Create an account
attributes that may be evaluated prior to a purchase as the customer learns about competitive offerings
difficult to judge even after consumption; professional service providers are dominated by this
company offers something, customer offers something in return; goal is to create mutual benefit to establish long-term customer relationships
Services are simultaneously produced and consumed; services cannot be stored while goods can; services cannot be separated from provider while goods can
Relating to Variability, Marketers need to
Try to reduce bad variability
Try to improve good variability
supplemental and marketers can compete/differentiate on them; satisfies customers
may appear to produce three product lines, but they may all be characterized as organic
starts with a name; marketers should chose brand names that convey brand information; brand name meaning built over time; invoke a certain image
Customer Benefits of Branding
brands identify company ownership, make customer decision making easier, serve as status symbol
How to Pick a good Brand Name
suggest product benefits, be memorable and positive, fit company brand/logo, simple and emotional
Company Benefits of Branding
induce loyalty, allow for premium pricing, allow single firm to pursue multiple targets
two companies collaborating in a joint venture to create a good or service for the customer
Why improve products?
better corporate pride, be consistent w/ image, attract customers, beat competition
New Product Development Process
idea generation, refinement, obtain feedback, use results to develop prototype, test market on small scale, launch
implement low initial price and gradually increase as product grows/becomes known
new products crucial to growth; new product development process; products evolve through a life cycle; models can be used to forecast sales; marketers should study important trends
graph relating the quantity sold and price, which shows the maximum number of units that will be sold at a given price
3 Factors to Estimating Demand
Price and availability of similar products
greater when item is a luxury, customers don;t care about price, there are substitutes
increase in sales exactly offsets a decrease in prices, so total revenue remains the same
increases as price increases; demand increased when price increases
(price x demand) - (fixed costs) - (variable costs x demand)
establishes the initial price for a product and the intended direction for price movements over the product life cycle
Four General Pricing Approaches
Demand (McDonalds), Cost (retail), Profit (Kroger), Competition (Rolex, Walmart)
Yield Management Pricing
changing of the price based on the day, time, week, and even season (airlines)
Setting the Right Price
Establish pricing goals
Estimate demand, costs, and profits
Choose a price strategy to help determine a base price
Fine-tune the base price with pricing tactics
network of firms which are interconnected, provides sellers access to goods/services and buyers a means of purchasing those goods
Supply Chain Logistics
logistics is the process of coordinating the flow of all those goods/services and information throughout the channel, movement and ownership of goods
individuals/firms involved in the process of making a product/service "available" for use or consumption
how many intermediaries will a manufacturer go through to distribute its goods to consumers?
What is the most effective and efficient way to distribute the product? conflict may arise
Highest Profit Items
impulse buys, generally just below eye level height; kids cereal kept within reach of kids
incentives are offered to distribution partners to push products through the channel; targets suppliers
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