Marketing Exam 2: Chapter 8

51. JC Penney made a major mistake in changing their price philosophy. What did they do?

A strategic mistake made close to two years ago, regarding its pricing strategy --replacement of sales through coupons with everyday low prices. customers no longer thought they were saving money so stopped going

97. Describe how good Supply chain management systems work to deliver marketing value for the consumer?

Companies must decide on the best way to store, handle, and move their products and services so that they are available to customers in the right assortments, at the right time, and in the right place

76. How are "shipping costs" used in geographic pricing as a tactic to pass along price discounts or increases? Example might be FOB-origin pricing, Uniform-delivered pricing, zone pricing, basing-point pricing or freight-absorption pricing.

1. FOB-origin pricing Charges for shipping based on proximity from shipping origin. Can make it difficult for a company to penetrate far-away markets 2. Uniform-Delivered Pricing Charges equally for shipping. Areas closer to origin subsidize shipping for farther away people 3. Zone Pricing Charged based on a zone eg. west coast, midwest 4. Basing-point pricing Choose a city and base pricing off proximity from that place eg. Chicago 5. Freight-absorption pricing Firm absorbs price for transportation, used when trying to gain market share

31. What is the difference between product idea, product concept and a product image?

A product idea is an idea for a possible product that the company can see itself offering to the market, a product concept is a detailed version of the idea stated in meaningful consumer terms, and a product image is the way consumers perceive an actual or potential product.

84. What is Vertical Integration of your channels, "Corporate VMS"? Describe the issues of Direct versus Indirect channel management.

A vertical marketing system (VMS) is a channel structure in which producers, wholesalers, and retailers act as a unified system. One channel member owns the others, has contracts with them, or has so much power that they all corporate. Corporate VMS is a vertical marketing system that combines successive stages of production and distribution under single ownership~channel leadership is established through common ownership Direct channel management: a marketing channel that has no intermediary levels Indirect marketing channel: a marketing channel that contains one or more intermediary levels

7. ALDI's, Whole Foods, Wegman's, Trader Joe's, WalMart and Target all took different positioning strategies in the Food Business. What segments were they going after and how were they accomplishing it? (VIDEO) p. 210

ALDI: less for much less. no frills. customers bring own bags. rent carts. Whole Foods: natural, organic foods at premium prices. health-conscious customers willing to pay higher price for more value Wegman's: more of an experience, low prices on food families buy regularly Trader Joe's: specialty supermarket, store brand, cheap gourmet WalMart: discount store, everyday low prices Target: superstore, focusing on the expect more side & offering more for your money

48. Describe the current strategies of Amazon and Walmart in their current Price War for Online Supremacy? What approach and competitive strategy are each one using?

Amazon: 1. established distribution network that can deliver goods within days. 2. Amazon also employs a mobile app that is quite popular and convenient. 3. It also utilizes big data to create personalized buying experiences. Walmart suffers from its late arrival to the online retail industry. However, it is figuring ways to integrate online and physical buying. Since it has such an expansive network of stores, Walmart can efficiently do same-day delivery by having employees pack and ship online orders to customers. trying to use efficient operations to slash prices. has a presence of brick and mortar that amazon can't match

98. What is Third-Party logistics (3PL) and why have these companies mushroomed over the past 20 years?

An independant logistics provider that performs any or all of the functions required to get a client's product to market Companies hate the associated grunt work involved in getting products to their customers so they get companies like UPS to get products to customers more quickly and reliably

16. There are many challenging decisions involving brands - positioning, name selection, sponsorship and development. Give examples of each these decisions. (p. 241)

Brand positioning: attributes, benefits, and beliefs/ values. 3 levels: lowest= product attributes (easily copied by competitors, customers want to know what attributes will do for them). 2nd= benefit (less hassle, energy savings, etc). strongest= beliefs and values (engaging customers on a deep emotional level). Whirlpool: attributes= quality and style, benefits= ease and less energy, beliefs and values= "every day, care" about caring for those you love. Goal- become lovemarks, products or services that inspire loyalty beyond reason (disney) Name selection: adds to products success. Begin with product and benefits, then part science part instinct. 1. Should suggest something about product benefit and qualities 2. Easy to pronounce and remember 3. Distinctive 4. Extendable 5. Easily translated. Ex: "Bing" in chinese translates to easy to respond, amazon means A to Z Sponsorship: can be a national/ manufacturer's brand (Samsung and Kellogg sell output under own brand names) or private/ store brand: a brand created and owned by a reseller of a product or service (more savings, like Kroger Private Selection). Or two companies can co-brand. Battle of the brands between national and private. National brands must sharpen value proposition Development: introducing line extensions, brand extensions, multibrands, and new brands

57. How did the Ritchie Brothers establish price for their used Machinery and what did they do to increase that price? What is the advantage for the Seller when they use "auction-pricing"

By offering live auctions for used machinery, Ritchie Brothers uses the idea of excitement and competition to drive up prices. makes customers want to be a part of the experience

29. How does the Bose Development process work (Video)?

Can envision what might be. Start with an anechoic chamber (what comes out/ off of speaker). Use reference rooms to remove anomalies. Design Assurance Engineering labs with reliability test chambers to understand failures, cargo bounce test, rain test. Goal- perfect details for products that are reliable with the best performance.

