Chapter 14 Business

brand name

Name of one or more items in a product line that identifies the source or character of the items.

promotion mix

Efforts by a company to reach distribution channels and to target customers through communica­tions, such as personal selling, advertising, public relations, and direct marketing.

pull strategy

Promotional strategy designed to create buyer demand that w ill encourage distribution channel members to stock a company's product.

push strategy

Promotional strategy designed to pressure distribution channel members to carry a product and to promote it to final users of the product.

International Advertising

International advertising differs a great deal from advertising in domestic markets. Managers must rely on their knowledge of a market to decide whether an ad is suitable for the company's inter­ national promotional efforts.

Shortened Product Life Cycles

Companies traditionally managed to extend a product's life by introducing it into different markets consecutively. They did this by introducing products in industrialized countries and only later marketing them in developing and emerging markets. Thus, while a product's sales are declining in one market, they might be growing in another.

Counterfeit Goods and Black Markets.

Counterfeiting is common among highly visible brand-name consumer goods, includingwatches, perfumes, clothing, movies, music, and computer software. Counterfeit products are typically sold to consumers on what is called the black market-a marketplace of underground transactions that typically appears because a product is either illegal (such as counterfeits) or tightly regulated

National Image

The value customers obtain from a product is heavily influenced by the image of the country in which it is designed, manufactured, or assembled. We consider the influence ofa country's name when thinking of Italian shoes, German luxury cars, and Japanese electronics. This image can be positive for some products but negative for others.

PRODUCT/COMMUNICATIONS EXTENSION (DUAL EXTENSION)

PRODUCT/COMMUNICATIONS EXTENSION (DUAL EXTENSION) This method extendsthe same home-market product and marketing promotion into target markets. Under certain con­ ditions, it can be the simplest and most profitable strategy. For example, because of a common language and other culn1ral similarities, companies based in English-speaking Canadian provinces can sell the same product with packaging and advertising in the US market-provided the product is not required by the US government to carry any special statements or warnings.

PRODUCT EXTENSION/COMMUNICATIONS ADAPTATION

Under this method, a company extends the same product into target markets but alters its promotion. Communications require adaptation because the product satisfies a different need, serves a different function, or appeals to a different type of buyer.

PRODUCT ADAPTATION/COMMUNICATIONS EXTENSION

Using this method, a company adapts its product to the requirements of the international market while retaining the product's original marketing communication.

PRODUCT/COMMUNICATIONS ADAPTATION (DUAL ADAPTATION)

PRODUCT/COMMUNICATIONS ADAPTATION (DUAL ADAPTATION) This method adapts both the product and its marketing communication to suit the target market. The product itself is adapted to match the needs or preferences of local buyers.

PRODUCT INVENTION

PRODUCT INVENTION This method requires that an entirely new product be developed forthe target market. Product invention is often necessary when many important differences exist between the home and target markets.

exclusive channel

Distribution channel in which a manufacturer grants the right to sell its product to only one or a lim ited number of resellers.

Zero level channel

In a zero-level channel-which is also called direct marketing-pro­ ducers sell directly to final buyers.

value density

Value of a product relative to its weight and volume.

worldwide pricing

Policy in which one selling price is established for all international markets.

dual pricing

Policy in which a product has a dif­ ferent selling price (typically higher) in export markets than it has in the home market.

transfer price

Price charged for a good or service transferred among a company and its subsidiaries.

arm's length price

Free-market price that unrelated parties charge one another for a specific product.

Price controls

Upper or lower limits placed on the prices of products sold within a country.