Surplus or Deficit: b. Analyzing Infrastructure and technology i. Transportation: ii. Distribution Channels: iii. Communications: iv. Commerce: c. Analyzing Government Actions i. Tariffs and Quotas 1. Tariffs: Tax on imported goods; artificially raises prices; lowers demand 2. Quotas: Minimum or maximum limit; reduces availability of imported goods a. Both benefit domestically made products because they reduce foreign competition ii. Exchange Controls: 1. Regulations of a country's currency exchange rate: the measure of how much one currency is worth in relation to another 2. In recent years, the value of the US dollar has changed significantly compared with other important world currencies 3. Prices are nearly always lower in the country of origin because there are no customs or import duties to pay, and international transportation expenses are less than domestic goods iii. Trade Agreements: 1. European Union 2. NAFTA: US, Canada, Mexico a. CAFTA: Costa Rica, DR, El Salvador, Guatemala, Honduras, and Nicaragua 3. Mercosur 4. ASEAN (Asian Islands) d. Analyzing Sociocultural Factors i. Visible artifacts ii. Underlying values iii. Geert Hofstede's Cultural Dimensions 1. Power distance: How comfortable a population is in interacting with others a. Guatemala is most high 2. Uncertainty avoidance: How much certainty is needed (US measures medium) 3. Individualism: How individual or collective a culture is (US is high) a. US is most extreme, Canada 4. Masculinity: Driven by aggression and assertion (US is high) 5. Time orientation: Long-term v. short-term history (US is more short-term) 6. Indulgence: If I want it, I'll have it (US is high) 2. Global Entry strategies - know each type, and know what the risk and level of control is for each a. Exporting (Lowest risk and control; Boeing) b. Franchising (Slightly higher control and risk—License another company to do business for them; McDonalds)
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