56. Why is "Competition-based pricing" method often preferred by the sales function? What are the pros and cons?

Competition-based pricing: setting prices based on competitors' strategies, prices, costs, and market offerings. This is preferred because the goal is to set a price according to the relative value created vs its competitors. pros: customers recognize and get added value. cons: can jack up prices

6. What is the difference between types of Consumer products - Convenience, Shopping, Specialty or Unsought - and their Pricing and Promotion? (p.223)

Convenience (frequent purchase, little planning, low involvement): pricing= low, promotion= mass promotion by producer Shopping (less frequent, much planning and effort, comparison of brands): pricing= higher, promotion= advertising and personal selling by the producers and the resellers Specialty (strong brand preference and loyalty, little comparison of brands, low price sensitivity): pricing= high price, promotion= more carefully targeted promotion by the producer and the resellers Unsought (little product awareness/ knowledge): price= varies, promotion= aggressive advertising and personal selling by the producer and resellers

54. How does one practice Cost-Based Pricing and what is the advantage and disadvantage of this method? What is Cost-Plus method of pricing?

Cost-based pricing designs a good product, adds up the costs of making the product, then sets the price to make a target profit. Then the company has to convince consumers to buy the product at this price. Advantages: guaranteed to not take a loss Disadvantages: not guaranteed that demand will match the price point. Cost-plus pricing is a cost-based method for setting the prices of goods and services. Under this approach, you add together the direct material cost, direct labor cost, and overhead costs for a product, and add to it a markup percentage (to create a profit margin) in order to derive the price of the product.

26. How does "Crowd Sourcing" help in new product development? (p. 258)

Crowdsourcing: the process through which a company invites broad communities of people (customers, employees, independent scientists and researchers) into the new product innovation process. Crowdsourcing can help in producing new and unexpected ideas because ideas are being drawn from a large pool of sources.

52. Customer "value-based pricing" is best determined in what whom and how?

Customer value based pricing: setting price based on buyers' perceptions of value rather than on the seller's cost. Price is considered along with other marketing mix elements before marketing program is set. First assess customer needs and perceptions and then set target price based on customer perceptions of value. determined by price floor (no profits below this point) and ceiling (no demand above this point)

89. What is a "customer value delivery network" and how do marketing channels play a key role in satisfying consumer needs?

Customer value delivery network: a network composed of the company, suppliers, distributors, and, ultimately, customers who partner with each other to improve the performance of the entire system in delivering customer value

10. What is the significance, purpose and use of a Brand Logo and why are some companies doing "makeovers"? (p. 230)

Customers form attachments to brands and logos that represent them. Companies want simple and easily recognized logos that quickly identify and position their brands and trigger positive consumer associations. Must look good on all forms of media. Most modifications focus on simpler, brighter, and more modern to be more digital device friendly. Can have logo kits. Must tread carefully because old logos closely link hearts and minds of consumers. Best practice is to alert customers of upcoming changes.

74. Pharma pricing model is often criticized. What are the two sides of the argument for why Pharma prices are set the way they are? What is Predatory Pricing? Price fixing?

Customers: It's unfair that lifesaving medicines are almost too expensive for the average patient Pharma: Most popular medicines have to pay for lower performing medicines and future R&D Price fixing: must set prices without talking to competitors. Price fixing is illegal or collusion is illegal Predatory pricing - selling below cost with the intention of punishing a competitor or gaining higher long-run profits by putting competitors out of business

77. Psychological pricing is used when a store practices "even / odd pricing". What do they do?

Even/ Odd pricing is used by many stores to indicate bargains. We see this in prices ending in $.99 instead of just being priced at the next whole dollar

93. Why is a company constantly re-evaluating their channel strategy? Economics, Control and Adaptability all play a role.

Every company wants to select the one that will best satisfy its long-run objectives Economic criteria - company compares the likely sales, costs, and profitability of different channel alternatives. What's the investment and and what's the return? Control issues - using intermediaries usually means giving them some control over the marketing of the product, and some intermediaries take more control than others. They want as much control as possible Adaptability criteria - channels often involve long term commitments, yet the company wants to keep the channel flexible so that it can adapt to environmental changes. If a long term commitment, it should be greatly superior economically and control grounds

92. Describe the difference between an exclusive, selective or intensive distributor.

Exclusive - giving a limited number of dealers the exclusive right to distribute the company's products in their territories Selective - the use of more than one but fewer than all of the intermediaries that are willing to carry the company's products Intensive - stocking the product in as many outlets as possible

2. How was GoPro successful when they redefined their products with experiences? (p. 219)

GoPro's avid customers have become evangelists for the brand. Part of the success is technology itself, the other part is that consumers want to take videos and tell the stories and share the emotions and moments in their lives and celebrate experiences together. GoPro creates an emotional connection between the storyteller and the audience. 4 essential steps: capture, creation, broadcast, and recognition. GoPro offers products and services for all 4 of these steps.

