Exam 2 MAR3023

Four I's of Service

-Differentiate services from products in most cases Intangibility Inconsistency Inseparability Inventory

Classification of Services.

1) they are delivered by people or equipment 2) they are for-profit or non-profit 3) they are government sponsored

Nate and Jessica were eating at an upscale Italian restaurant, and the waiter mixed up Jessica's order. When she pointed out that it was not the dish she wanted, the waiter immediately apologized and brought out the correct meal. To their surprise, he then told them the entire dinner was complimentary and brought them both desserts. This demonstrates which type of service?

Augmented Service

Paulette is in the market for a new brand of toilet paper, as the type she uses now leaves her feeling very itchy and uncomfortable. While watching TV, she sees a commercial for Charmin toilet paper. She is intrigued by the family of happy bears using the product and decides to go to Walmart immediately and purchase a 4-pack of rolls to try it out. After a week of using the Charmin toilet paper, Paulette doesn't feel itchy anymore, and she is very pleased with her purchase. She throws out all her old toilet paper, and decides to never buy anything other than Charmin for her bathroom needs. Which of the following describes Paulette's individual-level adoption process?

Awareness, Interest, Trial, Evaluation, Adoption

Close

Closing stage in the selling process involves obtaining a purchase commitment from the prospect. This stage is the most important and the most difficult because the salesperson must determine when the prospect is ready to buy. Close can take several forms 1.) Trial Close 2.) assumptive close 3.) urgency close

Integrated Marketing Communications (IMC)

Concept of designing marketing communications programs that coordinate all promotional activities-- advertising, personal selling, sales promotion, public relations, and direct marketing-- to provide a consistent message across all audiences.

Receivers

Consumers who read, hear or see the message

Relationship Selling

Customer value creation is made possible by this. It is the practice of building ties to customers based on a salesperson's attention and commitment to customer needs over time. Focuses on creating long-term customers.

Inconsistency

Developing pricing, promoting and delivering services is challenging because quality of a service is often inconsistent. Organizations attempt to reduce this through standardization and training.

Gap Analysis

Differences between the consumer's expectations and experience are identified by this.

National branding produces the kind of brands that are talked about all the time, like

Ford and Kellogg.

Services

Intangible activities or benefits (airline trips, financial advice or automobile repair) that an organization provides to satisfy consumer's needs in exchange for money or something else of value.

Sales Management

Involves planning the selling program and implementing and evaluating the personal selling effort of the firm.

Nicole owns a small organic spice company called RaisaSpice and was looking for a new product to add to her company's line. A friend suggested combining spices from India with tea. In the __________ stage of the new-product process, the spice and tea mixtures were distributed to grocery stores in Portland and Seattle to see if they sold well.

Market Testing

Gatorade is MOST LIKELY in which stage of its product life cycle?

Maturity

Seven P's of services marketing

Product (service) Price Place (distribution) Promotion People Physical Environment Process

The ____________________ is the set of product lines sold by a company, including width, depth, and consistency.

Product Mix

Service continuum

Range of product-dominant to service-dominant offerings.

Prospecting

Search for and qualification of potential customers. There are 3 types of of prospects. 1.) Lead- name of a person who may be a possible customer 2.) Prospect- is a customer who wants or needs the product. 3.) Qualified Prospect- in the individual wants the product, can afford to buy it, and is the decision maker.

Intangibility

Services can't be held, touched or seen before the purchase decision. More difficult for consumers to evaluate, so marketers try to make them tangible or show the benefits.

The ____________________ is the unique ordering code for a product item.

Stock Keeping Unit (SKU)

You've been looking for a T-33 high-tech pen that glows in the dark and plays music. You finally find it on the Internet and order it. When you get the pen and start to write with it, you realize the pen's ink has dried up, and you are very disappointed and unsatisfied. The pen's ability to write represents the CORE level of a product. (T or F)

T

Message

The information sent by a source such as the description of a new smartphone, conveyed by the channel of communication.

Channel of Communication

What conveys the message such as a salesperson, advertising media, or public relations tools.

Customer Contact Audit

a flowchart of the points of interaction between consumer and service provider.

Field of Experience

a key part to communicating effectively, and is a a similar understanding shared between sender and receiver.

From an organization's perspective regarding its new products and innovations, which of the following new-product strategies has the LOWEST level of risk?

a product line extension

Sales promotion

a short term inducement of value offered to arouse interest in buying a product or service. Coupons, rebates, samples, contests and sweepstakes are some examples.

