Exam 2

Discuss the product adoption process.

When customers accept a new product, they usually do so through a five-stage adoption process. The first stage is awareness, when buyers become aware that a product exists. Interest, the second stage, occurs when buyers seek information and are receptive to learning about the product. The third stage is evaluation—buyers consider the product's benefits and decide whether to try it. The fourth stage is trial, during which buyers examine, test, or try the product to determine if it meets their needs. The last stage is adoption, when buyers purchase the product and use it whenever a need for this general type of product arises.

Packaging

-A package can be a vital part of a product, making it more versatile, safer, and easier to use -i.e. Producers of jellies, sauces, and ketchups package their products in squeezable plastic containers that can be stored upside down, which make dispensing and storing the product more convenient -may give a product a competitive advantage

Manufacturer Brands

-initiated by producers and ensure that producers are identified with their products at the point of purchase -i.e. Green Giant, Dell Computer, and Levi's jeans -usually requires a producer to become involved in distribution, promotion, and to some extent, pricing decisions

Branding Strategy

-influenced by the number of products and product lines the company produces, the number and types of competing products available, and the size of the firm -An organization is not limited to a single branding strategy

product line

-a group of closely related product items that are considered to be a unit because of marketing, technical, or end-use considerations -i.e. Starbucks has product lines for beverages, food, mugs and tumblers, and coffee making equipment (Within its beverage product line, the Mocha Frappuccino is a product item) -to develop the optimal product line, marketers must understand buyers' goals -Firms with high market share are more likely to expand their product lines aggressively, as are marketers with relatively high prices or limited product lines

Individual Branding

-a policy of naming each product differently -i.e. Nestlé S.A., uses individual branding for many of its more than 2,000 different brands, such as Nescafé coffee, PowerBar nutritional food, Maggi soups, and Häagen-Dazs ice cream -A major advantage of individual branding:, if an organization introduces a product that fails in the marketplace, the negative images associated with it do not influence consumers' decisions to purchase the company's other products -may also facilitate market segmentation when a firm wishes to enter many segments of the same marke -a firm cannot capitalize on the positive image associated with successful products

product item

-a specific version of a product that can be designated as a distinct offering among an organization's products -i.e. American Eagle Outfitters T-shirt

Brand Preference

-a stronger form of brand loyalty -A customer has a definite preference for one brand over competitive offerings, and will purchase this brand if it is available. -if the brand is not available, the customer will accept a substitute

Private Distributor Brands

-a.k.a. private brands, store brands, or dealer brands -initiated and owned by re-sellers—wholesalers or retailers -the manufacturers are not identified on the products -Private distributor brands give retailers or wholesalers freedom to purchase products of a specified quality at the lowest cost without disclosing the identities of the manufacturers -i.e. IGA (Independent Grocers' Alliance) and Price Chopper

Family Branding

-all of a firm's products are branded with the same name, or part of the name -i.e. Kellogg's Frosted Flakes, Kellogg's Rice Krispies, and Kellogg's Corn Flakes -means that the promotion of one item with the family brand promotes the firm's other products -benefit when consumers have positive associations with brands, or a drawback if something happens to make consumers think negatively of the brand

Family Packaging

-all packages should be similar or should all feature a major design element -i.e. Campbell's soups, Weight Watchers' foods, or Planters Nuts

Brand Licensing

-an agreement in which a company permits another organization to use its brand on other products for a licensing fee -i.e. Disney Products, NFL, NASCAR, MLB -The licensee is responsible for all manufacturing, selling, and advertising functions and bears the costs if the licensed product fails

component parts

-become part of the physical product and are either finished items ready for assembly or products that need little processing before assembly -i.e. Spark plugs, tires, clocks, brakes, and headlights -Buyers purchase such items according to their own specifications or industry standards

introduction stage of product life cycle

-begins at a product's first appearance in the marketplace -Sales start at zero and profits are negative because companies must invest in product development and launch prior to selling -Profits may remain low or below zero because initial revenues will be low while the company covers large expenses for promotion and distribution -difficulties that may arise: 1. sellers may lack the resources, technological knowledge, and marketing expertise to launch the product successfully 2. the initial product price may have to be high to recoup expensive marketing research or development costs, which can depress sales

Secondary Use Packaging

-can be reused for purposes other than its initial function -i.e. margarine container can be reused to store leftovers, and a jelly container can serve as a drinking glass

product mix

-composite, or total, group of products that an organization makes available to customers

