MARK 110 short answer flashcard questions
What sort of advertising is used at the very beginning of the product life cycle? (Right before introduction)
Before the company starts it will focus on light advertising and PR to gain a bit of attention before they launch the business.
What kinds of advertising is done at the introductory stages in the product life cycle?
Heavy advertising and PR to build self awareness. Sales promotions often include a trial - for example, Netflix and other media companies offer their first month free. During the introductory phase, the company will also focus on building a website and implementing and SEO strategy to rise to the top of the search engine.
What kinds of advertising does a company do during the growth stage of the product life cycle?
During the growth stage of the product life cycle, the company is focused on advertisements that differentiate their product from their competitors products. Heavy advertising to build brand loyalty. During the growth stage, they decrease the focus on sales promotion because consumers need fewer incentives to purchase than they would if it was a new product. Social media is used to foster relationships with consumers.
What is advertising like in the maturity stage?
In the maturity stage, advertisements of this product decrease. The advertisements are more persuasive and reminding in nature. Think of crest toothpaste adds. You already know it exists so just the promotion is more focused on. Hey, remember us? We create the amazing toothpaste that you use every morning. During the maturity stage, however there is an increased use of personal selling to maintain product distribution.
When the product reaches the decline stage, what is the advertising like?
When the product reaches the decline stage, the advertising is more sparse. Sales promotion and personal selling are maintained at low levels.
When is the price skimming strategy used? What company can you compare this to?
The price skimming strategy is used when there is low competition and your product is doing well. (So, not in the decline stage.) Companies often use this technique when the product is perceived by target markets to have unique consumer benefits. For example, Starbucks in the beginning was one of the very few better coffee shops around. Because Starbucks dark roast is better than the dirt they sold in a can, people flocked to the stores despite the price.
When is the penetration pricing strategy used? What company can you compare this to?
The penetration price strategy is used when the competition is high and and the product is not in the decline stage yet. When you think of penetration pricing, think of pets.com. Pet’s.com strategy was to undercut the market so that they would be able to raise their prices later without all the competition.
When is status quo pricing used? What company can you compare this to?
Status quo pricing is used when the product is not doing very well or there is medium competition. Status quo pricing can be especially helpful for small businesses. Bookstores are normally small businesses, there is only a bit of competition and they are also normally small businesses.
What is a direct channel? What is a company that is like this?
A direct channel is when a product goes directly from the producer to the consumer. (Direct to consumer) Think the dollar shave club.
What is a retailer channel? What company can you compare this to?
A retailer channel is when a producer sells to a retailer and the retailer sells those to the end consumer. Think: Lays chips.
What is a wholesale channel? What company can you compare this to?
A wholesale channel is when a company sells to another company, who sells that product to a retailer, then the retailer sells the product to the end consumers. For example all the dropshipping stores.
What is an agent or broker channel? Give an example.
An agent or broker channel happens when a producer finds an agent because they are not good at selling their product to wholesalers. The wholesalers sell it to a retailer who sells the product to the end consumer. A good example of this is traditional publishing or a farmer who does not know anything about sales.
What are the decisions effecting channel choice?
The decisions that effect channel choice include the market, the product and the producer.
What does intermediaries mean?
Intermediaries are a link between two people - or corporations.
What are the marketing channel functions?
The marketing channel functions are transactional functions, logistical functions and facilitating functions.
