Chapter 6

Business marketing
o Basically marketing of goods and services to
Other businesses
Governments
Non for profit organizations
o For use in the creation of goods and services that they can
produce and market to others
o Ex.

Michael scott from the office markets ink and printer

paper to a print shop so that they can make posters
for their customers
A canvas company selling canvas to an online print
shop for production

Organizational buyers
o Basically businesses who buy goods and services for own
use or resale
o manufacturars, wholesalers, retailers, and government
agencies
Who buy goods and services for their own use or
resale

North American Industry Classification system (NAICS)

o Basically provides common industry definitions so that can
measure economic activity
For US, Canada, Mexico

Derived demand
o Demand for industrial products is driven by demand for
consumer products

Organizational buying criteria

o Attributes of a suppliers products or services
o And capabilities of supplier itself

Supplier Development
o Effort by organizational buyers to build relationships in
order to shape supplierss

 Products
Services
Capabilities
o For the purpose of fitting a buyers needs and those of its
customers

Reciprocity
o Two organizations agree to purchase each others products
and services

Supply Partnership
o Basically supplier and buyer form relationship to lower cost
and increase value of products and services delivered to
ultimate consumer
o Relationship between buyer and supplier
o Both adopt mutually beneficial
Objectives
Polocies
Procedures

Buying center
o Group of people in organization who participate in a buying
process process
o Share common goals, risks, knowledge relevant to decision

Organizational buying behavior

o Decision making process that organizations uses to
Establish need for products and services
And identify and evaluate among alternative brands
and suppliers
Make buy decision
o Evaluation of whether to purchase components for a
product or make them in house

Value analysis
o Analyzing a products
Design
Quality
Performance
o In order to reduce purchasing cost

Bidders list
o List of firms believed to be qualified to supply a given item

E marketplace (B2B, E hubs)

o Online trading communities
o Bring buyer and supplier organizations together
Traditional auction
o Seller puts item for sale
o Buyers bid in competition with eachother

Reverse auction
o Buyer communicates a need for product or service
o Suppliers bid in competition with eachother

Chapter 7

Countertrade( bartering goods or services)

o exchanging goods or services which are paid for, in whole
or part, with other goods or services, rather than with
money

GDP
o Monetary value of all goods and services produced in a
country during one year
o Primary indicator to health of countrys economy

Balance of trade
o Difference between monetary value of nations exports and
imports
o Export vs import value
o A country has a trade deficit if it imports more than it
exports; the opposite scenario is a trade surplus.

Economic Espionage act (1996)

o Makes theft of trade secrets by foreign entities federal
crime in united states
o Economic espionage
outright theft of invaluable proprietary information in
a number of areas including technology, finance and

government policy

Protectionism
o Shielding a countrys
o Shield through use of quotas or tariffs
o Reasons
Protect local businesses
Protect local jobs

Tariffs
o Government taxes on imports

Quota
o restriction placed on the amount of a product allowed
to enter or leave a country

World Trade Organization

o Institution that governs trade and disputes between
countries

Global competition
o Exists when firms originate, produce and market products
and services world wide

Strategic alliances
o Agreements among two or more firms to cooperate for
purpose of achieving common goals

Multidomestic marketing strategy

o Multinational firms that have a vast array of product
variations, brand names, and advertising programs

Global marketing strategy

o Transnational firms employ practice of
standardizing marketing activities When cultural
similarities
Adapting them when cultures differ

Global Brand

Brand that is marketed with same name and centrally

coordinated marketing programs in multiple countries

Cross cultural analysis

o Study differences and similarities among consumers in
different nations

Values
o A societies personally or socially preferable modes of
conduct or states of existen

Customs
o The norm or expected way people do things in a specific
country
Foreign corrupt practices act ( 1977)
o Crime for US corporations to bribe officials of foreign
government to retain business

Semiotics
o Study of symbols and their meaning for people

Back translation
o Translated word or phrase is retranslated into original
language by different interpreter to catch errors

Consumer ethnocentrism
o Belief that immoral to purchase foreign made products

Bottom of the pyramid

o Largest but poorest socio-economic group in world

Microfinance
o Small collateral free loans to those cant get capital

Currency exchange rate

o Price of one countrys currency expressed in terms of
anothers

Exporting
o Global market entry strategy which company produces
goods in one country sells them in another

