Test 3 Prep

Question 1

Service industry is divided into 4 groups:

Answer 1

1) Leisure/personal
2) Food and beverages
3) Accommodations
4) Business services

Question 2

Service (definition)

Answer 2

work done by one person (or organization) that benefits another; they are intangible, inseparable, vary in quality, demand is perishable

Question 3

factors that can influence pricing

Answer 3

1. demand
2. volume, e.g., Costco
3. elastic demand: small change in price, drastic change in volume
4. inelastic demand

Question 4

PRICE SKIMMING

Answer 4

• pricing strategy where a company sets a high price for a new product and then gradually lowers price as competitors enter the market or as demand shifts
• e.g., Apple

Question 5

PRICE PENETRATION

Answer 5

• increase market share
• company lowers product price to get people to buy their product to penetrate the market, to get attention to show customers their produce to eventually raise prices
  e.g., Netflix

Question 6

retailing

Answer 6

activities involved in the sale of goods and services to final consumers for personal, family, or household us

Question 7

FAD

Answer 7

• a product that has a reasonably short selling season, perhaps one or a few financially successful seasons (e.g., with fashion or leisure)

Question 8

INSTANT BUST

Answer 8

• a product that a firm had high expectations of and launched with marketing fanfare but consumers rejected very quickly (e.g., Crystal Pepsi)

Question 9

adoption process

Answer 9

i) AWARENESS
ii) INTEREST
iii) EVALUATION
iv) TRIAL
v) ACTION

Question 10

INNOVATORS

Answer 10

• risk takers and trendsetters eager to try new products
• 2.5% of consumers are within this group

Question 11

Elastic Demand

Answer 11

• small change in price results in large change in volume

Question 12

Inelastic Demand

Answer 12

• change in price does not have an impact on the quantity purchased

Question 13

positioning

Answer 13

• a new product/service might be set higher to: say they have high quality, exclusive, unique value

Question 14

Canadian Tire

Answer 14

• 85% of Canadians live within 15 minutes of a Canadian Tire store
• this is because of brand identity, stock balance, and marketing mix

Question 15

ATMOSPHERE OF RETAIL STORE

Answer 15

• exterior appearance
• interior appearance
• store layout
• product display