Brand Loyalty

-customer's favorable attitude toward a specific brand -Customer satisfaction with a brand is the most common reason for loyalty to that brand -i.e. Delta, Amazon, Lyft, Red Bull, Advil, ExxonMobil, AT&T, and Discover -Brand Recognition is the weakest form of Brand Loyalty

accessory equipment

-does not become part of the final physical product but is used in production or office activities -i.e. Examples include file cabinets, fractional-horsepower motors, calculators, and tools -usually are less expensive -often treated as expense items rather than capital items because they are not expected to last as long -

Brand Mark

-element of a brand that is not comprised of words—often a symbol or design -i.e. McDonald's Golden Arches, Nike's "swoosh," and Apple's silhouette of an apple with a bite missing

Innovative Packaging

-employs a unique cap, design, applicator, or other feature to make a product distinctive -effective when the innovation makes the product safer, easier to use, or provides better protection -make the brand stand out from its competitors -uniquely shaped packages that attract attention are likely to be perceived as containing a higher volume of product than comparable products that generate less attention

Installations

-facilities and non-portable equipment -i.e. office buildings, factories, warehouses ; production lines and very large machines -decisions often made by high-level management because it's a long term investment -Marketers of installations must frequently provide a variety of services, including training, repairs, maintenance assistance, and even aid in financing

Product Life Cycle

-has four major stages: introduction, growth, maturity, and decline -As a product moves through each cycle, the strategies relating to competition, pricing, distribution, promotion, and market information must be evaluated and possibly adjusted -marketing managers use the life-cycle concept to make sure that strategies relating to the introduction, alteration, and deletion of products are timed and executed properly

Generic Brands

-indicate only the product category and do not include the company name or other identifying terms -i.e. sugar, salt, or aluminum foil -sold at lower prices than comparable branded items and compete on the basis of price and value

Business Services

-intangible products that many organizations use in their operations -i.e. financial, legal, marketing research, information technology, and janitorial services -Firms must decide whether to provide these services internally or obtain them from outside the organization

shopping products

-items for which buyers are willing to expend considerable effort in planning and making the purchase -i.e. Appliances, bicycles, furniture, stereos, cameras, and shoes -still within the budgets of most consumers and are purchased less frequently than convenience items -marketing channel members expect to receive higher gross margins to compensate for the lower turnover

Trademark

-legal designation indicating that the owner has exclusive use of a brand or a part of a brand and that others are prohibited by law from its use -To protect a brand name or a brand mark in the United States, an organization must register it as a trademark with the U.S. Patent and Trademark Office

MRO supplies

-maintenance, repair, and operating items that facilitate production and operations, but do not become part of the finished product -i.e. paper, pencils, cleaning supplies, and paints -purchased routinely -buyers often deal with more than one seller

width of product mix

-measured by the number of product lines a company offers -i.e. Deere & Co. offers multiple product lines for the agricultural industry, including tractors and loaders, farm equipment and technology, tools and used equipment, and utility vehicles

Brand Recognition

-occurs when a customer is aware that the brand exists and views it as an alternative purchase if the preferred brand is unavailable or if the other available brands are unfamiliar -weakest form of brand loyalty

Brand Extension

-occurs when an organization uses one of its existing brands to brand a new product in a different product category -i.e. Baileys extended its well-known Baileys Irish Cream liqueur brand when it introduced Baileys Iced Coffee, single serving canned iced coffees flavored with Baileys Irish Cream, to capitalize on the growing category of iced coffee -If a brand is extended too many times or extended too far outside its original product category, it can be weakened through dilution of its image and symbolic impact

Brand Name

-part of a brand that can be spoken—including letters, words, and numbers -i.e. 7UP or V8 -Marketers must make efforts so that brand names do not become generic terms, which are not protected under the law

specialty products

-possess one or more unique characteristics, and generally buyers are willing to expend considerable effort to obtain them -i.e. fine jewelry or limited-edition collector's items -have lower inventory turnover and thus requiring high gross margins to be profitable -buyers do not compare alternative and are unlikely to base their decision on price

