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Marketing Exam 3
Ch. 10, 11, 12, 19, 20
106
Marketing
11/03/2011

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Cards

Term
Which of the following is a pricing policy whereby a firm charges a high introductory price, often coupled with heavy promotion?
Definition
Price skimming
Term
When a firm introduces a new product at a relatively low price because it hopes to reach the mass market, it is following a _________ strategy. THe low price is designed to capture a large share of a substantial market and produce lower production costs
Definition
penetration pricing
Term
a firm charginga price identical to or very close to the competition's price is using a _______ strategy?
Definition
status quo pricing
Term
State laws that put a lower limit on wholesale and retail prices are called _______. In states that have these laws, selling below cost is illegal.
Definition
Unfair Trade Practice Acts
Term
The practice of charging a very low price for a product with the intent of driving competitors out of business or out of a market is called:
Definition
Predatory Pricing
Term
Which of the following is a price tactic that offers all goods and services at the same price (or perhaps two or three prices)?
Definition
single-price tactic
Term
Odd-even pricing is also called:
Definition
psychological pricing
Term
Reducing the services that come with the basic product is called:
Definition
unbundling
Term
_________ are extra fees paid by consumers for violating the terms of purchase agreements
Definition
consumer penalties
Term
Costs that are shared in the manufacturing and marketing of several products in a product line are called:
Definition
joint cost
Term
A(n) ______ is the result of applying human or mechanical efforts to people or objects
Definition
service
Term
_______ products are purchased with little shopping effort. These products typically are purchased regularly, usually with little planning and require wide distribution
Definition
convenience
Term
The value of company and brand names as referred to as:
Definition
Brand Equity
Term
A consumer who consistently and repeatedly purchases the same brand is said to have:
Definition
brand loyalty
Term
Campell's Nature Valley, Honda, and Lipton products are examples of _______ brands because of who owns them
Definition
manufacturers
Term
Which type of warranty is a written guarantee?
Definition
express
Term
________ occurs when an existing product is targeted toward new market segments. It is another type of new product development because the product is new to that segment
Definition
repositioning
Term
in the __________ stage of new-product development, preliminary demand, cost, sales, and profitability estimates are made.
Definition
Business analysis
Term
A team-oriented approach to new-product development is referred to as:
Definition
Simultaneous product development
Term
The _________ adopt a product because most of their friends have already done so, and their adoption is usually the result of pressure to conform because they rely on group norms.
Definition
Late majority
Term
A biological metaphor that traces the stages of a product's acceptance, from its introduction (birth) to its decline (death) is called the:
Definition
product life cycle
Term
What is a product?
Definition
Everything, both favorable and unfavorable that a person receives in an exchange

Tangible good
service
idea
Term
Business Product
Definition
A product used to manufacture other goods
Term
Consumer Product
Definition
A product bought to satisfy an individual's personal needs or wants

(make pies: buy ingredients and make pies and sell them)
Term
Amy stopped by the grocery store to pick up a gallon of milk. As she was waiting to check out she noticed that Soap Opera Digest had an interesting story about one of her favorite characters. As Amy is a huge fan of the long running soap, she had to buy a copy. In this example, the Soap Opera Digest is an example of a(n)________ product.
Definition
Convenience

Something you're familiar with, didn't plan to buy but you bought it anyways
Term
Convenience Product
Definition
A relatively inexpensive item that merits little shopping effort

candy bars, drinks, fast food
Term
Shopping Product
Definition
A product that requires comparison shopping, because it is usually more expensive and found in fewer stores

jeans, clothes, cars, (no specific brand in mind)
Term
Specialty Product
Definition
A particular item for which consumers search extensively and are reluctant to accept substitutes

Want a certain brand and won't buy it if they don't have it
Term
Specialty Product
Definition
A particular item for which consumers search extensively and are reluctant to accept substitutes

Want a certain brand and won't buy it if they don't have it
Term
Unsought Product
Definition
A product unknown to the potential buyer or a known product that the buyer does not actively seek

insurance, funeral planning, financial planning (usually a salesperson you come in contact with will make you aware of your need for it)
Term
There are a number of toothpastes marketed under the Crest brand including Cavity-Protection Crest, Sensitive-teeth protection Crest, Baking Soda Crest, ets. The large variety of toothpastes under the Crest brand is an example of a:
Definition
Product line (since it's JUST talking about toothpaste)
Term
Product Items
Definition
A specific version of a product that can be designated as a distinct offering among an organization's products

One certain product (different UPC code=Different product items)

One cell in excel
Term
Product Line
Definition
A group of closely-related product items

A column in Excel
Term
Product Mix
Definition
All products that an organization sells

The Excel spreadsheet
The entire mix of products
Everything the company has
Term
Benefits of Product LInes
Definition
Advertising economies
package uniformity
standardized components
efficient sales and distribution
equivalent quality
Term
Product Mix Width
Definition
The number of product lines an organization offers

Diversifies risk
Capitalizes on established reputation
Term
Product line Depth
Definition
The number of product items in a product line

