Free Practice Test: CLEP Principles of Marketing

• Ethics
• Nonprofit marketing
• International marketing

There are multiple ethical concerns when it comes to marketing. First is being aware of your target audience. Everyone knows that tobacco companies have been targeting children with their advertisements for decades. It is critical that you are marketing to your appropriate demographics to maintain your integrity and ethical standards.

When marketing for a nonprofit, you will be using multiple streams: social media, mass mailings, mass emails, radio and television, and print ads. Nonprofits tend to have very small marketing budgets, so it is essential that any marketing campaigns are handled with cost-efficiency in mind.

International Marketing used to be extremely expensive. Thanks to our more technologically based business world, companies can use social media, email, and other forms of technology to market to any country in the world. It’s amazing that foam roller manufacturers in China are able to market directly to US consumers through blogs and Instagram!

• Marketing concept
• Marketing strategy
• Marketing environment
• Marketing decision system
• Marketing research
• Marketing information system

When deciding what your marketing concept will be, you must start with identifying you purpose and goals for the campaign. Is the goal to increase sales or to increase awareness of your product offerings? Also, who are you marketing to? Knowing your demographics is key to targeting the right audience for your marketing campaign.

The strategy you use will be based largely on your budget. If you are looking to reach as many consumers as possible with a little expenditure as possible, social media and mass emails are the best option. If you are looking to encourage repeat customers, a personal letter or postcard is more effective – it has the personal touch! If you are reaching for an international audience, web-based marketing through social media, blogs, and business websites will be your best bet.

The marketing environment is largely based on what your company offers for products and services. For example, if your company is competing with other companies for customers in the fashion industry, the marketing environment will be brutal! Fashion is a cut-throat industry and only the very best campaigns will produce return on investment. This will mean a very expensive campaign crossing multiple demographics and wide-ranging geographic areas.

Marketing decision systems help businesses explore different marketing strategies through the manipulation of existing data from the past campaigns. The best marketing campaigns are ones that take past successes and failures into consideration. It is vital to be aware of who is doing what in the market and how your company will take advantage of the strengths and weaknesses in the existing market.

Marketing research is all about identifying your demographics. Who is your target audience? Can it be identified by gender or race? Age or education? Work history or family size? Each of these factors are critical keys in creating a successful marketing strategy and campaign. It won’t do you any good to market high end cosmetics using a cartoon character 😊

Marketing research helps companies find out which products are selling and which are not – and why. Research helps with investigating the trends of the current market, what competitors are up to, what’s coming soon, and what products have reached the end of their marketable life-span. Every day, new products are born, while old products go six-feet under the mall 😉

The marketing information system is a system where marketing data is collected, stored, analyzed, and circulated to managers according to their daily information needs. Marketing managers and specialists must be aware of all trends in their industry, particularly those that can change on a daily basis. Some industries, like those in social media, are subject to daily fluctuations in their values. All it takes is one really good or one terribly bad Tweet to considerably influence the value of such commodities.

• Consumer behavior
• Segmentation
• Positioning
• Business-to-business markets

Consumer behavior is a major part of strategizing for marketing campaigns. Consumers tend to follow trends in all forms of commerce. There are media firms that do nothing but collect data on consumers to direct their future decisions on production and marketing. The tools they use are as simple as surveys or as complex as reading your shopper’s reward card purchases to determine what you are most likely to buy during your next visit to the store!

Segmentation in marketing is the process of differentiating between the varied consumers who purchase your products or services. For example, with video games, the segment of the market most influenced by marketing would be young men between the ages of 12-22, living at home with their parents. That segmentation allows marketing specialists to create a very specific campaign to reach that segment of the market as efficiently as possible.

Position in marketing is knowing where best to put your advertising dollars to get the biggest return. In large cities, for example, ads on taxi cabs, buses, and subways are high in position value because they will be seen by literally thousands of people every day – if not every hour! In smaller locales, marketers have to focus more on the segmented groups of consumers to target their specific buying habits and needs. In a small town, a family-owned restaurant would be most successful by marketing with advertising in the local newspaper or on a nearby radio station.

Business to business markets are extremely important in maintaining your company’s success. While there are businesses out there that only target the main consumer market, there are others that will market their products not only to consumers, but to other businesses as well. Think about places like Office Depot. As an office supply store, they market to the individual consumer to purchase office supplies, home office needs, computers, or peripherals. Office Depot also has corporate contracts with nearby businesses – those businesses agree to purchase their everyday items from Office Depot.

• Product and service management
• Branding
• Pricing policies
• Distribution channels and logistics
• Integrated marketing communications/promotion
• Marketing application in e-commerce

Product and service management is the process whereby companies obtain, develop, maintain, or improve a viable service and product mix capable of responding to ever-changing market opportunities. This process requires savvy, long-term thinking about which products will continue to be profitable and which are likely to be seen as a fad and the demand will drop drastically within the first year.

Branding is the process of creating a name, design, or symbol that identifies and singles out one product from similar products. Without an effective brand strategy, success for new items on the market can be jeopardized. What is crucial when creating a brand is that it is unique – from the design, photos, and color schemes, to the music associated with the advertising and the potential for upgrades as the product goes to market.

Pricing policies require a significant amount of research. Once you have identified your target market, it is necessary to find out what the competition is charging for similar products. When introducing totally unique, new products, companies tend to charge a premium to help offset their costs for research and development of the product. Once a product has ample competition, the marketing staff must keep up to date with what every company is charging for their products, so they can keep their prices competitive. Would you pay $15 for a cell phone charging cord when you can pay $3?

When dealing with logistics and distribution channels, you are dealing with how the products get to the consumers. What does that have to do with marketing you ask? Well, if the marketing department decides to go big and offer huge discounts on their products, those products must be available in the market before the campaign kicks off. For example, in the early 2000s, a major pizza chain introduced a sale for a large pizza with unlimited toppings for only $8. The problem with the campaign was that local franchisees did not consider how that sale would affect their individual markets. Many stores simply ran out of food!

Integrated marketing communications/promotion is a process of planning that utilizes the roles of a variety of communication channels (ie: print advertising, direct response, sales promotion, and public relations) for a single campaign. This technique is most frequently used by large, multi-million-dollar corporations who operate on a nationwide or global scale. Because they are covering such a wide, geographic area, this is the only way to reach all of their customers.

The marketing applications in e-commerce are literally limitless. Companies have expanded their marketing efforts to Facebook, Twitter, and other social media platforms. They are also using sites like Overstock, Groupon, Ebates, and Wish to sell excess inventory. What is truly interesting is that platforms like Shopify or Etsy are hosting pages for entrepreneurs who buy from company wholesalers and sell on their own! This is great for a company because it meets the needs of consumers and offers another channel to distribute their products.