Study Guide for Exam 3: Developing New Products and Services

A collection of flashcards summarizing key concepts related to new products and services, pricing, and marketing channels based on a study guide.

Product

A good, service, or idea with a bundle of tangible and intangible attributes that satisfies consumer needs.

Consumer Products

Items purchased by the ultimate consumer.

Business Products

Items purchased by organizations that assist in providing other products for resale.

New-Product Development Process

Seven stages organizations go through to identify opportunities and convert them into salable products or services.

Feature Bloat

Adding unnecessary features or functionality to a product.

Feature Fatigue

The complexity of a product that reduces consumer satisfaction.

Gap Analysis

Comparing consumer expectations with actual experiences to assess service quality.

Convenience Products

Items that the consumer purchases frequently, conveniently, and with a minimum of shopping effort.

Shopping Products

Items for which the consumer compares several alternatives on criteria such as price, quality, or style.

Specialty Products

Items that a consumer makes a special effort to search out and buy.

Unsought Products

Items that the consumer either does not know about or knows about but does not initially want.

Idle Production Capacity

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

Product Item

Stock-keeping unit (SKU).

Product Line

Closely related group of items.

Product Mix

All of the product lines offered by a company.

Continuous Innovation

Consumers do not need to learn new behaviors.

Dynamically Continuous Innovation

Minor behavior changes are needed.

Discontinuous Innovation

Consumer learns new consumption patterns in order to use the product.

Brand Extension

Using the brand name on a new product.

Protocol

(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.

Product Life Cycle

Describes the stages a product goes through in the marketplace: introduction, growth, maturity, and decline.

Branding

Marketing decision in which an organization uses a name, phrase, design, or symbols to identify its products and distinguish them from competitors.

Brand Equity

The added value a brand name gives to a product beyond the functional benefits it provides.

Packaging

Any container in which a product is offered for sale and on which label information is conveyed.

Seven Ps of Services Marketing

Product, price, place, promotion, people, physical environment, and process.

Penetration Pricing

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

Skimming Pricing

Setting the highest initial price that customers who really desire the product are willing to pay.

Channel Conflict

Arises when one channel member believes another is engaging in behavior that prevents it from achieving its goals.

Logistics Management

The practice of organizing the cost-effective flow of raw materials, in-process inventory, finished goods, and related information from point of origin to point of consumption to satisfy customer requirements.

Supply Chain Management

Integration of information and logistics across firms to create and deliver products and services that provide value to consumers.