Marketing Exam 3

Product

anything that is of value to a consumer and can be offered through a voluntary marketing exchange.

Consumer products

products / services for personal consumption

Convenience

customer buys frequently, immediately, and with minimum effort. Often inexpensive.

Shopping

customer compares carefully on suitability, quality, price, and style. Occasional purchase, (more) expensive

Specialty

possess unique characteristics or brand identification. Considerable buying effort.

Unsought

consumer does not know about or knows about but does not normally think of buying.

Product Mix

complete list of all products and services offered by a firm

Product line

groups of associated items that consumers tend to use together or think of as part of a group of similar products

Brand

name, term, sign, or design or a combination of
these that identifies a seller’s products as distinct from others. May include brand name, brand mark, trademark or trade name

Brand equity

brand value; set of assets and liabilities linked to a brand

Brand Awareness

measures how many consumers in a market are familiar with the brand

Brand Loyalty

when a consumer buys the same brand’s products repeatedly over time

Brand Ownership

marketers have four options

-Manufacturer’s (national) brand

-Retailer / Store (private label)

-Family

-Individual

Brand Name

choosing a brand name

-Easy to say, spell, recall

-Suggest the product’s uses, characteristics or benefits

-Be distinctive and extendable

-Be capable of registration and legal protection

-Translate easily

Brand Development

includes four options:

-line extension 

-Brand extension 

-co-branding 

-new brands/rebranding

Packaging

activities of designing and producing the container for a product. Used for protection, customer convenience and promotion.

Labeling

presentation of information on a product or package. Includes required or optional information.

Product Modification

redesign product or packaging

Market Modification

encourage new product uses / users

Marketing Mix Modification

increase sales by changing one or more components of the marketing mix

Decline

Retain or eliminate product

Price

overall sacrifice a consumer is willing to make to
acquire a specific product or service

Profit Orientation

company policy that products must attain a
specified profit margin

Sales Orientation

belief that increasing sales will help more
than increasing profits

Competitor Orientation

pricing significantly influenced by the competition

Customer Orientation

based on how value is added to product or service

Demand Curve

how many will the consumer demand at different prices

Prestige products

purchased for status vs functionality

Price elasticity of demand

ratio that measures how a price change affects (relative) demand

Elastic

demand is price sensitive; substitute available

Inelastic

demand is insensitive to price; none or fewer substitutes

Break-even analysis

used to understand the relationship between cost, price, revenue and profit; break-even point

Cost-Based Method

final price determined by starting
with cost; markup

Competition Based Method

set prices relevant to those
of competitor

Value-Based Method

price based on overall value of offering as perceived by consumer

Cost-of-Ownership Method

determined by total cost of owning/using the product

Pricing Strategy

long-term approach to setting prices based on the 5 C’s of pricing

Everyday Low Pricing

prices set between regular and discounted prices by competitors; prices tend to be lower

High / Low Pricing

involves temporary reductions in pricing and
sales promotion

Price skimming

high initial prices to “skim” revenue layers from the market. Skim the profit.

Penetration pricing

low initial price to “penetrate” the market, and secure high volume

Pricing Tactic

short term, focused on the consumer.

Captive-product pricing

pricing products that must be used along with a main product

By-product pricing

pricing by-products to make the main product
competitive

Product bundle pricing

Combining several products and offering the bundle at a reduced price

Discount and allowance pricing

price reductions to reward customers for certain responses

Segmented pricing

product is sold at two or more prices even though the difference is not based on cost

Psychological pricing

consider the psychology of prices, not simply the economics.

Promotional pricing

when prices are temporarily priced below list price or below cost

Geographical pricing

used for customers in different parts of the country or the world

Dynamic pricing

prices are adjusted continually to meet the characteristics and needs of the individual customer and situations

International pricing

is when prices are set in a specific country based on country-specific factors