Marketing Final exam
Service
-features: intangibility, perishability, inseparability, heterogeneity, fluctuating demand, Customer effort -The importance of Internal marketing
Trade-in allowances
Price reductions given for turning in an old item when buying a new one EX: Verizon: trade in smart phone and trade up
reminder
Which advertising objective is best suited to maintaining customer relationships and for more mature products?
Price bundling
selling more than 1 product for a single, lower price EX: •EX: burger king: meals "5 for $4" •Why? •Because the products are markup on soda is high •Soda has higher margin
The major steps in advertising media
(1) determining reach, frequency, impact, and engagement; (2) choosing among major media types; (3) selecting specific media vehicles; and (4) choosing media timing.
The importance of Internal Marketing
-Careful selection and hiring of frontline employees -Particular service strategy that frontline people need to act on -Training, support and incentives to be provided to employees with capacity
Advertisers should regularly evaluate
-Communication affects: brand awareness, recall, message association, brand favorability, purchase consideration -Sales and profit effects-Communication affects: brand awareness, recall, message association, brand favorability, purchase consideration -Sales and profit effects
break-even pricing
-or a variation called target return pricing. -setting price to break even on the costs of making and marketing a product, or setting price to make a target return
audience matchup
EX: Generation Y Matchup: lebron james
elastic
If demand changes greatly, we say the demand is
Department stores
Macy's, Sears, Neiman Marcus
Specialty stores
REI, Sunglass Hut, Sephora, Williams-Sonoma
Tc= FC+VC
Total cost
Superstores
Walmart Supercenter, SuperTarget, Meijer
fixed cost/(price-variable cost)
break even volume
True
t/f PR should be blended smoothly with promotion activities.
product assortment
the set of all product lines and individual products that a firm sells
Factors to be considered when selecting celebrities endorsers
1.audience matchup 2. brand matchup 3. Saturation/ overexposure 4. Trouble factor
Product line filling
BMW Only had 3,5,7 series in 1990s Now added 4th series
Brand extension
BMW started their company with cars. if BMW decided to introduce motorcycles, and then boats that is an example of ______________
Price Decision
Bergdorf Goodman caters to the upper crust by selling apparel, shoes, and jewelry created by designers such as Chanel, Prada, Hermès, and Jimmy Choo.
Promotion
Developing and spreading persuasive communications about an offer.
monopolistic competition
Google attempts to set its Pixel smartphones apart not by price but by the power of its brand and the host of differentiating features. Pixel ads tell consumers to "Ask more of your phone."
Co-branding
Google partnered with Oreo to name a latest version of its Android operating system Android Oreo, creating a fun association with great buzz value for both brands.
Slice of life
IKEA content—from microsites and Instagram posts to print ads and television commercials—features people living in rooms furnished with IKEA furniture and household goods.
inelastic
If demand hardly changes with a small change in price, we say demand is
a broad selection of more specialized and highly targeted media
In place of traditional media, marketers are using __________________________ to engage smaller customer segments with more personalized, interactive content.
Franchise organizations
In which is vertical conflict, conflict between different levels of the same channel, common?
service-firm-sponsored retailer franchise system
Jimmy Johns and its more than 2,600 franchisee-operated restaurants in the United States.
multichannel distribution systems
John Deere sells its familiar green-and-yellow lawn and garden tractors, mowers, and outdoor power products to consumers and commercial users through several channels, including John Deere retailers, Lowe's home improvement stores, and online. It sells and services its tractors, combines, planters, and other agricultural equipment through its premium John Deere dealer network
product assortment
Lane Bryant carries plus-size clothing; Five Below offers "hot stuff. cool prices."—all priced at $1 to $5; and Battery Depot offers about every imaginable kind of replacement battery.
Administered VMS
Large retailers like Walmart have enormous channel control due to their size and power. Which type of channel arrangement does this represent?
Manufacturing and assembly
Many vital and key functions are performed by marketing channels. Of the following, which is NOT one of those key functions?
the entire supply chain management
Marketing logistics addresses not only outbound logistics but also inbound logistics and reverse logistics, which means it involves
Selecting Specific Media Vehicles
Media planners must also choose the best media vehicles—specific media within each general media type. For example, television vehicles include Modern Family and ABC World News Tonight.
product Line downward stretching
Mercedes has _____________ ___________with the CLA line to draw in younger, first-time buyers.
good-value pricing
Mercedes-Benz released its CLA Class, entry-level models starting at $31,500. From its wing-like dash and diamond-block grille to its 208-hp turbo inline-4 engine, the CLA Class gives customers "The Art of Seduction. At a price reduction
Value delivery network
Of the following, which most closely describes the method by which companies engage and create benefits for their customers?
potentially high cost savings and improved customer satisfaction
One of the primary advantages of marketing logistics is
pull strategy
P&G promotes its Tide laundry products directly to consumers using TV and print ads, web and social media brand sites, and other channels. if the _________ _________ is effective, consumers will then demand the brand from retailers such as Walmart, Target, Kroger, Walgreens, or Amazon, which will in turn demand it from P&G.
Matching
Shaping offers to meet the buyer's needs, including activities such as manufacturing, grading, assembling, and packaging
Co-branding
Taco Bell and Doritos teamed up to create the Doritos Locos Taco.
Price Decision
The decision a customer reaches on the price s/he is willing to pay for a good or service.
Advertising budget
The dollars and other resources allocated to a product or a company advertising program
Planning the message strategy
The first step in creating effective advertising content is to plan a message strategy—the general message that will be communicated to consumers.
length
The number of intermediary levels indicates the____________of a channel.
value delivery network
Toyota makes great cars. But to make and market just one of its many lines—say, its best-selling Camry model—Toyota manages a huge network of people within the company, from marketing and sales people to folks in finance and operations. It also coordinates the efforts of thousands of suppliers, dealers, and advertising agencies and other marketing service firms.
negative publicity
Typically negative has biggest impact on business perception -something you don't forget ex: United -Doctor was dragged out of plane Building brand takes a long time but negative tears reputation apart in seconds
Integrated Marketing Communications
Unilever, one of the world's largest advertisers, now spends as much as 30 percent of its more than $9 billion global marketing budget on digital media. this is an example of
freight absorption pricing
Using this strategy, the seller absorbs all or part of the actual freight charges to get the desired business. The seller might reason that if it can get more business, its average costs will decrease and more than compensate for its extra freight cost. Freight-absorption pricing is used for market penetration and to hold on to increasingly competitive markets.
Celebrity-brand matchup
Value, behavior appearance where sports person is compatible with brand EX: Rodger -won 8 tennis championships, -he destroys you, but in polite way Artistic, graceful Values, & behavior is compadible
A communications hodgepodge for consumers
What potential risk do marketers incur by using richer but more fragmented media and promotional mixes?