40. Why was Alphabet formed by Google to help their new product develop management?

Google has innovated in so many diverse new ventures that it created a broader organization, Alphabet the parent holding company, to contain them all. Google is largest Alphabet company, continuing to house information and internet related products. Alphabet provides an independent home for the company's more far-reaching collection of products and businesses.

39. Google Moonshot has a development process that is unique? Describe the process.

Google's innovation machine renowned for 'moonshoots': futuristic, breathtakingingly idealistic long shots that if successful change how people live. Created Google X, a secret innovation lab, to develop audacious things.

43. What decisions must be made in the Growth Stage of the PLC to extend the life of a product?

Growth stage: the PLC stage in which a product's sales start climbing quickly. Decisions: improving product quality, adds new features and models, enters new market segments, shifts advertising to product conviction and purchase, faces trade off between high market share and high current profit. Keep promotion spending at same or slightly higher level, educating market and meeting competition- 2 main goals.

44. What are some of the reasons that carrying a weak product in decline can hurt the company and be very costly?

Hidden costs: weak product can take up too much of management's time, requires frequent price and inventory adjustments. Requires advertising and sales force attention that might be better used to make 'healthy' products more profitable. A products failing reputation can cause customer concerns about company and its products. Biggest cost lies in future: delays search for replacements, lopsided product mix, hurts current profits, and weakens company's foothold on future

11. What is the value of the "Lexus Covenant" for communicating with their customers? (p.231)

High-quality support service creates an unmatched car ownership experience and some of world's most satisfied car owners. Lives up to the ambitious customer-satisfaction promise. "Will enter the most prestigious automobile race in the world... will be the finest cars ever built... will treat each customer as a guest in our home"

25. As with the case of Samsung, many companies develop an IOT strategy? What is IOT and what effect will it have on the economy? (p. 254-255)

IOT, or "Internet of Things" is a global environment where everything will be digitally connected to everything else. IOT will transform the economy and everything will be digitally connected.

32. In developing a "Marketing Strategy Statement, what does a developer include in their initial proposal?

In their initial proposal, the developer includes the target market, the planned value proposition (planned price, distribution, and marketing budget), and the planned long run sales, profit goals, and marketing mix strategy

19. Describe the four Brand Development Strategies - Line extensions, Brand extensions, multi-brand and new branding - and when you would use each? (p. 246)

Line extensions: extending an existing brand name to new forms, colors, sizes, ingredients, or flavors of an existing product category. Low-cost low-risk way to introduce new products. Example: doritos tortilla chip flavors. Brand extensions: extending an existing brand name to new product categories. Can create immediate new-product familiarity and acceptance at lower development costs. Ex: Nest and "works with nest" expanding to other product partners Multi-branding: marketing different brands in a given product category. Example: PepsiCo has like 8 different soft drinks, sports drinks. Offers ways to establish different features that appeal to different customer segments. New branding: when a company believes the existing brand name is waning or creating a new brand name when it enters a new product category. Like toyota making the brand lexus for more luxury.

73. What is the purpose of the "low-price fighter brand"? How are "store brands" used to serve this function?

Low-Price fighter brand: in order to respond to consumer trends or competitor success, a company might acquire or establish a low-price fighter brand, a product line that is lower priced than the company's other products and maybe targeted towards more price sensitive markets that the company wants to go after

75. Lululemon Stores takes prestige pricing to the limits. What do they do to get value and such high price products?

Lululemon stresses the quality of their products and the fact that they will last for years. People see their higher prices and recognize that their goods are superior and are willing to pay a higher rate.

80. Laws prohibit "retail price maintenance" - where a manufacturer requires a dealer price a product at a certain level, creating MSRP. What is MSRP and what is Price Discrimination with channels?

Manufacturer's Suggested Retail Price (MSRP) is a system, very commonly used in car sales, that allows the manufactured to sell items to an agent, wholesaler, or dealership with a suggested price, yet allow the retailer to effectively charge any price they want

65. When is a company practices "market - skimming" what are they doing?

Market-skimming: setting a high price for a new product to skim maximum revenues layer by layer from the segments willing to pay the high price; the company makes fewer but more profitable sales.

81. What is a Marketing Channel? Give some examples of types of channels used by markets.

Marketing channel: a set of interdependent organizations that help make a product or service available for use or consumption by the consumer or business user Ex. Enterprise rent-a-car set up off-airport rental offices Apple turned retail music business around by selling music for the ipod on the internet (itunes) Fedex creating and imposing distribution system making it a leader in express package delivery Amazon changed retailing and sold anything and everything without physical stores

5. What is the mistake Brand Managers make when the Overposition, Underposition, Confused Positioning or Doubtful positioning for their brands? (p. 208)

Overposition: buyers have a very narrow image of a brand like Blue Train being an exorbitantly expensive train for overseas tourists (even if people have the money the won't buy a ticket) Underposition: customers have only a vague idea of a brand, the brand is a "me too" one and customers do not sense anything unique about it Confused positioning: when marketer changes the positioning of the brand too frequently or when too many claims are made about the brand, customers are not sure what to expect Doubtful positioning: claims made about a brand are hard to believe or too good to be true. Makes customers reluctant to buy the brand.

