MKT 301 - Exam 2

business market

individuals, organizations, or groups that purchase a specific kind of product for resale, direct use in producing other products, or use in general daily operations

producer markets

individuals and business organizations that purchase products to make profits by using them to produce other products or using them in their operations

reseller markets

intermediaries that buy finished goods and resell them for a profit (wholesalers and retailers)

government markets

federal, state, county, or local governments that buy goods and services to support their internal operations and provide products to their constituencies

institutional markets

organizations with charitable, educational, community, or other nonbusiness goals

North American Industry Classification System (NAICS)

an industry classification system that generates comparable statistics among the United States, Canada, and Mexico

derived demand

demand for business products that stems from demand for consumer products

inelastic demand

demand that is not significantly altered by a price increase or decrease

joint demand

demand involving the use of two or more items in combination to produce a product

B2B e-commerce sites

online marketplaces where buyers and sellers from around the world can exchange information, goods, services, ideas, and payments

digital media

electronic media that function using digital codes; media available via computers, cellular phones, smartphones, and other digital devices that have been released in recent years

digital marketing

using all digital media, including the internet and mobile and interactive channels, to develop communication and exchanges with customers

electronic marketing (e-marketing)

the strategic process of pricing, distributing, and promoting products, and discovering the desires of customers using digital media and digital marketing

omnichannel retailing

offering a seamless experience across mobile, desktop, and traditional retail spaces

new-task purchase

an initial item purchase to be used to perform a new job or solve a new problem

straight rebuy purchase

the routine purchase of the same products by a business buyer

modified rebuy purchase

a new-task purchase that is changed on subsequent orders or when requirements of a straight rebuy are modified

business (organizational) buying behavior

the purchase behavior of producers, government units, institutions, and resellers

buying center

the people within an organization who make business purchase decisions

consumer products

products purchased to satisfy personal and family needs

business products

products bought to use in an organization's operations, to resell, or to make other products (raw materials and components)

convenience products

relatively inexpensive, frequently purchased items for which buyers exert only minimal purchasing effort

shopping products

items for which buyers are willing to expand considerable effort in planning and making purchases

specialty products

items with unique characteristics that buyers are willing to expend considerable effort to obtain

unsought products

products purchased to solve a sudden problem, problems of which customers are unaware, and products that people do not necessarily think of buying

installations

facilities and non portable equipment

accessory equipment

not part of final product, used in production or office

raw materials

basic natural materials that become part of a physical product

component parts

finished items ready for assembly or need little processing

process materials

used in production but not identifiable

MRO supplies

maintenance, repair, and operating items not part of final product

services

intangible products used in operations

product item

a specific version of a product that can be designated as a distinct offering among a firm's products

product line

a group of closely related product items viewed as a unit because of marketing, technical, or end-use considerations

product mix

the total group of products that an organization makes available to customers

width of product mix

the number of product lines a company offers

depth of product mix

the average number of different products in each product line

product adoption process

the stages buyers go through in accepting a product

brand

a name, term, design, symbol, or other feature that identifies a seller's products and differentiates them from competitors' products

brand name

the part of a brand that can be spoken, including letters, words, and numbers

brand mark

part not made up of words, such as a symbol or design

trademark

legal designation of exclusive use of a brand

trade name

full legal name of organization

brand equity

the marketing and financial value associated with a brand's strength in a market

recognition attitude

aware brand exists and is alternative if preferred brand unavailable

preference attitude

preferred over competitive offerings

insistence attitude

strongly preferred, no substitute

manufacturer brand

brands initiated by producers

private distributor brand

brands initiated and owned by resellers

generic brand

brands indicating only the product category

individual branding

a policy pf naming each product differently

family branding

branding all of a firm's products with the same name

brand extensions

using an existing brand to brand a new product

co-branding

using two or more brands on one product

brand licensing

an agreement whereby a company permits another organization to use its brand on other products for a licensing fee

packaging

involves the development of a container and a graphics design for a product

labeling

providing identifying, promotional, or other information on package labels

line-extensions

development of a product that is closely related to existing products in the line but meets different customer needs

product modification

a change in one or more characteristics of the product and the elimination of the original product from the product line

quality changes

changes relating to a product's dependability and durability

functional changes

changes affecting a product's versatility, effectiveness, convenience, or safety

aesthetic changes

changes to the sensory appeal of a product

internal sources

marketing managers, researchers, sales personnel, and engineers

external sources

customers, competitors, advertising agencies, consultants, and research agencies

screening

choosing the most promising ideas for further review

concept testing

seeking potential buyers' responses to a product idea

business analysis

assessing the potential of a product idea for the firm's sales, costs, and profits

product development

determining if producing a product is feasible and cost effective

test marketing

introducing a product on a limited basis to measure the extent to which potential customers will actually buy it

commercialization

refining and finalizing plans and budgets for full-scale manufacturing and marketing of a product

product differentiation

creating and designing products so that customers perceive them as different from competing products

customer services

human or mechanical efforts or activities that add value to a product

product positioning

creating and maintaining a certain concept of a product in customers' minds

product manager

the person responsible for a product, a product line, or several distinct products that make up a group

brand manager

the person responsible for a single brand

market manager

the person responsible for managing the marketing activities that serve a particular group of customers

venture team

a cross-functional group that creates entirely new products that may be aimed at new markets

off-peak pricing

the practice of reducing prices of services used during slow periods in order to boost demand

price competition

emphasizes a product's low price and sets a price that equals or beats the competitors' price

non-price competition

emphasizing factors other than price to distinguish products through their distinctive features from competing brands

price elasticity of demand

a measure of the sensitivity of demand to changes in price

marginal analysis

examines what happens to a firm's costs and revenues when production (or sales volume) changes by a single unit

fixed costs

costs that do not vary with changes in the number of units produces or sold

average fixed cost

the fixed cost per unit produced

variable costs

costs that vary directly with changes in the number of units produced or sold

average variable cost

the variable cost per unit produced

total cost

the sum of average fixed and average variable costs times the quantity produced

average total cost

the sum of the average fixed cost and the average variable cost

marginal cost

the extra cost incurred by producing one more unit of a product

marginal revenue

the change in total revenue resulting from the sale of an additional unit of a product

breakeven analysis

means of deterring the number of goods or services that must be sold at a given price to generate sufficient revenue to cover total costs

breakeven point

point at which total revenue just equals total cost

cost-based pricing

adding a dollar or percentage amount to the cost of the product

cost-plus pricing

adding a specified dollar amount to the seller's costs

markup

adding to the cost of the product a predetermined percentage of that cost

demand-based pricing

customers pay a higher price when demand for the product is strong and a lower price when demand is weak

competition-based pricing

pricing influenced primarily by competitors' prices

pricing strategy

a course of action designed to achieve pricing objectives

price skimming

charging the highest possible price that buyers who desire the product will pay

penetration pricing

setting prices below those of competing brands to penetrate a market and gain a significant market share quickly