AGEC 3010 Final

Product Life cycles: Decline

-declining sales -low cost per customer -declining profits -customers: lagging adopters -competitors: declining number

Product Life Cycle: Introduction

-low sales -high costs per customer -negative profts -customers: innovators - few competitors

Product Life cycle: Maturity

-peak sales -low cost per customer -high profits -customers: mainstream adopters -competitors: stable numbers begin to decline

Product Life cycles: Growth

-rapidly rising sales -average cost per customer -rising profits -customers: early adopters -competitor number growing

Major Stages in New Product Development

1. Idea generation 2. Idea screening 3. Concept development and testing 4. Marketing strategy development 5. Business analysis 6. Product development 7. Test marketing 8. Commercialization

Four Service Characteristics

1. Intangibility 2. Inseparability 3. Variability 4. Perishability

Market Channels-Food wholesaling and retailing

The wholesale assembly markets are generally located in food production areas.• bout 75% of food wholesalers are classified as merchant wholesalers.• Food retailing is the largest retail sector in the U.S. economy and the most expensive segment of the food marketing system.

Purposes of social selling, the use of online, mobile, and social media, are to do all of the following EXCEPT _______

eliminate person-to-person selling

Brand ________ is the differential effect that knowing the brand name has on customer response to the product and its marketing.

equity

Foodservice outlets—

facilities that serve meals and snacks for immediate consumption on site (food away from home

Shopper Marketing

focuses the entire marketing process on turning shoppers into buyers as they approach the point of sale, whether during in-store, online, or mobile shopping.

________ pricing refers to offering just the right combination of quality and gratifying service at a fair price.

good value

Managers at the Imperial Hotel-Chicago complained that the chain's overall image was hurt because Imperial Hotel-Dallas was overcharging guests and providing poor service. The Imperial Hotel was experiencing ________ conflict.

horizontal

New product development starts with ________.

idea generation

Downstream partners

include the marketing channels or distribution channels that look toward the customer, including retailers and wholesalers.

Wholesaling

includes all activities involved in selling goods and services to those buying for resale or business use.• Selling and promoting• Buying and assortment building• Bulk breaking• Warehousing• Transportation

Retailing

includes all the activities in selling products or services directly to final consumers for their personal, nonbusiness use.

________ play an important role in efficiently making products available to target markets in the needed varieties and quantities.

intermediaries

Public relations

involves building good relations with the company's various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events.

Direct and digital marketing

involves engaging directly with carefully targeted individual consumers and customer communities to both obtain an immediate response and build lasting customer relationships.

Channel level

is a layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer.

Indirect marketing channel

is a marketing channel containing one or more intermediary levels.

Direct marketing channel

is a marketing channel that has no intermediary levels.

Sales promotion

is a short-term incentive to encourage the purchase or sale of a product or service.• Discounts• Coupons• Displays• Demonstrations

Advertising

is any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor.• Broadcast• Print• Online• Mobile• Outdoor

Product

is anything that can be offered in a market for attention, acquisition, use, or consumption that might satisfy a need or want.

Cost-based pricing

is product driven.- Fixed, variable, total

Price

is set to match perceived value

Price

is the amount of money charged for a product or service, or the sum of all the values that customers exchange for the benefits of having or using the product or service.

Personal selling

is the personal interaction by the firm's sales force for the purpose of engaging customers, making sales, and building customer relationships.

The promotion mix

is the specific blend of promotion tools that the company uses to persuasively communicate customer value and build customer relationships.

Prices in a perfect competitive market are most likely to be _________ than the prices charged by a monopoly.

lower

Many institutions, including retailers, wholesalers, and ________ do retailing.

manufacturers

Generic Advertising Purposes and strategies:

1. Promote the use of one product in place of another 2. Alter public opinions and attitudes toward a product 3. Increase consumer product usage rates or provide information that changes the ways in which the product is used 4. Expand the overseas market for a U.S. food product. Cherry, pecan, pork

Which of the following is true about the sales force of a company?

A) Salespeople represent customers to the company and manage the buyer-seller relationship.

Which of the following helps companies in setting sales force size?

A) workload approach

Adjusting prices: Dynamic and personalized pricing

Adjusting prices continually to meet the characteristicsand needs of individual customers and situations

Adjusting prices: International pricing

Adjusting prices for international markets

Adjusting prices: Psychological pricing

Adjusting prices for psychological effect

Adjusting Prices: Geographical pricing

Adjusting prices to account for the geographic location of customers

Price Adjustment: Segmented pricing

Adjusting prices to allow for differences in customers,products, or locations

Which of the following impacts the pricing strategy of agricultural products. A) the number of buyers and sellers B) the number of close substitutes C) the commodity's storability D) government policies E) all of the above

All of the above

Adjusting prices: Promotional pricing

Temporarily reducing prices to spur short-run sales

The sets of firms that supply companies with the raw materials, components, parts, information, finances, and expertise needed to create products or services are known as ________.

