Chapter 14 - Developing and Pricing Goods and Services
Product line
*A company usually doesn't sell just one product -> too risky -A group of products that are physically similar or are intended for a similar market -In one product line, there may be several competing brands
Total Product Offer
*A product is more than just the physical good or service -Consists of everything consumers evaluate when deciding whether to buy something; also called a value package
Brand association
The linking of a brand to other favorable images ex. Mercedes Benz associated with successful people who live luxurious lives
Specialty goods and services
consumer products with unique characteristics and brand identity -Because these products are perceived as having no reasonable substitute, the consumer puts forth a special effort to purchase them Ex. fine watches, expensive wine, fur coats, jewelry, services provided by specialists
Unsought goods and services
products that consumers are unaware of, haven't necessarily thought of buying, or find that they need to solve an unexpected problem Ex. emergency car-towing services, burial services, and insurance
Break-even analysis
the process used to determine profitability at various levels of sales -It's the point where revenues from sales equal all costs BEP = total fixed costs/ (Price of one unit - costs of one unit) units are in volume
p.397 figuring out your own cost, slapping money on top off t
you could possibly sell for a lot more it is convenient to you but if your competitors are offering something similar for less
Brand loyalty
-The core of brand equity -The degree to which customers are satisfied, like the brand, and are committed to further purchases
Shopping goods and services
-Those products that the consumer buys only after comparing value, quality, price, and style from a variety of sellers -Sold largely through shopping centers Ex. Target
Brand equity
-a major goal of marketers The value of the brand name and associated symbol
Marketing Different Classes of Consumer Goods and Services (Four general categories: Convenience, shopping, specialty, and unsought)
1) Convenience goods and services 2) Shopping goods and services 3) Speciality goods and services 4) Unsought goods and services
Brand
A name, symbol, or design (or combination thereof) that identifies the goods or services of one seller or group of sellers and distinguishes them from the goods and services of competitors
Brand awareness
How quickly or easily a given brand name comes to mind when a product category is mentioned
Skimming Price Strategy
Strategy in which a new product is priced high to make optimum profit while theres little competition -Idea is to recover research and development costs and make as much of a profit as possible -large profits will attract new competitors
Penetration strategy
Strategy in which a product is priced low to attract many customers and discourage competition
Product Mix
The combination of product lines offered by a manufacturer
Product differentiation
The creation of real or perceived product differences -The process of distinguishing a product or service from others to make it more attractive to a particular target market *Actual product differences are quite small -> marketers must create a unique, attractive image for product
Value Based Pricing
arguing its worth a huge amount of money
Convenience Goods and Services
products that the consumer wants to purchase frequently and with a minimum effort Ex. candy, gum, milk, snacks, gas, banking services