Marketing Exam 2

What is a product line?

A group of products closely related because they function in a similar manner, are marketed together, or target the same customer group

What is product line length?

The number of items or products in a single product line

What are the main product line strategies?

line stretching: adding products above or below the current range

line filling: adding more products within the existing range

line pruning: removing underperforming or unprofitable items

What is a product mix?

The total collection of product lines that a company offers to customers

What are convenience products?

low effort and frequently purchased items

What are shopping products

products that consumers compare based on quality, price, and feature before purchasing

What are specialty products?

Unique items with strong brand preference, loyal, often expensive and exclusive

What are unsought products?

Products consumers don’t normally think about or buy until needed

7Ps of service marketing/

Product, price, promotion, place, people, physical evidence, and process

What it is meant by services as products?

Services offered as the core product rather than as a support to physical good

What is derived service in marketing?

The concept that value is co created by both customer and the service provider during the interaction

What is a servicescape?

physical environment where service is delivered, impacting customer perceptions, behavior, and satisfaction

What does intangibility mean in services?

services cannot be seen, touches, or stored before purchase

what does inseparability mean in services?

services are produced and consumed at the same time, often involving customer participation

what does variability mean in services?

service quality may vary depending on who provides it, when, and how

what does perishability mean in services?

services cannot be stores or inventoried for later use

what is the purpose of the service gaps model?

to identify where service quality fails, leading to customer dissatisfaction

what is gap 1 in the service gaps model?

not knowing what customers expect

what is gap 2 in the service gaps model?

not selecting the right service design and standards

what is gap 3 in the service gaps model

not delivering service according to standards

what is gap 4 in the service gaps model

not matching actual service with what was promised

what are factors affecting customer satisfaction?

service and product quality, price, personal and situation factors

what is the service profit chain?

a model showing how internal service quality leads to employee satisfaction —>? better service value —> customer loyalty —> growth and profits

what is continuous innovation?

Minor improvements that don’t significantly change user behavior

What is dynamically continuous innovation?

Innovations that require some change in consumer behavior (e.g., electric toothbrush)

What is discontinuous innovation?

Innovations that create entirely new consumption patterns (e.g., smartphones)

What is discontinuous innovation?

Innovations that create entirely new consumption patterns

What are the three levels of a product?

• Core Product: Basic benefit.

• Actual Product: Tangible design and features.

• Augmented Product: Additional services like warranties and delivery.

What are the stages of new product development?

• Idea generation

• Idea screening

• Concept development and testing

• Marketing strategy

• Business analysis

• Product development

• Test marketing

• Commercialization

Why do new products fail?

• No clear benefits

• Poor pricing or promotion

• Bad distribution

• Overestimated demand

• Low quality

What factors affect new product adoption?

Relative advantage, complexity, compatibility, trialability, and observability.

What is price in marketing?

The value exchanged for the perceived benefits of a product or service.

What are the key steps in price planning?

• Set objectives

• Estimate demand

• Determine costs

• Break-even analysis

• Evaluate environment

• Choose pricing strategy

• Develop tactics

What influences demand elasticity?

Availability of substitutes, whether the item is a necessity, and brand loyalty.

What are types of pricing strategies?

• Skimming: High intro price

• Penetration: Low entry price

• Bundle Pricing: Selling as a set

• Psychological Pricing: $9.99 vs. $10

• Trial Pricing: Short-term low price

What are legal and ethical issues in pricing?

Price fixing and predatory pricing.

What is a supply chain?

The complete process of producing and delivering a product from raw materials to the consumer.

What is a distribution channel?

The part of the supply chain that deals specifically with the flow of finished goods to the end consumer.

What is logistics in marketing?

The planning, implementation, and control of the movement and storage of goods.

What are the main functions of channel intermediaries?

Reduce complexity, provide assortment, offer convenience in location and hours.

What are the types of distribution intensity?

• Intensive: Wide availability (convenience goods)

• Selective: Limited outlets (shopping goods)

• Exclusive: One outlet per area (luxury/specialty goods)

What is the push strategy in distribution?

Promoting products to intermediaries to push them down the channel to customers.

What is the pull strategy in distribution?

Creating demand at the consumer level so they pull the product through the channel.

What is disintermediation in digital distribution?

Eliminating intermediaries and selling directly to customers online.

What is knowledge management in the supply chain?

Sharing and using data across the supply chain to improve coordination and performance.

What is retailing?

Selling goods or services directly to final consumers for personal use.

What are examples of retail store types?

• Convenience stores: Limited selection, quick stops

• Supermarkets: Moderate variety, focus on groceries

• Specialty stores: Deep focus in one category

• Discount stores: Low prices, wide range (e.g., Walmart)

• Warehouse clubs: Bulk, membership-based

• Factory outlets: Excess or off-season items

• Department stores: Wide product categories

• Hypermarkets: Very large, rare in the U.S.

What are the main types of store layouts?

• Grid: Structured, high control (e.g., grocery)

• Racetrack: Circular path to expose all departments

• Free-form: Informal, boutique-style experience

What are common challenges in e-commerce?

Website design, delivery logistics, return handling, and user experience optimization.