Product-line pricing/ price lining
When marketers establish a price floor and ceiling for an entire line of similar products and then few other prices in between to represent distinct differences in quality, this is called price lining. EX: jiffylube oil change: premium, standard,
Targeted levels of customer service
When setting marketing channel objectives, companies should state the objective in terms of
Channel Levels
Which of the following describes layers of intermediaries performing some of the work to bring the product and its ownership closer to the final buyer?
Integrated supply chain management
Which of the following recognizes that improved logistics mandates teamwork across the company and the entire supply chain?
Outsourcing logistics functions
Which of the following represents a new trend in logistics to save costs, increase efficiencies, and gain faster and more effective access to global markets?
personal selling
Which of the following uses promotional tools such as presentations, trade shows, and incentive programs to engage customers, make sales, and build customer relationships?
Testimonial evidence or endorsement
Whole Foods features a variety of real customers in its Values Matter marketing campaign
horizontal marketing system
a channel arrangement in which two or more companies at one level join together to follow a new marketing opportunity
indirect marketing channels
containing one or more intermediaries.
Sustainable marketing
in response to criticism on mcDonald's being unhealthy, McDonald's has responded to these challenges with a more sustainable strategy of diversifying into salads, fruits, grilled chicken, low-fat milk, and other healthy fare.
The number of intermediary levels in the channel
indicates the length of a channel
How Channel Members Add Value
information, promotion, contact, matching, negotiation, physical distribution, financing, risk taking
corporate VMS
integrates successive stages of production and distribution under single ownership. Coordination and conflict management are attained through regular organizational channels EX: Starbucks = corporate because they are owned by company
Product line filling
involves adding more items within the present range of the line.
product line
is a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges.
retail (or resale) price maintenance
manufacturer cannot require dealers to charge a specified retail price for its product. Although the seller can propose a manufacturer's suggested retail price to dealers, it cannot refuse to sell to a dealer that takes independent pricing action, nor can it punish the dealer by shipping late or denying advertising allowances
Brand Sponsorship
manufacturer's brand, private brand, licensing, co-branding
public relations
press releases, sponsorships,events, and web pages are promotional tools used in ___________
return on advertising investment
the net return on advertising investment divided by the costs of the advertising investment
product mix width
the number of different product lines an organization offers
product line length
the number of items in the product line
product mix width
the number of versions offered of each product in the line.
Co-branding
the practice of using the established brand names of two different companies on the same product
Line extension
the use of an established brand name for a new item in the same product category
Persuasive
___________________ advertising is the type of advertising objective used when attempting to build brand preference and prompting customers to purchase now.
A pull strategy
_____________________ direct(s) its marketing activities (primarily advertising, consumer promotion, and direct and digital media) toward final consumers to induce them to buy the product.
Direct and digital marketing
_______________________ uses tools that engage directly with carefully targeted individual consumers and customer communities to both obtain an immediate response and build lasting customer relationships.
Public affairs
___________________is used to build and maintain national or local community relationships and is one of the functions of public relations.
types of intermediaries
-Dell initially sold directly to final consumers and business buyers only through its sophisticated phone and online marketing channel. -It also sold directly to large corporate, institutional, and government buyers using its direct sales force. - to reach more consumers and match competitors such as Samsung and Apple, Dell now sells indirectly through retailers such as Best Buy, Staples, and Walmart
Brand equity
-Is the positive differential effect that knowing the brand name has on customer response to the product or service. -Is a valuable asset that offers many competitive advantages.
Major Advertising Decisions
1.Setting advertising objectives 2.Setting the advertising budget 3. Developing advertising strategy - Message decisions Media decisions 4. Evaluating advertising campaigns
product form pricing
:a round-trip economy seat on a flight from New York to London might cost $1,100, whereas a business-class seat on the same flight might cost $6,500 or more
horizontal channel conflict
A Subaru dealer complaining that another Subaru dealer is advertising in its territory
private brand
A brand name owned by a wholesaler or a retailer. Also known as a private label or store brand. EX: Sam's Club sells membersmark, and Costco sells Kirkland
demand curve
A curve that shows the number of units the market will buy in a given time period, at different prices that might be charged
push strategy
A promotion strategy that calls for using the sales force and trade promotion to push the product through channels. The producer promotes the product to channel members who in turn promote it to final consumers
Supermarkets
A relatively large, low-cost, low-margin, high-volume, self-service operation designed to serve the consumer's total needs for grocery and household products. ex: Safeway, Rayleys
communication effects and the sales and profit effects
Advertisers should regularly evaluate two types of advertising results_____________________ & _________________
Evaluation
Advertising decisions involve multiple steps culminating in the measurement of the sales effects of advertising or brand content. Which of the following considers return on investment?
tying agreements
An illegal agreement requiring a customer to buy other products in order to obtain desired goods and services
everyday low pricing
An important type of good-value pricing at the retail level. involves charging a constant, everyday low price with few or no temporary price discounts. EX: Walmart, which practically defined the concept. Except for a few sale items every month, Walmart promises everyday low prices on everything it sells.
Adaptability criteria
Channels often involve long-term commitments, and companies have many alternatives. What type of criteria should be used if the company wants to keep the channel flexible so that it can respond to environmental changes?
Exclusive
Companies such as Breitling watches and Pandora charm bracelets use which of the following types of distribution strategy?
informing advertising
EX: 1st ipad - shows you can read, email, look at picture -shows what you can do
franchise organization
EX: Mcdonalds - contracts so franchisee have to follow corporate
dynamic pricing
EX: UBER -price depending on time of day/ day of week
service intangibility
EX: customer service rating -physical evidence to show you offer good service
contact
Finding and engaging customers and prospective buyers.
The importance of Internal Marketing
For employee commitment to customer service, management must develop programs possessing the following critical compon
manufacturer-sponsored retailer franchise system
Ford and its network of independent franchised dealers
Product mix length
GE appliances offers French door fridges, side by side.
product mix width
GE appliances offers fridges, icemakers, freezers
Information
Gathering and distributing information about consumers, producers, and other actors and forces in the marketing environment needed for planning and aiding exchange.
Place Decision
Locations should be accessible to the target market in areas that are consistent with the retailer's positioning. EX, Apple locates its stores in high-end malls and trendy shopping districts—such as the Magnificent Mile on Chicago's Michigan Avenue or Fifth Avenue in Manhattan
consumers don't distinguish between content sources the way marketers do
Marketers now have a richer mix of media and content approaches with consumers being bombarded by many brand messages. The result is that _________________________.
product bundle pricing
Microsoft Office is sold as a bundle of computer software, including Word, Excel, PowerPoint, and Outlook.
product line
Nike produces several lines of athletic shoes and apparel, and Marriott offers several lines of hotels. these are examples of a ________________
Multibrands
Offers a way to establish different features and appeal to different buying motives. companies market many different brands in a given product category
Service perishability
Some doctors charge patients for missed appointments because the service value existed only at that point and disappeared when the patient did not show up.
