Marketing Quiz 3

Product Line

group of closely related products sold to same customer group with similar pricing

Product Item

stock keeping the unit/item

Product Mix

all product lines offered by organization

Product Class

specific, narrow grouping of items sharing similar physical characteristics, functions, and target demographics, serving as a subset within a broader product category. ex: Running shoes in footwear

Product

good, service or idea with attributes that satisfy cusomer needs and is recieved in exchange for money or something of value

Tangible Product

physical, touchable item that can be seen, felt, and held, with a measurable existence ex: electronics

Intangible Product

non-physical asset or service that cannot be touched, seen, or stored, yet provides value, utility, or experience to the consumer. ex: insurance

Durable Product

used repeatedly over time ex: car

Nondurable Product

consumed over short period of time ex: battery

Consumer Product Classifications and Marketing Strategies

Convenience - frequent purchase - widespread many outlets

Shopping - compares criteria - differentiation from competitors stressed.

Specialty products - special effort to search/buy - uniqueness of brands

Unsought products - items consumer does not know about - awareness is essential

4 stages of product life style + characteristics + objectives

Intro - sales grow slow, build awarness, create selective deamnd for specific brand

Growth - rapid sales growth, more competition, profit peak

maturity - industry and product sales slow, lots of repeat customers

Decline - price decreases, retain product but reduce marketing costs (harvesting)

Product Line extension

introduce new, similar items (flavors, sizes) under an existing brand within the same product category to increase depth ex: coke, Diet coke

Brand Extension

using a current brand name to enter a copellet different product class, ex: soap to beauty products

4 reasons consumers resist new product

usage barriers - product not compatible with habits

value barriers - no incentive to change

Risk barriers - phsyica, economic, social

psychological barriers - cultiure difference or image

Types of Demand during Product Lifestyle

primary demand (market education) in the introduction stage, growing/fast-rising demand in the growth phase, stable/saturated demand in maturity, and declining demand in the final phase

3 competitive advantages/ disadvantages of packaging and labeling

1. communicates benefits

2. functional benefits - storage, convience, or protection

3. perceptual benefits - distinguishes brand in customers eyes

Four i’s of Service

1. Intangibility - can’t be touched or seen before purchase

2. Inseparability - delivered and consumed simultaneously 

3. Inconsistency - quality can vary based on the person delivering service

4. Inventory - can’t be stored for future use

3 unique P’s of service w/ examples

1. People 

   1. Internal marketing 

   2. Customer experience management 

2. Physical Environment

3. Process

   1. Capacity Managment 

Idle production capacity

Occurs when service provider is available but there is no demand for the service\

Supplementary Services

add value and provide competitive differentiation or a better customer experience.

Roles People play in Managing services and concept of customer expereince managment

• Unskilled labor - lawn care

• Skilled Labor - appliance repair 

• Professional - lawyers

Price Equation (Final Price)

Final Price = List price - (Incentives + allowances) + extra frees

Profits

Total revenue - total cost 

Profit = (unit price x quantity sold) - (Fixed cost + variable cost)

Total Cost

Total Cost = Fixed Cost + Variable Cost 

TC = total expense incurred

FC = satbale and do change

VC vary directly with quantity of product

Fixed Cost

stable and do not change

Varibale Cost

vary directly with quantity of product

break even quanity

Elastic

small price change caused a big change in demand. airefare

Inelastic

if big price change causes little or no change in demand

Necessities are price inelastic  gasoline

pricing approaches and policies

1. demand oriented approaches

2. cost oriented approaches

3. profit oriented approaches

4. competition oriented approaches