Marketing 301 at John Carroll University Exam 2 chapters 11,12 and14

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Marketing concepts from Grewal-Levey Marketing Book 4th addition

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Question Answer
Core customer value- defines the basic problem solving benefits that consumers are seeking
Actual product Attributes such as the brand name, features/design, quality level, and packaging
Associated Service also known as the augmented product are attributes that are not physical, something like a warranty financing or the after sale service
Specialty- are those for which customers express such a strong preference that they will expend considerable effort to search for the best suppliers.
Convenience- are products that the consumer doesn’t evaluate before they purchase it. They are commodities that are always purchased like toilet paper or bread.
Unsought Types of product They are products that the consumer would not normally buy or they are unknown to the consumer before the purchase. For instance when GPS were in their relatively new state no one knew the true power behind them.
Product Mix Breadth- This is the number of product lines that a firm offers. Kellogg’s example would be like their toaster pastries, cookies and crackers and ready to eat cereal.
Product Line Depth - This is the number of products in a product line. So going along with the Kellogg’s example, in the cookies and crackers line the company makes Cheez-it’s and Keebler cookies.
what makes a brand (elements of a brand) The brand elements are Brand Name, URL’s, logos and symbols, characters (Pillsbury Doughboy), Slogans and jingles or sounds.
value of branding A brand establishes loyalty along with helping set in long term prices. Brands are also assets that can be sold with copy writes.
Brand Equity is the set of assets and liabilities that either add or subtract value to a product or service. Like Barbie teaching little girls what nurses and stewardess look like through their dolls
Branding Strategies Techniques that firm’s institute to create and manage key brand assets, such as the decision to own the brands, establishing a branding police, extending the brand name to other products and markets, cooperatively using the brand name with that of another firm and licensing the brand to other firms.
Manufacturer- also known as National brands is brands that are owned and managed by the manufacturer. Famous Manufacturer brands include Coca-Cola and Nike. With these brands the manufacturer develops the merchandise, produces it to ensure consistent quality and invests in a marketing program to establish an appealing brand image.
Retailer/Private Label Brands products that are developed by retailers. Some relaters manufacture their own products other develop the design and pay other manufacturers to do it for them.
Premium Brands - A branding strategy that offers consumers a private label of comparable or superior quality to a manufacturer brand
Generic Brands No-frills products offered at a low price without any branding information.
Copycat Brands Mimic a manufacturer’s brand in appearance, but generally with lower quality and prices
Exclusive Cobrands Developed by national brand vendor and retailer and sold only by that retailer
Family Brands A brand name that is on an individual product as well. For example Kellogg’s puts their name on their cereal such as special-K
Individual Brands- Brand extension refers to the use of the same brand name in a different product line. A line extension is the same brand name within the same product line
Brand dilution This occurs when the brand extensions adversely affects consumer perceptions about the attributes the core brand is believed to hold.
Co-branding- This is when you market two or more brands together. For instance sometimes there is a pizza hut and a taco bell in one store space.
Brand Licensing- This is when one firm allows another firm to use the brand name logo or any other part of their brand for a negotiated fee.
Brand Repositioning- This is when marketers change a brands focus so they may reach a different consumer base within the market with the same product.
Packaging you can either have primary packaging or secondary packaging. Secondary is when the exterior carton contains other product information from another source
Product Labeling- - an important part of any product and must be sure to follow labeling requirements from the trade commission act of 1914.
Innovation Refers to the process when ideas are transformed into new offerings. This includes products; services, process and branding concepts that will help the firm grow.
Reasons why firms create new products changing customer Needs Market saturation, managing risk through diversity, Fashion Cycles and Improving Business Relationships
Diffusion of innovation including the different categories of market groups that adopt the innovation over time
Innovators- Are those who buy the product so that they may be the first one out of everyone to have it. These buyers enjoy taking risk and are usually highly knowledgeable about the product at hand
Early Adopters They Generally don’t like to take a lot of risk like the innovators but instead want to purchase the product after reviews have been posted. They decide whether or not the technology is worth it.
