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Marketing 300- Chapter 8-11 and 15-16
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Terms in this set (95)
Product
A tangible good, services, idea, or some combination of these that satisfies consumer or business customer needs through the exchange process; a bundle of attributes including features, functions, benefits, and uses.
Good
tangible products that individual consumers purchase for persona or family use
Service
intangible products that are exchanged directly between producer and consumer.
Attributes
Features, functions, benefits, and uses of a product
Layers of the Product
Core
Actual
Augmented
Core: Basic Benefit
Actual: Features, Package, Brand, Quality, Appearance
Augmented: Warranty, Delivery, Credit, Installation, Repair/Maintenance
Core
All the benefits the product will provide for consumers or business customers
Actual
The physical good or the delivered service that supplies the desired benefit
Augmented
The actual product plus other supporting features
Product classifications 1-3
How long does the product last?
How do consumers buy the product?
How do businesses buy the product?
Durable goods
Consumer products that provide benefits over a long period of time
Non-durable good
Consumer products that provide benefits for a short time because they are consumed or are no longer useful
Convenience products
A consumer good or service that is usually low-priced, widely available, and purchased frequently with a minimum of comparison and effort
Shopping products
Goods or services for which consumers spend considerable time and effort gathering information and comparing alternatives before making a purchase
Specialty products
Goods or services that has unique characteristics and is important to the buyer and for which she will devote significant effort to acquire
Unsought products
Goods or services for which a consumer has little awareness or interest until the product or a need for the product is brought to her attention
Equipment
Expensive goods that an organizations uses in its daily operations that last for a long time
Maintenance
Goods that a business customer consumes in a relatively short time
Raw materials
Products of the fishing, lumber, agricultural, and mining industries that organizational customers purchase to use in their finished products
Processed materials
Products created when firms transform raw materials from their original state
Component parts
Manufactured goods or subassemblies of finished items that organizations need to complete their own products
New Product development process
1. Idea Gerneration
2. Product Concept Development and Screening
3. Marketing Strategy Development
4. Business Analysis
5. Technical Development
6. Test Marketing
7. Commercialization
Product adoption
Product adoption: The process by which a consumer or business customer begins to buy and use a new good, service, or idea
Diffusion
The process by which the use of a product spreads throughout a populations
Adopter categories
Innovators
Early adopters
Early majority
Late majority
Laggards
Tipping point/ critical mass
In the context of product diffusion, the point when a product's sales spike from a slow climb to an unprecedented new level, oven accompanied by a steep price decline
Product Life cycle
1. Introduction Stage
2. Growth Stage
3. Maturity Stage
4. Decline Stage
Product management
The systematic and usually team-based approach to coordinating all aspects of a product's marketing initiative including all elements of the marketing mix
Product mix width
The number of different product lines the firm produces
Product line length
Determined by the number of separate items within the same category
Cannibalization
The loss of sales of an existing brand when a new item in a product line or product family is introduced
Brand
A name, a term, a symbol, or any other unique element of a product that identifies one firms product(s) and sets it apart from the competition
Trademark
The legal term for a brand name, brand mark, or trade character
Brand meaning
The beliefs and associations that a consumer has about the brand
Brand equity
The value of a brand to an organization
Family branding
A brand that a group of individual products or individual brands share
Store brands
Brands that a certain retailer owns
Co-branding
An agreement between two brands to work together to market a new product
Packaging
The covering or container for a product that provides product protection, facilitates product use and storage, and supplies important marketing communication
Characteristics of services
Intangibility
Perishability
Variability
Inseparability
Intangibility
The characteristic of a service that means customers can't see, touch, or smell good service
Perishability
The characteristic of a service that makes it impossible to store for later sale or consumption
Variability
The characteristic of a service that means that even the same service performed by the same individual for the same customer can vary
Inseparability
The characteristic of a service that means that it is impossible to separate the production of a service from the consumption of that service
Service Encounter
The actual interaction between the customer and the service provider
Servicescape
The actual physical facility where the service is performed, delivered, and consumed
Gap analysis
A marketing research method that measures the difference between a customer's expectation of a service quality and what actually occurred
Price
The assignment of value, or the amount the consumer must exchange to receive the offering
Elements of price planning
Set pricing objectives
Estimate demand
Determine costs
Examine the pricing environment
Choose a pricing strategy
Develop pricing tactics
Fixed costs
Costs that do not change with the number of units produced.