91. How is your Brand effected - If you are using a "prestige product" strategy? If you are use "comparison" pricing strategy? If you use a "technical or innovation selling" strategy?

Prestige pricing: is a physiological pricing strategy that sets prices of luxury products to the expectations of a niche class of customers who associate higher prices with superior quality. Comparison pricing strategy: Method in which the selling price of a new product is arrived at by comparing the benefits it offers with those offered by the competing brands technical/ innovation strategy: is a focused mindset that helps sales professionals move away from "pushing" a product / service to a customer and looks for ways to help customers achieve success through the value that your organization provides.

70. A Manufacturer likes setting a "Reference price" as a psychological marker. How do they use it? A "Promotional Price" is set but there are often restrictions on them... what are they?

Reference Pricing: Prices that buyers carry in their minds and refer to when they look at a given product. Can be used in studying the psychological aspects of price, such as that higher prices tend to indicate to consumers higher quality (regardless of whether this is actually true) Promotional Pricing: Temporarily pricing products below the list price and sometimes even below cost to increase short-run sales Restrictions can often include time-sensitive components, like sales for certain occasions that last a limited time.

85. Gavina Coffee uses 11 different types of channels to help them grow. What are the variety that they use in the 20 states they sell their products?

Retail, Brokers, Dealers, National Chains, Distributors, Wholesalers, Business Partners, Relabeling

8. Organizational marketing programs are conducted by many companies to enhance their corporate image and their brand. What is "Social Marketing" and how does it help a company?

Social marketing: the use of traditional business marketing concepts and tools to encourage behaviors that will create individual and societal well-being. Helps a company engage customers and allows them to use a broad range of marketing strategies and marketing mix tools

47. International product and service Introduction must consider several critical issues. Name several issues and what the risks when introducing those products in other countries or regions

Some issues include 1. figuring out what products and services to introduce and in which countries, and 2. deciding how much to standardize or adapt their products for world wide markets. EX: mcdonalds varies menu for local food preferences (shrimp burgers in japan, salmon burgers in Norway. Challenges for service markets: some companies have a long history of going global (DB, retailers following). Growth of global service trend will continue.

62. Taco Bell uses price as a weapon to compete. What is their method and how does target marketing contribute to their strategy of what to charge?

Taco Bell uses its dollar menu to increase demand. By targeting lower-income people who use cost to make their decisions, Taco Bell, by delivering quality food at lower prices, will attract a lot of customers.

55. What are "Target-Profit Pricing" and "Break-Even Analysis" and how are they used to determine price?

Target-Profit Pricing: designed to determine how many units a company must sell to cover costs and make a certain profit. The company must be able to sell a reasonable amount, so they estimate how much they'll sell and adjust the price accordingly. Break-Even Analysis: Break-Even Analysis is the same as Target-Profit, but it only calculates how much you'll need to sell to cover costs.

34. Marketers roles in New Product Development might include testing by the consumer of new products. What advantage does involvement by the marketer have for the Process?

Test marketing gives the marketer experience with marketing a product before going to the great expense of full introduction. Allows entire marketing program to be tested

38. Important decisions must be made by a company at each step of the PLC. In the introduction stage, why must a toy maker look at in the current product line when introducing new products?

The introduction stage is a period of slow sales growth - profits from the new product are nonexistent In this stage because of the heavy expenses of product introduction. ensure that the introduction of a new product will not impact the sales of an existing product.

58. Why is the shopper at the Whole Foods store willing to use a different type of pricing philosophy at that store and what is their main criteria for shopping there?

The shopper at Whole Foods wants healthy, organic food, so they're not shopping for JUST the food, but also the health benefits. When it comes to quality food, the price isn't everything. higher quality at higher prices

13. Zappos' successfully re-thought the "Telesales" model and adopted the "Deliver Happiness" theme to their clients. What was their secret of success in this new model? (p.237)

The slogan "Delivering Happiness" sends a message of promise and fun to its consumers. Zappos begins by hiring energetic and excited employees, and maintaining a work culture that promotes happiness with its employees, from Nerf gun wars to providing life coaches for employees. Having happy employees allows Zappos to deliver happiness because happiness is intrinsic to the company culture. This slogan promises consumers that their product wants and brand needs will be satisfied, and that a happy and helpful relationship with the consumer is more important than churning out profits. Instead of burying contact information in hard to find places on its website, Zappos clearly puts the phone number at the top of its website pages, and has a call center that is staffed 24/7. Being constantly available and willing to talk to customers allows Zappos to create an emotional impact and lasting memory with its customers. Zappos also develops customers relationships with social networking tools and featuring employees in its marketing. By creating relationships between customers and employees, as well as the larger brand, Zappos uses interactive marketing to satisfy customer needs and provide the best possible customer experience.

