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Shopping Products
products that a customer feels are worth the time and effort to compare with competing products.
Homogeneous shopping products
shopping products the customer sees as basically the same and wants at the lowest price.
heterogeneous shopping products
shopping products that the customer sees as different and wants to inspect for quality and suitability branding is less important, the more carefully consumers compare price and quality, the less they rely on brand names or labels Ex: Furniture, clothing, and club membership
Specialty Products
consumer products that the customer really wants and makes a special effort to find it's the customer's willingness to search, not the extent at which it searches
Unsought Product
products that potential customers don't yet want or know they can buy - so they don't search for them at all
New Unsought Products
products offering really new ideas that potential customers don't know about yet
Regularly Unsought Prodcuts
products like gravestones, life insurance, and ecyclopedias - there may be a need, but potential customers aren't motivated to satisfy it Personal Selling is very important NPO's try to "sell" their unsought products
Capital Item
long-lasting product that is often expensive and can be used and depreciated for many years
Components
processed expense items that become part of a finished product - items that are ready for assembly into the final product
Supplies
Maintenance, Repair, and Operating - MRO Supplies - expense items that do not become part of a finished product branding is important for such "nuisance" purchases
Professional Services
specialized services that support a firm's operations - usually expense items Ex: Management Consulting, IT, Advertising Agencies, Food Services
Market Introduction
sales are low, customer's aren't looking for the product, informative promotion is needed, most companies experience losses because they spend so much money on Product, Place, and Promotion Development
Market Growth
industry sales grow fast - but industry profits rise and start falling Ex: Innovator begins to make big profits until competitors copy the product and enter the market Monopolistic Competition with downward sloping demand curves is typical Towards the end of this stage is when in…
Market Maturity
occurs when industry sales level off and competition gets tougher Industry profits go down because promotion costs rise There is a long-run downward pressure on prices
Sales Decline
new products replace the old price competition from dying products becomes more vigorous - but firms with strong brands may make profits until the end because they have successfully differentiated their products
ISO-9000
A set of international standards on quality management and quality assurance
Multiple Buying Influence
several people - perhaps even top management - play a part in purchase decision. Users - line workers or supervisors Influencers - engineering or R&D people who write the specs Buyers - purchasing managers who work with suppliers Deciders - people with power to select or approve the…
buying center
a group of people in the organization who make a purchase decision
Vendor Analysis
a formal rating of suppliers on all relevant areas of performance aim is NOT to get lower price BUT rather to get the lowest total costs associated with purchases
New-Task Buying
First-time or unique purchase situation that requires considerable effort by decision makers.
Straight Rebuy
a routine repurchase that may have been made many times before. buyers probably don't bother looking for new information or new sources of supply
Modified Rebuy
the in-between process where some review of the buying situation is done - though not as much as new-task buying
White Papers
reports designed to help them make decisions about a particular topic
Competitive Bid
the terms of sale offered by the supplier in response to the purchase specs posted by a buyer
operational linkages
direct ties b/t internal operation of the buyer and seller firms; usually involves ongoing coordination of activities; can reduce total inventory costs; just in time delivery
Buying Committee
may decide to add/drop a line or change buying policies
Marketing Information System (MIS)
an organized way of continually fathering, accessing, and analyzing information that marketing managers need to make ongoing decisions
Decision Support System (DSS)
a computer program that makes it easy for a marketing manager to get and use information as he/she is making decisions
Marketing Model
a statement of relationships among marketing variables - enables a manager to look at the sales (and costs) expected with different types of promotion and select the marketing mix that is best for a particular target market
Marketing Research Process
Defining the Problem Analyzing the Situation Getting Problem-Specific Data Interpreting the Data Solving the Problem
Defining the Problem
often the most difficult step it's easy to confuse problems with symptoms setting research objectives may require more understanding
Analyzing the Situation
Situation Analysis - an informal study of what info is already there in the problem area Analysis of Secondary Data (existing/previous data) and Primary Data (specifically collected for current problem) Internet directory sources can be useful - Secondary
Getting Problem Specific Data
Qualitative - seeks in depth, open ended responses, not yes or no answers.....Ex: Focus Groups of 6-10 people in an informal group setting Quantitative - seeks structured responses that can be summarized in numbers, percentages, averages, or other statistics easier and quicker respons…
Consumer Panels
a group of consumers who provide information on a continuing basis
Statistical Packages
easy-to-use computer programs that analyze data Ex: Cross Tabulation - one of the most frequently used approaches - shows the relationships of answers to two different questions
Channel of Distribution
any series of firms or individuals who participate in the flow of products form producer to final user/consumer
Direct Marketing
direct communication between a seller and an individual customer using a promotion method other than face-to-face selling...e.g. online
Discrepancy of Quantity
difference between the quantity of products is economical for a producer to make and the quantity final consumers normally want
Discrepancy of Assortment
consumers need a wide variety of products but firms usually produce one or few products
Regrouping Activities
ways that channel specialists adjust discrepancies
Accumulating
a way to adjust quantity discrepancies involves collecting products from many small producers - especially important in less-developed countries & agricultural markets many wholesalers and retailers who operate form internet websites focus on this
Bulk Breaking
adjusting quantity discrepancy dividing larger quantities into smaller quantities as products get closer to the final market Ex: wholesalers selling to other/smaller wholesalers or to retailers
Sorting
adjusting assortment discrepancy separating products into grade and qualities desired by different target markets
Assorting
adjusting assortment discrepancy putting together a variety of products to give a target market what it wants usually done by those closest to final consumer - retailers or wholesalers
Traditional Channel Systems
the various channel members make little or no effort to cooperate with each other. They buy and sell from each other - that's the extent of their relationship
Vertical Conflicts
occur between firms at DIFFERENT levels in the channel of distribution can occur if a producer and retailer disagree about how much promotion effort the retailer should give the producer's product
Horizontal Conflict
occur between firms at the SAME level in the channel of distribution if a retailer is giving a test ride for bikes and then realizes an online retailer is selling them at a lower price while customers are test riding them in the others store
Channel Captain
a manager who helps direct the activities of a whole channel and tries to avoid or solve channel conflicts In US, producers frequently take the lead in channel relations BUT sometimes wholesalers/retailers take the lead (Ex: Wal-Mart, Tesco, etc.)
