chapter 19 the marketing mix - product and price

Question 1

marketing mix

Answer 1

the four key decisions on product, price ,promotion and place that must be taken to enable the effective marketing of a product

Question 2

product

Answer 2

goods or services that are the end result of the production process and are sold on the market to satisfy customer needs

Question 3

goods

Answer 3

products which have a physical existence, such as washing machines and chocolate bars

Question 4

services

Answer 4

products which have no physical existence , but satisfy consumer needs in other ways, such as hairdressing , car repairs , childminding and banking

Question 5

brand

Answer 5

an identifying symbol, name , image or trademark that distinguishes a product from its competitors

Question 6

intangible attributes

Answer 6

the subjective opinions of customers about a product, which cannot be measured or compared easily

Question 7

tangible attributes

Answer 7

the measurable features of a product , which can be easily compared with other products

Question 8

new product development NPD

Answer 8

the design , creation and marketing of new goods and services

Question 9

unique selling point USP

Answer 9

the special feature of a product that makes it different from competitors’ products

Question 10

product differentiation

Answer 10

the unique qualities of a product that leads to a difference between the product and competitors’ products

Question 11

product positioning

Answer 11

consumers, view of a product or service as compared to its competitors

Question 12

product portfolio analysis

Answer 12

analysing the range of existing products of a business to help allocate resources effectively between them

Question 13

product life cycle

Answer 13

the pattern of sales for a product from launch to withdrawal from the market

Question 14

consumer durable

Answer 14

a manufactured product that can be re-used and is expected to have a reasonably long life, such as a car or washing machine

Question 15

extension strategy

Answer 15

a marketing plan to extend the maturity stage of the product before a completely new one is launched

Question 16

boston matrix

Answer 16

a method of analysing the product portfolio of a business in terms of market share and market growth

Question 17

mark-up pricing

Answer 17

adding a fixed mark-up for profit to the unit cost of buying in a product

Question 18

cost-plus pricing

Answer 18

setting a price by calculating a total unit cost for the product and then adding a fixed profit mark-up

Question 19

contribution-cost pricing

Answer 19

setting prices based on the variable costs of making a product , in order to make a contribution towards fixed costs and profit

Question 20

competitive pricing

Answer 20

making pricing decisions based on the price set by competitors

Question 21

price discrimination

Answer 21

charging different groups of consumers different prices for the same good or service

Question 22

dynamic pricing

Answer 22

offering products at a price that changes according to the level of demand and the customers’ ability to pay

Question 23

penetration pricing

Answer 23

setting a relatively low price to achieve a high volume of sales

Question 24

market skimming

Answer 24

setting a high price for a new product when a firm has unique or highly differentiated product with low price elasticity of demand

Question 25

psychological pricing

Answer 25

setting a price at a level which matches consumers’ views about a product’s perceived value