B) upstream partners

Which of the following is an example of a convenience product?

Fast food

Market Channels- the foodservice industry•

Foodservice outlets—facilities that serve meals and snacks for immediate consumption on site (food away from home)• A Large and Growing Market The foodservice industry is nearly equal in size to food retailing: • The food marketing system, including food service and food retailing, supplied about $1.77 trillion worth of food in 2019.• Of this total, $969.4 billion was supplied by foodservice facilities.

Product mix ________ refers to the total number of items a company carries within its product lines.

Length

What Benefits Do Coops provide? •.

Opportunities to buy from or sell to the co-op.• Get better prices paid or received.• Enhanced market power.• Possible members benefit from profits - patronage refunds

Local Advertising•

Quality• Freshness

Ag Product Characteristics•

Raw materials• Bulky and Perishable• Costly to store• Transportation issues • Special weather treatments• Seasonal production• Quality variations• Homogeneous goods

Price Adjustments Strategy Description : Discount and allowance pricing

Reducing prices to reward customer responses suchas volume purchases, paying early, or promoting theproduct

Product differentiation advertising •

Stand out from many similar producers

Checkoff Program:

a system in which producers pay a certain amount of money to an organization for the advertising of the products of their industry in general, rather than of their particular brand

Generic advertising

aims to expand total product sales rather the sales of an individual farm. • Example: "Got milk," "Orange juice. It's not just for breakfast," " Pork: the other white meat," and "The incredible edible egg."

Services

are a form of product that consists of activities, benefits, or satisfactions and that is essentially intangible and does not result in the ownership of anything.

Retailers

are businesses whose sales come primarily from retailing.

Upstream partners

are firms that supply raw materials,components, parts, information, finances, and expertise needed to create a product or service.

Demand and price

are inversely related Higher price = lower demand

Price is important to managers ________.

because a small percentage improvement in price can generate a large percentage increase in profitability

Advertising is used mostly by ________.

business firms

Marketers now view themselves as ________ that create and share brand messages and conversations with and among customers across a mix of paid, owned, earned, and shared communication channels.

content marketing managers

________ are two or more outlets that are commonly owned and controlled.

corporate chains

Which of the following is the practice of inviting broad communities of customers, employees, independent researchers, and members of the public into the new product innovation process?

crowdsourcing

Until retailers ________ their markets, they cannot make consistent decisions about product assortment, services, pricing, or advertising.

define and profile

Amazon.com and GEICO approach customers via Web sites or mobile apps. This is an example of ________ marketing.

direct

Which of the following is one of the five major promotion tools?

direct and digital marketing

A(n) ________ is a straight reduction in price on purchases during a stated period of time or of larger quantities.

discount

Developing an effective integrated marketing mix program involves coordinating price decisions with product design, promotion, and ________ decisions.

distribution

companies that set a low price for a new product in order to attract a large number of buyers and a large market share are using the ________ strategy.

market-penetration pricing

Which of the following are the three characteristics that an advertising appeal should have?

meaningful, believable, and distinctive

Which of the following product mix pricing strategies involves pricing additional or accessory products sold along with the main product?

optional-product pricing

Alex Smith rents storage space to college students who go home for the summer but do not want to haul all of their property home and back. The business is profitable during the summer months, but when the storage space is unoccupied in the off-season, Alex loses money. Which of the following characteristics of service is most likely the source of Alex's problem?

perishabilty

A company that uses well-known celebrities to help sell its products is using ________ marketing.

person

Encouraging customers to switch brands is most likely the objective of ________ advertising.

persuasive

individual Product Decisions

product attributes, branding, packaging, labeling, product support services

Which of the following refers to the course that a product's sales and profits take over its lifetime?

product life cycle

Variability

quality of services depends on who provides them and when, where, and how

ou receive a report that 68 percent of your target market has been exposed to your ad campaign during a given period of time. Which of the following aspects of media selection is represented by this information?

reach

Intangibility

services cannot be seen, tasted, felt, heard, or smelled before purchase

inseparability

services cannot be separated from their providers

perishability

services cannot be stored for later sale or use

demand curve

shows the number of units the market will buy in a given period at different prices.

Pricing Value-based pricing

uses the buyers' perceptions of value rather than the seller's cost. customer driven

Costs that change with the level of production are referred to as ________.

variable costs

________ involves creating a video, e-mail, mobile message, advertisement, or other marketing event that is so

viral marketing