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BBI - Competition and Marketing

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schoolstudycanada's version from 2017-06-25 22:04

Competition

Question Answer
Price fixingcompetitors agree on prices they charge customers to decrease competition; thus causing product prices to be higher
Bid riggingone or more companies agree not to submit a bid to narrow the competition, or competitiors agree who will win a "tendered contact"
Abuse of position- Large company saturates the market with goods priced much lower than those of a small local business.
- This results in the small local companies not being able to compete with lower prices
Exclusive dealings- manufacturers cannot force suppliers to exclusively stock their product
Refusal to deal- manufacturers cannot refuse to provide a product to a store
Merger- occurs when two or more companies join together
- might restrict competition (bank mergers of late 1990's)
Market share- percentage of a total market's sales one company has
- division in a market segment
Market segmenta portion of an overall market share (cars -> suv)
Demographics- study of people in a population. Used to track potential customers.
8 ways to study people- age
- gender
- location
- income
- ethnicity
- education
- culture
- family lifestyle
Brand name- word/group of words that distinguish a one company product from others
Imagethe way a consumer sees the business or thinks about the product that the business offers
- i.e.: reputation
How is image used- brand-id on packages
- websites
- promotional activities
Brand Identificationonce a name, logo and slogan are developed everything associated with the product should carry those brand identifiers
- i.e.: People recognize the company via its Brand identifier
Promotional activities- ads should emphasize product-name and it should be mentioned repeatedly
- e.g. flyers, banners, catalogues
Brand extensionimage created by one product is transferred to another product made by the same company (e.g.: google search engine and google pixel-phone)
Psychographics- Psychological traits of people. Used to track potential customers
- i.e.: study of how people think
3 ways to study psychographics- attitude
- lifestyle
- values
Deephaving few products but in large quantities
Widehaving large variety of products
Value added servicesextra services used to attract and keep customers
Service sector (Service market)Businesses that provide mainly services
Competition benefits- creation of new businesses
- increased productivity
- new and improved goods or services to improve our lives (cancer drugs, GPS)
Direct competition- two or more companies sell similar goods or services
- only minor differences between products (Coke & Pepsi are in SUGARY CARBONATED DRINK market)
Indirect competition- products and services that aren't related directly to each other (subway and pizza nova are in the FOOD INDUSTRY)
Competition among goods- quality
- price
- design
- features
Competition among services- convenience
- quality
- price
- reputation
memorize

Stockmarket

Question Answer
why does the public equate playing the Stockmarket with gambling?investor puts money into something they can't control
against what can you measure the performance of your stock investments?standard and poor's 500 index
Who is Bernie Madoff- Bernie Madoff was an person who invested money
- for 48 years he scammed people by taking their money and giving them back a little percentage
- his clients thought they were stock investing (not knowing which ones)
What is a Ponzi scheme?where an operator pays return to its investors from new capital paid by new investors
memorize

