Week 9 Flashcards by Anna Raponi | Brainscape

Q

More stable and predictable in demand

A

Basic products

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Q

Higher stock keeping units (SKUs), between 60-80%

A

Basic products

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Q

More competition
Lower profit margin
Less forecast error
Less likely to become obsolete quickly

A

Basic products

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Q

Less stable and unpredictable in demand

A

Fashion products

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Q

Lower stock keeping units (SKUs), between 20-40%

A

Fashion products

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Q

Less competition
Higher profit margin
More forecast error
More likely to become obsolete quickly

A

Fashion products

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Q

Higher overstock or out-of-stock situations

Higher markdown towards end of season

A

Fashion products

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Q

The ‘old’ version of luxury: exclusive, expensive, best quality, self-indulgent, conspicuous, tangible, overt

A

Materialism

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Q

Emphasis on quality of life, experiential, personal, authentic, subtle/convert materialism

A

Enrichment

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Q

The value of relaxing and destressing from the pace of everyday life, focus on self-development and quality of life, intangible, non-material

A

Time

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Q

Concept becoming increasingly fragmented and individual. Now more experiential rather than being rooted in materialism. Customers increasingly choose these items.

A

The massification of luxury

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Q

As this concept changes, the role of price becomes less clear and time and experience become more important factors. The challenge is to connect emotionally with customers and emphasize the experience they will have.

A

The massification of luxury

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Q

Assessing products and foreign markets: choosing the target product and market

A

Element of International Market Entry Strategy

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Q

Setting objectives and goals

A

Element of International Market Entry Strategy

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Q

Choosing the entry mode: export, contractual arrangement, or investment

A

Element of International Market Entry Strategy

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Q

Designing the marketing plan: price, promotion, distribution, etc.

A

Element of International Market Entry Strategy

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Q

Control system: monitoring operations/revising entry strategy

A

Element of International Market Entry Strategy

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Q

Target country market factors
Target country environmental factors
Target country production factors
Home country factors

A

External Factors in the Entry Mode Decision

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Q

Company product factors

Company resource/commitment factors

A

Internal Factors int he Entry Mode Decision

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Q

Direct exporting
Indirect exporting
Intra corporate transfer

A

Non-Equity Mode Exporting

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Q

Manufacturers export agents
Export commissions agent
Export merchants

A

Indirect Exporting

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Q

Piggybacking
Wholly-Owned Subsidiaries
Exporting: Turnkey Project

A

Licensing and Franchising (Non-Equity Mode)

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Q

Wholly-Owned Subsidiaries
Joint Ventures
Mergers and Acquisitions
Strategic Alliances

A

Equity Based Mode of Entry

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Q

Pooling alliances

Trading alliances

A

Strategic Alliances

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Q

Similarity and integration

A

Pooling Alliances

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Q

The contribution of dissimilar resources

A

Trading Alliances

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Q

Collective and distinctive knowledge and skills an organization has.

A

Core competencies

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Q

An organization’s ability to integrate a variety of specific technologies and skills in the development of new products and services.

A

Core competencies

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Q

The skills that enable a business to deliver a fundamental customer benefit.

A

Core competencies

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Q

Core competencies manifest in core __________ that serve as a link between the competencies and the end product.

A

Core products

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Q

Once a company has successful core _________, it can expand the number of uses in order to gain a cost advantage via economies of scale and economies of scope.

A

Core products

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Q

Financial (profit, balance of equity, return of capital, economic value added)

A

Measure of Performance

Q

Customer (satisfaction, retention, profitability, market share, acquisition)

A

Measure of Performance

Q

Internal Business Process (quality, response time, cost, new product launch time)

A

Measure of Performance

Q

Organizational Learning and Growth (employee satisfaction, worker productivity)

A

Measure of Performance

Q

Strategy:
Product customized for each market
Decentralized control- local decision making
Effective when large differences exist between countries

A

Multi-Domestic Strategy

Q

Strategy: Product differentiation, local responsiveness, minimized political risk, minimized exchange rate risk

A

Advantages of Multi-Domestic Strategy

Q

Strategy:
Product is the same in all countries
Centralized control- little decision-making authority on the local level
Effective when differences between countries are small

A

Global Strategy

Q

Strategy: Cost, coordinated activities, faster product development

A

Advantages of Global Strategy

Q

Strategy:
Products available before competition
Strong applied research capability needed
Can set high price to skim market or set lower price to gain market share

A

First-to-Market Strategy

Q

Strategy:
Quick imitation of first-to-market companies
Less emphasis on applied research and more emphasis on development
Learn from first-to-markets mistakes

A

Second-to-Market Strategy

Q

Strategy:
Wait until market becomes standardized and large volume demanded
Compete on basis of costs instead of product features
Research efforts focus on process development versus product development

A

Late-to-Market Strategy (Cost Minimization)

Q

Use domestic approach worldwide.

