Quiz 2

Question 1

model of buyer behaviour

Answer 1

environment (marketing stimuli, 4 P’s), buyer’s black box (characteristics, decision process), buyer responses (attitudes, preferences, purchase behavior)

Question 2

brand personality

Answer 2

mix of human traits that may be attributed to a particular brand

Question 3

4 types of buying decision behaviour

Answer 3

complex, variety-seeking, dissonance-reducing, habitual

Question 4

complex buying behaviour (and example)

Answer 4

high involvement, significant differences between brands; characterized by high consumer involvement in purchases and significant perceived differences among brands; ex. buying long-term investment goods like a car; marketers must inform consumers, differentiate products, and motivate salespeople

Question 5

dissonance-reducing buying behaviour (and example)

Answer 5

low consumer involvement, few significant perceived brand differences; buying expensive, infrequent, or risky purchases with few brand differences (ex. carpeting), marketers must counter postpurchase dissonance with after=sale communications to support consumers

Question 6

habitual buying behaviour(and example)

Answer 6

low consumer involvement, few brand differences;
ex. table salt
marketers can use price and promotions, product enhancements

Question 7

variety seeking behaviour (and example)

Answer 7

low consumer involvement, many significant brand differences; brand switching occurs for sake of variety rather than dissatisfaction, ex. buying cookies, marketers for leading brand will encourage habitual buying behaviour (with better shelf space, etc) while challenger firms will encourage variety by offering deals, samples, etc.

Question 8

(5 step) buyer decision process

Answer 8

need recognition, information search, evaluation of alternatives, purchase decision, postpurchase behaviour

Question 9

(3 levels) levels of products and services

Answer 9

1. core customer value
2. actual product (brand name, quality level, features, design, packaging)
3. augmented product (delivery and credit, product support, warranty, after-sale service)

Question 10

product line

Answer 10

group of products that share similar functions, customer groups, marketing outlets, and/or prices

Question 11

product line filling/stretching

Answer 11

adding to the product line or taking it a different direction

Question 12

product mix/portfolio

Answer 12

set of all product lines and items that a particular seller offers

Question 13

(4) nature and characteristics of a service

Answer 13

intangibility, variability, inseparability, perishability

Question 14

intangibility (one nature and characteristic of a service)

Answer 14

services cannot be seen, tasted, felt, heard, smelled before purchase

Question 15

variability (one nature and characteristic of a service)

Answer 15

quality of service depends on who provides it and when, where, how

Question 16

inseparability (one nature and characteristic of a service)

Answer 16

services cannot be separated from their providers

Question 17

perishability (one nature and characteristic of a service)

Answer 17

services cannot be stored for later sale or use

Question 18

brand equity

Answer 18

the differential effect that knowing the brand name has on customer response to the product or its marketing;
a measure of the brand’s ability to capture customer preference and loyalty;
brand strength can be measured along 4 consumer perception dimensions (differentiation, relevance, knowledge, and esteem)

Question 19

brand value

Answer 19

total financial value of a brand

Question 20

8 stages in new product development

Answer 20

idea generation, idea screening, concept development and testing, marketing strategy development, business analysis, product development, test marketing, commercialization

Question 21

product concept

Answer 21

detailed version of the new product idea stated in ‘meaningful consumer terms’

Question 22

3 parts of a marketing strategy statement

Answer 22

1. describe target market, planned value proposition, sales, market-share, and profit goals for first few years
2. outline product’s planned price, distribution, and marketing budget for first year
3. describe planned long-run sales, profit goals, marketing mix strategy

Question 23

things to include in business analysis

Answer 23

sales history of similar products
min and max sales (range of risk)
costs and profits, product’s financial attractiveness

Question 24

test marketing

Answer 24

literally testing the product in its proposed market god dammit;
can be simulated

Question 25

commercialization

Answer 25

introducing a new product into the market

Question 26

customer value-based pricing

Answer 26

setting price based on buyers’ perceptions of value (rather than on sellers’ costs)

Question 27

good-value pricing

Answer 27

offering ‘right combination’ of quality and good service at fair price

Question 28

value-added pricing

Answer 28

attaching value-added features and services to differentiate a company’s offers and charging higher prices

Question 29

cost-based pricing

Answer 29

setting prices based on the costs of producing, distributing, and selling plus a fair rate of return for effort and risk

Question 30

experience curve

Answer 30

drop in average per-unit production cost that comes with accumulated product experience

Question 31

cost-plus pricing

Answer 31

adding a standard markup to product price

Question 32

break-even/target-return pricing

Answer 32

setting price to break even on costs / make a target return

Question 33

competition-based pricing

Answer 33

setting prices based on competitors’ strategies, prices, costs, market offering

Question 34

break-even volume formula

Answer 34

break-even volume = fixed cost / (price - variable cost)

Question 35

unit cost formula

Answer 35

unit cost = variable cost + fixed cost / unit sales

Question 36

pricing in a monopolistic competition market

Answer 36

many buyers/sellers trading over a range of prices; branding, ads, and personal selling sets offers apart

Question 37

pricing in a oligopolistic competition market

Answer 37

a few large sellers; price is main marketing tool

Question 38

pricing in a pure competition market

Answer 38

many buyers/sellers trading in a uniform commodity, no single actor has much effect on market price, marketing plays little/no role

Question 39

pricing in a pure monopoly market

Answer 39

market is dominated by one seller

Question 40

market-skimming pricing

Answer 40

setting a high price to skim max revenues layer by layer from the segments willing to pay the higher prices; company makes fewer but more profitable sales

Question 41

market-penetration pricing

Answer 41

setting a low price for a new product to attract a large number of buyers/large market share

Question 42

5 product mix pricing strategies (know definitions also)

Answer 42

product line pricing
optional-product pricing
captive-product pricing
by-product pricing
product bundle pricing

Product line pricing setting price steps between various products in a product line based on cost differences between the products, customer evaluations of different features, and competitors’ prices
Optional-product pricing pricing of optional or accessory products with the main product
Captive-product pricing setting a price for products that must be used along with a main product, such as blades for a razor and games for a video game console
By-product pricing setting a price for by-products to help offset the costs of disposing of them and help make the main product’s price more competitive
Product bundle pricing combining several products and offering the bundle at a reduced price

Question 43

7 price adjustment strategies

Answer 43

discount and allowance [pricing]
segmented
psychological
promotional
geographical
dynamic
international

Question 44

4 concepts on public policy and pricing (do you know definitions)

Answer 44

(price fixing, predatory pricing, deceptive pricing, price discrimination)

Question 45

Sherman, Clayton, and Robinson-Patman Acts

Answer 45

initially adopted to curb formation of monopolies and regulate business practices that might unfairly restrict trade

Question 46

marketing channel

Answer 46

set of interdependent organizations that help make a product or service available for use or consumption by the consumer or business user

Question 47

Channel level

Answer 47

layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer

Question 48

Direct marketing channel

Answer 48

has no intermediary levels; company sells direct to consumers

Question 49

Indirect marketing channel

Answer 49

one or more intermediary levels (ex. Wholesalers, retailers, business distributors, sales branches)

Question 50

2 types of channel conflict

Answer 50

Horizontal conflict occurs among firms at the same level of the channel (ex. Dealer v. dealer)

Vertical conflict between different levels (ex. Company v. franchises)

Question 51

Disintermediation

Answer 51

Cutting out of marketing channel intermediaries by product or service producers or the displacement of traditional resellers by new types of intermediaries (ex. Amazon to Borders, Netflix to Blockbuster)

Question 52

Changing channel organization

Answer 52

caused by changes in tech, growth of online and direct marketing