Chapter 15 - Managing the Marketing Mix

What is product development?

The process of creating a good, service, or a combination of both.

Why is product development crucial for businesses?

To design and promote better products that provide the best value to consumers.

Define 'value' in the context of product evaluation.

Good quality at a fair price, calculated by benefits minus costs.

What is a total product offer?

Everything that consumers evaluate when deciding whether to buy something.

List potential components of a total product offer.

Price, brand name, store surroundings, service, speed of delivery, reputation, image, packaging, convenience.

What is a product line?

A group of products that are physically similar or intended for a similar market.

What constitutes a product mix?

The combination of product lines offered by a manufacturer.

What is product differentiation?

The creation of real or perceived product differences to enhance perceived value.

How can packaging change a product?

By making it more attractive to retailers and improving its basic product features.

What is shrinkflation?

A tactic where companies reduce the size or weight of a product without increasing the price.

Define slack-fill.

The empty space in a package that could mislead consumers if it serves no functional purpose.

What does 'maple-washing' refer to?

Misleadingly suggesting a product is Canadian by using Canadian imagery.

What is brand equity?

The value of the brand name and associated symbols.

What is brand loyalty?

The degree to which customers are satisfied and committed to further purchases.

What is the role of a brand manager?

To have direct responsibility for one brand or product line.

Differentiate between national brand and private brand.

National brand is distributed and advertised nationally; private brand carries the distributor's name.

What is a generic name?

A name for a product category that is not advertised and sold at a discount.

What is brand erosion?

The gradual decline of a brand's value and customer loyalty.

What is competitive pricing?

A pricing strategy based on what competitors are doing.

What is cost-based pricing?

Setting prices based on the desired profit margin.

Define demand-based pricing.

A pricing strategy driven by consumer demand and willingness to pay.

What is break-even analysis?

The process used to determine profitability at various sales levels.

What is a skimming price strategy?

Pricing a new product high to recover R&D costs quickly.

What is penetration pricing?

Pricing a new product low to capture a large market share quickly.

What is Everyday Low Pricing (EDLP)?

A pricing strategy that sets prices lower than competitors without frequent sales.

What is captive pricing?

Pricing strategy where the core product is sold at a low price, but complementary products are priced higher.

What is non-price competition?

Competing on product attributes other than price.

What is breakeven pricing?

Breakeven pricing is a strategy where the price is set to cover costs without profit.

What does non-price competition refer to?

Non-price competition refers to competing on product attributes other than price, such as product image and consumer benefits.

What are the five types of utility provided by distributors?

Time utility, place utility, ownership utility, information utility, and service utility.

What is time utility?

Time utility adds value by making products available to customers at convenient times.

What is place utility?

Place utility provides the right products at the right place.

What is ownership utility?

Ownership utility makes it easier for customers to possess the goods and services they purchase.

What is information utility?

Information utility increases customer satisfaction by providing helpful information.

What is service utility?

Service utility adds value by providing fast, friendly, and personalized service.

What role do agents and brokers play in marketing?

Agents and brokers bring buyers and sellers together to assist in negotiating exchanges without taking title to the goods.

What is the difference between wholesalers and retailers?

Wholesalers sell to other organizations, while retailers sell directly to ultimate consumers.

What is intensive distribution?

Intensive distribution puts products into as many retail outlets as possible.

What is selective distribution?

Selective distribution uses only a preferred group of available retailers in an area.

What is exclusive distribution?

Exclusive distribution uses only one retail outlet in a given geographic area.

What is non-store retailing?

Non-store retailing includes online retailing, telemarketing, vending machines, kiosks, direct selling, and multi-level marketing.

What is telemarketing?

Telemarketing is the sale of goods and services by telephone, supplementing or replacing in-store selling.

What are pop-up stores used for?

Pop-up stores connect online brands with customers, test retail, and reduce shipping.

What is multi-level marketing (MLM)?

MLM relies on independent contractors who earn commissions from their sales and those of recruits in their downline.

How does the supply chain differ from the channel of distribution?

The supply chain includes links from suppliers to manufacturers, while the channel of distribution starts with manufacturers.

What is the promotional mix?

The promotional mix consists of all techniques that sellers use to motivate customers to buy their products.

What are the categories of advertising?

Categories include product advertising, online advertising, and comparison advertising.

What is personal selling?

Personal selling is the face-to-face presentation and promotion of goods and services.

What is public relations (PR)?

PR is the management function that evaluates public attitudes and executes programs to earn public understanding and acceptance.

What is sales promotion?

Sales promotion stimulates consumer purchasing and dealer interest through short-term activities.

What is direct marketing?

Direct marketing links manufacturers or intermediaries directly with the ultimate consumer.

What is word of mouth (W.O.M) promotion?

W.O.M promotion involves people telling others about products they've purchased or services they've used.

What are some contemporary promotional tools?

Contemporary promotional tools include social media, blogging, podcasting, and mobile marketing.

Price matching

A store promises to sell you a product for the same low price a competitor offers (or even lower)

Price beating

A store promises to not only match a competitor's lower price on an identical product, but also reduce their price by an additional fixed amount or percentage. 

Captive market

Geographical location makes it harder to get the food in the North

There's a smaller market for producers, population wise. 

what kind of pricing is used? 

 

A house is on sale for: $799,900 

A car on sale for: $9,995  

Psychological pricing 

• Why?: To consumers, this looks more affordable and consumers will tend to lean more towards purchasing it as it looks more affordable.  

  • Even though $9,995 is only short of $5 from $10,000 

B2C Consumer process

1. Approach

2. Ask Questions

3. Make preentation

4. Close sale

5. Follow up

5 components of product

• Advertising

• Direct marketing

• Personal selling

• Public relations (PR)

• Sales promotion

**** (EXAM) Which of the following distribution modes is the longest?

Supply chain is the longest mode of distribution 

**** (EXAM) The marketing mix vs Promotional mix

The marketing Mix is the broad strategy covering Product, Price, Place, Promotion (the 4P’s) while the Promotional Mix is a component of that mix, focusing narrowly on communication tools like advertising, sales promotion, PR, and personal selling to persuade customers

Another name for a store manager is:

A product manager

The type of retailer that sells a huge variety of one type of product to dominate one type of goods is a:

Category Killer

Universal Product Codes (UPC)

Combine a bar code (black and white lines) and a preset number that gives the retailer information about the product’s price, size, colour, and other attributes.

Free samples, information pamphlets, and contests used to promote a product are considered part of the

Promotional mix

A means of distributing audio and video programs via the Internet that lets users subscribe to a number of files, also known as feeds, and then hear or view the material at the time they choose is known as___

podcasting

A brand manager manages all elements of a product line or the brand's _____

Marketing mix

Everything that consumers evaluate when deciding whether to buy something is referred to as the 

total product offer

Break-even analysis is

the process used to determine profitability at various levels of sales