Attracts buyers with different preferences

Increases sales/ profits by further market segmentation

Capitalizes on economies of scale

Evens out on seasonal sale patterns
Term
Brand
Definition
A name, term, symbol, design, or combination thereof that identifies a seller's products and differentiates them from competitor's products
Term
Brand Name
Definition
The part of a brand that can be spoken including letters, words, and numbers

Lucky Jeans, Nike Shoes
Term
Brand Mark
Definition
The elements of a brand that cannot be spoken

Golden Arches, Chevy bowtie, Nike Swish
Term
Brand Equity
Definition
The value of company and brand names

Coca-cola brand is VERY expensive
buying the name Google is Very expensive
Term
Global Brand
Definition
A brand where at least one-third of the product is sold outside its home country

Apple, McDonalds, Nike, Burger King, Nokia, Toyota, Pizza Hut
Term
Benefits of Branding
Definition
Product identification
repeat sales
new product sales
Term
Top Ten Global Brands
Definition
Coca Cola
IBM
Microsoft
GE
Nokia
Toyota
Intel
McDonald's
Disney
Google
Term
Wal-mart sells many health and beauty aid products under the name, Equate. This brand can only be purchased in Wal-Mart stores and is an example of a(n) ___________ brand.
Definition
Private (in store)
Term
No Brand
Definition
True Generic
Private Brand
Individual Brand
Family brand
Combination
Term
Brand
Definition
Manufacturers brand

Individual brand
family brand
combination
Term
Manufacturer's Brand
Definition
THe brand name of manufacturer

Under Armor, Nike
Term
Private Brand
Definition
A brand name owned by a wholesaler or a retailer. Also known as private label or store brand.

Hy-Vee Brands
Sam's or Wal-Mart Brands
Term
Advantages of Manufacturer's Brands
Definition
Heavy consumer ads by manufacturers
Attract new customers
Enhance dealer's prestige
Rapid delivery, carry less inventory
If dealer carries poor quality brand, customer may simply switch brands and remain loyal to dealer
Term
Advantages of Private Brands
Definition
Earn higher profits on own brand
Less pressure to mark down price
Term
Individual Brand
Definition
Using different brand names for different products

going away from this (diff. brand for different lines)
Term
Family Brand
Definition
Marketing several different products under the same brand name

Kraft
Nike (shoes, apparel, women, kids, men apparel)
Term
Cobranding
Definition
Selling two brands at the same time

KC masterpiece Barbeque Chips; herseys Betty Crocker Brownies
Term
Trademarks
Definition
exclusive right to use a brand

Many parts of a brand and associated symbol qualify for trademart protection

Trademark right comes from use rather than registration

the mark has to beontinuously protected

rights continue for as long as the mark is read

Tratemark law applies to the online world
Term
Sherwin-Williams paint brand, Dutch Boy, has come up with an all-plastic gallon container with an easy twist-offlid, comfortable side handle, and even a pouring spout. There is no other paint product like it on the market. This innovative packagaing was most likely designed for which of the follwing functions?
Definition
Facilitate Product for used and convenience
Term
Functions and Packaging
Definition
Contain and protect
promote
facilitate storage, use and convenience
facilitate recycling
Term
Labeling
Definition
Persuasive and informational
Term
Persuasive
Definition
Focuses on promotional theme
Consumer information is secondary
Term
Informational
Definition
Helps make proper selection
lowers cognitive dissonance
includes use/care
Term
Universal Product Codes
Definition
UPC's
A series of thick and thin vertical lines (bar codes), readable by computerized optical scanners, that represent numbers used to track products.
Term
Warranty
Definition
a confiration of the quality or performance of a good or service
Term
Express warranty
Definition
A written guarantee
Term
Implied Warranty
Definition
An unwritten guarantee that the good or ervice is fit for the purpose for which it was sold.

Buy something and there are bugs in it

Buy something and all the pieces aren't in there
Term
New Product
Definition
A product new to the world, market
Term
New Product Advantages
Definition
Being first on the market has numerous advantages:

Increased sales through longer sales life
Increased margins
increased product quality
Term
New-to-the-world Products
Definition
Don't see many of these
Term
New product lines
Definition
Car company

electric car line
Term
Product line additions
Definition
Company has added a new product to the mix (something new to a soft drink)
Term
Improvements or revisions
Definition
Toothpaste- now with whitening
Term
Repositioned Products
Definition
Term
Lower-Priced products
Definition
SW airlines- same seat on plane can be different priced (super saver)
Term
If you don't have new products, you can't keep going
Definition
"either green and growing, or ripe and rotting"
Term
New Product Success Factors
Definition
long-term commitment
company-specific approach
capitalize on experience
Establish an environment
Term
Process
Definition
New-product strategy
Idea Generation
Idea screening
Business analysis
Development
Test Marketing
Commercialization
NEW PRODUCT
Term
Idea Generation
Definition
Not filtered; everything is possible

Term
Sources of new-product ideas
Definition
Customers
Employees
Distributors
Vendors
Competitors
R and D
Consultants
Term
Brainstorming
Definition
the process of getting a group to think of unlimited ways to vary a product or solve a problem
Term
Idea Screening
Definition
The first filter in the product development process, which eliminates ideas that are inconsistent with the organization's new product strategy or are inappropriate for some other reason

Term
After Mattel evaluated many new products to add to its Barbie product line and before any prototype was created, the toy manufacturer instructed a committee to select three of the ideas to present to a group of consumers. The consumer group was asked to evaluate the three product ideas in terms of their marketability. This stage of new-product development is called:
Definition
Concept Testing
Term
Concept Test
Definition
A test to evaluate a new-product idea, usually before any prototype has been created

We've been thinking about adding this topping to pizza
Term
Business Analysis: Considerations in Business Analysis Stage
Definition
Can you afford the Product?