Clayton Act of 1914
Strengthened Sherman Act, outlawed certain anticompetitive practices not prohibited by the Sherman Act, including price discrimination, tying contracts, exclusive dealing, interlocking directorates, and buying the corporate stock of a competitor
deliver clear, consistent, and compelling messages about the organization and its brands
The goal of integrated marketing communications is to __________________________________.
Service perishability
The perishability of services is not a problem when demand is steady. However, when demand fluctuates, service firms often have difficult problems.
goal of advertising
To help move consumers through the buying process
Determining Reach, Frequency, Impact, and Engagement
To select media, the advertiser must determine the reach and frequency needed to achieve the advertising objectives. Reach is a measure of the percentage of people in the target market who are exposed to an ad campaign during a given period of time.
Creating advertising messages and selecting advertising media
What are the two major elements in developing advertising strategy?
he responsibilities of channel members
When the company has defined its channel objectives, it should next identify its major channel alternatives in terms of the types of intermediaries, the number of intermediaries, and __________________.
marketing mix
Which of the following accurately describes a company's efforts to engage customers, persuasively communicate customer value, and build customer relationships?
Development
Working with donors or members of nonprofit organizations to gain financial or volunteer support represents which public relations function?
economic criteria
a company compares the likely sales, costs, and profitability of different channel alternatives
Service
banking, hotel, tax preparation, and home-repair services.
Line extension
coke introduces Cherry coke is an example of _______ __________
three major types of VMS
corporate, contractual, and administered
Fixed costs/ overhead
costs that do not vary with production or sales level. EX: a company must pay each month's bills for rent, heat, interest, and executive salaries regardless of the company's level of output.
omni-channel retailing
creating a seamless cross-channel buying experience that integrates in-store, online, and mobile shopping
Power centers
huge unenclosed shopping centers consisting of a long strip of retail stores, including large, freestanding anchors such as Walmart, Home Depot, Costco, Best Buy, Michaels, PetSmart, and Office Depot.
advertising objective
is a specific communication task to be accomplished with a specific target audience during a specific period of time. Advertising objectives can be classified by their primary purpose—to inform, persuade, or remind.
Analyzing consumer needs
is the first step in marketing channel design.
Service perishability
means that services cannot be stored for later sale or use. ex: if you own a hotel & the goal is to sell 100 rooms a day . you sol 60 % of rooms, so still have 40 left. Cannot save 40 days for tomorrow
The retail strategy and retail marketing mix
must combine to create value for targeted retail customers.
good-value pricing
offering the right combination of quality and good service at a fair price. ex: Kroger carries three low-priced product lines—Heritage Farm, Check This Out, and Psst, which offers thrift-conscious customers rock-bottom prices on grocery staples such as chicken, toilet paper, and sugar.
selective distribution
outdoor power equipment maker STIHL doesn't sell its chain saws, blowers, hedge trimmers, and other products through mass merchandisers such as Lowe's, Home Depot, or Sears. Instead, it sells through a select corps of independent hardware and lawn and garden dealers.
Product line pricing
setting prices across an entire product line
Competition-based pricing
setting prices based on competitors' strategies, costs, prices, and market offerings. Consumers will base their judgments of a product's value on the prices that competitors charge for similar products
Cost-based pricing
setting prices based on the costs of producing, distributing, and selling the product plus a fair rate of return for the company's effort and risk. -Fixed costs (overhead) -Costs that do not vary with production / sales
true
t/f The lines between advertising and public relations are becoming more blurred.
major media types
television digital, mobile, and social media, newspapers direct mail magazines radio outdoor
supply chain
the connected chain of all of the business entities, both internal and external to the company, that perform or support the logistics function
pure monopoly
the market is dominated by one seller. The seller may be a government monopoly (the U.S. Postal Service), a private regulated monopoly (a power company), or a private unregulated monopoly (De Beers and diamonds).
pure competition
the market structure that exists when there are many small businesses selling one standardized product ex: are agricultural products, such as corn, wheat, and soybeans
Total costs
the sum of the fixed and variable costs for any given level of production. Management wants to charge a price that will at least cover the total production costs at a given level of production.
Brand extension
using existing brand name to enter a completely different product clas
control issues
using intermediaries usually means giving them some control over the marketing of the product, and some intermediaries take more control than others
three pricing methods
value-based pricing, cost-based pricing, and competition-based pricing.
target costing
when Honda initially designed the Honda Fit, it began with a $13,950 starting price point and highway mileage of 33 miles per gallon firmly in mind. It then designed a stylish, peppy little car with costs that allowed it to give target customers those values.
personal selling
which of the following uses promotional tools suchas presentations, trade shows, and incentive programs to engage customers, make sale, and build customer relationships
Customer value-based pricing
•1. assess customer's needs and value perceptions -experiment •2. set the target price to match customer perceived value •3. determine costs that can be incurred •4. design product to deliver value at target price
Competition-based pricing
•EX: AT&T, Verizon, Sprint, & T mobile -Verizon offers highest quality so higher $ -T mobile- you need to offer more value to attract customer *they offer free iphones, unlimited data, Netflix
dynamic pricing
•EX: Amazon: -AAA energizer batteries for 24 pack -in august price was $26 -January 11 price dropped to $10 Adjust based on demand
Wholesaling
•Grainger •Buy anything from paper- toilet paper •Biggest whole seller •Distinction between large retailers and wholesalers continues to blur.
Wholesaling
•Includes all activities involved in selling goods and services to those buying for resale or business use. •What do whole sellers do? -sell in bulk -go to specific retailers -bulk breaking- -transportation - ship to retailers -financing -promote •EX: 7/11 purchase from ____________
Special-event pricing
•Low-interest financing •Longer warranties •Free maintenance Price doesn't change EX: BMW may give you free maintanence but no discount - Higher end brands Don't want to cheapen brand with discounts so this is how they attract ppl
Deceptive packaging
•exaggerating package contents through subtle design. Using misleading labeling, etc. EX: Chips
market-skimming pricing / price skimming
•setting a high price for a new product to skim maximum revenues layer by layer from the segment willing to pay the high price -capture high-end market -may eventually lower price, but end to capture high-end market
market-penetration pricing
•setting a low price for a new product to attract a large # of buyers and a large market share Typically for big company with large resources
Convenience store
A relatively small store located near residential areas, open 24/7, and carrying a limited line of high-turnover convenience products at slightly higher prices. Ex: 7-Eleven, Circle K, Speedway, Sheetz
promotional pricing
A seller may simply offer discounts from normal prices to increase sales and reduce inventories. Sellers also use special-event pricing in certain seasons to draw more customers
Marketing channel
A set of interdependent organizations that help make a product or service available for use or consumptions by the consumer or business users
Category killers
A specialist that offers an extensive assortment in a particular category, so overwhelming the category that other retailers have difficulty competing. Ex:Petsmart, Home Depot
Specialty stores
A store that carries a narrow product line with a deep assortment, such as apparel stores, sporting-goods stores, furniture stores, florists, and bookstores. EX: wine store, cigar store
Department stores
A store that carries several product lines—typically clothing, home furnishings, and household goods—with each line operated as a separate department managed by specialist buyers or merchandisers. EX: Macy's, nordstrom
discount
A straight reduction in price on purchases during a stated period of time or of larger quantities EX: -Credit terms and cash discount: if you pay credit in first 10 days there is a discount
Superstores
A very large store that meets consumers' total needs for routinely purchased food and nonfood items. This includes supercenters, combined supermarket and discount stores, and category killers, which carry a deep assortment in a particular category EX: target and walmart
Vertical marketing system
A(n) _____ consists of producers, wholesalers, and retailers acting as a unified system.
