D One Seven for Learning Live Cohort - Session Three

Flashcards covering key vocabulary and concepts from Unit 4, Modules 7, 8, and 9, focusing on product strategies, services, and pricing.

Product

Anything offered to the consumer that satisfies a need or want.

Essential Benefit

Why we need the product or what we're going to get out of the product.

Core Product

The what of the product; those things that we can see that make up the benefits.

Enhanced Product

The extras that we get with the product.

Tangibility

How easy it is for the consumer to physically touch, examine, or see the product prior to purchase.

Durability

Represents the length of the product's use.

Convenience Goods

Grab and go items at the checkout lane that are low cost and regularly purchased.

Shopping Goods

Goods that cost more than convenience goods and are purchased less frequently.

Specialty Products

Once in a lifetime purchases that can only be obtained from the manufacturer and are extremely pricey.

Unsought Goods

Products that we don't know we need until we need them.

Materials

The resources needed to produce a product, such as lumber, minerals, or farm products.

Parts

Equipment, either fully assembled or in smaller pieces, that will be assembled into larger components and used in the production process.

MRO

Everyday items that a company needs to keep running; maintenance, repair, and operating supplies.

Capital Goods

Major purchases in support of a significant business function, such as building a new plant or installing a new IT network.

Form (Product Differentiation)

Changes to the product's size, shape, color, and other physical characteristics.

Features (Product Differentiation)

Product and performance attributes.

Performance Quality (Product Differentiation)

Building the product to performance expectations; higher cost usually leads to higher expectations.

Conformance Quality (Product Differentiation)

Delivering on the promise of marketing communications.

Durability (Product Differentiation)

How long the product will last.

Reliability (Product Differentiation)

The percentage of time that the product will work without failure.

Repairability (Product Differentiation)

How easy it is to fix the product.

Style (Product Differentiation)

The look and feel of the product.

Product Planning

Organizing individual products into lines, allowing product managers to make decisions about adding or removing products.

Product Mix

All the products offered by a company, regardless of product line.

Product Life Cycle

The four stages a product category goes through: introduction, growth, maturity, and decline.

Introduction Stage

When a product category becomes available to the consumer.

Growth Stage

The stage where sales start to creep up and then increase dramatically.

Maturity Stage

The stage where sales may be slowed down, but more importantly, they stabilize.

New Product Development

Acquiring another company and moving into a space that maybe they weren't in before, which now becomes a new product offering for them or developing new products

Disruptive Innovation

Products that are so innovative that they create a fundamental change in the marketplace.

Sustaining Innovations

Products that are newer, better, faster versions of existing products that target existing customers.

Cost Reduction

Introducing a value version of the product; less features, less quality, altered service.

Go-to-Market Mistake

When a company fails to stop a bad product idea from moving into product development.

Stop-Market Mistake

When a good idea is prematurely eliminated during the screening process.

Innovation Diffusion Process

How long it takes the product to move from first purchase to last purchase.

Awareness (Adoption Process)

The user knows of the product but has insufficient information to move forward through the adoption process.

Interest (Adoption Process)

The user is looking for more information about the product because they have a need for the product.

Evaluation (Adoption Process)

The user is comparing the product with the competition's products, looking at things like price, quality, warranties.

Trial (Adoption Process)

The user purchases the product but is still deciding if the product is right for them.

Adoption Process

The user has grown loyal to the product because it does provide them the value that the consumer was looking for.

Innovators

Product enthusiasts who enjoy being the first to try and master a new product.

Early Adopters

Opinion leaders who seek out new products consistent with their personal self-image.

Early Majority

Product watchers who want to be convinced of the product's claims and value proposition before making a commitment.

Late Majority

Product followers that are price-sensitive and risk-adverse.

Laggards

Product avoiders that want to evade adoption if possible; resistant to change.

Service

A new logic that considers service and the customer experience to be the principal function in marketing.

Intangibility

The service cannot be seen, heard, tasted, felt, or smelled.

Inseparability

The service is produced and consumed at the same time; cannot be separated from the provider or recipient.

Variability

The service is only as good as the service provider.

Perishability

The service cannot be stored for future use.

