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Final Exam Review Ch. 10-18 This is a summary of all the powerpoints put into 1 document file. Pulled relevant information out of powerpoints. Used this to study for final.

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York University
Administrative Studies
ADMS 2200
Elena Skliarenko

Chapter 10 Marketers develop strategies to sell both tangible goods and intangible services People buy want satisfaction, not objects Product: Bundle of physical, service, and symbolic attributes designed to enhance buyers want satisfaction Goods: Tangible products that customers can see, hear, smell, taste, or touch Services: Intangible tasks that satisfy the needs of consumer and business users Goods-Services continuum: device that helps marketers to visualize the differences and similarities between goods and services Pure Good: Car, Middle: Dinner in a Restaurant, Pure Service: Hair Salon Characteristics that distinguish services from goods: Intangibility Inseparability Perishability Variability Frequent requirement of interaction between buyer and seller Products often blur the distinction between goods and services Example: Rental car company is a service that provides a good Homeshoring: hiring workers to do jobs from their homes Consumer products: Products destined for use by ultimate consumers Business (or B2B) products: Products that contribute directly or indirectly to the output of other products for resale; also called industrial or organizational products Some products fall into both categories Example: Prescription drugs, which are marketed to doctors and to end users Classification of Consumer Products: Convenience product Good or service that consumers want to purchase frequently, immediately, and with minimal effort Impulse goods and servicesare purchased on the spur of the moment (Magazines, Snack Foods) Staplesare convenience goods and services that consumers constantly replenish to maintain a ready inventory (Gasoline, Milk, Dry Cleaning) Emergency goods and servicesare bought in response to unexpected and urgent needs (Emergency vet visit, Plumbing repair kit, Asthma inhalers). Shopping product: Good or service purchased only after the customer compares competing offerings from competing vendors on such characteristics as price, quality, style, and color. (Flights homogenous/Furniture Heterogeneous) Typically cost more than convenience purchases Include tangible items Shopper lacks complete information and gathers information during the buying process Specialty product: Good or service with unique characteristics that cause the buyer to value it and make a special effort to obtain it (Lexus and Infiniti, Luxury Cars, Tax Attorney, Versace designer clothes) Unsought product: Good or service marketed to consumers who may not yet recognized in the need for it (Funeral plans, long-term health care insurance). Classification of Business Products: Installation: Major capital investment by a business buyer that typically involves expensive and relatively long-lived products, such as a new factory or piece of heavy machinery (Bombardier airplanes, Suburban office plaza, Oil drilling rig) Accessory equipment: Capital product, usually less expensive and shorter-lived than installation (Canon copiers, Steelcase office equipment, cell phones, computers) Component parts and materials: Finished business products that become parts of buying firms final products, such as spark plugs for new cars (Hewlett-Packard computer chips, truck bed, Honda motors for lawn equipment, General Electric jet engines). Raw materials: Business product, such as a farm product (wheat, cotton, soybeans) or natural product (coal, lumber, iron ore) that become part of a final product Supplies: Products that represent regular expenses necessary to carry out a firms daily operations but are not part of the final product. Supplies are sometimes called MRO items MRO items: Business supplies categorized as maintenance items, repair items, or operating supplies such as light bulbs, nuts and bolts used in repairing equipment, or pencils (Staples, Scotch tape, Xerox copy paper, post-its). Business services: Intangible product purchased to facilitate a firms production and operating processes such as financial services, leasing of vehicles, legal advice and consulting, security services. Quality as a Product Strategy: Total quality management (TQM): Approach that involves all employees in continually improving products and work processes to achieve customer satisfaction and world-class performance ISO 9002: Set of standards for quality management and quality assurance developed by the International Standards Organization in Switzerland for countries in the European Union Benchmarking: Purpose is to achieve superior performance that results in a competitive advantage. Quality as a Service Strategy: Service encounterpoint at which customer and service provider interact, which usually determines the customers perception of the quality of service. Service qualityexpected and perceived quality of a service offering Determined by five variables: Tangibles Reliability Responsiveness Assurances Empathy Product line Series of related products offered by one company Motivation: Desire to Grow Growth potential limited if company focuses on a single product Example: Roots began selling a single style of shoes but has grown by selling a variety of products Enhance companys position in the marketplace Entire lines of products make a company more important to consumers and marketing intermediaries Make optimal use of company resources Spreading operations costs over a series of product lines reduces the average production and marketing costs of each product Product mix Assortment of product lines and individual offerings Product widththe number of product lines offered Product lengththe number of different products a firm sells Product depthvariations in each product that a firm markets in its mix Line extension Adding individual offerings that appeal to different market segments while remaining closely related to the existing product line Product life cycle: Progression of a product through introduction, growth, maturity, and decline stages Extending the Product Life Cycle: Increasing Frequency of Use Convincing current customers to buy a product more frequently boosts total sales even if no new buyers enter the market Example: Custom printed M&Ms that allow consumers to order their own initial or sayings Increasing the Number of Users Attracting new customers who have not previously used the product Example: Walt Disney markets its theme parks to adults Finding New Uses New applications extend a products life cycle WD-40 identified the top 2000 uses of its oil Changing Package Sizes, Labels, or Product Quality Example: Krafts 100-calorie Snack Packs, which package snacks in 100 calorie amounts Product Deletion Decisions Firms may carry poor performing items to carry a complete product line Example: Grocery stores carry bulky, low-unit value items like salt to meet shopper demand Shortages of raw materials can prompt a firm to discontinue production Firm may drop products that dont fit into the direction in which it plans to grow
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