Variable costs
The costs of production (raw and processed materials, parts, and labor) that are tied to and vary depending on the number of units produced
Break even analysis
A method for determining the number of units that a firm must produce and sell at a given price to cover all its costs
Cost plus pricing
an amount added to the cost of a product to create the price at which a channel member will sell the product
Demand-based pricing
determining how much product you can sell in a certain region
Price leadership
a pricing strategy in which one firm first sets is price and other firms in the industry follow with the same or very similar prices
Everyday low pricing
A pricing strategy in which a firm sets prices that provide ultimate value to customers
Skimming pricing
A very high, premium price that a firm charges for its new, highly desirable product
Penetration pricing
A pricing strategy in which a firm introduces a new product at a very low price to encourage more customers to purchase it
Two-part pricing
two separate types of payments to purchase the product
Payment pricing
breaking up the price into smaller amounts payable over time
Price bundling
selling two or more goods/services as a single package
Price elasticity
Demand in which changes in price have large effects on the amount demanded
Price inelasticity
Demand in which changes in price have little or no effect on the amount demanded
Price elasticity of demand equation
% change in
quantity demanded
/
% change in
price
Place
The availability of the product to the customer at the desired time and location
Supply Chain
All the activities necessary to turn raw materials into a good or service and put it in the hands of the consumer or business consumer
Supply Chain Management
The management of flows among firms in the supply chain to maximize total profitability
Channel intermediaries
Firms or individuals such as wholesalers, agents, brokers, or retailers who help move a product from the producer to the consumer or business user
Breaking bulk
Dividing larger quantities of goods into smaller lots in order to meet the needs of buyers
Disintermediation
The elimination of some layers of the channel of distribution in order to cut costs and improve the efficiency of the channel
Distribution strategies
Conventional
Conventional:A multiple-level distribution channel in which channel members work independently of one another
Distribution strategy
Vertical
A channel of distribution in which there is formal cooperation among members at the manufacturing, wholesaling, and retailing levels
Distribtion strategy
Horizontal
An arrangement within a channel of distribution in which two or more firms at the same channel level work together for a common purpose
Logistics
The process of designing, managing, and improving the movement of products through the supply chain
Transportation
The mode by which products move among channel members
Inventory control
Activities to ensure that goods are always available to meet customers' demand
Just in Time
Inventory management and purchasing processes that manufacturers and resellers use to reduce inventory to very low levels and ensure that deliveries from suppliers arrive only when needed
Order processing
The series of activities that occurs between the time an order comes into the organization and the time a product goes out the door
Warehousing
Storing goods in anticipation of sale or transfer to another member of the channel of distribution
Retailing
The final stop in the distribution channel in which organizations sell goods and services to consumers for their personal use
3 retail store classifications
By what they sell
By merchandise selection
By level of service
By what they sell
Merchandise mix: "The total set of all products offered for sale by a retailer, including all product lines sold to all consumer groups"
Combination stores: "Retailers that offer consumers food and general merchandise in the same store"
Supercenters: "Large combination stores that combine economy supermarkets with other lower-priced merchandise"
By merchandise selection
Merchandise breadth: "The number of different product lines available"
Merchandise depth: "The variety of choices available for each specific product line"
By level of service
Self-service retail stores
Limited-service retail stores
Full-service retail stores
Convenience stores
Neighborhood retailers that carry a limited number of frequently purchased items and cater to consumers willing to pay a premium for the ease of buying close to home
Supermarkets
Food stores that carry a wide selection of edibles and related products
Box Stores
Food stores that have a limited selection of items, few brands per item, and few refrigerated items
Specialty stores
Retailers that carry only a few product lines but offer good selection within the lines that they sell
Category Killer
A very large specialty store that carries a vast selection of products in its category
Leased departments
Departments within a larger retail store than an outside firm rents
Variety Stores
Stores that carry a variety of inexpensive items
General merchandise discount stores
Retailers that offer a broad assortment of items at low prices with minimal service
Off-price retailers
Retailers that buy excess merchandise from well-known manufacturers and pass the savings on to customers
Department stores
Retailers that sell a broad range of items and offer a good selection within each product line
Hypermarkets
Retailers with the characteristics of both warehouse stores and supermarkets; hypermarkets are several times larger than other stores and offer virtually everything from grocery items to electronics
Store image
A given consumer's or target market's perception of all the attributes associated with a retail outlet
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