Service Profit Chain

A tool used to see the connections between employees and the quality of service that they are delivering.

Internal Marketing

Recognizing that employees are a customer group and finding ways to meet their needs.

Brand Advocates

People who actively promote brands to people they know through word-of-mouth.

Search Attributes

Attributes that can be verified upon inspection.

Experience Attributes

Attributes can be verified after use.

Credence Attributes

Difficult to evaluate even after use, so trust comes into play.

Customer Delight

Exceeding expectations.

Service Quality

How we measure performance versus expectations.

Service Encounter

When the customer is interacting with the service provider.

Moment of Truth

The face to face time between the customer and the service provider.

Gap Analysis

A tool used to discover gaps between expectations and performance.

Gap One

We don't know what the customer actually wants.

Gap Two

We design service processes that do not meet the customer's needs.

Gap Three

We do not perform up to par, maybe due to poor training, poor execution, poor management.

Gap Four

We say one thing in our advertising and then do another.

Gap Five

Customers think they should receive a certain level of service and perceive a different level of service actually provided.

ServQual Instrument

A survey with scaled responses to a number of questions related to five dimensions of service quality.

ServQual Instrument

Is broken up into dimensions of service quality.

Tangibles (Service Quality Dimension)

Physical observable elements; how clean are the bathrooms? How clean are employee uniforms? How clean are the tables?

Reliability (Service Quality Dimension)

How well the company does delivering the service correctly and consistently.

Responsiveness (Service Quality Dimension)

How quickly we respond to customer requests; how quickly we respond to emails.

Assurance (Service Quality Dimension)

The knowledge and courtesy of employees, which in turn, builds customer confidence.

Empathy (Service Quality Dimension)

How caring the service provider is and whether they can see things from the customer's point of view.

Service Blueprints

Visualize the customer experience and relationships among all service components, both those that are visible to the customer and those that are not.

Price and Value

Connected in that what we pay for a product impacts whether we see the value in the product.

Penetration Pricing

Going into the market with competitors and using this because we want to capture market share and take sales away from those already established brands.

Skimming Strategy

The opposite of penetration pricing because we go into the market with a higher price on a product, because we have a product that is technically advanced and there is currently no competition.

Target ROI

Solely focused on how you need to price the product in order to secure a certain level of profit.

Competitor-Based Pricing

Pricing our products in line with our competitors.

Stability Pricing

Setting a neutral price point; not too low to encourage a price war, but not too high to damage our value proposition with consumers.

Value Pricing

Strategy primarily based on a consumer's perceived value of the product or service.

Product Line Pricing

Involves releasing multiple versions of the same product or service at different price points at the same time.

Captive Pricing / Complementary Pricing

Involves gaining a commitment from the customer for a basic product or system that requires continual purchase of additional items to operate the product.

Price Bundling

When we offer multiple products together at a slightly lower price than if we were buying each product individually.

Reference Pricing

The price customers believe or expect an item should cost based on experience with or knowledge about the product.

Prestige Pricing

When we price the product high due to the quality of the product and the status owning the product.

Odd-Even Pricing

Odd pricing simply means that the price is not expressed in whole dollars, while even pricing is a whole dollar amount.

One-Price Strategy

The seller offers the same price to every customer.

Variable Pricing

Customers are encouraged to haggle over the price and negotiate a lower price.

Everyday Low Price (EDLP)

To reduce investment in promotion and then transfer part of the savings to lower the price for the customer.

High-Low Pricing

Retailers introduce products or in some cases services at a higher price point and then gradually discount or mark down the price as demand decreases.

Auction Pricing

The highest bidder wins and pays exactly what they bid.

Cost-Plus Pricing

Builds a price by adding a standardized markup on top of costs for an offering, hence the term markup on cost.

Target Return Pricing

How much the company wants to make from the sale of the product.

Fixed Costs

Incurred over time regardless of volume.

Variable Costs

Fluctuate with volume.

Discounts

Immediate reductions in price.

Allowances

Monies given to purchases after the fact.

Cash Discounts

Encourage distributors to pay for the product faster.

Trade Discounts

When we provide a discount in exchange for the buyer performing some sort of function, things like assembly in store.