IBM 301 Final Exam Study Guide - IBM 301 Final Review The...

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IBM 301 Final Review The exam will be largely based on the application of these concepts and principles. 1. Understand the three sources of competitive advantage (ch2) a. Cost Competitive Advantage : being the low-cost competitor in an industry while maintain satisfactory profit margins. A cost competitive advantage enables a firm to deliver superior customer value. (ex-Wal- Mart) b. Product/service differentiation competitive advantage : the provision of something that is unique and valuable to buyers beyond simply offering a lower price than the competitions. (ex- Nike, Lexus, Maytag appliances) c. Niche competitive advantage : the advantage achieved when a firm seeks to target and effectively serve a small segment of the market. (ex—Rolex [high-quality watches], Nordstrom [services], Southwest Airlines [low price]) 2. Explain the components of a situation analysis (ch2) SWOT Analysis : the firm should identify its internal strengths (S) and weakness (W) and also examine external opportunities (O) and threats (T). Internal [strength and weaknesses] : production costs, marketing skills, financial resources, image, and technology. External [opportunities and threats] : social, demographic, economic, technological, political/legal, and competitive. 3. Describe the elements of the marketing mix (ch2) a. Product : not only is physical unit important but the package, warranty, after-sale service, brand name, company image, value, and many other factors. b. Place : goal is to make sure products arrive in usable condition at designated places when needed. Making products available when and where consumers are wanted. c. Promotion : advertising, public relations, sales promotion, and personal selling. Informing, education, persuading and reminding consumers. d. Pricing : what a buyer must give up to obtain a product; it is often the most flexible o the four marketing mix elements—the quickest element to change. 4. Analyze the components of the consumer decision making process and explain how each component is useful to marketers (ch5) a. Need recognition : occurs when consumers are faced with an imbalance between actual and desired states (internal stimuli: hunger, thirst, tired/ eternal stimuli: restaurant recommendation, color of car, design of package). This creates a want in a product by advertisement.
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