service intangibility
Airline passengers have nothing but a ticket and a promise that they and their luggage will arrive safely at the intended destination, hopefully at the same time.
captive-product pricing
Amazon makes little or no profit on its Kindle readers and tablets. It's eight-inch Fire tablet is priced at less than $80 versus an eight-inch iPad tablet at more than $300. However, Amazon hopes to more than make up for thin margins through sales of more Amazon Prime memberships, digital books, music, movies, subscription services, and other content for the devices.
Deciding on Media Timing
An advertiser must also decide how to schedule the advertising over time. Suppose sales of a product peak in December and drop in March (for winter outdoor gear, for instance). The firm can vary its advertising to follow the seasonal pattern, oppose the seasonal pattern, or be the same all year. Most firms do some seasonal advertising.
licensing
Apparel and accessories sellers pay large royalties to adorn their products—from blouses to ties and linens to luggage—with the names or initials of well-known fashion innovators such as Calvin Klein, Tommy Hilfiger, Gucci, or Armani.
product line length
Apple iPhones 3G, 4, 4s, 5, 5s,... 8, 9, x, xr are examples of _________
Line extension
Apple introducing the iPad mini is an example of ___________ ______________
indirect marketing channels
Apple sells products to Best buy= indirect channel -Pros= cannot be everywhere -cons= best buy may promote Samsung because they make more of them, may not have enough training
product Line downward stretching
BMW has a 3, 4, 5, and 7 series. if they decided to ad a 1 series that would be ___________ _____________
Category killers
Best Buy, Petco, Staples, Bed Bath & Beyond
Promotion Decision
CVS/pharmacy distributes personalized versions of its weekly circulars to the chain's 80 million ExtraCare loyalty program members. Called myWeekly Ad, customers can view their circulars by logging into their personal accounts on CVS.com or through the CVS app on their phones.
Positive publicity
Can help make customers have more positive image of the brand ex: Toms- for every pair of shoes he sells he donates a pair to children in ethopia
Integrated Marketing Communications
Carefully integrating and coordinating the company's many communication channels to deliver a clear, consistent, and compelling message about the organization and its products.
Saturation/ overexposure
Celebrity that represents too many things -EX: Michael Jordan & Nike Strong association with Nike
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
manufacturer-sponsored wholesaler franchise system
Coca-Cola licenses bottlers (wholesalers) in various world markets that buy Coca-Cola syrup concentrate and then bottle and sell the finished product to retailers locally
Product mix length
Colgate carries several brands within each line. its personal care line includes Softsoap liquid soaps and body washes, Tom's of Maine, Irish Spring bar soaps, Speed Stick deodorants, Afta, and Colgate toiletries and shaving products, among others
product mix width
Colgate markets a fairly wide product mix, consisting of dozens of brands that constitute the "Colgate World of Care"—products that "every day, people like you trust to care for themselves and the ones they love.
First-line partners
Companies today see channel members as ______________ and practice strong partner relationship management.
creative concept
Compelling big idea that brings the advertising message strategy to life in a distinctive and memorable way EX: coca cola commercial of guy having a picnic and insects stealing his coke Key idea-"open happiness" makes people happy https://www.youtube.com/watch?v=qE2jkJC7I2A
Customer effort
Customers are often involved to a relatively great degree in production of many types of services ex: in the movie theater people are talking the whole time so you dont remember the movie
high-low pricing
Department stores such as Kohl's and JCPenney practice _____________- by having frequent sale days, early-bird savings, and bonus earnings for store credit-card holders.
Direct marketing
Direct connections with carefully targeted individual consumers to both obtain an immediate response and cultivate lasting customer relationships Ex: call, email, text, mail to directly contact consumers Messages can be customized Allows a dialogue between the marketing team and the consum
Loss-leader pricing
Do not make any profit, but expect people to buy more items EX: Rayleys sells strawberries @ .99 to make people come in the store to buy more profitable items
Market skimming
EX: Apple If name is not associated with high quality you cannot use this strategy -Companies make fewer, but more profitable sales
corporate VMS
EX: Apple Company has place for the designing and also the making of the products. These products that are made by the company are sold in the retailer shops of the company itself. They need not have to depend on any of the other people for the purpose of production or even selling of the products.
administered VMS
EX: P&G => they are able to control shelf space, pricing, promotion, advertising, etc. or they will not be given anymore
Optional-product pricing
EX: Refrigerators come with optional ice makers. And when you order a new laptop, you can select from a bewildering array of processors, hard drives, docking systems, software options, and service plans.
value-added pricing
EX: Studio-movie grill -more premium -champagne & food -3x as much as regular movie -on a date you may pay large sums More services and more features to differentiate from others
Market skimming
EX: Tesla Capture high-end market using Tesla X, S Made model 3 to introduce lower price electric car -could devalue your brand
Trouble factor
EX: Tiger woods -cheating on wife -consequence= he lost all sponsorships except Nike -damage to brands endorsed -cost shareholders up to $12 billion -he won masters, but only had 4 sponsors because brands are scared to endorse him because people don't change easily
Product-line pricing/ price lining
EX: car wash: ultimate, the works, the deluxe, the regular EXIpad: 64GB= $999 256 GB= $1149 512 GB= $1349 Tb=$1549
location-based pricing
EX: concert- depending on where you sit you pay more/ less
intensive distribution
EX: toothpaste, candy, and other similar items are sold in millions of outlets to provide maximum brand exposure and consumer convenience
Product line pricing
EX:Intuit offers an entire line of Quicken financial management software versions, including Starter, Deluxe, Premier, and Home and Business versions priced at $59.99, $89.99, $129.99, $159.99, respectively. Although it costs Quicken no more to produce the Premier version than the Starter version, many buyers happily pay more to obtain additional Premier features, such as financial-planning, retirement, and investment-monitoring tools.
channel level
Each layer of marketing intermediaries that performs some work in bringing the product and its ownership closer to the final buyer is a
marketing channel
Enterprise Rent-A-Car revolutionized the car-rental business by setting up off-airport rental offices. Apple turned the retail music business on its head by selling music for the iPod via the internet on iTunes.