A

Ethnocentric

Q

Customize product to meet needs of local market

A

Polycentric

Q

Use a standardized approach worldwide

A

Geocentric

Q

The firm adopts a standard price for its products, regardless of where they are sold.

A

Standard price policy (Geocentric)

Q

The firm sets one price for domestic sales and a second price for international sales. Often used by firms that are new to international markets.

A

Two-Tiered Pricing (ethnocentric)

Q

The firm changes the profit-maximizing price in each market, that is, the firm sets:
marginal revenue=marginal cost in each market.

A

Market Pricing (polycentric)

Q

High rate of new product introduction.
Price cutting as a strategy to maintain or regain market share.
Increased availability of bargain-priced dealer and generic brands.
More efficient and better-informed buyers/customers.

A

Factors influencing price setting

Q

Profit maximization
Satisfactory profits
Target Return on Investment (ROI)

A

Profit-Oriented Pricing Objectives

Q

Market Share

Sales Maximization

A

Sales-Oriented Pricing Objectives

Q

Maintain existing prices

Meet competitions prices

A

Status Quo Pricing Objectives

Q

Standard Price, two-tier price and market price

A

International Pricing Strategies

Q

How do you negotiate the best terms of sale? (3)

A

Discounts
Shipping Charges
Dating and Payment terms

Q

Trade, Quality and Seasonal __________

A

Discounts

Q

The price the manufacturer or retailer pays or the list price minus the trade discount

A

Net Price

Q

A per cent of the list price

A

Discount

Q

Rate x List Price =

A

Trade Discount

Q

List Price - Trade Discount

A

Net Price

Q

EOM Terms

A

End-Of-Month

Q

ROG Terms

A

Receipt of Goods

Q

A cash discount is allowed when the bill is paid within the specified number of days from the _____________, not from the date of the invoice.

A

ROG Terms

Q

A payment that does not equal the full amount of the invoice less any cash discount.

A

Partial Payment

Q

A cash discount applied only to the amount of the partial payment.

A

Partial Discount

Q

The sum of the partial payment and the partial discount.

A

Amount Credited

Q

The invoice amount minus the amount credited

A

Outstanding Balance

Q

Freight on Board or Free on Board

A

FOB

Q

Two or more independent brands combined into a new joint product or service.

A

Co-branding

Q

Involves two or more brands, both with significant customer recognition.

A

Co-branding

Q

All participating brand names are retained.

Medium to long term duration.

A

Co-branding

Q

The net value creation potential is not large enough to justify developing a new brand and/or joint legal venture.

A

Co-branding

Q

Reach Awareness
Values Endorsement
Ingredient co-branding
Complementary

A

Co-branding Format

Q

Increase sales due to either expansion in current market or access to new geographical or sector markets.
Enhanced benefits for consumers
Lend credibility to the other brand
Share expensive promotional costs with a partner
Access to cutting edge technology
Decreased cost of entering new markets
Limit the risk of entering a new product category in which consumers may question the firms expertise

A

Advantages of Co-branding

Q

Trying to combine incompatible corporate personalities
Overextending a brand to sectors far removed from where the brand’s reputation lies
The effect of one partner repositioning its original brand
Financial Difficulties for either partner
Failure to meet co-branding targets
The dilution or loss of distinctive features of one of the ingredient brands

A

Disadvantages of Co-branding

Q

Unlike the traditional character licensing model which deals with a short timescale, this license tends to be for an average term of four to seven years.

A

Brand Extension

Q

Intensify the brand image and enhanced the equity in a brand.
Low investment. The cost for launching a new brand in consumer markets is very high.

A

Advantages of a Brand Extension

Q

Risk of diluting the brand image or brand equity
Rather than adding sales to the total brand, a brand eats into existing sales
The risk of giving out a negative or confusing message about the original brand

A

Disadvantages of a Brand Extension

Q

From consumers to people
From product to experience
From honesty to trust
From quality to preference
From notoriety to aspiration
From identity to personality
From function to feel
From ubiquity to presence
From communication to dialogue
From service to relationship

A

10 Commandments of Emotional Branding