Module 5: Developing the Marketing Mix: Value Proposition (Product and Price) Flashcards
1
Q
refers to anything that can be offered to a market for attention, acquisition, use, or consumption to satisfy a want or a need.
A
Product
2
Q
Form of products
A
Tangible (Goods)
Intangible (Services and ideas)
3
Q
those products that we can see.
A
Tangible (Goods)
4
Q
those products that we cannot see and own but we can experience,
A
Intangible (Services and ideas)
5
Q
Products can also include events, places, or organizations
A
…
6
Q
Most of the times, products are sold as a bundle, meaning we get the product as well as its complimentary services.
A
…
7
Q
Levels of Products
A
- Core or Generic Product
- Actual Product
- Extended Product
- Modified Product
- Potential Product
8
Q
level of product refers to the functional essence of the product.
reason why a customer purchase a product
A
Core or Generic Product
9
Q
basic features of a product that make it usable in the first place.
evident in the product’s packaging
A
Actual Product
10
Q
refers to additional features added to the product to attract more customers
A
Extended Product
11
Q
refers to the additional product features that will meet new demands and needs of customers.
consider modifying an existing product
A
Modified product
12
Q
refers to the product features that a firm plan to add or change in the future.
adds these features in order to further differentiate their product
A
Potential product
13
Q
3 levels after a product is finished
A
- Core Product
- Actual Product
- Augmented Product
14
Q
essential motivational benefit the customer is purchasing.
A
Core product
15
Q
physical and intangible properties or characteristics the product takes on
A
Actual product
16
Q
these are the extra attributes and features that are not part of the actual product
A
Augmented product
17
Q
Classification of Products
A
- Consumer Products
- Industrial or Organizational Products
18
Q
called as business-to-consumer (B2C) products. These are products that are personally and destined for use by ultimate consumers.
A
Consumer Products
19
Q
business-to-business (B2B) products.
products that are used by companies or firms for product creation
A
Industrial or Organizational Products
20
Q
Types of Consumer Products
A
- Convenience Products
- Shopping Products
- Specialty Products
- Unsought Products
21
Q
goods that people normally buy and consume frequently.
A
Convenience Products
22
Q
Types of convenience product
A
a. Staple Goods
b. Impulse Goods
c. Emergency Goods
23
Q
basic commodities such as rice, sugar, and other grocery items that are included as basic necessities.
A
Staple Goods
24
Q
items such as candies and snack foods usually acquired by customers out of their impulse buying behavior.
A
Impulse Goods
25
products bought in response to unexpected and urgent needs. candles, match sticks, flash light
Emergency Goods
26
goods that people acquire or consume less frequently and are more expensive than convenience products.
Shopping Products
27
products that are distributed exclusively by an authorized distributor and have unique characteristics
even more expensive than shopping products.
Specialty Products
28
goods or services that may not consider highly necessary in their lives. Consumers may avoid purchasing them but companies can successfully sell them through persuasive technique
Unsought Products
29
Types of Industrial Products
1. Raw Materials
2. Finished Products
3. Equipment
4. Supplies
30
goods that the company processes or assembles to create a new product.
Raw Materials
31
final products the firm produces.
Finished Products
32
machines and tools used in creating products or providing services.
Equipment
33
products which may not necessarily be used in creating products, but are important in the daily operations of a firm.
Supplies
34
produce several related products which they group together as a
product line
35
the overall range of products sold by a company
product assortment
36
Terms of product assortment
Width
Length
Depth
Consistency
37
number of product lines a company offers
width
38
number of individual products included in each product line
length
39
variation of products in a product line
depth
40
product assortment pertains to the extent of relatedness among the product lines
consistency
41
Unrelated products can also be grouped and displayed in one store space
intended to give customers a one-stop shopping experience
scrambled merchandise
42
process through which products are enclosed in a container, wrapper, or a similar medium
Packaging
43
refers to the act of providing information about the product in its container.
labeling
44
helps the companies make their products distinct from others.
Other features are logos and symbols
branding
45
two brands are being marketed and sold jointly
essen a company’s expenses while earning more profit and gaining more shares in the market.
Dual branding
46
takes place when more than two brands are jointly sold by a company
Multi-branding
47
6 Stages in Development of New Product
1. Idea Generation
2. Idea Screening
3. Project Planning
4. Product Development
5. Test Marketing
6. Commercialization
48
all products start with idea. Business firms source their ideas internally
Idea generation
49
after gathering different ideas the company must have proper and careful screening to avoid costly mistakes.
Idea Screening
50
the idea is further developed and conceptualized into a product for consumers and the demand for such product is estimated.
Project planning
51
Most company employs safety measures and will initially produce a prototype or sample of the actual product, which will be subject to thorough testing.
Product development
52
this stage will give further assurance to the company that its product is acceptable to consumers.
Test Marketing
53
In this stage, the company officially launch the new product in the market.
commercialization
54
Four Stages in Product Life Cycle
1. Introduction Stage
2. Growth Stage
3. Maturity Stage
4. Decline Stage
55
in this stage, more customers become aware about the product and the sales start to increase.
Growth stage
56
in this stage, the product reaches its peak sales performance. The company maintains high profits and lessen costs in marketing the product.