4. LL Bean was more than a set of products, it was a brand identity. What does Graeme Newll mean by that when describing LL Bean? (VIDEO)

brand identity that draws consumers due to unique merchandise that reflects their lifestyle Jeremy likes L.L.Bean because their products are reliable, feels good and lets him have peace of mind. This is an example of Brand benefits

83. Give some examples of "channel conflict" and how do "power" relationships play in channel management. What is "horizontal" conflict and "vertical" conflict?

channel conflict: disagreements among marketing channel members on goals, roles, and rewards-who should do what and for what rewards...ex: samsung makes phone and Best Buy displays products like maybe they would disagree horizontal conflict: occurs among firms at the same level of the channel. Ex: ford dealers complaining to other dealers that the city steals sales Vertical conflict: the conflict between different levels of the same channel

82. How does a franchise represent a marketing channel for a company and what is good and bad about it as a way of doing business? What is the difference between manufactured- sponsored retailer, wholesalers and service-firm-sponsored retailers?

franchise: is simply a method for expanding a business and distributing goods and services through a licensing relationship Bad: Creating a channel means giving up some control over how and to whom they sell their products Good: intermediaries are used because they create greater efficiency in making goods available to target markets; with its contacts, experience, specialization and scale of operations intermediaries offer a lot Manufactured-sponsored retailer - Ford has their own stores Manufactured - sponsored wholesaler - coke has licensed bottlers that take the ingredient, bottle it locally and sell it to retailers. Service firm sponsored retailers- franchises, Burger King has different people own each individual store

49. How is a "Price" created for each product and how is it validated by the marketplace?

price: the amount of money charged for a product or service or the sum of the values that customers exchange for the benefits of having or using the product or service. Pricing increases or decreases sales revenue and overall net profit, so the marketplace will determine whether the price is fair or not by choosing whether or not to buy the product/service. most flexible marketing element. understand how much value customers place on a product and setting a price that captures this value

50. Price is one of the biggest headaches for Executive management but also the biggest opportunity to improve profitability. Why do executives not want to deal with it?

prices are very flexible in the marketing mix, so it takes a lot of work to manage the price to maximize profit. Smart managers treat pricing as a key strategic tool for creating and capturing customer value

20. Define what is the "Product Mix" or sometimes called "Product Portfolio Mix". ( p. 232)

product/ portfolio mix: the set of all product lines and items that the particular seller offers for sale. Ex: Colgate-Palmolive and their oral hygiene products. 4 important decisions= width, depth, length, and quality.

37. What is the PLC - Product Life Cycle and why is it important to understand?

The product life cycle is the course of a product's sales and profits over its lifetime. A company's products are born, grow, mature, and then decline. To remain vital, the firm must continually develop new products and manage them effectively through their life cycles.

95. Apple Pay is a potential disinter-mediator? How are they offering change?

They offer change because they remove the need of carrying around credit cards. Have Apple Partners that play a role in success such as Uber

100. How does "RFID" technology make an integrated logistics management supply system simpler and inventory management more accurate?

Today's companies are using sophisticated supply chain management software, internet based logistics systems, point of sale scanners, RFID tags etc. to make things more accurate (radio frequency identification, tracks) Lets them quickly and efficiently manage the flow of goods, information, and finances For inventory management Could make up to 75 percent of the supply chain intelligent and automated Can know exactly where a given product is located physically within a supply chain Can not only tell them when it's time to reorder but also can place the order automatically

36. Intuit's "Design for Delight" philosophy has helped their product development in what way?

"Design for Delight" - products should delight customers by providing experiences that go beyond their expectations Understand problems and needs that even customers themselves might not recognize and then develop many customer driven product ideas before narrowing them down into one of a few great ideas for products that will solve customer problems =. Then turn the great ideas into actual producs and services that create customer delight and collect customer feedback steadily throughout the development process Has allowed intuit to understand customers better

101. How does New Balance shoes track their product requirements for their stores and what advantages does it provide? ***

***?

60. Who within an organization should set price? Product Developers, Finance, Sale, Marketing?

All of these people should have a hand in deciding what the price is, but it also depends on the type of company. Smaller companies' prices are set by top management. Large companies usually have divisional/product managers decide. Industrial markets have salespeople negotiate with customers within a certain price range. In industries where pricing is a key factor, companies usually have pricing departments.

94. How does Amazon and P&G work together in their Vendor-flex program.

Amazon and P&G work together to decrease costs for both companies. P&G stores their goods that are sold on Amazon in an onsite facility where Amazon picks up the goods and delivers them. This partnership allows Amazon to decrease storage costs as well as limiting the time and money P&G has to put into shipping their goods.

63. Apple Computer gets a strong premium price for their product and rarely discounts. Their competitors like Xiaomi have created a cheaper alternative for their phone. How should Apple counter this type of competition?

Apple needs to add more value to its services. apple creates "life feels good" experiences and deepening user experiences. built a huge core of enthusiasts. caters to the more than affluent customers who want And can afford the luxury and status associated with apple. truly premium products earn premium prices.

