Marketing 300- Chapter 8-11 and 15-16

Terms in this set (95)

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.

tangible products that individual consumers purchase for persona or family use

intangible products that are exchanged directly between producer and consumer.

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

All the benefits the product will provide for consumers or business customers

The physical good or the delivered service that supplies the desired benefit

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?

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

Expensive goods that an organizations uses in its daily operations that last for a long time

Goods that a business customer consumes in a relatively short time

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

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

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

The legal term for a brand name, brand mark, or trade character

The beliefs and associations that a consumer has about the brand

The value of a brand to an organization

Family branding

A brand that a group of individual products or individual brands share

Brands that a certain retailer owns

An agreement between two brands to work together to market a new product

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

The characteristic of a service that means customers can't see, touch, or smell good service

The characteristic of a service that makes it impossible to store for later sale or consumption

The characteristic of a service that means that even the same service performed by the same individual for the same customer can vary

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

The actual physical facility where the service is performed, delivered, and consumed

A marketing research method that measures the difference between a customer's expectation of a service quality and what actually occurred

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

Costs that do not change with the number of units produced.

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

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

The availability of the product to the customer at the desired time and location

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

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

The process of designing, managing, and improving the movement of products through the supply chain

The mode by which products move among channel members

Inventory control

Activities to ensure that goods are always available to meet customers' demand

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

Storing goods in anticipation of sale or transfer to another member of the channel of distribution

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

Food stores that carry a wide selection of edibles and related products

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

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

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

A given consumer's or target market's perception of all the attributes associated with a retail outlet

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