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Marketing Exam 1, Ch. 3


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Environmental scanning
Process used to collect information about market trends
Social forces
Demographic characteristics about a population and its value
Describing populations based on factual characteristics
Baby boomers
1946-1964: Interested in health, wellness, appearance
Generation X
1965-1976: Self-reliant and supportive of diversity, well-educated
Generation Y
1977-1994: Technology fiends, younger members are millenials
Metropolitan statistical area
At least one urbanized area (50,000+) and adjacent area of high economic/social integration
Micropolitan statistical area
At least one urban cluster (10,000-50,000) and adjacent area of high economic/social integration
Set of values, ideas, and attitudes that are learned and shared among members of a group
Economic forces
Income, expenditures, resources that influence cost of running a business or household
Gross income
Total amount of money made by a person or family unit in one year
Disposable income
Money a consumer has left over after taxes to use for necessities
Discretionary income
Money that remains after taxes and necessities
Technological forces
Inventions or innovations from applies science and engineering research
Pure competition
Many sellers with similar products
Monopolistic competition
Many sellers compete with slightly differentiated products
A few companies control the majority of industry sales
Pure monopoly
When only one firm sells a product
Components to competition
1. Entry barriers 2. Power of buyers and sellers 3. Existing competitors/substitues
Sherman Anti-Trust Act
1890; made monopoly formation illegal and forbade collusion between companies
Clayton Act
1914; supplement to the Sherman Act, forbids any action that lessens competition significantly
Robinson-Patman Act
1936; price discrimination is illegal when it lessens competition
Digital Millenium Copyright Act
1998; improves protection of copyrighted material
1960s; movement to increase consumer rights in dealing with institutions
Lanham Act
1946; provides for registration of a company's trademarks unless the word/phrase becomes generalized (ex: escalator)
Exclusive dealing
When a manufacturer arranges for a reseller to handle only its products
Requirement contracts
When a buyer must purchase all or part of its products from one seller
Tying arrangements
When a seller requires a purchaser of one product to also buy another product

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