Cost-based pricing
Ex: factory facility Price of factory does not vary depending on how much they make or sell -Variable costs Costs that vary directly with the level of production Cost based pricing: Design a good product=>determine product costs=> set price based on cost=> convince buyers of product value
Fluctuating demand for service
For example, Hotels and resorts charge lower prices in the off-season to attract more guests.
oligopolistic competition
For example, only a handful of providers—Comcast, Spectrum, AT&T, and Dish Network—control a lion's share of the cable/satellite television market. Because there are few sellers, each seller is alert and responsive to competitors' pricing strategies and marketing moves. In the battle for subscribers, price becomes a major competitive tool. For example, to woo customers away from competitors, they offers special discounts, free equipment upgrades, and lock-in prices.
value-added pricing
For example, premium audio brand Bose doesn't try to beat out its competition by offering discounts or by selling lower-end, more affordable versions of its speakers, headphones, and home theater system products. Instead, for more than 50 years, Bose has poured resources into research and innovation to create high-quality products that merit the premium prices it charges.
promotional pricing
For example, to encourage consumers to convert to its Windows 10 operating system, Microsoft ran an Easy Trade-Up promotion offering buyers $200 trade-ins on their old devices when purchasing new Windows 10 PCs costing $599 or more at the Microsoft Store. It sweetened the deal to $300 for trade-ins of Apple MacBooks or iMacs.
Manufacturer-sponsored retail franchise systems
Ford licensing car dealerships to sell its cars while being subject to various sales and service conditionsfranchise systems
product Line downward stretching
Giorgio Armani, Emporio Armani, Armani jean, Armani exchange Armani exchange= ___________ ______________ because it is cheaper and added after
A push strategy
In which of the following does a producer direct marketing activities (primarily personal selling and trade promotion) toward channel members?
By-product pricing
Instead of paying to have it disposed of, they now sell it to local city and county highway departments, which use it in conjunction with salt to melt icy roads.
Multibrands
PepsiCo markets at least eight brands of carbonated soft drinks (Pepsi, Sierra Mist, Mountain Dew, Manzanita Sol, Mirinda, IZZE, Tropicana Twister, and Mug root beer)
personal selling
Personal customer interactions by the firm's sales force to engage customers, make sales, and build customer relationships. ex: sales presentations, trade shows, and incentive programs
Optional-product pricing
Pricing optional or accessory products sold with the main product EX: a car buyer may choose to order a navigation system and premium entertainment system.
full-line forcing
Producers of a strong brand sometimes sell it to dealers only if the dealers will take some or all of the rest of its line.
It may or may not be legal.
Producers of a strong brand sometimes sell it to dealers only if the dealers will take some or all of the rest of its line. This is known as full-line forcing. Which of the following statements is true regarding full-line forcing?
national brands
Products are marketed under the manufacturer's own name ex: Samsung and Kellogg
Negotiation
Reaching an agreement on price and other terms so that ownership or possession can be transferred.
Corporate VMS
Sherwin-Williams sells its paint and other branded products exclusively through company-owned retail stores. Sherwin-Williams has established a(n) _________.
sales promotion
Short-term incentives to encourage the purchase or sale of a product or service. ex: includes discounts, coupons, displays, demonstrations, and events
client relationships
Similar to customer relationship, but typically more intense in ___________ customer effort is essential
target costing
Sleep Number beds cost more than a traditional mattresses—models run from $900 to more than $7,000 compared with good-quality traditional mattresses at $1,000 or less. But Sleep Number's satisfied customers are willing to pay more to get more.
warehousing
Snapper, Toro, and other lawn mower manufacturers run their factories all year long and store up products for the heavy spring and summer buying seasons. The storage function overcomes differences in needed quantities and timing, ensuring that products are available when customers are ready to buy them.
true
T/F If demand is elastic rather than inelastic, sellers will consider lowering their prices.
horizontal marketing system
Target also partners with CVS Health, which operates CVS pharmacies and Minute Clinics in Target stores through a store-within-a-store format. The partnership gives CVS Health more than 1,700 pharmacies and 80 clinics at prime locations inside Target stores
horizontal marketing system
Target partners with noncompetitor Starbucks to place coffee stands in its stores. Starbucks benefits from Target's heavy store traffic, and Target keeps its shoppers caffeinated and ready to shop
Zone pricing
The company sets up two or more zones. All customers within a given zone pay a single total price; the more distant the zone, the higher the price
Warehousing, inventory management, transportation, and logistics information management
The goal of logistics is to provide a targeted level of service at the least or lowest possible cost. To achieve this goal, which of the following are logistical functional areas?
transportation
The process by which passengers or goods are moved or delivered from one place to another. EX: large trucking firms now offer everything from satellite tracking, internet-based shipment management, and logistics planning software to cross-border shipping operations.
Inventory management
The process of buying and storing materials and products while controlling costs for ordering, shipping, handling, and storage.
exclusive territorial agreements
The producer may agree not to sell to other dealers in a given area, or the buyer may agree to sell only in its own territory. The first practice is normal under franchise systems as a way to increase dealer enthusiasm and commitment.
Product mix
The set of all of the product lines and items that a particular seller offers for sale.
Retail atmospherics
The use of a combination of factors such as layout and design, lighting, fixtures, sounds and smells to attract customers and induce buying activity Music affects behavior •Slow music makes you stay longer Smells Ex: cinnabon
integrated logistics management
This concept recognizes that providing better customer service and trimming distribution costs require teamwork, both inside the company and among all the marketing channel organizations.
Mood or image
This style builds a mood or image around the product or service, such as beauty, love, intrigue, serenity, or pride. Few claims are made about the product or service except through suggestion. ex: : beauty products: perfume, makeup Mabeline
Personality symbol
This style creates a character that represents the product. The character might be animated (Mr. Clean, the GEICO Gecko, or the Travelocity Gnome) or real (perky Progressive Insurance spokeswoman Flo, KFC's Colonel Sanders, or Ronald McDonald).
Fantasy
This style creates a fantasy around the product or its use. ex: Samsung commercial -Shows view in the movie with dinosaur
Testimonial evidence or endorsement
This style features a highly believable or likable source endorsing the product. It could be ordinary people saying how much they like a given product. EX: Proactive commercials
Scientific evidence
This style presents survey or scientific evidence that the brand is better or better liked than one or more other brands ex: Crest toothpaste has used ___________ ___________ to convince buyers that Crest is better than other brands at fighting cavities.
Musical
This style shows characters singing about the product. For example, as part of its "Insure Carefully, Dream Fearlessly" campaign, American Family Insurance sends Grammy Award winner Jennifer Hudson to the streets of Atlanta to help make a dream come true by singing a surprise duet with an aspiring street performer. "With the right support, any dream is possible," the ad concludes
Lifestyle
This style shows how a product fits in with a particular lifestyle.
