Marketing Exam 2

Brand purpose

the reason why a brand exists, the place it has in consumers’ lives, the solution it provides to consumers, and the brand’s role in making society better off. It focuses on a brand’s underlying values and beliefs and its identity and meaning

Brand equity

the added value a brand name gives to a product beyond the functional benefits provided

Brand meaning and customer perceptions

The ideas, feelings, associations, and beliefs customers connect with a brand that influence how they perceive its value and distinguish it from competitors.

Multiproduct branding

branding strategy in which a company uses one name for all its products in a product class

Mixed branding

branding strategy where a firm markets products under its own name(s) and that of a reseller because the segment attracted to the reseller is different from its own market

Private branding

a branding strategy used when a manufacturer produces products but sells them under the brand name of a wholesaler or retailer, also called private labeling or reseller branding

Multibranding

branding strategy that involves giving each product a distinct name when each brand is intended for a different market segment

Packaging

a component of a product that refers to any container in which it is offered for sale on which label information is conveyed

Label

an integral part of the package that typically identifies the product or brand, who made it, where and when it was made, how it is to be used, and package contents and ingredients

how branding decisions support the intended audience and positioning

Choosing a brand name, design, personality, and messaging that appeal to the target audience and communicate the product’s desired image and place in the market.

Product

a good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies consumers’ needs and is received in exchange for money or something else of value

Services

intangible activities or benefits that an organization provides to satisfy consumers’ needs in exchange for money or something else of value

Product item

a specific product that has unique brand, size, or price

Product line

group of product or service items that are closely related because they satisfy a class of needs, are used together, are sold to the same customer group, are distributed through the same outlets, or fall within a given price range

Product mix

consists of all the product lines offered by an organization

Protocol

statement that, before product development begins, identifies: (1) a well-defined target market; (2) specific customers’ needs, wants, and preferences; and (3) what the product will be and do to satisfy consumers

Open innovation

consists of practices and processes that encourage the use of external and internal ideas as well as internal and external collaboration when conceiving, producing, and marketing new products and services

new-product development process

consists of seven stages an organization goes through to identify opportunities and convert them to salable products or services

7 stages in new-product development process

new-product strategy development, idea generation, screening and evaluation, business analysis, development, market testing, commercialization

New-product strategy development

first stage of new-product process, defines role for a new product in terms of the firm’s overall objectives (SWOT analysis, environmental scanning, protocol and strategic role defined, disruptive innovation)

Idea generation

second stage of new-product process, develops pool of concepts to serve as candidates for new products, building upon previous stage’s results (internal and external, employee, friend, customer, and supplier suggestions, crowdsourcing)

Screening and evaluation

third stage of new-product process, internally and externally evaluates new-product ideas to eliminate those that warrant no further effort (customer experience management, concept tests)

Business analysis

fourth stage of new-product process, specifies the features of the product and the marketing strategy needed to bring it to market and make financial projections (business fit of new product, data analysis)

Development

fifth stage of new-product process, turns the idea on paper into a prototype

Market testing

sixth stage of new-product process, exposes actual products to prospective consumers under realistic purchase conditions to see if they will buy (standard, controlled, and simulated test markets)

Commercialization

seventh stage of new-product process, positions and launches new product in full-scale production and sales

The product life cycle

describes stages a new product goes through in the marketplace: introduction, growth, maturity, and decline

Product modification

altering one or more of a product’s characteristics, such as its quality, or appearance, to increase the product’s value to customers and increase sales

Market modification

strategies by which a company tries to find new customers, increase a product’s use among existing customers, or create new use situations

Trading up

adding value to the product (or line) through additional features or higher quality materials

Trading down

reducing a product’s number of features, quality, or price

Price

the money or other consideration (including other products and services) exchanged for the ownership or use of a product or service

Value

ratio of perceived benefits to price (perceived benefits divided by price)

Value pricing

practice of simultaneously increasing product and service benefits while maintaining or decreasing price

Pricing objectives

specify role of price in organization's marketing and strategic plans

Pricing constraints

factors that limit range of prices a firm may set

Total Revenue

total money received from sale of a product

Total cost

total expense incurred by a firm in producing and marketing a product, sum of fixed cost and variable cost

Break-even analysis

technique that analyzes the relationship between total revenue and total cost to determine

profitability at various levels of output

Skimming pricing

setting the highest initial price that customers who really desire the product are willing to pay when introducing a new or innovative product

Penetration pricing

setting a low initial price on a new product to appeal immediately to the mass market

Prestige pricing

setting a high price so that quality or status conscious consumers will be attracted to the product and buy it

Price lining

setting the price of a line of products at a number of different specific pricing points

Odd-even pricing

setting prices a few dollars or cents under an even number

Target pricing

(1) estimating the price that ultimate consumers would be willing to pay for a product, (2) working backward through markups taken by retailers and wholesalers to determine what price to charge wholesalers, and then (3) deliberately adjusting the composition and features of the product to achieve the target price to consumers

Bundle pricing

the marketing of two or more products in a single package price

Yield management pricing

charging of different prices to maximize revenue for a set amount of capacity at any given time

Customary pricing

involves setting a price that is dictated by tradition, a standardized channel of distribution, or other competitive factors

Above-, at-, or below-market pricing

setting a market price for a product or product class based on a subjective feel for the competitors’ price or market price as the benchmark

Marketing research

the process of defining a marketing problem and opportunity, systematically collecting and analyzing information, and recommending actions

Marketing research steps

define the problem, develop the research plan, collect relevant information, develop findings, take marketing actions

Data

facts and figures related to the project that are divided into two main parts: secondary and primary data

Secondary data

facts and figures that have already been recorded prior to the project at hand

Primary data

facts and figures that are newly collected for the project

Observational data

facts and figures obtained by watching how people actually behave, using mechanical, personal, or neuromarketing data collection methods

Questionnaire data

facts and figures obtained by asking people about their attitudes, awareness, intentions, and behaviors

Data mining

practice of examining large databases to find statistical relationships between consumer purchasing patterns and marketing actions

Predictive modeling

based on statistical models that use data mining and probability analysis to foretell outcomes

Qualitative research

research using nonnumerical evidence to understand experiences, meanings, and reasons

Quantitative research

research using numerical evidence to measure patterns and compare results

Descriptive analysis

summarizes observed data

Correlational analysis

measures association between variables

Predictive analysis

uses a model to estimate an unknown outcome

Causal analysis

estimates the effect of changing a facto