Category-Consistent Packaging

-product is packaged in line with the packaging practices associated with a particular product category -i.e. mayonnaise, mustard, ketchup, and peanut butter—have traditional package shapes or categories are characterized by recognizable color combinations, such as red and white for soup and red, white, and blue for Ritz-like crackers -marketers will often use traditional package shapes and color combinations to ensure that customers will recognize the new product as being in that specific product category

Handling-Improved Packaging

-product's packaging may be changed to make it easier to handle in the distribution channel -i.e. An ice cream producer, for instance, may adopt a rectangular-shaped package over a cylindrical one to facilitate handling -Outer containers for products are sometimes altered so they will proceed more easily through automated warehousing systems

Convinience Products

-relatively inexpensive, frequently purchased items for which buyers exert only minimal purchasing effort -i.e. Bread, Soda, Gas -convenience product is normally marketed through many retail outlets, such as gas stations, drugstores, and supermarkets -package plays a major role in selling the product -Low per-unit gross margins because of high turnover rate

Decline stage of the product cycle

-sales fall rapidly -the marketer must consider eliminating items from the product line that no longer earn a profit -i.e. decline in demand for most sweetened carbonated beverages such as soda

Maturity stage of the product cycle

-sales peak and start to level off or decline, and profits continue to fall -i.e DVDs and DVD Players -characterized by intense competition because many brands are now in the market -Competitors emphasize improvements and differences in their versions of the product

The growth stage of the product cycle

-sales rise rapidly and profits reach a peak and then start to decline -critical to a product's survival because competitive reactions to the product's success during this period will affect the product's life expectancy -i.e. smart speakers: Google Home, Amazon Echo (currently in the growth stage) -Profits begin to decline late in the growth stage as more competitors enter the market -typical marketing strategy seeks to strengthen market share and position the product favorably against aggressive competitors by emphasizing product benefits i.e. Aggressive pricing, including price cuts, a packaged goods company might introduce new flavors of a successful cookie -Firms should seek to fill gaps in geographic market

depth of product mix

-the average number of different product items offered in each product line -Procter & Gamble offers a broad product mix, comprised of all the health-care, beauty-care, laundry and cleaning, food and beverage, and paper products the firm manufactures

Raw Materials

-the basic natural materials that actually become part of a physical product -i.e. minerals, chemicals, agricultural products, and materials from forests and oceans.

Brand Equity

-the marketing and financial value associated with a brand's strength in a market -represents the value of a brand to an organization -includes both tangible assets and intangibles such as public perception and consumer loyalty

Brand Insistence

-the strongest and least common level of brand loyalty -A customer will accept no substitute -i.e. Hilton Hotels, or sports teams, such as the Dallas Cowboys

Co-Branding

-the use of two or more brands on one product -i.e. Benjamin Moore partnered with the retailer, Target, to release a co-branded line of paint colors that coordinate with Target's kids' furniture and accessories collection

unsought products

-those purchased when a sudden problem must be solved, products of which customers are unaware until they see them in a store or online, and products that people do not plan on purchasing -Emergency medical services and automobile repairs -speed of problem resolution is more important than price or other features a buyer might normally consider

Multiple Packaging

-twin packs, tri-packs, six-packs, or other forms of multiple packaging -may increase demand because it increases the amount of the product available at the point of consumption (e.g., in one's house) -increase consumer acceptance of the product by encouraging the buyer to try the product several times -multiple packaging does not work well for all types of products

Process Materials

-used directly in the production of other products -i.e. vinegar in a salad dressing -process materials are not readily identifiable or extractable -purchased according to industry standards or the purchaser's specifications

Labeling

-used for identification, promotional, informational, and legal purposes -i.e. stickers on a banana or an apple are small and display only the brand name of the fruit, the type, and perhaps a stock-keeping unit number

Product Adoption Process

1. Awareness: The buyer becomes aware of the product. 2. Interest: The buyer seeks information and is receptive to learning about the product. 3. Evaluation: The buyer considers the product's benefits and decides whether to try it, considering its value versus the competition. 4. Trial: The buyer examines, tests, or tries the product to determine if it meets his or her needs. 5. Adoption: The buyer purchases the product and can be expected to use it again whenever the need for this product arises Rejection may occur at any stage