Early Majority- represents approx. 34 percent of the population that buys the product. If this group never becomes large enough then the product typically fails.
Late Majority is the last group of buyers to enter a new product market that that have any real impact. When this group does buy the product the product has generally received its full market potential
Laggards- Make up roughly 16 percent of the market. These consumers like to avoid change and rely on traditional products until they are no longer available.
Different characteristics that impact the speed with which innovation diffuses – Relative Advantage some products are perceived as better than their substitutes. In this case the diffusion will be very fast.
Different characteristics that impact the speed with which innovation diffuses –Compatibility some diffusion processes may take longer then others. This depends on the various consumer features also cultural differences.
Different characteristics that impact the speed with which innovation diffuses- Observability When a product can be easily observed, its features are easily communicated to others, which enhance the diffusion process.
Different characteristics that impact the speed with which innovation diffuses –Complexity and trial ability Products that are relatively less complex are also relatively easy to try these products diffuse very quickly and lead to faster adoption than those that are not so easy to try.
Product development process Idea generation ->Concept testing->Product Development-> Market testing->Product Launch-> Evaluation of Results
Product life cycle- defines the stages that products move through as then enter, get established in and ultimately leave the marketplace. Introduction->Growth->Maturity->Decline
Role of price in the marketing mix- The overall sacrifice a consumer is willing to make to acquire a specific product or service
The five C’s of Pricing- Competition, Costs, Company Objectives, Customers, Channel members
Target profit pricing Is when a company has a certain profit goal that acts as their main concern
Target return pricing Pricing strategies used to produce a specific return on their investment, usually expressed as a percentage of sales.
Profit maximization A strategy that looks at a price that would maximize sales from an economic standpoint.
Sales orientation a belief that if you increase sales then you will increase profits
Competitor orientation - when firms take this strategy they focus on comparing them selves to the competition. Often they set prices that are similar to their competition.
Customer Orientation- When a firm sets its pricing strategy based on how it can add value to its products or services.
Demand curves and pricing A demand curve is used to show the number of units of a product or service consumers will demand during a specific period of time at different prices. This is assumed that the marketer will not changing anything else such as advertising or other marketing benefits.
Price elasticity of demand – this measures how changes in price affect the quantity of the product demanded. It is the ratio of the percentage change in quantity demanded to the percentage change in price % Change in Quantity Demanded/ % Change in Price
Income Effect refers to the change in the quantity of the product demanded by consumers due to a change in their income. Generally as income increases so does their spending behavior
Substitution Effect Refers to the ability that consumers have to substitute the product with other products from a different brand.
Cross Price Elasticity the percentage change in the quantity of product A demanded, compared to the percentage change in price in product B. if Product A’s price were to increase then product B’s price would either increase or decrease depending on if it was a complement or substitute.
Variable cost are costs of preliminary labor and materials that vary with production volume.
Fixed Cost Costs that remain essentially the same, regardless of the quantity produced.
Total cost Sum of the variable and fixed costs
Break-even analysis A useful technique that allows managers to look at the relationships among cost, price, and profit over different levels of production and sales. It determines the break-even point and works from there. Breakeven Point = Fixed Costs/(Unit Selling Price - Variable Costs) Total variable cost = variable cost per unit * Quantity Total Revenue= Price* Quantity
Monopoly one firm provides the product or service in a particular industry. Which results in less price competition
Oligopolistic only a few firms dominate, firms typically change prices in results of the other few firms.
Monopolistic competition - occurs when there are many firms competing for customers in a given market but their products are differentiated.
Pure Competition There is a large number of sellers of standardized products of commodities that consumers perceive as substitutable, such as grains, gold, meat, spices etc.
Gray market Employs irregular but not necessarily illegal methods; generally sells prices lower than the manufacturer.
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