Technical expertise
This style shows the company's expertise in making the product. Thus, Jim Koch of the Boston Beer Company tells about his many years of experience in brewing Samuel Adams beer.
characteristics of advertising appeals
To be meaningful, to be believable, and to be distinctive
Cost-based pricing
Walmart or Spirit Airlines, work to become the low-cost producers in their industries. Companies with lower costs can set lower prices that result in smaller margins but greater sales and profits
Supply chain management
________ entails managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers, and final consumers.
Marketing channel
____________ _________________members are able to transform the assortments of products made by producers into the assortments wanted by consumers
Partner relationship management
____________ software systems enable companies to coordinate their whole-channel marketing efforts.
location-based pricing
a company charges different prices for different locations, even though the cost of offering each location is the same.
comparative advertising
a company directly or indirectly compares its brand with one or more other brands EX: Pepsi Godfather pepsi vs coca cola Shows a competition Shows coke's name https://www.youtube.com/watch?v=h7R-bR0cW8c
zone pricing
a customer in Texas probably pays less than one in New England.
time-based pricing
a firm varies its price by the season, the month, the day, and even the hour. EX: airline prices varies depending on day of week & time of day - At 10 pm price if lower than at &10 am
reference prices
a grocery retailer might place its store brand of bran flakes and raisins cereal priced at $2.49 next to Kellogg's Raisin Bran priced at $3.79
shopping center
a group of retail businesses built on a site that is planned, developed, owned, and managed as a unit.
advertising agency
a marketing services firm that assists companies in planning, preparing, implementing, and evaluating all or portions of their advertising programs
brand
a name, term, sign, symbol, or design, or a combination of these, that identifies the products or services of one seller or group of sellers and differentiates them from those of competitors
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
Quantity discount
a price reduction to buyers who buy large volumes. ex: Ex: coupon for 15% of first 1-3 items 25% off 4-5 items
seasonal discount
a price reduction to buyers who buy merchandise or services out of season.
Uniform-delivered pricing
a price tactic in which the seller pays the actual freight charges and bills every purchaser an identical, flat freight charge
FOB-origin pricing
a price tactic that requires the buyer to absorb the freight costs from the shipping point ("free on board")
pull strategy
a promotion strategy that calls for spending a lot on consumer advertising and promotion to induce final consumers to buy the product, creating a demand vacuum that "pulls" the product through the channel
Reminder advertising
a recent ad campaign for Silk soymilk tells consumers to "Fall back in love with Soymilk," reminding them of the many reasons that "Silk helps you bloom."
Discount store
a retail operation that sells standard merchandise at lower prices by accepting lower margins and selling at higher volume Ex:Walmart, Target, Kohl's
Off-price retailer
a retailer that buys at less-than-regular wholesale prices and sells at less than retail •EX: Folsom outlets
Deceptive pricing
a seller states prices or price savings that mislead consumers or are not actually available to consumers. This might involve bogus reference or comparison prices, as when a retailer sets artificially high "regular" prices and then announces "sale" prices close to its previous everyday prices
multichannel distribution systems
a single firm sets up two or more marketing channels to reach customer segments
intensive distribution
a strategy in which they stock their products in as many outlets as possible. These products must be available where and when consumers want them.
break-even pricing
a video game company sells contollers. the price is $15 (for example, the company's revenue is $12 million on 800,000 units, or $15 per unit).
Mood or image
a warm, soul-stirring three-minute "Little Moments" ad for HP's phone-sized Sprocket printer captures through printed images the evolving relationship between a father and his moody 12-year-old daughter as she starts sixth grade. "Hold onto the ones you love," the ad urges. "Reinvent memories."
cost-plus pricing/ or markup pricing
adding a standard markup to the cost of the product. ex: an electronics retailer might pay a manufacturer $20 for a gaming controller and mark it up to sell at $30, a 50 percent markup on cost.
Integrated Marketing Communications
adidas has now abandoned TV altogether and uses only digital channels to reach younger consumers. "It's clear that the younger consumer engages with us predominantly over the mobile device," says adidas's CEO.
dynamic pricing
adjusting prices continually to meet the characteristics and needs of individual customers and situations
International pricing
adjusting prices for international markets EX: Starbucks -in foreign may pay more/ less -in Tokyo- more expensive -Korea capachino is $6 or $7
Special-event pricing
advertised sales or price cutting linked to a holiday, season, or event EX: back to school sale
Promotion Decision
advertising, personal selling, sales promotion, public relations, direct marketing
The five major promotion tools
advertising, sales promotion, personal selling, public relations, direct marketing
advertising budget methods
affordable method, percentage of sales method, competitive parity method, objective and task method
promotion mix
also called its marketing communications mix—consists of the specific blend of advertising, public relations, personal selling, sales promotion, and direct and digital marketing tools that the company uses to engage consumers, persuasively communicate customer value, and build customer relationships.
independent off-price retailer
an ____________ is either independently owned and run or is a division of a larger retail corporation EX:TJ Maxx
Lifestyle
an ad for Athleta activewear shows a woman in a complex yoga pose and states: "If your body is your temple, build it one piece at a time."
Fantasy
an ad for Nestle Pure Life water shows a young girl diving into a water-filled fantasy land where children blow bubbles high on a gondola lift and paddle a boat through the clouds, suggesting "a future full of possibilities starts by drinking pure bottled water now."
Deceptive pricing
an illegal practice that involves intentionally misleading customers with price promotions •EX: make you feel like you got a good deal WAS :$1918.00 NOW: $499
third-party logistics (3PL) providers
an independent logistics provider that performs any or all of the functions required to get a client's product to market EX: Ryder, Penske Logistics, BAX Global, DHL Logistics, FedEx Logistics, and UPS Business Solutions.
Advertising
any paid form of non-personal presentation and promotion of ideas, goods, or services by an identified sponsor
product line
apple offers multiple ________ ________. they offer tablets, watches, phones, computers, etc.
Promotional allowances
are payments or price reductions that reward dealers for participating in advertising and sales-support programs.
Persuasive advertising
as EVs catch on, GM is now trying to persuade consumers that its Chevy Bolt offers more value for the price than the Tesla Model 3, Toyota Prius Prime, or Nissan Leaf.
value-added pricing
attaching value-added features and services to differentiate a company's offers and charging higher prices
Persuasive advertising
becomes more important as competition increases. Here, the company's objective is to build selective demand ex: Verizon matters commercial "When things aren't made well you find out" Persuade consumers, unlike any consumers it is better
Public relations
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 ex: press releases, sponsorships, events, and webpage
Marketing channel design
calls for analyzing consumer needs, setting channel objectives, identifying major channel alternatives, and evaluating those alternatives
Marketing channel management
calls for selecting, managing, and motivating individual channel members and evaluating their performance over time
break-even analysis and target return
can help the company to determine the minimum prices needed to cover expected costs and profits, they do not take the price-demand relationship into account.
high-low pricing
charging higher prices on an everyday basis but running frequent promotions to lower prices temporarily on selected items.
warehouse clubs
clubs selling a limited selection of goods at deep discounts to consumers who pay membership fees. Ex:Costco, Sam's Club, BJ's
multimodal transportation
combining two or more modes of transportation EX:not only is piggyback (use of rail and truck) cheaper than trucking alone, but it also provides flexibility and convenience.
informing advertising
commercial on "Hello" on 1st apple Iphone - objective: suggesting new product, evolution of the phone, -intended to build excitement about what is coming
promotional pricing
companies will temporarily price their products below list price—and sometimes even below cost—to create buying excitement and urgency.
sales and profit effects
compare past sales and profits with past expenditures or through experiments
contractual VMS
consists of independent firms at different levels of production and distribution that join together through contracts to obtain more economies or sales impact than each could achieve alone. Channel members coordinate their activities and manage conflict through contractual agreements.
