Exam 2 - Chapter 11 Flashcards
Product
a good, service, or idea received in an exchange
Three Product Components
a. core product
b. symbolic and experiential benefits
c. supplemental features
Core Product
fundamental utility or main benefits
addresses the basic need of a consumer (ex: sports drink - rehydrates)
Symbolic and Experimental Benefits
experience surrounding the product or its use
ex: shopping experience at Nordstrom/symbolic meaning of Marlboro – cowboys
Supplemental Features
attributes in addition to the core
do not help the function but serve as a differentiator
ex: 10 year warrenty
Consumer Products (B to C)
products purchased to satisfy personal family wants and needs
Business Products (B to B)
products bought to use in a firm’s operations to resell or to make other products
purchased to satisfy the goals of an org
4 Classifications of Consumer Products
a. convenience products
b. shopping products
c. specialty products
d. unsought products
Convenience Products
relatively inexpensive, frequently purchased items for which buyers exert minimal purchasing effort
no search, many retail outlets, heavy brand promotion – brand loyalty!
ex: coke or pepsi
Shopping Products
items for which buyers are willing to expend considerable effort in planning and making purchases; extensive searches/less frequent; fewer retail outlets; not much brand loyalty
ex: tvs or cars
Specialty Products
items with unique characteristics that buyers are willing to expend considerable effort to obtain; extensive search/high prices
ex: engagement rings/Rolex watches
Unsought Products
products purchased to solve a sudden problem, products of which customers are unaware and do not necessarily think about buying; no search; price not important; no searches; trust/relationships built prior to need
ex: car maintenance/hospital fees
First Moment of Truth
when the consumer confronts the product for the first time
ex: packaging/ads
Second Moment of Truth
when the consumer takes the product home - does it satisfy the need?
7 Classifications of Business Products
a. installations
b. accessory equipment
c. raw materials
d. component parts
e. process materials
f. MRO supplies
g. business services
Installations
products bought to use in a firm’s operation, to resell, or to make other products
facilities and non-portable equipment
ex: paper machine
Accessory Equipment
equipment that does not become part of the final physical product but is used in production or office activities
ex: calculator/file cabinet
Raw Materials
basic natural materials that become major parts of a physical product
ex: chemicals/grain
Component Parts
items that become part of the physical product and are either finished items ready for assembly or items that need little processing before assembly
ex: tires/batteries
Process Materials
materials that are used directly in the production of products but are not readily identifiable
ex: wine vinegar in salad dressing
MRO Supplies
maintenance, repair, and operating items that facilitate production and operation but do not become part of the finished product
ex: pencils
Business Services
intangible products that many organizations use in their operations
ex: consulting accounting
Product Item
a specific version of a product that is designated as a distinct offering among a firm’s products
ex: honey nut Cheerios
Product Line
a group of closely related product items viewed as a unit because of marketing, technical, or end-use considerations
ex: Cherrios by GM
Product Mix
the composite, or total, group of products that an organization makes available to customers
Width of Product Mix
the number of product lines a company offers
Depth of Product Mix
the average number of different products in each product line
4 Stages of the Product Life Cycle
a. introduction
b. growth
c. maturity
d. decline
PLC: Introduction
first appearance in the marketplace
sales start at zero and profits are negative
high risk of failure - only 10% of new products succeed because of high costs
PLC: Growth
sales rise rapidly
profits peak and start to decline
marketers must stress brand benefits to encourage loyalty, identify segmentation, strengthen market share (**competition)
PLC: Maturity
sales peak and start to decline
profits continue to fall
customers have tried/used product, has become normal and growth slows to population growth
intense competition – weak links exit market; marketers manage by finding new uses for product or increasing share of customer
ex: Arm and Hammer Baking Soda
PLC: Decline
sales fall rapidly, marketers will likely eliminate/reposition items, cut promotion, eliminate marginal distributors, plan to phase out product
ex: VCR to DVD to BlueRay
5 Stages of Production Adoption Process
a. awareness
b. interest
c. evaluation
d. trial
e. adoption
Production Adoption Process: Awareness
the buyer becomes aware of the product
Production Adoption Process: Interest
the buyer seeks info and is receptive to learning about the product
Production Adoption Process: Evaluation
the buyer considers the product’s benefits and decides whether to try it, considering its value vs. the competition
Production Adoption Process: Trial
the buyer examines, tests, or tries the product to determine if it meets his or her needs
ex: sampling/test drives
Production Adoption Process: Adoption
the buyer purchases the product and can be expected to use it again whenever the need arises
5 Adopter Categories
a. innovators
b. early adopters
c. early majority
d. late majority
e. laggards
Innovators
first adopters of new products
people that have the latest things
Early Adopters
people who adopt new products early, choose new products carefully, and are viewed as “the people to check with” by later adopters
tried it after innovators
Late Majority
skeptics who adopt new products when they feel it is necessary
Laggards
the last adopters
may distrust new products/change
ex: grandparents and tech.
Why Some Products Fail
a. failure to match product to needs
b. failure to sent the right message
c. tech/design problems
d. poor timing
e. overestimate market
f. ineffective promotion
Why do B to C fail more than B to B?
products are designed specifically to business needs
easier to discover/be successful with marketing mix
Why Some Products Succeed
a. significant and perceivable benefits to a sizable number of customers
b. more features, ease of operation, improved tech
c. companies follow systematic, customer-focused plans
Early Majority
individuals who adopt a new product just prior to the average person
