Essential Marketing Concepts, Global Strategy, and Consumer Behavior

Posted on Nov 7, 2025 in Business Administration and Management (BAM)

Core Marketing Definitions and Strategies

The 4 P’s of Marketing (The Marketing Mix)

Define each of the 4 P’s of marketing and provide an example of each:

  • Product: Creating value (goods vs. services).
  • Price: Capturing value (money, time, and energy).
  • Place: Delivering the value proposition.
  • Promotion: Communicating the value proposition.

Definition of Value

Value is the relationship of benefits to costs—what the consumer gets for what they give.

Three Macro Strategies for Developing Customer Value

List and define the three macro strategies for developing customer value, including the characteristics of each strategy:

  • Operational Excellence: Involves a firm’s focus on efficient operations and excellent supply chain management. Characteristic: “Good enough” efficiency.
  • Customer Intimacy (Excellence): Involves a focus on retaining loyal customers and providing excellent customer service. Characteristic: “Just right” personalization.
  • Product Leadership (Excellence): Involves a focus on achieving high-quality products and innovation. Characteristic: “Never good enough” pursuit of quality.

Consumer Decision Making

Compensatory and Non-Compensatory Decision Rules

Define and provide an example of compensatory decision rules and non-compensatory decision rules:

  • Compensatory Decision Rules: The consumer trades off one characteristic against another.
    • Example: Comparing computer weight (Dell 0.7 lbs vs. Mac 0.5 lbs), where a slightly heavier weight might be compensated by a lower price or better features.
  • Non-Compensatory Decision Rules: Selecting a product based on only one characteristic, regardless of other features.
    • Examples: Must be a light computer; Chevy vs. Ford; must be made in the USA.

Defining Cognitive Dissonance

Cognitive dissonance is an uncomfortable state produced by an inconsistency between beliefs and behaviors, often resulting in buyer’s remorse.

Example: Giving to charity (if the donor later questions the effectiveness or necessity of the donation, conflicting with their belief in being helpful).

Global Economic Metrics for Business Expansion

The Big Mac Index and Its Utility

The Big Mac Index measures how much a country’s currency is over- or undervalued against the U.S. dollar, based on the price of a Big Mac in that country. It is useful for companies as a simple indicator of purchasing power parity (PPP).

Gross Domestic Product (GDP)

GDP is the market value of all goods and services produced by a country in a year. It is an important metric for firms considering global expansion because it indicates the overall size and health of the economy, influencing pricing and production decisions.

Per Capita Income

Per capita income is the overall income of a population divided by the number of people included in the population. This metric is crucial for firms considering global expansion as it indicates the average consumer spending power, helping determine the viability of selling specific goods or services in that market.

Market Research Data

Advantages and Disadvantages of Market Research Data

Secondary Data

  • Advantages:
    • Saves time in collecting data because it is readily available.
    • It is often free or inexpensive.
  • Disadvantages:
    • May not be precisely relevant to the information needed.
    • May not be timely.
    • Data sources may be biased.

Primary Data

  • Advantages:
    • Specific to immediate data needs and the topic at hand.
    • Offers behavioral insights not offered by secondary data.
  • Disadvantages:
    • Costly and time-consuming.
    • Requires more sophisticated training and experience to collect data.

International Business Concepts

Hofstede’s Cultural Dimensions

List and define each of Hofstede’s cultural dimensions:

  • Power Distance: The willingness to accept social inequality as natural.
  • Uncertainty Avoidance: The extent to which a society relies on orderliness, consistency, structure, and formalized procedures in daily life.
  • Individualism: The perceived obligation to and dependence on groups (low individualism implies high collectivism).
  • Masculinity: The extent to which dominant values are male-oriented (e.g., assertiveness, material success).
  • Time Orientation: Short-term versus Long-term orientation. A country with a long-term orientation values long-term commitments and is willing to accept a longer time horizon for goals to be achieved.

Global Entry Strategies: Risk and Control

What are the five global entry strategies? Which are risky, which are not risky? What are some qualities of each strategy?

  1. Exporting: (Low risk, low control) Producing goods in one country and selling them in another.