Variable costs
costs that vary with the quantity of output produced EX: Each smartphone or tablet produced by Samsung involves a cost of computer chips, wires, plastic, packaging, and other inputs. Although these costs tend to be the same for each unit produced, they are called variable costs because the total varies with the number of units produced.
customer-segment pricing
different customers pay different prices for the same product or service EX: EX: senior citizen discount, student discount, military discount
product form pricing
different versions of the product are priced differently but not according to differences in their costs.
Channel conflict
disagreements among marketing channel members on goals, roles, and rewards - who should do what and for what rewards
Direct and digital marketing
engaging directly with carefully targeted individual consumers and customer communities to both obtain an immediate response and build lasting customer relationships EX: direct mail, email, catalogs, online and social media, mobile marketing, and more.
price discrimination
every retailer is entitled to the same price terms from a given manufacturer, whether the retailer is REI or a local bicycle shop. However, _____________ is allowed if the seller can prove that its costs are different when selling to different retailers
exclusive distribution
giving a limited number of dealers the exclusive right to distribute the company's products in their territories
push strategy
goal is to induce channel members to carry and promote the product
price-fixing
governments at the state and national levels have been aggressively enforcing _________regulations in industries ranging from gasoline, insurance, and concrete to credit cards, computer chips, and e-books.
corporate VMS
grocery giant Kroger owns and operates 38 food product plants—17 dairies, seven bakery plants, five grocery plants, one deli plant, two frozen dough plants, two beverage plants, two cheese plants, and two meat plants.
Product mix
has four important dimensions: width, length, depth, and consistency.
direct marketing channel
has no intermediary levels—the company sells directly to consumers. EX:Pampered Chef, Mary Kay Cosmetics, and Amway sell their products through home and office sales parties and online websites and social media
Integrated Marketing Communications
helps establish brand identity If not consistent, customers might find it confusing or forget it Consistency is crucial
price elasticity
how responsive demand will be to a change in price.
Reminder advertising
is important for mature products; it helps to maintain customer relationships and keep consumers thinking about the product. ex: Nike has comercials to stay relevant
Brand equity
is the differential effect that knowing the brand name has on customer response to the product and its marketing. It's a measure of the brand's ability to capture consumer preference and loyalty.
Advertising strategy
is the strategy by which the company accomplishes its advertising objectives and consists of: 1. Creating advertising messages 2. Selecting advertising media
informing advertising
is used heavily when introducing a new product category. In this case, the objective is to build primary demand
distribution centers
large, centralized warehouses that focus on moving rather than storing goods EX:Amazon operates more than 70 giant distribution centers in the United States, called fulfillment centers, which fill online orders and handle returns.
percentage-of-sales method
last year a company had $10 million in sales so they decided to use 30% of sales
administered VMS
leadership is assumed not through common ownership or contractual ties but through the size and power of one or a few dominant channel members. Manufacturers of a top brand can obtain strong trade cooperation and support from resellers
product Line stretching
lengthening the product line beyond the current range
Deceptive pricing
luxury apparel and accessories retailer Michael Kors recently settled a class action lawsuit alleging that it used deceptive pricing at its outlet stores. The retailer was charged with tagging products with false "manufacturer's suggested retail prices" to make its supposed discounted prices more appealing when, in fact, the products were sold only in the outlet stores.
supply chain management
managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers, and final consumers
monopolistic competition
market consists of many buyers and sellers trading over a range of prices rather than a single market price. A range of prices occurs because sellers can differentiate their offers to buyers Ex: cars, clothing
heterigeneity
means that the quality of services depends on who provides them as well as when, where, and how they are provided. same as Service variability
franchise organization
most common type of contractual relationship. In this system, a channel member called a franchisor links several stages in the production-distribution process.
time-based pricing
movie theaters charge matinee pricing during the daytime, and resorts give weekend and seasonal discounts.
Horizontal conflict
occurs among the firms at the same level of the channel (e.g., between different dealers of the same brand). EX: GM in Folsom and Sacramento -Folsom dealership go out of Folsom to sell their cars
Vertical Conflict
occurs between different levels of the same channel (e.g. between a brand and its franchise) EX: Mcdonalds -Corporate forces all day breakfast menu & lower costing point -$ Menu because they are not making as much money -"your own creation" - larger profit but takes longer to make
disintermediation
occurs when a business sells directly to the customer online and cuts out the intermediary EX: online music download services such as iTunes and Amazon pretty much put traditional music-store retailers out of business,
Deceptive promotion
overstating a product's features or performance, EX: Advertised burger looks different than actual EX: Loreal ad -models are edited
service intangibility
people undergoing cosmetic surgery cannot see the result before the purchase.
media multitaskers
people who absorb more than one medium at a time. For example, it's not uncommon to find someone watching TV with a smartphone in hand, tweeting, Snapchatting with friends, and chasing down product information on Google.
Marketing logistics/ physical distribution
planning, implementing, and controlling the physical flow of materials, final goods, and related information from points of origin to points of consumption to meet customer requirements at a profit
The Robinson-Patman Act
prevents unfair price discrimination by ensuring that the seller offer the same price terms to customers at a given level of trade
reference prices
prices that buyers carry in their minds and refer to when looking at a given product. The reference price might be formed by noting current prices, remembering past prices, or assessing the buying situation.
psychological pricing
pricing that considers the psychology of prices and not simply the economics; the price is used to say something about the product EX: consumers usually perceive higher-priced products as having higher quality
target costing
pricing that starts with an ideal selling price, then targets costs that will ensure that the price is met
Product Assortment and Services Decision
product assortment, services mix, and store atmosphere. These decisions, more than any other, can help store retailers differentiate themselves from online sellers
Service
products that consist of activities, benefits, or satisfactions offered for sale that are essentially intangible
going-rate pricing
qsetting a price for a product/ service using the prevailing market price as a basis •Common for generic products EX:•energy, grain & oil seeds, livestock, metals (gold, copper etc), orange juice, coffee beans, lumber, & daily products,
Allowances
reductions in price given to final consumers, customers, or channel members for doing something or accepting less of something EX: trade-in allowances are price reductions given for turning in an old item when buying a new one. Trade-in allowances are most common in the automobile industry, but they are also given for other durable goods.
types of intermediaries
refers to channel members available to carry out channel work. Most companies face many channel member choices.
consistency of the product mix
refers to how closely related the various product lines are in end use, production requirements, distribution channels, or some other way.
product bundle pricing
sellers often combine several products and offer the bundle at a reduced price. EX: fast-food restaurants bundle a burger, fries, and a soft drink at a "combo" price
Service inseparability
services cannot be separated from their providers, whether the providers are people or machines. If a service employee provides the service, then the employee becomes a part of the service. And customers don't just buy and use a service; they play an active role in its delivery.
affordable method
set the promotion budget at the level they think the company can afford. Small businesses often use this method, reasoning that the company cannot spend more on advertising than it has.
