CHAPTER 13

Question 1

Convenience Products

Answer 1

Everyday goods and services that people buy frequently, usually without much conscious planning.

Question 2

Shopping Products

Answer 2

Fairly important goods and services that people buy less frequently with more planning and comparison.

Question 3

Specialty Products

Answer 3

Particular brands that the buyer especially wants and will seek out, regardless of location or price.

Question 4

Expense Items

Answer 4

Inexpensive products that organizations generally use within a year of purchase.

Question 5

Capital Items

Answer 5

More expensive organizational products with a longer useful life, ranging from office and plant equipment to entire factories.

Question 6

Product Life Cycle

Answer 6

Four stages through which a product progresses: introduction, growth, maturity, and decline.

Question 7

Product Development Process

Answer 7

A formal process of generating, selecting, developing, and commercializing product ideas.

Question 8

Prototypes

Answer 8

Preproduction samples of products used for testing and evaluation.

Question 9

Test Marketing

Answer 9

A product development stage in which a product is sold on a limited basis to gauge its market appeal.

Question 10

Commercialization

Answer 10

Large-scale production and distribution of a product.

Question 11

Brand

Answer 11

A name, term, sign, symbol, design, or combination of those used to identify the products of a firm and to differentiate them from competing products.

Question 12

Brand Equity

Answer 12

The value that a company has built up in a brand.

Question 13

Brand Loyalty

Answer 13

The degree to which customers continue to purchase a specific brand.

Question 14

Brand Names

Answer 14

The portion of brands that can be spoken, including letters, words, or numbers.

Question 15

Brand Marks

Answer 15

The portion of brands that cannot be expressed verbally.

Question 16

Logo

Answer 16

A graphical and/or textual representation of a brand.

Question 17

Trademarks

Answer 17

Brands that have been given legal protection so that their owners have exclusive rights to their use.

Question 18

Private Brands

Answer 18

Brands that carry the label of a retailer or a wholesaler rather than a manufacturer.

Question 19

National Brands

Answer 19

Brands owned by manufacturers and distributed nationally.

Question 20

Co-branding

Answer 20

A partnership between two or more companies to closely link their brand names together for a single product.

Question 21

Brand Licensing

Answer 21

Agreement in which one company pays to use another company’s brand on its products.

Question 22

Brand Managers

Answer 22

Managers who develop and implement the marketing strategies and programs for one or more of a company’s products or brands.

Question 23

Product Line

Answer 23

A series of related products offered by a firm.

Question 24

Product Mix

Answer 24

The complete portfolio of products that a company offers for sale.

Question 25

Family Branding

Answer 25

Using a brand name on a variety of related products.

Question 26

Brand Extension

Answer 26

Applying a successful brand name to a new product category.

Question 27

Price Elasticity

Answer 27

A measure of the sensitivity of demand to changes in price.

Question 28

Fixed Costs

Answer 28

Business costs that remain constant regardless of the number of units produced or number of customers served.

Question 29

Variable Costs

Answer 29

Business costs that increase with the number of units produced or customers served.

Question 30

Break-Even Analysis

Answer 30

A method of calculating the minimum volume of sales needed at a given price to cover all costs.

Question 31

Break-Even Point

Answer 31

Sales volume at a given price that will cover all of a company’s costs.

Question 32

Cost-Based Pricing

Answer 32

A method of setting prices based on production and marketing costs, rather than conditions in the marketplace.

Question 33

Value-Based Pricing

Answer 33

A method of setting prices based on customer perceptions of value.

Question 34

Competition-Based Pricing

Answer 34

A method of setting prices based on what suppliers of similar products are charging.

Question 35

Algorithmic Pricing

Answer 35

A variety of computational methods used to set price, either in more nuanced ways than simple cost or competition based pricing or in dynamic ways that respond in real time to fluctuations in demand and other market conditions.

Question 36

Skim Pricing

Answer 36

Charging a high price for a new product during the introductory stage and lowering the price later.

Question 37

Penetration Pricing

Answer 37

Introducing a new product at a low price in hopes of building sales volume quickly.

Question 38

Loss-Leader Pricing

Answer 38

Selling one product at a loss as a way to entice customers to con- sider other products.

Question 39

Freemium Pricing

Answer 39

A hybrid pricing strategy of offering some products for free while charging for others, or offering a product for free to some customers while charging others for it.

Question 40

Subscription Pricing

Answer 40

A pricing model in which customers are charged a recurring fee for the right to continuing using a product.

Question 41

Discounts

Answer 41

Temporary price reductions to stimulate sales or lower prices to encourage certain behaviors such as paying with cash.

Question 42

Bundling

Answer 42

Offering several products for a single price that is presumably lower than the total of the products’ individual prices.

Question 43

Virtual Reality (VR)

Answer 43

Computer-generated simulations that create the sensation of being in a real environment.

Question 44

Augmented Reality

Answer 44

Systems that superimpose visual or textual information on live images of real scenes.