Module 7 Flashcards

Question

Specialty Products

Answer 1

products that require considerable time and effort to purchase. They tend to be expensive products from specialty brands that require high purchase satisfaction. Examples include Rolex watches, Persian rugs and exotic sports cars

Answer 2

products that the consumer does not know about, or is not interested in purchasing. Examples of unsought products include insurance, funeral services, fire extinguishers and insulin.

Answer 3

products for which the consumer comparison shops, assessing the attributes and prices of different products and brands. These products are more expensive than convenience products, require greater shopping time, and require a greater assurance of purchase satisfaction. Examples include jeans, airline tickets, laptops and mattresses.

Answer 4

inexpensive items that are purchased frequently with minimal shopping effort and risk. Examples include shampoo, chocolate bars, toilet paper and gasoline.

Answer 5

A brand is more than just a logo. * A name, term, sign, symbol, or design, or a combination of these intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors * “The sum total of all the customer impressions of your product or service. [A] brand consists of conscious and subconscious perceptions and it exists only in your customers’ minds, but it drives their behaviour in a very real way”

Answer 6

Facilitates consumer decision because if you decide on a brand once and are happy with it, then you can easily make your decision the next time by simply purchasing the same product … brand loyalty. The level of quality of the product will not necessarily high (remember that quality does not immediately mean high quality), but at least it will be consistent from one time you purchase that brand to the next … we hope! If a consumer does not want to support a specific company, say because they were involved in pollution or child labour or some other unethical practice that the consumer does not support, then a brand name allows the consumer to identify this.

Answer 7

“Successful branding programs are based on the concept of singularity. The objective is to create in the mind of the prospect, the perception that there is no other product on the market quite like your product.” (Ries and Ries, 2002) Which one tastes better? A study at Stanford University found that 77% of children thought the McDonalds branded French fries tasted better even though they were all the same.

Answer 8

Product strategy involves managing and developing products and brands, and is a fundamental component of the marketing mix.

Answer 9

A product is defined as a good, a service, or an idea consisting of tangible and intangible attributes. Tangible attributes are physical characteristics such as colour, size or material intangible attributes are non-physical characteristics such as quality, style or reliability.

Answer 10

Intangibility means that services cannot be held, touched or seen before purchase. Inconsistency (or variability) means that services can vary based on the service provider and are harder to standardize. Inseparability means that services cannot be separated from the service provider; the consumer is involved in the production of the service if they provide guidance or feedback. Inventory (or perishability) means that there is fluctuating demand for services and they cannot be stored for times when demand exceeds capacity

Answer 11

The total product concept: Packaging and labelling: Product lines and mixes

Answer 12

views products as having three layers: -the core product (is the benefit a consumer derives from having the product), -the actual product (the physical good or service and includes the product’s branding, design, and features) , -the augmented product (includes additional features and attributes that accompany a product, such as warranty, service contract, delivery options, or an accompanying app)

Answer 13

Packaging and labelling provide functionality, communication, and reinforcement of a brand image. They reflect a product’s brand image and positioning against competitors

Answer 14

A product line is a group of similar products that are closely related because they satisfy a similar need and are marketed to the same general target market.

Answer 15

The product mix includes all the product lines marketed by a company. It can be simple in small companies and more complex in larger organizations.

Answer 16

Consumer products are purchased by end consumers for their own personal use. Business products, introduced in the B2B Marketing module, are purchased to help run a business or to be used as a component in another product or service.

Answer 17

* Convenience Products – inexpensive items that are purchased frequently with minimal shopping effort and risk. Examples include shampoo, chocolate bars, toilet paper and gasoline. * Shopping Products – products for which the consumer comparison shops, assessing the attributes and prices of different products and brands. These products are more expensive than convenience products, require greater shopping time, and require a greater assurance of purchase satisfaction. Examples include jeans, airline tickets, laptops and mattresses. * Specialty Products – products that require considerable time and effort to purchase. They tend to be expensive products from specialty brands that require high purchase satisfaction. Examples include Rolex watches, Persian rugs and exotic sports cars. * Unsought Products – products that the consumer does not know about, or is not interested in purchasing. Examples of unsought products include insurance, funeral services, fire extinguishers and insulin.

Answer 18

are classified based on their: use, and include production goods used in the manufacturing process, support goods and services used to assist in production, installations such as buildings and equipment, accessory equipment purchased by buyers, supplies used in the business and services such as transportation and maintenance

Answer 19

is a name or phrase uniquely given by a company to a product to identify and distinguish it in the market. Brands can be legally protected using patents (for technologies, processes, formulations), copyrights (for written material, music and performance) or trademarks (for brand names and logos

Answer 20

is the term used to describe the value of a brand that results from the favourable exposure, interactions, associations, and experiences that consumers have with a brand over time.

