Chapter 5 - Small Business Marketing

Question 1

What are the 4 p’s of marketing?

Answer 1

The four major components of a marketing effort are product, price, promotion, and placement. SOmetimes called the marketing mix.

Question 2

What are goods?

Answer 2

physical products?

Question 3

what are services?

Answer 3

a nonphysical product

Question 4

What is tangibility?

Answer 4

an item’s capability of being touched, seen, tasted, or felt.

Question 5

What is perishability?

Answer 5

a service exhibits perishability in that if it is not used when offered it cannot be saved for later use.

Question 6

what is inseparability?

Answer 6

a quality of a service in which the service being done cannot be disconnected from the provider of the service.

Question 7

What is heterogeneity?

Answer 7

a quality of a service in which each time it is provided it will be slightly different from the previous time.

Question 8

What is a total product?

Answer 8

the entire bundle of products, services, and meanings of your offering; includes extras like service, warranty, or delivery, as well as what the product means to the customer.

Question 9

What is augmented product?

Answer 9

core product plus features that tend to differentiate it from the competition.

Question 10

What is a core product?

Answer 10

The very basic description of what a product is a bar of soap, a house cleaning service.

Question 11

What is a target market?

Answer 11

The group of people on which a marketer focuses promotion and sales effort.

Question 12

What are me-too products?

Answer 12

Products essentially similar to something already on the market.

Question 13

What is optimum price?

Answer 13

The highest price that will produce your desired level of sales in your intended market.

Question 14

What is markup pricing?

Answer 14

a price-setting method where an amount is added to the cost of a product to set the retail price and provide a profit.

Question 15

What is margin?

Answer 15

the amount of profit, usually stated as a percentage of the total price.

Question 16

What is markup?

Answer 16

the amount an entrepreneur adds to costs to provide a profit.

Question 17

What is elasticity?

Answer 17

from economics the ideas that the market’s demand for a product or service is sensitive to changes in its price.

Question 18

What is an inelastic product?

Answer 18

product for which there are few substitutes and for which a change in price makes very little difference in quantity purchased.

Question 19

What is an elastic product?

Answer 19

product for which there are any number of substitutes and for which a change in price makes a difference in quantity purchased.

Question 20

What is the law of supply and demand?

Answer 20

The economic theory that describes how the demand for products(or services) and the supply of them affect each other.

Question 21

What is price gougin?

Answer 21

charging an outrageously high price for something.

Question 22

What is internal reference price?

Answer 22

a consumer’s mental image of what a product’s price should be.

Question 23

What is an external reference price?

Answer 23

an estimation of what a price should be based on information external to a consumer, such as advice, advertisements, or comparison shopping.

Question 24

What is skimming?

Answer 24

Setting a price at the highest level the market will bear, usually because there is no competition at the time.

Question 25

What is prestige pricing?

Answer 25

Setting a price above that of the competition so as to indicate a higher quality or that a product is a status symbol.

Question 26

What is odd-even pricing?

Answer 26

setting a price that ends in the number 5, 7, or 9

Question 27

What is partitiuoned pricing

Answer 27

setting the price for a base item and then charging exra for each additional component.

Question 28

What is captive pricing?

Answer 28

Setting the price for an item relatively low and then charging much higher prices for the expendables it uses.

Question 29

What is price lining?

Answer 29

The practice of setting (usually) three price points: good quality, better quality, best quality.

Question 30

What is periodic discounting?

Answer 30

sales conducted at either predictable or nonpredictable intervals

Question 31

What is off-peak pricing?

Answer 31

charging lower prices at certain times to encourage customers to come during slack periods.

Question 32

What is bundling?

Answer 32

combining two or more products in one unit and pricing it less than if the units were sold separately.

Question 33

What are multiple or bonus packs?

Answer 33

Combining more than one unit of the same product and pricing it lower than if each unit were sold separately.

Question 34

What is a referral discount?

Answer 34

A discount given to a customer who refers a friend to the business.