Chapter 14 - Developing and Pricing Goods and Services

Product line

*A company usually doesn't sell just one product -> too risky -A group of products that are physically similar or are intended for a similar market -In one product line, there may be several competing brands

Total Product Offer

*A product is more than just the physical good or service -Consists of everything consumers evaluate when deciding whether to buy something; also called a value package

Brand association

The linking of a brand to other favorable images ex. Mercedes Benz associated with successful people who live luxurious lives

Specialty goods and services

consumer products with unique characteristics and brand identity -Because these products are perceived as having no reasonable substitute, the consumer puts forth a special effort to purchase them Ex. fine watches, expensive wine, fur coats, jewelry, services provided by specialists

Unsought goods and services

products that consumers are unaware of, haven't necessarily thought of buying, or find that they need to solve an unexpected problem Ex. emergency car-towing services, burial services, and insurance

Break-even analysis

the process used to determine profitability at various levels of sales -It's the point where revenues from sales equal all costs BEP = total fixed costs/ (Price of one unit - costs of one unit) units are in volume

p.397 figuring out your own cost, slapping money on top off t

you could possibly sell for a lot more it is convenient to you but if your competitors are offering something similar for less

Brand loyalty

-The core of brand equity -The degree to which customers are satisfied, like the brand, and are committed to further purchases

Shopping goods and services

-Those products that the consumer buys only after comparing value, quality, price, and style from a variety of sellers -Sold largely through shopping centers Ex. Target

Brand equity

-a major goal of marketers The value of the brand name and associated symbol

Marketing Different Classes of Consumer Goods and Services (Four general categories: Convenience, shopping, specialty, and unsought)

1) Convenience goods and services 2) Shopping goods and services 3) Speciality goods and services 4) Unsought goods and services

Brand

A name, symbol, or design (or combination thereof) that identifies the goods or services of one seller or group of sellers and distinguishes them from the goods and services of competitors

Brand awareness

How quickly or easily a given brand name comes to mind when a product category is mentioned

Skimming Price Strategy

Strategy in which a new product is priced high to make optimum profit while theres little competition -Idea is to recover research and development costs and make as much of a profit as possible -large profits will attract new competitors

Penetration strategy

Strategy in which a product is priced low to attract many customers and discourage competition

Product Mix

The combination of product lines offered by a manufacturer

Product differentiation

The creation of real or perceived product differences -The process of distinguishing a product or service from others to make it more attractive to a particular target market *Actual product differences are quite small -> marketers must create a unique, attractive image for product

Value Based Pricing

arguing its worth a huge amount of money

Convenience Goods and Services

products that the consumer wants to purchase frequently and with a minimum effort Ex. candy, gum, milk, snacks, gas, banking services