41. Mattel has been extremely successful managing the Product Life Cycle of the Barbie Doll? Describe what they have done and implemented and why is it so important for their survival

Barbie has seen annual revenues slipping. New Barbie models and features: Entrepreneur barbie (LinkedIn and smartphone), and "Hello Barbie" with talking and wifi. New campaigns like barbie "unapologetic" (backlash with sports illustrated). Barbie was in decline stage but trying to introduce new products like Monster High dolls. Also new offerings like online games, movies with Barbie, books, etc. Mattel decided to maintain its brand with repositioning and reinvigorating to move Barbie in the growth stage again.

15. How is a brands' value determined and why is it important? What is brand equity? (p.241)

Brand value: the total financial value of a brand. Brand with high equity is a valuable asset. Powerful brands form basis for building strong and profitable customer engagements and relationships Brand equity: the differential effect that knowing the brand name has on customer response to the product or its marketing. Ability of company to capture customer preference and loyalty. Must rate high on differentiation, knowledge, esteem, and relevance.

45. How does a company nurture and develop a community of "Early Adopters" for their product?

By advertising to these during the introduction and growth stages of the life cycle and ensuring that they have services that address any issues with the product early on

18. Why would someone want to "Co-Brand" their product and what are the potential problems? (p. 245)

Co-brand: the practice of using the established brand names of two different companies on the same product. Taco bell and doritos locos taco. goal= broader customer appeal and greater brand equity, allows brands to enter new categories. problems= complex contracts and licenses, must carefully coordinate advertising, each partner must trust the other will take good care of the brand.

33. What process did Sara Lee use in developing the "Soft and Smooth" White Bread?

Concept development - develop new concepts, find how attractive each is to its customers, and choose the best one

72. What are the different considerations when one changes, increase or decreases prices from the customer? From the competition?

Consumers do not always react to prices in straightforward ways. In the price of a luxury good goes up, consumers could think this is either indicating higher quality or just being greedy. If the price of a luxury good goes down it could indicate either a good deal on something exclusive or that the prestige and quality have gone down significantly (similar thoughts with bargain items/ inferior goods) Competitors can interpret price changes in similar ways. They can see price decreases as trying to reverse a recent drop in sales, or as a power move to soak up more of the market due to recent success.

3. What is the difference of the three levels of Products - Core, Actual or Augmented? Give an example by using Apple iPad. (p. 221)

Core customer value: what is the buyer really buying? For an Ipad: entertainment, self-expression, productivity, and connectivity. Actual product: develop product and service features including design, quality level, brand name, and packaging. Ipad is an actual product (parts, packaging, styling) Augmented product: augment core benefit and actual product by offering additional services and benefits. Ipad: apple provides apps and accessories, warranties, etc.

87. Netflix is seen as a disrupter because they have not been afraid of "disintermediating" many companies business models and roles in the marketing chain. They believe in "disintermediating" themselves. What does that mean?

Disintermediating allows Netflix to offer their products directly to their consumers. For example, they are producing movies and offering them straight to consumers via their online video streaming services

86. "Disintermediation" is the constant concern of players in the marketing channel? When does it occur and give some examples of how companies fight it?

Disintermediation is the cutting out of marketing channel intermediaries by product or service producers or the displacement of traditional resellers by radical new types of intermediaries.

68. What is "Dynamic pricing" and how does Amazon implement it?

Dynamic pricing is adjusting prices continuously to meet the characteristics and needs of individual customers and situations Amazon's automated dynamic pricing system reportedly changes the price on as many as 80 million items on its site in a given day based on a host of marketplace factors.

99. Logistics Information Management is critical to making a large enterprise run efficiently. What is ERP - Enterprise Resource Planning and how does it help a company replenish their products?

ERP helps with ML. ERP= integrated management of core business processes Marketing logistics = planning, implementing, and controlling the physical flow of materials, final goods, and relayed information from points of origin to points of consumption to meet customer requirements at a profit

53. The airline industry pricing practices and the Spirit Airline strategy has many interesting rules? Describe Spirit Airlines pricing practices, like "ala carte" or auction-based pricing. What is the pros and cons? Why consumers like or dislike their methods?

Got lowest rating for customer experience. Masters science of extreme good-value pricing, "less money, more go". Gets you only a seat and you have to pay for nearly everything else. Practices "frill control" to give customers control over what they pay for. auction pricing allows for producer because people compete and pay more than what product is worth

27. Define Idea Generation, the life-blood of New Product Development, internal idea sources, external idea sources, and Crowd-Sourcing (all methods for new products to be introduced.) (p. 257- 258)

Idea generation: the systematic search for new product ideas Internal idea sources: finding new ideas through formal research and development or through picking the brains of a company's own people External idea sources: obtaining new ideas from any number of external sources, including distributors, suppliers, and competitors, as well as trade magazines, shows, websites, seminars, government agencies, advertising agencies, marketing research firms, university and commercial laboratories, and inventors. Can also include customers themselves Crowdsourcing: the process through which a company invites broad communities of people (customers, employees, independent scientists and researchers) into the new productinnovation process. Crowdsourcing can help in producing new and unexpected ideas because ideas are being drawn from a large pool of sources.

