Marketing Midterm: Chapter 1 Study Guide

1. What is marketing?

Marketing is managing profitable customer relationships.

Marketing is advertising and promotion.

Marketing is conducting market research.

Marketing is selling products or services.

Marketing involves much more than just selling or advertising. It is a holistic approach that encompasses understanding and fulfilling customer needs profitably.

Explanation

Marketing involves much more than just selling or advertising. It is a holistic approach that encompasses understanding and fulfilling customer needs profitably.

2. What is the model of the Marketing Process?

The PESTLE Analysis

The SWOT Analysis

The Segmentation, Targeting, and Positioning (STP) Model

The Marketing Mix, also known as the 4Ps (Product, Price, Place, Promotion), is a well-known model used in marketing to guide businesses in making strategic decisions.

Explanation

The Marketing Mix, also known as the 4Ps (Product, Price, Place, Promotion), is a well-known model used in marketing to guide businesses in making strategic decisions.

3. How do you calculate your profit?

(Fixed Costs + Variable Costs) X Projected Units Sold = Profit

Sale Price - Fixed Costs = Profit

(Sale Price - Variable Costs) X Projected Units Sold = Profit

(Sale Price X Projected Units Sold) - Fixed Costs - (Variable Costs X Projected Units Sold) = Profit

To calculate profit, it is essential to consider both fixed costs, variable costs, sale price, and the projected units sold. The formula provided takes into account all these components to give an accurate representation of the profit margin.

Explanation

To calculate profit, it is essential to consider both fixed costs, variable costs, sale price, and the projected units sold. The formula provided takes into account all these components to give an accurate representation of the profit margin.

4. What is Contribution Margin?

Total Revenue - Total Costs

Unit Revenue - Variable Costs

Total Costs - Variable Costs

Fixed Costs - Unit Costs

Contribution Margin is the difference between unit revenue and variable costs, representing the portion of sales revenue that exceeds variable costs and contributes to covering fixed costs and generating profits.

Explanation

Contribution Margin is the difference between unit revenue and variable costs, representing the portion of sales revenue that exceeds variable costs and contributes to covering fixed costs and generating profits.

5. Why are customer expectations important?

They only matter in certain industries.

They the influence Satisfaction and Loyalty of the Customer.

They have no impact on customer experience.

They are only relevant for new customers.

Customer expectations play a crucial role in determining their satisfaction and loyalty towards a brand or company. Meeting or exceeding customer expectations can lead to positive outcomes, while failing to do so can result in negative consequences for the business.

Explanation

Customer expectations play a crucial role in determining their satisfaction and loyalty towards a brand or company. Meeting or exceeding customer expectations can lead to positive outcomes, while failing to do so can result in negative consequences for the business.

6. How can a business ensure customer satisfaction?

Set their expectations slightly below what you can realistically/systematically deliver.

Ignore customer feedback and complaints.

Promise more than you can deliver to exceed expectations.

Provide inconsistent and unreliable service.

Setting expectations slightly below what you can deliver allows you to consistently meet or exceed those expectations, leading to increased customer satisfaction. The other options either lead to unmet expectations, lack of customer care, or inconsistent service, resulting in dissatisfied customers.

Explanation

Setting expectations slightly below what you can deliver allows you to consistently meet or exceed those expectations, leading to increased customer satisfaction. The other options either lead to unmet expectations, lack of customer care, or inconsistent service, resulting in dissatisfied customers.

7. How do Needs, Wants and Demands relate to each other?

Demands are basic requirements for survival, while Wants are unnecessary desires.

Needs are the same as Wants, and together they create Demand.

Wants are driven by societal expectations, while Demands are personal preferences.

Physical, Social and Individual needs are necessary to survive and develop normally.
Wants are needs shaped by culture and individual personality.
Wants + Buying Power = Demand

Physical, Social and Individual needs are necessary for survival and development, while Wants are desires influenced by culture and personality. When Wants are backed by buying power, they create Demand in the market.

Explanation

Physical, Social and Individual needs are necessary for survival and development, while Wants are desires influenced by culture and personality. When Wants are backed by buying power, they create Demand in the market.

8. What are the offerings of the market?

Sales, Discounts, and Promotions.

Customer Complaints, Returns, and Refunds.

Products, Services, and Brand Experiences.

Marketing Strategies, Competitor Analysis, and Revenue Growth.

The offerings of a market typically refer to the products, services, and brand experiences available for consumers. While sales, discounts, and promotions are related to offerings, they are not the core elements. Customer complaints, returns, and refunds are more related to customer service and not market offerings. Marketing strategies, competitor analysis, and revenue growth are important business factors but are separate from market offerings.

Explanation

The offerings of a market typically refer to the products, services, and brand experiences available for consumers. While sales, discounts, and promotions are related to offerings, they are not the core elements. Customer complaints, returns, and refunds are more related to customer service and not market offerings. Marketing strategies, competitor analysis, and revenue growth are important business factors but are separate from market offerings.