Marketing

Question Answer
4P's 2C's- product
- price
- place
- promotion
- competition
- consumer
4P's - Product- what is being sold (g/s)?
- refers to product features
- product image
4P's - Place- where is the product available
- channel of distribution
4P's - Price- how much will consumers pay
- involves production costs plus profit
Promotion- how are potential customers made aware of g/s (advertising, sales promotions)
Competition- who is the competition
- how are "we" going to compete
Consumerwhat kind of customer will be the target? (using demographic or psychographic research)
MarketingCompany figures out customer needs & wants, then stresses needs and wants of buyer (we offer a wide range of cellular networks that are efficient and inexpensive)
Sellingcompany makes product and stereos in need of seller (we are a phone company)
- i.e.: sell to distributor
Factors that affect the marketing mixgovernment, consumer groups, press coverage, technology, economy
Channels of distributionproducer, intermediaries, retailer, consumer
Specialty channelsVending machines, telemarketers, catalogues, internet, door-to-door
Pricing strategiesskimming, penetration, competitive, loss leader, markup
Pricing Strategy - Skimming- initially company prices it products high to make profits before competition enters market
Penetration- initially company sets lower prices than competition to get marketshare then slowly increases prices (water going under door and freezing, causing it to expand)
Pricing Strategy - Competitive- company sets prices at same level as competition
Loss leader- items priced at less than wholesale price
- used to get consumer in the store
Pricing Strategy - Markup- cost of g/s is multiplied by a certain percentage and that is added to cost price (think of it like taxing their own product)
- i.e.: self-set product tax
Name brand (national)- usually known nationally or internationally
- often more expensive (thought to be better quality)
Private brand (store)- products sold with retailers name on it
- manufactured by other companies (often by the name brand manufacturers)
- often less expensive than name brands
- e.g.: the bay, Canadian tire
No name (generic)- products without a distinctive name
- often produced by name brand manufacturers
- plain packaging
- less expensive
- limited product "flavours"
Push Branding- sells products to retailers not consumers
- idea is that if consumers see a product in a store, they will buy it
- in many cases marketer pays shelf allowance to be allowed to stock where they want
Pull branding- manufacturers try to convince customers they need a product and they should look for it by brand name.
- companies must vigorously advertise, do promotional campaigns directed at consumers
- marketers hope consumers will request their product to be at a retail store near them
Primary researchnew information
Secondary research- collected by someone else for you to use (statscan)
Types of researchconsumer, motivation, product, pricing, advertising, sales
Consumer research- determine how many people buy the product to predict sales potential
Market research- determine who are the potential customers
Motivational researchdetermine why "we buy". emotional or rational motives
Product researchinvolves test marketing
- color, taxation, sound, flavour, size, design
Pricing analysis- production cost
- competition
- profit
- pricing strategy
Advertising/media researchdetermine best advertising media that will reach your target audience
Sales analysisdetermine whether sales are up to expectations
Another name for Packaging"Silent sales person"
Characteristics of good packagingprotect/preserve
convenience<promotion>
Product designForm & Function
Product Life CycleIntro, growth, maturity, decline, decision point
Intro- few customers
- no competitions product is new or unique
- sales are rising slowly
- none to very low profits
- skimming and/or penetration is used
- promotion is aimed at early adopters
Product Life Cycle - Growth- mass market customers
- competition increasing
- sales are rapidly increasing
- profits increasing
- pricing is very competitive
- extensive promotions, attempting to get customer loyalty
Maturity- mass market customers
- very intense competition
- flat, no growth
- large profits
- competitive
Product Life Cycle - Decline- loyal customers
- competition decreasing
- sales decreasing
- cheaper prices
- attempt to stress differences between competitors goods and services
Product Life Cycle - Decision point- loyal customers
- competition decreasing
- little or no sales
- profits are very low
Other types of product life cyclefad, niche, seasonal
Fad- product that goes through the product lifecycle very quickly
Niche- section of the market in which a product dominates with very few competitors
Seasonalproducts that are popular only during a particular time/season
Types of promotionPublicity, advertising
advertising techniqueslife style, testimonial, informative, repetitive, Direct-to-home, Out-of-home
Promotionscoupons, contests, premiums, samples, special events
Parts of a print advertisementheadline, illustration, logo
AIDAAttention. Interest. Desire. Action. Used when creating ads
Marketing distribution channelway goods get from producer to consumer
Indirect marketinguse of intermediaries (fences) to get product from producer to consumer
Direct marketingconsumer buys g/s directly from producer
Producerperson/company that makes a product
Retailerperson/company who sells the product to the ULTIMATE CONSUMER
Wholesalerbuys product from producer in large quantities and resells to retailers or ultimate consumers in smaller quantities at a higher price
Ultimate consumerperson who buys the product for use (average "joe"/"jane")
Intermediariespeople who come in between producer & consumer. Also known as middle men
Direct-to-home- highly segmented market
- easy to measure effectiveness
- often considered junkmail
Out-of-home- low cost
- can repeat message
- high visibility
- increasingly regulated
- messages are short
- seldom have viewers full attention
Radio- highly mobile
- high segmented market
- messages are limited to audio
Television- reach large audiences
- lost cost per viewer
- sight, sound and motion combined
- highly segmented markets
- high total cost
Newspapers- large circulation, can rcarry coupons
- low print quality
- short life
Magazines- long life
- excellent print quality
- high cost
Use of media in advertisement -
Internet
- low cost
- reach large audience
- international range
- audience selectivity
- online media
- requires research to know target market
- clutter on internet (busy competing ads)
memorize