Four Major Elements of Brand Equity

1. Brand-name awareness 2. Brand Loyalty 3. Perceived Brand Quality 4. Brand Associations

Brand Name factors to consider

1. First, the name should be easy for customers to say, spell, and recall 2. brand name should indicate in some way the product's major benefits and, if possible, should suggest the product's uses and special characteristics (always avoid negative or offensive references) 3. set it apart from competing brands, the brand should be distinctive creating a brand personality that aligns with the products sold and the target market's self-image is important to brand success (if the target market feels aligned with the brand, they are more likely to develop brand loyalty)

Seven Categories of Business Products

1. Installations 2. Accessory Equipment 3. Raw Materials 4. Component Parts 5. Process Materials 6. MRO Supplies (Maintenance, Repair, and Operating) 7. Business Services

3 types of Brands

1. Manufacturer 2. Private Distributor 3. Generic

Product Adopter Categories

1. innovators 2. early adopters 3. early majority 4. late majority 5. laggards

How many new products succeed in the market place?

15% - 25%

Explain the major components of branding, including brand types, branding strategies, and brand protection.

A brand is a name, term, design, symbol, or any other feature that identifies one seller's good or service and distinguishes it from those of other sellers. Branding helps buyers to identify and evaluate products, helps sellers to facilitate product introduction and repeat purchasing, and fosters brand loyalty. Brand equity is the marketing and financial value associated with a brand's strength. It represents the value of a brand to an organization. The four major elements underlying brand equity include brand-name awareness, brand loyalty, perceived brand quality, and brand associations.

Define the concept of a product.

A product is a good, a service, an idea, or any combination of the three received in an exchange. It can be either tangible or intangible and includes functional, social, and psychological utilities or benefits. When consumers purchase a product, they are buying the benefits and satisfaction they think the product will provide.

Explain the concepts of product line and product mix and how they are related.

A product item is a specific version of a product that can be designated as a distinct offering among an organization's products. A product line is a group of closely related product items that are considered a unit because of marketing, technical, or end-use considerations. The composite, or total, group of products that an organization makes available to customers is called the product mix. The width of the product mix is measured by the number of product lines the company offers. The depth of the product mix is the average number of different products offered in each product line.

Identify the functions of labeling and legal issues related to labeling.

Labeling is closely interrelated with packaging and is used for identification, promotional, informational, and legal purposes. Various federal laws and regulations require that certain products be labeled or marked with warnings, instructions, nutritional information, manufacturer's identification, and perhaps other information.

Describe the major packaging functions, design considerations, and how packaging is used in marketing strategies.

Packaging involves the development of a container and a graphic design for a product. Effective packaging offers protection, economy, safety, and convenience. It can influence a customer's purchase decision by promoting features, uses, benefits, and image. When developing a package, marketers must consider the value to the customer of efficient and effective packaging, offset by the price the customer is willing to pay. Other considerations include how to make the package tamper resistant, whether to use multiple packaging and family packaging, how to design the package as an effective promotional tool, and how best to accommodate resellers. Packaging can be an important part of an overall marketing strategy and can be used to target certain market segments. Modifications in packaging can revive a mature product and extend its product life cycle. Producers alter packages to convey new features or to make them safer or more convenient. If a package has a secondary use, the product's value to the consumer may increase. Innovative packaging enhances a product's distinctiveness.

Discuss how products are classified.

Products can be classified on the basis of the buyer's intentions. Consumer products are those purchased to satisfy personal and family needs. Business products are purchased for use in a firm's operations, to resell, or to make other products. Consumer products can be subdivided into convenience, shopping, specialty, and unsought products. Business products can be classified as installations, accessory equipment, raw materials, component parts, process materials, MRO supplies, and business services.

Explore the product life cycle and its impact on marketing strategies.

The product life cycle describes how product items in an industry move through four stages: introduction, growth, maturity, and decline. The sales curve is at zero at introduction, rises at an increasing rate during growth, peaks during the maturity stage, and then declines. Profits peak toward the end of the growth stage of the product life cycle.