61. Why must the Price Demand curve be studied before any strategy or decisions are made on price?

If there's too high a price, nobody's going to buy the product. Conversely, if the price is too low, the company will not make a healthy profit. Finding that perfect middle ground will maximize profits.

14. Why is "internal marketing" so important in the "services" business? (p. 236)

Internal marketing: orienting and motivating customer-contact employees and supporting service employees to work as a team to provide customer satisfaction. Must precede external marketing. Idea to make employees themselves believe in the brand so that they can authentically deliver the brand's promise to customers.

71. Why are international prices hard to determine and what are the factors that go into setting them?

International Pricing: charging different prices in different countries Very difficult because styles, cultural differences can seriously impact demand and thus companies must determine how they want to price the same products in different markets that perceive the value of the products differently

96. Why is your channel strategy so important in developing an International marketing program?

International marketers face additional complexities when designing channels Each country has its own unique distribution system that has evolved over time and changes very slowly Different and new channels so company has to adapt to the countries delivery channel and research closely Example = India very small shops run by owners and offers personal service and credit

35. What does it mean to "Commercialize" a product? What role does marketing play in the process?

Introducing the new product into the market Commercialization may require great expenses in terms of marketing and advertising

78. When a company adopts "High/ Low" pricing (JC Penney) and battles against EDLP pricing (Walmart) how do they compete?

JCPenney employed High/Low Pricing with their couponing offers. This combatted Walmart's Everyday Low Pricing by allowing loyal customers to purchase items at lower prices with coupons, while charging those without them higher prices. This also encouraged those without coupons to come back next with them and grew their loyal customer base

66. An aggressive approach to eliminate competition is "Market-penetration pricing". What is the goal and objective of this strategy?Printer manufacturers, Amazon Kindle and shaving companies often use "captive" pricing to make profits. How does it work?

Market-Penetration pricing: setting a low price for a new product in order to attract a large number of buyers and a large market share. The goal is to build a solid customer base that won't react as much to a higher price point. captive pricing: low price on the core product (kindle) but high prices on the captive product (books) to make a profit which are needed to use the core product

46. How can a company make a lot of money even in the Maturity stage of a product?

Modifying the market: companies try to increase consumption by finding new users and new market segments for its brands. (Axe making female fragrances), increase usage among present customers (3M using campaign to inspire more use of post-its) modifying the product (changing characteristics like quality, features, styles, packaging, or technology platforms, like crayola creating the my virtual fashion show) modifying the market mix (improving sales by changing one of marketing mix elements): cut pricing or move into new marketing channels (PepsiCo reinvigorating Quaker- Quaker up campaign, healthy, fuel, new energy packed products)

24. What are the many definitions of a "New Product" and why must a branding and marketing program be developed for each? (p. 256)

New products can refer to original products, product improvements, product modifications, and new brands that the firm develops through its own product development. New products are a key source of growth for companies but new products face tough odds.

23. How does Mayo clinic make the service "Tangible" for their patients and what is the advantage? (p.234)

Offers patients organized and honest evidence of its dedication to providing the best patient care. Staff trained to act in a way that signal's clinic's concern for well-being. Phsyical facilities designed like a place of refuge. External confirmation= on social networking to share experience. advantages= loyal customers spread good word to others and build one of the most powerful brands in healthcare.

22. Bill Rossiter in his talk gave several examples of how good "Personal Branding" is vital for your success. Give an example.

One example is the personal brand he talked about. Your brand is your reputation. It is your calling card your promise. It is what you are known for and how people experience you. It is about bringing who you are to what you do and how you do it. Delivering your brand clearly and consistently will create a memorable experience in the minds of those you interact with and can open doors to new opportunities

9. Explain the five decisions on has to make about individual product marketing - Product Attribute, Branding, Packaging, Labeling/ logos and Product Support services? (p. 227 - 229)

Product attribute: quality, features, and style and design. quality= characteristics of a product or service that bear on ability to satisfy stated need or implied customer needs, linked to customer value and satisfaction. features= allows companies to create higher level models of stripped down models to compete. Style and design= adds customer value, catches eyes, begins with observing customers. Branding: a name, term, sign, symbol, or design of a combination of these that identifies the products or services of one seller or group of sellers and differentiates them from those of competitors. Can add value to consumer's purchase, customers attach meaning to brands, can develop brand relationships. Packaging: activities of designing and producing the container or wrapper for a product. Used as a marketing tool, packaging must performa sales tasks, can give advantages over competitors and boost sales. Labeling/logos: identifies a product or brand. Describes the product. Promotes the brand and engages customers. Product support: customer service is an element of product strategy. Enhances brand experiences and keeping customer happy after the sale allows for brand relationships.