Maturity stage
57
this is the stage when the sales of the product begin to decrease
decline stage
58
this theory came from ____ and it explains the progression of a product’s sale and life cycle.
Everett Roger
59
This theory also examines how new ideas and technology spread and become widely popular among people
Diffusion of Innovations Theory
60
individuals who adopt an innovation
adopters
61
are intangible offerings that companies provide for their customers.
Services
62
it explains the progression of a product’s sale and life cycle.
Diffusion of Innovations Theory
63
Some companies are offering ______ to their customers such as salon, carwash and hotel services.
pure services
64
it refers to the overall result of all the interactions between a customer and a firm.
Customer Experience
65
Characteristics of a Service
1. Intangibility
2. Inseparability
3. Variability
4. Perishability
66
it is the only component of the marketing mix that provides revenue for the company.
Price
67
Pricing Concepts
1. Computation of prices
2. Variability
3. Reference price
68
this involves understanding the various elements of pricing, and can be further be studied through formulas.
Computation of prices
69
the willingness on the part of the company to adjust the prices of its products.
Variability.
70
related concept to the variability of the prices and it is the price that customers expect the product to have.
Reference price
71
based on the price that the company has announced and on the prices of competing products.
Reference price
72
value and benefits customers gain from purchasing a product or service.
customer value
73
companies show that they understand the value that consumers place on the benefits they receive
customer value-based pricing
74
Pricing Objectives
1. Survival Pricing
2. Market Penetration Pricing
3. Market Skimming Pricing
4. Parity Pricing
5. Regulated Pricing
75
main pricing objective when the company is in deep competition.
firm will settle for break-even pricing or even set a price below break-even
Survival Pricing
76
new in a particular industry or market segment, it does its best to increase its market share.
company prices its product slightly lower than the competition
Market Penetration Pricing
77
when a company happens to develop a unique product the price of the new product is set very high.make an extra profit margin
Market Skimming Pricing
78
company is new to a particular industry or market segment, it can benchmark its pricing scheme with those of competitors
strategy is often implemented by companies that would like to play it safe
Parity Pricing
79
the firm must abide by government regulations in setting prices.
reflects the company’s social and ethical responsibility.
Regulated Pricing
80
Common Pricing Strategies and Schemes
1. Cost-Based Pricing
2. Demand-Based Pricing
3. Break-Even Pricing
4. Psychological Pricing
5. Time-Based Pricing
6. Location-Based Pricing
7. Competitive Pricing
8. Premium Pricing
81
most common pricing strategy and it is mostly concerned with the expenses of the company in creating a product.
Cost-Based Pricing
82
Cost-Based Pricing, two components
Unit Cost
mark-up
83
the total amount of money needed to create the product.
Unit Cost
84
three values important in determining the unit cost are:
a. Fixed Cost
b. Variable Cost
c. Total Product Units
85
refers to the expenses necessary to create a product, regardless of their quantity or type.
Fixed Cost
86
it comprises expenses needed for the creation of the specific product.
Variable Cost
87
quantity or volume of the products created. Companies expect their sales performance to match their total product units.
Total Product Units
88
is then added to the unit cost in order to determine the selling price of the product.
mark-up
89
it focuses on the needs of customers.
utilizing this approach conducts thorough research to find out how much customers are willing to pay for a product based on their perceived value
Demand-Based Pricing
90
period that a service or a product is most needed and will most likely be purchased.
peak season
91
period that these services and products are less in demand
Off season
92
in this strategy, companies may earn just enough to cover the costs of production without any profit.
Break-Even Pricing
93
point when the company has gained enough revenue to cover its total production costs.
break-even point,
94
it helps determine the minimum amount at which the break-even point can be reached
Break-even sensitivity analysis
95
refers to the range of prices at which a product can be sold
Sensitivity range
96
which refers to the minimum price at which a product must be sold for the company to regain its production costs.
break-even price
97
it appeals to customers’ ideas regarding affordability and value.
Psychological Pricing
98
Psychological Pricing 2 type
Reference price - can also use for psychological pricing to show the savings gained through the new price.
Price bundling - strategy of combining products in a bundle and pricing them as one unit to make the products appear to be cheaper
99
the company is considering a certain time frame in setting prices.
Time-Based Pricing
100
the marketers consider proximity and the quality of the area in setting prices
Location-Based Pricing
101
strategy involves setting prices that match those of rival products on the market,
Competitive Pricing
102
products are deliberately priced higher than similar offerings to show that they are “exclusive”
Premium Pricing
103
Fighting Price Attacks Using Price Response
1. Flanker Brand
2. Fight
3. Selective Response
4. Preemptive Strike
104
using another brand to fight a price attack from competition
Flanker Brand
105
matching what is being offered by an attacker.
Fight
106
selective matching what is being offered by competition
Selective Response
107
anticipate and pre-empt competitive move
Preemptive Strike
108
Fighting Price Attacks Using Non-Price Response
1. Quality
2. Alliance
3. Cost Advantage
4. Bundling
109
highlight the product’s strengths or warning consumers of the risk of buying competitive products at lower prices by associating them with lower quality products.
Quality
110
creating a coalition to offer the market better value.
Alliance
111
using lower cost as leverage.
Alliance
112
using lower cost as leverage.
Cost Advantage
113
offering another item free to improve value proposition.
Bundling
