BMI Marketing Exam
By Daniel Hicken
UNIT 1 - Marketing Fundamentals
What is Marketing?
Goods vs. Services
Industrial goods are
This would help a company learn about the market, and learn how to make a better product for their next version.
2. Product Development
Where the manufacturer or company making the product, perform beta test. This would be where they make sure the product that they are developing meets the Consumers needs and wants, so that they can make a product people want or need to buy.
The package must provide protection to the product being sold, so they can arrive at stores still in one piece. (unless its a puzzle haha.) The packaging also acts as a way of promoting the product. If your product and your competitors product are side by side in a store, chances are the better packaging will attract their attention more and possibly lead to the final sale.
You want to decide whether you are going to put a lower price than your competition to try and steal their customers. Or if you are going to make your pricing more expensive but offer a more premium product.
Some key components of Branding would be, your companies logo, slogan, and package design. You want to create a simple, creative logo that people will remember, and that matches your company name or products that it sells. You want to have a slogan that is preferably seven words or less, and is catchy, such as "Im Loving it." (McDonalds)
This step is very important as you want to keep the price of distributing your product very low, so that you can have a higher profit, or keep your prices low.
7. Inventory Management
Retailers must make sure that they have enough products in store, to meet the customer demand, but not too much where they over spend on the getting the product in store that they sacrifice profit because of it.
Products need to be maintained and stored until they are needed, ordered and shipped by a customer or retailer. This may be done my a manufacturer, distributor, or retailer.
You need to be able to promote your product, to make customers and consumers aware that your product or service exist. This is a very important step, because without it, customers would not even purchase your product as they would not know that it is out there.
You need to be able to convince potential customers that that purchasing your product/service is a good idea, and that it will help them.
The Marketing Mix 4P's/2C's
The Object or service that is being sold. (Ex; Beats by Dre.)
Where the object or service is being sold, or found. (Ex; Best Buy.)
The price range. (Ex; $219.99 - $449.99.)
The Form of advertising being used, or sponsorship. (Ex; "Sound really Matters.")
2C's (Consumer, Competition).
Who the Typical Customer or consumer is. (Ex; People who like music and above average income.)
a) Direct Competition; is a company that is selling the same product or something similar. (Ex; Bose Headphones)
b) In-Direct Competition; is a company that is selling a product that is not the same or un-similar, how ever is still competing with it. (Ex; iPod.)
Satifaction - Cost = Brand Value
a) Push; When the company does little advertising, and sticks the product in your face at the store, your thought of buying that product is almost instant on the spot, while you were looking to buy something else.
b) Pull; When the company wants you to know your buying it before you actually do. often lots of advertising, and you decide you want to buy it, then you go hunting for that product.
UNIT 2 - The Consumer
Consumer Needs and Wants
- Gatekeeper. When the consumer is too young to purchase the product, such as a child or baby. Their parent or guardian/whomever buys for them, is known as their gatekeeper
- Consumer Buying Behaviour. Consumer behaviour is based around how the market interacts with the psychology of the person buying the product. This psychology includes their attitude, culture, previous learning and personal perceptions.
Product life cycle
The product is newly launched into the market. Very expensive at this stage, as you could need to set up new machines. Customers or consumers in this stage are known as trendsetters.
The Product is more visible to the media and public. This is the stage that the product will succeed or fail. The company that enters this will have to pay the most expenses, however get the advantage of no competition for a bit.
During this stage, sales increase more slowly. The expenses in this stage is a lot lower, therefore the profits are high.
Generally where new customers are harder to find, and sales decrease. This can be turned around and make a big increase if the company decides to release a new version.
The company decides whether to drop the product or try to keep it alive. Most often this would mean new promoting and new pricing.
a) Cohort; This is a group that shares common characteristics, and buying habits.
b) Primary/Target Market; The most likely consumers.
c) Secondary Market; Other consumers.
d) Demographics; The study of obvious characteristics that can then categorize people.
e) Psychographics; People being grouped by beliefs, fitness, and other similar items.
f) Geographics; A group based on where the customers live.