1. Why is the question, "What is a Product?" not so simple to answer? (p. 220)

Product: anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need. They include more than just tangible objects. You can classify products in business and consumer markets, individual product lines, products, and product mixes, and examine the characteristics of a special form of products (services)

21. Airbnb has a successful business model that use all four characteristics of service. What do they do to make sure they are in tune with their target market? (p. 251)

Promises experience opposite that of hotels. Provides authentic experience to fight cookie-cutter options. Positions itself as a provider of unique and authentic experiences through branding, communications, and other aspects. Hotels can't compete on relationship between guest and host. Focuses on hosts as primary customers. Hold Airbnb open- a motivational event to illustrate experiences.

17. What are the Pros and Cons of having your brand become "generic" like Kleenex or Band-Aid? (p. 243)

Pros: easily recognized, used by many sellers. Cons: threaten company's rights, companies need to use the word 'brand' and trademark symbols, eventually identified with the product category

30. The "New Product Screening" process says one should ask three questions - R, W, W. This stands for - Is it real? Can we win? Is it worth doing? What does this mean? (p. 259-260)

Real, win, worth doing? Is it real?: is there a real need and desire for the product and will customers buy it? Can we win?: does the product offer a sustainable competitive advantage? Does the company have the resources to make the product a success? Is it worth doing?: Does the product fit the company's overall growth strategy? Does it offer sufficient potential? The company should be able to answer all three with yes before developing a new idea further

69. Segmented pricing" is used to pass along lower prices by segment, geography, demographic, age group or sex. Is this fair and why do they do it?

Segmented Pricing; selling a product or service at 2 or more prices where the difference in price is not based on a difference in costs. Segmenting is a fair practice and can be used to incentivise different groups of people for different reasons in order to boost sales based on the different segment's demand for a certain product

12. What are the four service characteristics that a company needs to know when designing a Marketing campaign? (p. 234-235)

Service intangibility: services cannot be seen, tasted, felt, heard, or smelled before they are bought. Send the right signals about quality and make the service tangible in one or more ways. Service inseparability: services are produced and consumed at the same time and cannot be separated from their providers. Provider-customer interaction. Service variability: quality of services can vary greatly depending on who provides them and when, where, and how they are provided. Service perishability: services cannot be stored for later sale or use. Can be a problem when demand fluctuates.

64. What is Product Line Pricing? Give an Example.

Setting the price steps between various products in a product line based on cost differences between the products, customer evaluations of different features, and competitors' prices. setting goods into cost categories Ex: Quicken offers an entire line of financial management software at different prices. Quicken's task is to establish perceived value differences that support the price differences, even though it costs them no more to produce the premier version rather than the starter version

79. How does a consumer use "Showrooming" to get the best price? Why do retailers hate the practice?

Showrooming is the practice of customers looking in physical stores to see styles up close and determine their sizes, but then buying online for a lower price. Retailers hate this because they are already losing the battle against e-commerce, and many retail employees work partially on commission

42. Style, fashion, fad... how does time differ for each?

Style: a basic and distinctive mode of expression. Can last for generations or pass in an out of vogue (waves) Fashion: a currently accepted or popular style in a given field (grow slowly, remain popular for a while, then grow slowly), like a half-circle curve Fad: temporary period of unusually high sales driven by consumer enthusiasm and immediate product or brand popularity. Pet Rocks.

90. Why is the choice of marketing channels critical in maintaining your brand image / essence?

The company's channel decisions directly affect every other marketing decision. companies that pay too little attention to the channel can get damaging results and others can gain a competitive advantage by using imaginative distribution channels.

28. How did Under Armour get new ideas from their "Future Show" method? (p. 258-259)

The future show challenge invites entrepreneurs and inventors from around the nation to submit new product ideas. UA chooses 12 finalists to pitch their ideas, and the winner earns $50,000 and a contract to work with UA to help develop their winning product. Uses crowdsourcing to get new ideas

59. Trader Joe's has a new Pricing Mix and marketing strategy that changes the nature of pricing decisions. How do they price? Good-Value or value-added pricing?

Unique price-value positioning called "cheap gourmet". Gourmet caliber one of a kind products at bargain prices in a fun atmosphere. 90% of brands are private labels. Earns them a cult-like following of devoted customers. Prices aren't all that low absolutely but low in relative terms

88. How does the selling models of Volvo and Tesla threaten the existing car industry marketing channel strategy? What is the advantage and the disadvantage?

Volvo and Tesla use e-commerce, which makes it easier for customers to purchase cars directly from the companies. This cuts out dealers, which is radically different from the traditional channel marketing that car companies have used in the past

67. When would you use "Price-Bundling" prices and what are the good and bad points? What is the difference between passing along discounts or rewarding allowances?

You would use product bundling when there's a lot of complementary products. This can promote the sales of products consumers might not otherwise buy, but the combined price must be low enough to get them to buy the bundle. example: McDonald's value meals. discounts: straight reduction in price or purchase (i.e. cash discounts) allowance: promotional money paid by manufacturers to retailers in return for an agreement to feature the manufacturer's products in some way