Chapter 11 Marketing Terms

line extension

A marketing strategy that uses an existing brand to introduce a new item into the same product line.

Product modification

Change in one or more characteristics of a product.

Quality modifications

Changes relating to a product's dependability and durability.

functional modifications

Changes affecting a product's versatility, effectiveness, convenience, or safety.

Aesthetic modifications

Changes to the sensory appeal of a product.

Disruptive innovation

Identifies old technologies that can be exploited in new ways or develops new business models to give customers more than they've come to expect from current products in a specific market.

new product development process

A seven-phase process for introducing products.

idea generation

The methodical search for new product ideas.

screening

The process of evaluating new product ideas to identify those with the greatest potential for success.

concept testing

Testing new product ideas by asking a target group of customers to provide feedback to determine potential consumer appeal.

business analysis

Evaluating the potential contribution of a product idea to the firm's sales, costs, and profits.

breakeven analysis

Calculating how many units a company would have to sell to begin making a profit.

payback analysis

Computing the time period required to recover the funds that would be invested in developing the new product.

Product development

The phase in which the organization creates a prototype—or a working model—to determine the feasibility of developing the product as a viable market offering.

Test marketing

A limited introduction of a product in geographic areas that represent the desired market.

commercialization

Fully introducing the product into the market.

Product differentiation

Creating and designing products so that customers perceive them as distinct from competing products.

Quality

The ability of a product to satisfy a customer's needs as anticipated.

level of quality

The amount of quality a product possesses.

Consistency of quality

The degree to which a product has the same level of quality over time.

Product design

How a product is conceived, planned, and produced.

styling

The physical appearance of a product.

Product features

Specific design characteristics that allow a product to perform certain tasks.

customer services

Human or mechanical efforts or activities that add value to a product.

Product positioning

The place that a brand occupies in the minds of customers relative to the competition.

Product deletion

Eliminating a product from the product mix.

Intangibility

A service is not physical and therefore cannot be touched.

inseparability

The inability to differentiate between the production and consumption of the service.

Perishability

Refers to the fact that services cannot be resold or stored for future sale.

heterogeneity

Variation in quality.

client-based relationships

Interactions that result in satisfied customers who use a service repeatedly over time.

Customer contact

The level of interaction between provider and customer needed to deliver the service.

Off-peak pricing

The practice of reducing prices of services used during slow periods in order to boost demand.

product manager

The person within an organization responsible for a product, a product line, or several distinct products that make up a group.

brand manager

The person responsible for a single brand.

venture team

A cross-functional group that creates entirely new products that may be aimed at new markets.