Three examples of Consumer Motivation theories are;
1. Thorndike's Law of Effect
Several responses that are made to the same situation.
2. Malsow's Hierarchy of Needs
A pyramid which levels what is needed more to live. To have everything on the top level, you need everything on the level below it first, and so forth.
3. Alderfer's ERG Theory
Similar to Maslow's theory, however this is categorized into three sections. Existence, Relatedness, and growth.
UNIT 3 - Product
Invention vs Innovation
Feasibility; The company needs to ask themselves two important questions, "Can we produce it?" this is something that the production team needs to answer. The second question would be "Can we sell it?" The Marketers would need to answer this, what price is it going to be sold at? and so forth similar questions.
Product Development Stages
1. Idea Generation
This is an idea that is currently not available on the market.
2. Idea Screening
Not all ideas are good ideas. Ask others, see what other people think, and judge if its a good idea or not.
3. Concept Development
If you have received positive feedback, make a prototype. This will let you see if the product works.
4. Market Strategy
Determine what strategy to use, and decide on your 4P's.
5. Feasibility Analysis
Decide if you sell this product, can you make it, and will you be making money doing so?
6. Product Design
Thinking what the product will look like.
7. Test Market
You need to test the acceptance of the product in public. Offer the product to a random sample of people to get their feedback.
8. Market Entry
This is where the product officially enters the market and is sold to everyone.
This is the product look, and what it does decides on how it will look.
Need to let the consumers how to use the product. This can be done with a manual or a online website. Inform the customers info about the product.
Where the product is available.
You need to have the product available when the customer wants it. Nowadays some stores are open 24/7 because of this.
This is how easy it is to purchase product.
Product Development and the Marketing Concept
a) Product Mapping; You need to group products in a category. You can create an two way axis X and Y. In this axis you label each one like a chart, and place items on it.
b) Market Opportunity Analysis; you can start by identifying the category that the product is found in. Followed by, adding other products that fall in the same category. you then need to do this for indirect competition as well. Then compare your product with your direct competition.
c) Benefit Analysis; Identify what features the consumers value the most, and how much they are willing to pay for it.
2. Target; Need to focus on the consumer that is likely to buy it.
3. Price; you can use a high price to position your product as Luxury. Low pricing can be used to position it as the more affordable product.
4. Distribution; You can position your product by the way it is distributed, for example if it is only sold in specific stores or locations.
5. Service; You can position your product with a luxury service, such as your store is open 24/7, 7 days a week, or that it has a money back guaranteed.
2. Logo/Slogans; Small colour palette, Easy to read font, original, and needs to show your companies personality.
3. Brand Strategy; You need to have new packaging, a new target market.
2. Protect; Protects products from breaking, so that they are still in one piece when the consumer gets it.
3. Inform; Need to put information on the packaging that is required by the law. Such as the Nutrition facts on food and drinks.
4. Brand Identification; The packaging needs to be able to identify the product, that is original and stands out.
5. Promotion; The packaging needs to be able to promote itself. You can state that it is environmentally friendly.
UNIT 4 - Competition
Introduction to Competition
Canada encourages competition because it makes the products better.
Some types of competition are;
Sustainable Competitive Advantages
1. Direct vs. Indirect competition
2. Sustainable Advantages
a) Unique Selling Proposition
b) Lowering Costs
c) Servicing a Niche
d) Creating Customer Loyalty
Non-sustainable Competitive advantages
4. Benefits of Use
6. Design Features
2. Degree of Service
2. Market Share
3. Increasing Market Share
4. Market Leaders
5. Market Challenges
Unit 5 - Promotion/Advertising
Importance of Promotion – influence
2. Brand Trial
3. Brand Preference
4. Brand Reminder
5. Brand Repositioning
3. Marketing Appeals
3. Determining Which Media to use / Media Analysis
4. Factors used to Determine Media
e) Lead Time
f) Mechanical Requirements