By-product pricing
setting a price for by-products in order to make the main product's price more competitive EX:cheese makers in Wisconsin have discovered a use for their leftover brine, a salt solution used in the cheese-making process.
captive-product pricing
setting a price for products that must be used along with a main product, such as blades for a razor and games for a video-game console EX:captive products are razor blade cartridges, video games, printer cartridges, single-serve coffee pods, and e-books
Customer value-based pricing
setting the price based on buyer's perception of value rather than on the seller's cost EX:a painting may be priced as much more than the price of canvas and paints: the price in fact depends a lot on who the painter is.
percentage-of-sales method
setting their promotion budget at a certain percentage of current or forecasted sales. Or they budget a percentage of the unit sales price.
competitive-parity method
setting their promotion budgets to match competitors' outlays. They monitor competitors' advertising or get industry promotion spending estimates from publications or trade associations and then set their budgets based on the industry average.
non-store retailing
shopping without visiting a store •EX: airport there are best buy vending machines •EX: mcdonalds order yourself
message execution styles
slice of life, lifestyle, fantasy, mood or image, musical, personality symbol, technical expertise, scientific evidence, testimonial evidence or endorsement
Sustainable marketing
socially and environmentally responsible marketing that meets the present needs of consumers and businesses while also preserving or enhancing the ability of future generations to meet their needs
licensing
some companies license names or symbols previously created by other manufacturers, names of well-known celebrities, or characters from popular movies and books. For a fee, any of these can provide an instant and proven brand name.
heterigeneity
some hotels—say, Marriott—have reputations for providing better service than others. Still, within a given Marriott hotel, one registration-counter employee may be cheerful and efficient, whereas another standing just a few feet away may be grumpy and slow. Even the quality of a single Marriott employee's service varies according to his or her energy and frame of mind at the time of each customer encounter.
Customer value-based pricing
some owners consider a luxurious Patek Philippe watch a real bargain, even at eye-popping prices ranging from $20,000 to $500,000
location-based pricing
state universities charge higher tuition for out-of-state students, and theaters vary their seat prices because of audience preferences for certain locations
price-fixing
states that sellers must set prices without talking to competitors. Otherwise, price collusion is suspected. ____ is illegal per se—that is, the government does not accept any excuses for _________
retail (or resale) price maintenance
the Florida attorney general's office investigated Nike for allegedly _ of its shoes and clothing. It was concerned that Nike might be withholding items from retailers who were not selling its most expensive shoes at prices the company considered suitable.
Uniform-delivered pricing
the company charges the same price plus freight to all customers, regardless of their location. The freight charge is set at the average freight cost.
segmented pricing
the company sells a product or service at two or more prices, even though the difference in prices is not based on differences in costs.
objective-and-task method
the company sets its promotion budget based on what it wants to accomplish with promotion. This budgeting method entails (1) defining specific promotion objectives, (2) determining the tasks needed to achieve these objectives, and (3) estimating the costs of performing these tasks. The sum of these costs is the proposed promotion budget.
service intangibility
the concept that services cannot be seen, tasted, felt, heard, or smelled before they are bought
Subscription business model
the customer buys a monthly, quarterly, or yearly subscription fee to have access to a product or service EX: netflix
warehousing
the design and operation of facilities for storing and moving goods
oligopolistic competition
the market consists of only a few large sellers
basing-point pricing
the seller selects a given city as a "basing point" and charges all customers the freight cost from that city to the customer location, regardless of the city from which the goods are actually shipped
advertising media
the vehicles through which advertising messages are delivered to their intended audiences
functional discount/ a trade discount
to trade-channel members who perform certain functions, such as selling, storing, and record keeping
Total revenue= total cost
total revenue
exclusive dealing
when the seller requires that the sellers not handle competitor's products
product mix width
you can buy Colgate Total in regular, clean mint, advanced whitening, deep clean, total daily repair, 2in1 liquid gel, or any of several other versions.
heterigeneity
you go to a restaurant & have a good server = good dinner come back. next time you have bad server => bad experience -Depending on who offers your service experience is different
client relationships
you have gone to your Doctor for years and you feel comfortable talking to them. this is an example of
direct and digital marketing
Catalogs, online and social media, and mobile marketing are some of the specific promotional tools used in _________________________.
selective distribution
—the use of more than one but fewer than all of the intermediaries who are willing to carry a company's products. Most consumer electronics, furniture, and home appliance brands are distributed in this manner
wholesalers
• Walmart- doesn't need ________________ •You would have to pay more because they have to make a profit •Have capacity to make and distribute their own products •
vertical marketing systems
•A channel structure in which producers, wholesalers, and retailers act as a unified system •One channel member owns the other, has contracts with them, or has so much power that they all cooperate
Environment sustainability
•A management approach that involves developing strategies that both sustain the environment and produce profits for the company •Levels of environmental sustainability -pollution prevention/ new clean technology EX: Arrowhead bottles advertise smaller cap
Conventional distribution channel
•Consists of one or more independent producers, whole sellers, and retailers, each a separate business seeking to maximize its own profits •Producers=>Wholesaler=>retailer=> Consumer= conventional marketing system
direct marketing channel
•EX: Apple •Apple store= directs channel -pros= more control over everything (price, location, etc.), no competition -Cons=expenses, mostly in nice locations
market-penetration pricing
•EX: kindle fire - by amazon •When it came out price was $199 & ipad was over $600 •Amazon didn't make much money by selling kindle fire, but intention was not to make $ by selling kindle fire •Intent was to content/ interest in selling more ebooks
customer-segment pricing
•EX: typically female pay more than male: •Hair cuts- females with long hair pay more than guys with short hair •EX: night club females are free, guys pay
Retailing
•Includes all the activities involved in selling goods or services directly to final consumers for their personal, non-business use. EX:Costco, Home Depot, Macy's, and Trader Joe's
Retailer Strategy
•Segmentation and targeting •Store differentiation and positioning •Retail marketing mix
Sales promotion
•Short term incentives to encourage the purchase of a product or service •EX: coupons, sales •Should not be expected
Price bundling
•Xbox 1 bundle : comes with games and more controller •Travel sites: sell airfaire + hotel+ rental car