Protocol

a statement that identifies 1.) a well-defined target market 2.)specific customers needs, wants, and preferences 3.) what the product will be and do to satisfy consumers.

Shopping Products

are items for which the consumer compares several alternatives on criteria such as price, quality, or style.

Specialty Products

are items that consumer makes a special effort to search out and buy

Unsought Products

are items that the consumer does not know about or knows about but does not initially want

Convenience Products

are items that the consumer purchases frequently, conveniently, and with minimum of shopping efforts

Business products (B2B products or industrial products)

are products organizations buy that assist in providing other products for resale. Sales are often the result of derived demand

Consumer products

are products purchased by the ultimate consumer

The added value that a brand name provides to a product is known as

brand equity

Using an existing brand name to introduce a product that is new to the company into a totally new, unfamiliar market seems like a good idea. Several years ago, Harley-Davidson introduced perfume under the Harley-Davidson brand name—and it failed quickly. This innovation strategy is known as a

brand extension.

Mattel has a contractual agreement to let Colgate use the Barbie name and image on kids' toothpaste and toothbrushes. Colgate pays Mattel a fee for the use of the Barbie name and image. This is an example of __________.

brand-licensing

The most expensive stage in the new-product process for most products and services is

commercialization

Product Mix

consists of all the product lines offered by an organization

Off-peak pricing

consists of charging different prices during different times of the day or during different days of the week to reflect variations in demand for the service.

Personal Selling Process

consists of six stages: 1.) prospecting 2.) preapproach 3.) approach 4.) presentation 5.) close 6.) follow-up

Inseparability

consumer cannot separate the deliverer of the service from the service itself.

To handle products in the decline stage of the product life cycle, companies often use either a __________ or a __________ strategy.

deletion; harvesting

Pull Strategy

directing is promotional mix at ultimate consumers to encourage them to ask the retailers for a product.

Push Strategy

directing the promotional mix to channel members to gain their cooperation in ordering and stocking the product.

A concept test is an

external evaluation with consumers that consists of preliminary testing of a new-product idea rather than the actual product.

The proliferation of extra characteristics in a product that overwhelms many consumers with mind-boggling complexity is referred to as

feature bloat

Evan is an avid golfer and loves to play golf on the weekends. Evan just recently bought a new club called the Driver1000. This club has seven face angle options that offer variety in different ways to hit the ball, has a deep face head that provides more spin, and is made with top-of-the-line titanium that gives the ball more distance. The seven-angle face, deep face head, and titanium represent the product's:

features

Consultative Selling

focuses on problem identification, where the salesperson serves as an expert on problem recognition and resolution

Stimulus-Response Format

format assumes that given the appropriate stimulus by a salesperson, the prospect will buy. With this format the salesperson tries one appeal after another.

Need-Satisfaction Format

format emphasizes probing and listening by the salesperson to identify the needs and interest of prospective buyers. (Adaptive selling and Consultative selling)

Formula Selling format

format is based on the view that a presentation consists of information that must be provided in an accurate, thorough, and step-by-step manner to inform the prospect. Ex. "Canned Sales Presentation"- memorized standardized message conveyed to every prospect.

What is the marketing objective for the introduction stage of the product life cycle?

gain awareness

At which stage in the product life cycle do industry profits usually peak?

growth

When consumers think of Harley-Davidson, the image is of a masculine, non-conformist. With Vespa motor scooters, the image is of a brainy environmentalist. Both Vespa and Harley-Davidson __________.

have Brand Personalities

Interactive television with video-on-demand capabilities changes how people watch television and how consumers access the Internet. This technology requires significant customer education for most people. What type of product life cycle would be associated with this product?

high-learing

Noise

includes extraneous factors that can work against effective communication by distorting a message or the feedback received.

Follow-up

includes making certain the customer's purchase has been properly delivered and installed and addressing any difficulties experienced with the use of the item.

Adaptive Selling

involves adjusting the presentation to fit the selling situation, such as knowing when to offer solutions and when to ask for more information.

Stage 2) Idea Generation

involves developing a pool of concepts to serve as candidates for new products, building upon previous stage's results.

Crowdsourcing

involves generating insights leading to actions based on ideas from massive numbers of people

Public Relations

is a form of communication management that seeks to influence the feelings, opinions, or beliefs held by customers, prospective customers, stock-holders, suppliers, employees and other publics about a company and its products or services.

Product

is a good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies consumers' needs and is received in exchange for money or something else of value

Product Line

is a group of product

Publicity

is a nonpersonal, indirectly paid presentation of an organization, product or service. Advantage of publicity is credibility

Product Item

is a specific product that has a unique brand, size, or price.