Demand
cost
sales
Profitability
Term
Development
Definition
-Creation of Prototype
-marketing strategy
-Packaging, branding, labeling
-Promotion, price, and distribution strategy
-Manufacturing feasibility
-Final government approvals if needed
Term
Simultaneous product development
Definition
work on stuff all together
saves time
team-oriented
Term
Test Marketing
Definition
A limited introduction of a product and marketing program to determine the reactions of potential customers in a market situation
Term
Alternatives to Test Marketing
Definition
Simulated (laboratory) market testing
Online test marketing
Term
Commercialization
Definition
Production
Inventory Buildup
Distribution Shipments
Sales Training
Trade Announcements
Customer Advertising
Term
Why some products succeed and others fail
Definition
No discernible benefits
poor match between features and customer desires
overestimation of market size
incorrect positioning
price too high or too low
inadequate distribution
poor promotion
inferior product
Term
Success Factors
Definition
Good Price
GOod Promotion
Match between product and market needs
Different from substitute products
Benefit to large numbers of people
listening to customers
Producing the best product
Vision of future market
Getting every aspect right
Strong leadership
Commitment to new-product development
Project-based team approach
Willingness to fail occasionally
Term
The Spread of new products-All of the following statements about how adopters participate in the diffusion process are true EXCEPTS:
Definition
-Early Adopters may also be opinion leaders
-Laggards are the last consumer to adopt a new product
-THERE ARE THREE CATEGORIES OF CONSUMERS WHO WILL ADOPT AN INNOVATION (THERE ARE 5)
-The dominant characteristic of memebers of the late majority is skepticism
-Innovators are the first to purchase a new product
Term
Diffusion
Definition
The process by which the adoption of an innobation spreads

Smart Phones (not IPhones)
Term
Categories of Adopters (KNOW CHARACTERISTICS/ EXAMPLES OF EACH)
Definition
Innovators
Early Adopters
Early Majority
Late Majority
Laggards
Term
Product characteristics and the rate of adoptions
Definition
Complexity (Easy-fast; kind of difficult-slow)
Compatibility
Relative advantage
Observability (Can you see other people wearing it, wanting it, etc.
Trialability (Can you try it before you buy it?)
Term
Communication aids the diffusion process
Definition
Word of Mouth (Friend)
Direction from Marketer (marketer)
Term
The Stages of the product life cycle, in order, are:
Definition
Introduction, growth, maturity, decline (MEMORIZE)
Term
Product Life Cycle
Definition
A biological metaphor that traces the stages of a products acceptance from its introduction (birth) to it's decline (death)

Introductory Stage (sales 0)

Growth Stage (profits peak)

Maturity Stage (Sales Peak; more sales less profits; prices are lowered, but selling more; competition is crazy so you have to be competitive pricewise)

Decline Stage
Term
Product Life Cycles for
Definition
Styles
Fashions
Fads (doesn't see the whole product lifecycle)
Term
Introductory Stage
Definition
High Failure rates
Little competition
frequent production modification
limited distribution
high marketing and production costs
Negative profits with slow sales increases
Promotion focuses on awareness and information
Communication challenge is to stimulate primary demand
Term
Growth Stage
Definition
Increasing rate of sales
Enterance of competitors
Market consolidation
Initial healthy profits
Aggressive advertising of differences between brands
Wider Distribution
Term
Maturity Stage
Definition
Sales increase at a decreasing rate
Saturated markets
Annual models appear
Lengthened product lines
Service and repair assume important roles
Heavy promotions to consumer and dealers
Marginal competitors drop out
Niche marketers emerge
Term
Decline Stage
Definition
Long-run drop in sales
Large inventories of unsold items
Elimination of all nonessential marketing expenses
"Organized abandonment"
(Knowing and planning to abandon a particular line (VCR's)
Term
PRODUCT LIFE CYCLES SLIDE: USE TO STUDY FOR TEST!!!
Definition
Term
Service
Definition
The result of applying human or mechanical efforts to people or objects

A lot of times a service is accompanied with a good
Term
__% of GDP is earned through services
Definition
81%
Term
David and Kathy are trying to decide where to go on vacation. David has suggested a cruise. Since neither of them have been on a cruise before, they will be unable to assess the _________ of a cruise until they have actually taken the vacation.
Definition
Experience quality
Term
Inseperable
Definition
From the person performing the service

You can't get your haircut without being there

Have to be in contact with service provider to get that service