CHAPTER 12: Creating and Communicating Value

Vocabulary practice flashcards covering product layers, classifications, branding, innovation, product life cycles, and promotional tools based on the lecture.

Product

Anything that an organization offers to satisfy consumer needs and wants.

Pure goods

Products that do not include any service.

Pure services

Products that do not include any goods.

Core benefit

The fundamental element consumers buy that satisfies their needs.

Actual product

The physical good or delivered service that provides the core benefit.

Augmented product

Additional goods and services provided with the actual product that sharpen the product's competitive edge.

Consumer products

Products purchased for personal use or consumption.

Convenience products

Inexpensive goods and services that consumers buy frequently with limited consideration and analysis.

Shopping products

More expensive products that consumers buy less frequently and shop around for.

Specialty products

Much more expensive products that consumers seldom purchase.

Unsought products

Goods and services that hold little interest or even negative interest for consumers.

Business products

Products purchased to use either directly or indirectly in the production of other products.

Product differentiation

Attributes that make a good or service different from other products that compete to meet the same or similar customer needs.

Quality level

A measurement of how well a product performs its core functions.

Product consistency

The reliability of a product in delivering the promised level of quality.

Product features

Specific characteristics of a product.

Customer benefits

Advantages that a customer gains from a specific product feature.

Product line

A group of products that are closely related to each other.

Cannibalization

The risk of new product lines decreasing current product sales.

Product mix

The total number of product lines and individual items sold by a single firm.

Line extensions

Similar products introduced under the same brand name.

Brand extension

A new product, in a new category, introduced under an existing brand name.

Brand

A product's identity that sets it apart from others in the same category.

Brand equity

The overall value of a brand to an organization.

Licensing

Purchasing the right to use another company's brand name or symbol.

Cobranding

Established brands from different companies joining forces to market the same product.

National brands

Brands owned by the producer (such as Kraft).

Store brands

Brands owned by a retailer (also referred to as private label, dealer brands, or retail brands; such as Great Value).

Discontinuous innovation

Brand-new ideas that radically change how people live.

Dynamically continuous innovation

Innovation characterized by marked changes to existing products.

Continuous innovation

Innovation that features a slight modification of an existing product.

New Product Development Process

The six-step sequence consisting of Idea Generation, Idea Screening, Analysis, Development, Testing, and Commercialization.

Observability

A diffusion rate characteristic defined as the visibility of a product to other potential consumers.

Trialability

A diffusion rate characteristic defined as the ease in which potential consumers sample a new product.

Complexity

A diffusion rate characteristic defined as the ease with which potential consumers easily understand a product.

Compatibility

A diffusion rate characteristic defined as the consistency of a product with the existing way of doing things.

Relative advantage

A diffusion rate characteristic defined as the benefits of the new product compared to the existing product.

Product Life Cycle (PLC)

A model describing product category sales and profits through four stages (Introduction, Growth, Maturity, Decline), where profits tend to peak in Growth and sales tend to peak in Maturity.

Positioning statement

A statement of how the marketer would like the target market to envision a product relative to competition.

Big idea

A meaningful, believable, and distinctive concept used to cut through the competition.

Promotion

Marketing that influences consumer purchase decisions through information, persuasion, and reminders.

Integrated marketing communications (IMC)

Coordination of marketing messages through every promotional vehicle to communicate a unified impression about a product.

Advertising

Paid, nonpersonal communication designed to influence a target audience.

Public relations

Promotional activities that create positive relationships with a firm's different publics.

Publicity

Unpaid stories in the media that influence perceptions.

Personal selling

Person-to-person presentation of products to potential buyers.

Sales promotion

Activities that stimulate sales through specific short-term programs aimed at either consumers or distributors.

Consumer promotion

Sales promotion tools that stimulate consumers to purchase, including premiums, samples, coupons, rebates, and displays.

Trade promotion

Promotion designed to stimulate wholesalers and retailers to push specific products aggressively.

Push strategy

A promotional strategy that targets promotion toward the distribution channel.

Pull strategy

A promotional strategy that targets promotion toward consumers.