Stage 6) Market Testing

is a stage of the new product process that involves exposing actual products to prospective consumers under realistic purchase conditions to see if they will buy.

Advertising

is any paid form of non-personal communication about an organization, product, service or idea by an identified sponsor

Internal Marketing

is based on the notion that a service organization must focus on its employees or internal market before successful programs can be directed at customers.

A product can be classified as "new" if it __________ from existing products.

is functionally different

Service inventory cost

is the cost of paying the person used to provide the service along with any needed equipment.

Response

is the impact the message had on the receiver's knowledge, attitudes, or behaviors.

Communication

is the process of conveying a message to others and it requires six elements: a source, a message, a channel or communication, a receiver and the processes of encoding and decoding.

Decoding

is the reverse of encoding or the process of having the receiver take a set of symbols and transform them into an idea. Preformed by receivers according to their own frame of reference.

Feedback

is the sender's interpretation of the response and indicates whether the message was decoded and understood as intended.

Stage 5) Development

is the stage of the new-product process that turns the idea on paper into a prototype

Market modification refers to a marketing strategy that __________.

manages a product's life cycle to find new customers, increase a product's use among existing customers, or create new use situations

Source

may be a company or person who has information to convey

Encoding

process of having the sender transform an idea into a set of symbols

Customer Experience Management

process of managing the entire customer experience with the company.

Order Taker

processes routine orders or reorders for products that were already sold by the company. Their primary responsibility is to preserve an ongoing relationship with existing customers and maintain sales. Two types of order takers 1.) Outside Order Takers- visit customers and replenish inventory stocks of resellers, such as retailers or whole sellers 2.) Inside Order Takers- typically answer simple questions, take orders, and complete transactions with customers

There are three levels of product life cycles that can be identified

product class, product form, and brand.

Order Getter

sells in a conventional sense and identifies prospective customers, provide customers with information, persuades customers to buy, closes sales, and follows up on customers' use of a product or service. Can be inside ( car salesmen ) or outside (Xerox salesperson)

Partnership Selling

sometimes called enterprise selling, buyers and sellers combine their expertise and resources to create customized solutions; commit to joint planning; and share customer, competi

Stage 4) Business Analysis

specifies the features of the product and the marketing strategy needed to bring it to market and make financial projections.

Preapproach

stage involves obtaining further information on the prospect and deciding on the best method of approach.

Approach

stage involves the initial meeting between the salesperson and the prospect, where objectives are to gain the prospect's attention, stimulate interest, and build the foundation for the sales presentation itself for a working relationship.

Presentation

stage is at the core of the order-getting selling process, and its objective is to convert a prospect into a customer by creating a desire for the product or service. Three major presentation formats 1.) stimulus-response format 2.) formula selling format 3.) need-satisfaction format

Stage 1) New product strategy development

stage that defines the role of the new product in terms of the firm's overall objective.

Stage 3) Screening and Evaluation

the new product process that internally and externally evaluates new-product ideas to eliminate those that warrant no further effort.

Team Selling

the practice of using an entire team of professionals in selling to and servicing major customers

Capacity Management

the service component of the marketing mix must be integrated with efforts to influence the consumer demand.

New Product Process

the seven stages an organization goes through to identify opportunities and convert them into salable products or services. Stage 1) New-Product Strategy Development Stage 2) Idea Generatin Stage 3) Screening and Evaluation Stage 4) Business Analysis Stage 5) Development Stage 6) Market Testing Stage 7) Commercialization

Stage 7) Commercialization

the stage of the new-product process that positions and launches a new product in full scale production and sales.

Personal Selling

two-way flow of communication between a buyer and seller designed to influence a person's or group's purchase decision. 3 Major roles in a Firm's overall marketing effort. 1.) Salespeople are the critical link between firm and its customers. 2.) Sales people ARE the company in the consumer's eyes 3.) Personal Selling may play a dominate role in a firm's marketing program.

Generally, the average length of time it takes for a product category to move from the introduction stage to the decline stage of its product life cycle is __________.

unpredictable

Direct Marketing

uses direct communication with consumers to generate a response in the form of an order, a request for further information, or a visit to a retail outlet. Ex. Face-to-Face selling, direct mail, catalogs, telephone solicitations, direct response advertising, and online marketing.

Idle production capacity

when the service provider is available but there is no demand for the service.

Inventory

with services, inventory carrying costs are more subjective and are related to idle production capacity.