Vertical Marketing Systems
channel systems in which the whole channel focuses on the same target market at the end of the channel
Corporate Channel Systems
corporate ownership all along the channel - the firm is going 'direct' BUT actually might be handling wholesaling and retailing Ex: Sherwin-Williams, Florsheim Shoes
Vertical Integration
acquiring firms at different levels of channel activity Advantages: stable sources of supplies, better control of distribution and quality, greater buying power, and lower executive overhead
Administered Channel Systems
the channel members informally agree to cooperate with each other, e.g. routinized ordering and coordinate promotion efforts Ex: GE, Miller Beer, Scotts Miracle Grow
Contractual Channel Systems
channel members agree by contract to cooperate with each other Ex: McDonald's, Holiday Inn, Ace Hardware, Super Valu, Coca-Cola
Selective Distribution
selling through only those intermediaries who will give the product special attention
Exclusive Distribution
selling through only one intermediary in a particular geographic area
Avoid Selling to Retailers That:
place orders that are too small to justify making calls make too many returns or request too much service have a poor credit rating are not in a position to do a satisfactory job
Intensive Distribution
selling a product through all responsible and suitable wholesalers who will stock or sell the product Convenience Products are common here....laser print cartridges, ring binders, and copier paper
Multi-Channel Distribution
occurs when a producer uses several competing channel to reach the same target market - perhaps using several intermediaries in addition to selling directly
Reverse Channels
used to retrieve products that customers no longer want - forced by environmental laws often
5 Basic Ways to Enter International Markets
Exporting Licensing - selling the right to use some process, trademark, patent for a fee or royalty - licensee takes most of the risk Management Contracting - the seller provides only management and marketing - others own production and distribution facilities Joint Venture - a domesti…
5 Levels of Brand Familiarity
Rejection - customers won't buy a brand unless its image is changed Non-Recognition - customers don't remember the brand Recognition - customers remember the brand Preference - target customers usually choose the brand over other brands - habit or previously favorable experience Insis…
Lanham Act
spells out what kinds of marks (including brand names) can be protected and the exact method of protecting them
Manufacturer Brands
brands created by producer - Nabisco, MasterCard, McDonald's
Dealer Brands (private brands)
created by intermediaries Ex: Up & Up (Target), Equate (Wal-Mart), Craftsmen and Kenmore (Sears) often lower priced than manufacturer brands
Packaging
involves promoting, protecting, and enhancing the product - both important to sellers and consumers Advantages: sends a message, may lower distribution costs, reduce storage costs and breakages
Warranty
explains what the seller promises about their product US common law says that producers must stand behind their products - even if they don't offer a specific warranty
Magnuson-Moss Act
producers must provide a clearly written warranty if they choose to offer any warranty
Homogeneous shopping products
shopping products the customer sees as basically the same and wants at the lowest price. Ex: Computers, washing machines
heterogeneous shopping products
shopping products that the customer sees as different and wants to inspect for quality and suitability Ex: Dentist - price doesn't matter as much
Specialty Products
products that the consumer really wants and make a special effort to find - willingness to search NOT extent of search
Regularly Unsought Products
products - like gravestones, life insurance, and encyclopedias - that stay unsought but not unbought forever personal selling is VERY important
Expense Item
a product whose total cost is treated as a business expense in the year it's purchased
Capital Item
long-lasting product that can be used and depreciated form many years - often very expensive
Installation
capital item buildings, land rights, major equipment
Accessories
short-lived capital items tools and equipment used in production or office activites
Raw Materials
unprocessed expense items logs, iron ore, wheat become part of a physical good
Components
processed expense items that become part of a finished product Ex: Airbags in cars
Supplies
items that do not become part of a finished product Maintenance, Repair, and Operating
Professional Services
specialized services that support a firm's operations Ex: IT services, Food services, Consulting
Screening
involves evaluating new ideas with a SWOT analyis Safety and Product Liability must be considered ROI is crucial
Development
usually involved R&D and engineering to design and develop physical product Computer Aided Design - develop 3D color drawing and packaging/products Market Tests are costly BUT not doing so is risky
2 Keys to Improving Service
Training Empowerment - giving employees the authority to correct a problem without first checking with management

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