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Marketing Exam 3
| Term | Definition |
|---|---|
| Introductory | Product is introduced to market. Sales grow slowly and profit is minimal. |
| Growth | Rapid increases in sales. More competitors, profit peaks. |
| Maturity | Sales and revenues slow. Competitors leave the market. |
| Decline | Product sales drop. |
| Skimming | Setting the introductory price high to recoup initial investment |
| Penetration | Setting introductory price low to gain market share. |
| Harvesting | Continues to offer the product, but allocates no more investments. |
| Deleting | Dropping the product entirely. |
| Product Life Cycle | Describes the stages a new product goes through in the marketplace: introduction, growth, maturity, and decline. |
| Fashion Product | Sales rise and dip over time, style of the time. |
| Fad Product | Rapid sales on introduction the rapid decline. Fidget spinners |
| High-Learning Product | Significant customer education required and there is an extended introductory period. (When computers were new) |
| Low-Learning Product | Sales begin immediately because little learning is required by the consumer. (New razor) |
| Product Class | Refers to the entire product category or industry. |
| Product Form | Pertains to variations 3 of a product within the product class. |
| Product Modification | Involves altering one or more of a product’s characteristics, such as its quality, performance, or appearance, to increase the product’s value to customers and increase sales. |
| Market Modification | Strategies by which a company tries to find new customers, increase a product’s use among existing customers, or create new use situations. |
| Trading Up | Adding value to the product (or line) through additional features or higher-quality materials. |
| Trading Down | Reducing a product’s number of features, quality, or price. |
| Branding | A marketing decision in which an organization uses a name, phrase, design, symbols, or combination of these to identify its products and distinguish them from those of competitors. |
| Brand Name | Any word, device (design, sound, shape, or color), or combination of these used to distinguish a seller’s products or services. |
| Brand Personality | A set of human characteristics associated with a brand name. |
| Brand Equity | The added value a brand name gives to a product beyond the functional benefits provided. |
| Brand Licensing | A contractual agreement whereby one company (licensor) allows its brand name(s) or trademark(s) to be used with products or services offered by another company (licensee) for a royalty or fee. |
| Packaging | A component of a product that refers to any container in which it is offered for sale and on which label information is conveyed. |
| Label | An integral part of the package that typically identifies the product or brand, who made it, where and when it was made, how it is to be used, and package contents and ingredients. |
| Services | Intangible activities or benefits that an organization provides to satisfy consumers’ needs in exchange for money or something else of value. |
| Intangibility | Services cannot be held, touched, or seen before the purchase decision. |
| Inconsistency | The quality of a service is inconsistent. (Two servers at a chain restaurant will not provide the same service) |
| Inseparability | The consumer does not separate the deliverer of the service from the service itself. |
| Inventory | Service provider is available, but there may not be demand for the service (doctor with no patients) |
| Inventory Carrying Costs | Low cost, real estate and insurance. High cost, Airline and hospital. |
| Service Continuum | The range of offerings companies bring to the market, from the tangible to the intangible or the product-dominant to the service-dominant. |
| Gap Analysis | A type of analysis that compares the differences between the consumer’s expectations about and experiences with a service based on dimensions of service quality. |
| Customer Contact Audit | A flowchart of the points of interaction or “service encounters” between consumers and a service provider. |
| People | Services are marketed through the interaction between employees and customers. |
| Physical Environment | The appearance of the environment in which the service is provided. |
| Process | The procedures, mechanisms, and flow of activities in by which the service is created and delivered. |
| Off-Peak Pricing | Charging different prices during different times of the day or during different days of the week to reflect variations in demand for the service. |
| Internal Marketing | The notion that a service organization must focus on its employees, or internal market, before successful programs can be directed at customers. |
| Customer Experience Management | The process of managing the entire customer experience with the company. |
| Capacity Management | Integrating the service component of the marketing mix with efforts to influence consumer demand. |
| Price | The money or other considerations (including other products and services) exchanged for the ownership or use of a product or service. |
| Barter | The practice of exchanging products and services for other products and services rather than for money. |
| Final Price | Final Price = List Price - Allowance + Extra Fees |
| Value | The ratio of perceived benefits to price; or Value = (Perceived benefits ÷ Price). |
| Value Pricing | The practice of simultaneously increasing product and service benefits while maintaining or decreasing price. |
| Profit | Profit = Total revenue − Total cost; or Profit = (Unit price × Quantity sold) − (Fixed cost + Variable cost). |
| Figure 13-2 | 1. Identify pricing objectives and constraints; 2. Estimate the demand and revenue; 3. Determine cost, volume, and profit relationships; 4. Select an approximate price level; 5. Set list or quoted price; 6. Make special adjustments |
| Pricing Objectives | Specifying the role of price in an organization’s marketing and strategic plans. |
| Pricing Constraints | Factors that limit the range of prices a firm may set. |
| Demand Curve | A graph that relates the quantity sold and price, showing the maximum number of units that will be sold at a given price. |
| Demand Factors | Factors that determine consumers’ willingness and ability to pay for products and services. |
| Price Elasticity of Demand | The percentage change in quantity demanded relative to a percentage change in price. |
| Total Revenue | The total money received from the sale of a product. |
| Total Cost | The total expense incurred by a firm in producing and marketing a product. Total cost is the sum of fixed cost and variable cost. |
| Break Even Analysis | A technique that analyzes the relationship between total revenue and total cost to determine profitability at various levels of output. |
| Marketing Channel | Consists of individuals and firms involved in the process of making a product or service available for use or consumption by consumers or industrial users. |
| Transactional Function | Buying, selling, risk taking |
| Logistical Function | Assorting, Storing, Sorting, Transporting |
| Facilitating Function | Financing, Grading, Marketing Info and Research |
| Direct to Consumer Marketing Channel | Allow consumers to buy products by interacting with various print or electronic media without a face-to-face meeting with a salesperson. |
| Multichannel Marketing | Blending of different communication and delivery channels that are mutually reinforcing in attracting, retaining, and building relationships with consumers who shop and buy in traditional intermediaries and online. Sometimes called omnichannel marketing. |
| Dual Distribution | Firms reach different buyers through different types of channels for the same product. (GE sold directly to home builders and to stores like Home Depot) |
| Vertical Marketing Systems | Professionally managed and centrally coordinated marketing channels designed to achieve channel economies and maximum marketing impact. |
| Intensive Distribution | A level of distribution density whereby a firm tries to place its products and services in as many outlets as possible. |
| Exclusive Distribution | A level of distribution density whereby only one retailer in a specific geographical area carries the firm’s products. |
| Selective Distribution | A level of distribution density whereby a firm selects a few retailers in a specific geographical area to carry its products. |
| Channel Conflict | Arises when one channel member believes another channel member is engaged in behavior that prevents it from achieving its goals. |
| Disintermediation | A source of channel conflict that occurs when a channel member bypasses another member and sells or buys products direct. |
| Logistics | Those activities that focus on getting the right amount of the right products to the right place at the right time at the lowest possible cost. |
| Supply Chain | The various firms involved in performing the activities required to create and deliver a product or service to consumers or industrial users. |
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