Joint venture

o Foreign company and local firm invest together to create a

local business in order to share ownership, control, and
profits of new company
Direct investment
o Domestic firm investing in and owning foreign subsidiary or
division
Dumping
o Firm sells a product in foreign country below its domestic
price or its actual cost
Gray market (parallel importing)
o products sold through unauthorized channels of
distribution

chapter 8

marketing research
o process defining marketing problem and opportunity
o then collecting and analyzing information
o recommending actions
measures of success
o criteria or standards used in evaluating proposed solutions
to the problem
constraints
o in a decision, the restrictions placed on potential solutions
to a problem

Data
o Facts figures related to a problem

Secondary data
o Data recorded before project at hand

Primary data
o Data newly collected for project
Observational data
o Facts and figures obtained by watching mechanically or in
person how people behave
Questionare data
o Data obtained by asking people about there
Attitudes

Awareness
Intentions
Behavior
Information technology
o Operating computer networks that can store and process
data
Data mining
o Extraction of hidden predictive information from large
databases
o to find statistical links between consumer
purchasing patterns and marketing actions
sales forecast
o Total sales of product that firm expects to sell
During a specific time period
Under specific environmental conditions
And own marketing efforts

Chapter 9

Market segmentation
o Involves aggregating prospective buyers into groups that
Have common needs
Will respond similarly to a marketing action
Market segments
o Relatively homogenous groups of prospective buyers

Product differentiation
o Marketing mix strategy
o Using different marketing mix activities help
consumers perceive the product as being different
and better than competing products

Market product grid

o Relate market segments of potential buyers to
products offered or potential marketing actions

Usage rate (frequency marketing)

o Quantity consumed or patronage ( store visits) during a
period

80/20 rule
o 80% of firms sales are obtained from 20 percent of
customers
product positioning
o what a consumer thinks of a product compared to
the competitions products
o place an offering occupies in consumers mind
on important attributes relative to competitive
products

Product repositioning
o Changing consumers thoughts about a product compared
to competition

Perceptual map
o Graphing in two dimensions
Location of products or brands in consumers mind VS
competing products or brands
Enables managers to see consumers perception

Chapter 10

Product
o Good, service, or idea that satisifies consumers needs
o Either tangible or intangible
Services
o Intangible activities or benefits that satisfy consumers
needs
Consumer products (end user products)
o Products purchased by the end user (ultimate consumer)
Business products (B2B products, Industrial products)
o Products organizations buy that assist in providing other
products for resale
o Ex. Web designer buys computer and digital printer to
provide products to customers
o Ex. Shirt company buys the shirts and prints logos on them
for resale

Convenience products
o Frequently purchased
o Minimum effort
o Ex. Printer paper
Shopping products
o Compared between several alternitives
o Criteria price, quality, style
Specialty product
o Special effort is made to search out and buy
o Ex. Cattle prod
Unsought products
o Doesnt know about
o Knows about but doesnt want initially
Product item
o Specific product has unique brand, size, price
Product line
o Group of products or services closely related
Reasons related
Satisfy class of needs
Used together
Sold same customer group
Distributed same outlets
Fall within given price range
Product mix
o All product lines offered by organization
Protocol
o Established before product development begins
Identifies
Well defined target market
Specific needs, wants, preferences of

New
o
o
o

customers
What product will be and do to satisfy

consumers
product process
Seven stages
Identify business opportunities
Convert opportunities to salable products or services

New product process

1. New product strategy development

a. Defines role of new product in terms of firms overall

objective
2. Idea generation
a. Develops pool of concepts for canidates for new products
3. Screening and evaluation
a. Internally and externally evaluates new product
ideas
b. Eliminate ideas
4. Business analysis
a. Specify features of product
b. Specify marketing strategy needed to bring to market and
make financial projects
5. Development
a. turns idea on paper into prototype
6. Market Testing
a. Exposes actual products to prospective consumers
b. Do in limited area under realistic conditions to see if will
buy
7. Commercialization
a. Launch new product in full scale product and sales