During which of the product life cycle stages do sales rise rapidly? a. Growth b. Decline c. Maturity d. Deletion e. Introduction

a. Growth

Which of the following is closely related to packaging and is used to identify, promote, inform, and address legal requirements? a. Labeling b. Packaging c. Brand mark d. Branding e. Brand licensing

a. Labeling

Which of the following is used by retailers or wholesalers to develop more efficient promotion, generate higher gross margins, and change store image? a. Private distributor brands b. Manufacturer brands c. Equity brands d. Consumer brands e. Generic brands

a. Private distributor brands

Which of the following product elements derives from customers' involvement with the product, which may convey additional value to many products (and brands) for buyers? a. Symbolic or experiential benefits b. Brand equity c. The core product d. Supplemental features e. Brand loyalty

a. Symbolic or experiential benefits

Which of the following are purchased when a sudden problem must be solved, products of which customers are unaware of until they see them in a store or online, and products that people do not plan on purchasing? a. Unsought products b. Specialty products c. Convenience products d. Shopping products e. Accessory products

a. Unsought products

The Double-A of American Airlines, the peacock of NBC, and the apple with a missing bite of Apple are examples of a _______. a. brand mark b. trademark c. brand equity d. brand name e. trade name

a. brand mark

Huy Fong Foods is buying peppers and vinegar to make its iconic Sriracha sauce. For Huy Fong Foods, these are best described as _______. a. process materials b. accessory equipment c. component parts d. raw materials e. installations

a. process materials

Any product making a nutritional claim must have _______. a. standardized nutrition labeling b. standardized packaging c. promotional nutrition labeling d. the information that the manufacturer thinks is important e. package licensing

a. standardized nutrition labeling

Early Majority

adopt just prior to the average person, they are deliberate and cautious in trying new products

ACME Corp. has decided that all of its products' packages should be similar. ACME is using which of the following? a. Private distributor packaging b. Family packaging c. Family branding d. Co-branding e. Brand extension

b. Family packaging

Which of the following is NOT a typical function of packaging? a. To protect the product and maintain its form b. To prevent efficient handling of the product c. To offer convenience to consumers d. To prevent tampering and shoplifting e. To promote a product

b. To prevent efficient handling of the product

The Red Cross raises money to help people survive natural and manmade disasters. Red Cross can best be described as a(n) a. good b. idea c. unsought product d. specialty product e. service

b. idea

When a company offers many product lines, it can be said to have a _______. a. shallow product mix b. wide product mix c. brand product mix d. deep product mix e. narrow product mix

b. wide product mix

Which of the following is the total group of products that an organization makes available to customers? a. Brand mix b. Promotion mix c. Product mix d. Product mix width e. Marketing mix

c. Product mix

Which of the following are viewed as "in the know" by many product adopters? a. Late majority b. Laggards c. Early majority d. Early adopters e. Innovators

d. Early adopters

Early Adopters

choose new products carefully and are viewed as people who are in-the-know by those in the remaining adopter categories

Buyers recognize the existence of a new product during which of the following stages of the product adoption process? a. Interest b. Evaluation c. Adoption d. Awareness e. Trial

d. Awareness

In the case that a preferred brand is not available, which of the following consumer product types will a shopper be most likely to choose a substitute brand? a. Specialty b. Installations c. Shopping d. Convenience e. MRO supplies

d. Convenience

Which of the following is characterized by intense competition? a. Growth b. Test marketing c. Decline d. Maturity e. Introduction

d. Maturity

Free samples can help move consumers into which of the following? a. Interest b. Evaluation c. Awareness d. Trial e. Adoption

d. Trial

Which of the following is the strongest and most desired by marketers? a. Brand preference b. Brand equity c. Brand loyalty d. Brand recognition e. Brand insistence

e. Brand insistence

Sales fall rapidly during which of the following? a. Growth stage b. Maturity stage c. Introduction stage d. Product development e. Decline stage

e. Decline stage

A _______ is a specific version of a product, while a _______ is a group of closely related products that are considered to be a group because of marketing, technical, or end-use considerations. a. product mix; product line b. product item; product mix c. brand; product mix d. product mix width; product mix depth e. product item; product line

e. product item; product line

When a product's packaging can be reused for an additional purpose, this is best described as _______. a. family packaging b. family branding c. handling-improved packaging d. category-consistent packaging e. secondary-use packaging

e. secondary-use packaging

Trade Name

full and legal name of an organization, such as Ford Motor Company, rather than the name of a specific product

Brand

name, term, design, symbol, or any other feature that identifies one marketer's product as distinct from those of other marketers

Late Majority

skeptical of new products, but eventually adopt them because of economic necessity or social pressure

Innovators

the first to adopt a new product because they enjoy trying new products and do not mind taking a risk

Laggards

the last to adopt a new product, are oriented toward the past. They are suspicious of new products, and when they finally adopt them, the products may already have been replaced by even newer products.