Answer 21

refers to the degree consumers insist on purchasing a specific brand. Marketers try to create connections between brands and consumers so that their brand loyalty remains high. Marketers work to associate brands with specific personality traits that the consumer finds appealing. The association of human characteristics with a brand is referred to as brand personality.

Answer 22

A good brand name should be memorable, distinctive and positive, fit the company or product image, suggest the product benefits, have the ability to be legally protected and translated and be simple to spell and remember

Answer 23

Individual brands refer to only one product or product line Family brand includes a product mix with a variety of product lines. Manufacturer’s brands (also called national brands) are owned and produced by the manufacturer and are distributed through various marketing channels Private label brands (also called store brands) are owned by retailers who contract their manufacturing and sell the products under their own label, exclusively in their own stores Generic brands are essentially unbranded products, produced as a cheaper alternative to manufacturer’s or private label brands. They are most commonly found in the pharmaceutical industry

Answer 24

describes the stages a new product goes through in the marketplace; introduction, growth, maturity, and decline. The shape of the product life cycle is influenced by consumer demand, competition, and economic, legislative and technological factors The length and shape of a product life cycle varies according to the industry, the competition, technological innovation, and marketing approaches. There is no set timeframe for a product to move through its life cycle

Answer 25

The introduction stage of the product life cycle occurs when a product is first introduced to its intended target market. During this period, sales grow slowly and profit is minimal. The marketing objective is to create consumer awareness and get customers to try the product for the first time. Companies often spend heavily on marketing to build awareness. Distribution and pricing can be challenging because the product is not well known and building relationships with stakeholders takes time

Answer 26

The second stage of the product life cycle, growth, is characterized by increased competition and a rapid increase in sales. Profits peak during the growth stage as a result of economies of scale and increased demand. Product and promotional efforts focus on brand and product differentiation.

Answer 27

The maturity stage is characterized by a slow-down in the growth rate and an increased focus on price competition to differentiate products in the market. Promotional efforts focus on price and distribution levels tend to be saturated. Weaker competitors begin to leave the market.

Answer 28

During the decline stage, category sales begin to decline and many competitors fall out of the market. There is very little promotional support other than price discounts

Answer 29

Product life cycles can be extended in a number of ways: modifying the product, modifying the market, repositioning a product or introducing a new product

Answer 30

Product improvements or product line extensions are often used by marketers to ensure products remain competitive, to appeal to evolving needs, and to address new trends in the market.

Answer 31

Marketers may decide that their current product is under represented with certain consumer groups and they see an opportunity to target these consumers using new marketing approaches They can also target current users to increase their usage, by encouraging purchases more often or increased volume at time of purchase. This approach is used by marketers for products with strong brand equity and a loyal consumer base. In rare cases, marketers may also try to find new uses for an existing product, but that is not a simple task.

Answer 32

Once a product has reached the maturity stage it often needs an injection of newness. This can be achieved through new product development initiatives and/or a repositioning of the product to more readily meet changing consumer needs.

Answer 33

Adding a new product can provide the focus a mature product needs, bringing it back in the product life cycle to either the growth or early maturity stage.

Answer 34

are product modifications that require no adjustments by the consumer. Marketers work to build awareness of the innovation and market along current lines.

Answer 35

are new products that include a minor product improvement but do not require radical changes by consumers. Continuous innovations require extensive product development by the company.

Answer 36

involve the introduction of products that are entirely new to the market. Extensive advertising and public relations efforts are often needed for these products

Answer 37

Step 1: New Product Development Strategy - setting the new product strategy for the project. Step 2: Idea Generation - brainstorming sessions to prompt new ideas. Step 3: Screening and Evaluation - screening ideas down to a list of promising concepts. Step 4: Business Analysis - creating financial projections on commercializing the product. Step 5: Development - creating prototypes for consumer research and manufacturing tests. Step 6: Test Marketing - selling the product on a limited basis to determine potential success. Step 7: Commercialization - launching the product with full sales and marketing support.

Answer 38

The adoption curve explains the acceptance of a new product in the market, stating that approximately: 2.5% are innovators (risk takers) -venturesome, highly educated, use multiple information sources 13.5% are early adopters -leaders in social settings, slightly above average education 34% are early majority -deliberate, many informal social contracts 34% are late majority -skeptical, below average social status 16% are laggards -fear of debt, neighbours and friends are information sources

Answer 39

Market penetration (focusing on current consumers with promotional tactics) Product development (developing a new product for current consumers) Market development (targeting new markets with current products) Diversification (moving into new arenas with totally new products)

Answer 40

Assigning new product development to the current marketing group Investing in new staff focused on product development (hiring a manager, team, or creating a department)

Module 7 Flashcards

(64 cards)