Chapter 12: Creating and Pricing Products that Satisfy Customers

66 terms by hhilbert 

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BUS-102 Introduction to Business

accessory equipment

standardized equipment used in a firm's production or office activities

brand

a name, term, symbol, design, or any combination of these that identifies a seller's products as distinct from those of other sellers

brand equity

marketing and financial value associated with a brand's strength in a market

brand extension

using an existing brand to brand a new product in a different product category

brand loyalty

extent to which a customer is favorable toward buying a specific brand

brand mark

the part of a brand that is a symbol or distinctive design

brand name

the part of a brand that can be spoken

breakeven quantity

the number of units that must be sold for the total revenue (from all units sold) to equal the total cost (of all units sold)

bundle pricing

packaging together two or more complementary products and selling them for a single price

business product

a product bought for resale, for making other products, or for use in a firm's operations

business service

an intangible product that an organization uses in its operations

captive pricing

pricing the basic product in a product line low, but pricing related items at a higher level

comparison discounting

setting a price at a specific level and comparing it with a higher price

component part

an item that becomes part of a physical product and is either a finished item ready for assembly or a product that needs little processing before assembly

consumer product

a product purchased to satisfy personal and family needs

convenience product

a relatively inexpensive, frequently purchased item for which buyers want to exert only minimal effort

customary pricing

pricing on the basis of tradition

demand

the quantity of a product that buyers are willing to purchase at each of various prices

discount

a deduction from the price of an item

everyday low prices (EDLPs)

setting a low price for products on a consistent basis

express warranty

a written explanation of the producer's responsibilities in the event that a product is found to be defective or otherwise unsatisfactory

family branding

the strategy in which a firm uses the same brand for all or most of its products

fixed cost

a cost incurred no matter how many units of a product are produced or sold

generic product (or brand)

a product with no brand at all

individual branding

the strategy in which a firm uses a different brand for each of its products

labeling

the presentation of information on a product or its package

line extension

development of a new product that is closely related to one or more products in the existing product line but designed specifically to meet somewhat different customer needs

major equipment

large tools and machines used for production purposes

manufacturer (or producer) brand

a brand that is owned by a manufacturer

markup

the amount a seller adds to the cost of a product to determine its basic selling price

multiple-unit pricing

the strategy of setting a single price for two or more units

negotiated pricing

establishing a final price through bargaining

non-price competition

competition based on factors other than price

odd-number pricing

the strategy of setting prices using odd numbers that are slightly below whole-dollar amounts

packaging

all the activities involved in developing and providing a container with graphics for a product

penetration pricing

the strategy of setting a low price for a new product

periodic discounting

temporary reduction of prices on a patterned or systematic basis

premium pricing

pricing the highest-quality or most-versatile products higher than other models in the product line

price

the amount of money a seller is willing to accept in exchange for a product at a given time and under given circumstances

price competition

an emphasis on setting a price equal to or lower than competitors' prices to gain sales or market share \

price leaders

products priced below the usual markup, near cost, or below cost

price lining

the strategy of selling goods only at certain predetermined prices that reflect definite price breaks

price skimming

the strategy of charging the highest possible price for a product during the introduction stage of its life-cycle

process material

a material that is used directly in the production of another product but is not readily identifiable in the finished product

product

everything one receives in an exchange, including all tangible and intangible attributes and expected benefits; it may be a good, a service, or an idea

product deletion

the elimination of one or more products from a product line

product differentiation

the process of developing and promoting differences between one's product and all similar products

product life-cycle

a series of stages in which a product's sales revenue and profit increase, reach a peak, and then decline

product line

a group of similar products that differ only in relatively minor characteristics

product mix

all the products a firm offers for sale

product modification

the process of changing one or more of a product's characteristics

random discounting

temporary reduction of prices on an unsystematic basis

raw material

a basic material that actually becomes part of a physical product; usually comes from mines, forests, oceans, or recycled solid wastes

reference pricing

pricing a product at a moderate level and positioning it next to a more expensive model or brand

secondary-market pricing

setting one price for the primary target market and a different price for another market

shopping product

an item for which buyers are willing to expend considerable effort on planning and making the purchase

special-event pricing

advertised sales or price cutting linked to a holiday, season, or event

specialty product

an item that possesses one or more unique characteristics for which a significant group of buyers is willing to expend considerable purchasing effort

store (or private) brand

a brand that is owned by an individual wholesaler or retailer

supply

the quantity of a product that producers are willing to sell at each of various prices

total cost

the sum of the fixed costs and the variable costs attributed to a product

total revenue

the total amount received from sales of a product

trade name

the complete and legal name of an organization

trademark

a brand name or brand mark that is registered with the U.S. Patent and Trademark Office and thus is legally protected from use by anyone except its owner

transfer pricing

prices charged in sales between an organization's units

variable cost

a cost that depends on the number of units produced

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