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11 Cards in this Set

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RQ14-5 pg 402-403
What are the four stages of the product life cycle? How can a firm determine which stage a particular product is in?
Growth = increasing sales
Maturity = more competition
Decline = falling profits
RQ14-6 pg 405
What is the difference between a product line and a product mix? Give an example.
Product line = a group of similar products that differ only in relatively minor characteristics. General Mills cereal
Product mix = all the products a firm offers for sale. (cereal, coolies, cake mixes, yogurt)
RQ14-7 pg 405 bottom Volvo cars
Under what conditions does product modification work best?
Product modification = the process of changing one or more of a product’s characteristics.

Product must be modifiable
Existing customers must be able to know a modification was made.
Modification must be more consistent with customer desires.
Why do products have to be deleted from a product mix?
Product deletion = the elimination of one or more products from a product line.

Maintain an effective product mix
Reflect changes in consumer preference
RQ14-10 pg 407-408
Briefly describe the seven new product development stages.
Idea generation
Concept testing
Business analysis
Product development
Test Marketing
RQ14-11 pg 410
What is the difference between manufacturer brands and store brands? Between family branding and individual branding?
Manufacturing brand = brand owned by manufacturer. Calvin Klien, Jordache
Store brand = a brand that is owned by an individual wholesaler or retailer. Kenmore is Sears.
Individual branding = the strategy in which a firm uses a different brand for each of its products. Kleenex, Band-Aids, soaps, cigarettes
Family branding = the strategy in which a firm uses the same brand for all or most of its products. Xerox, Cannon
RQ14-13 pg 414
For what purposes is labeling used?
Labeling = the presentation of information on a product or its package.

Brand name
Brand mark
Registered trade mark
Package size
Product claims
Directions for use
Safety precautions
RQ14-17 pg 418-419
List and briefly describe the five major pricing objectives.
Price = the amount of money a seller is willing to accept in exchange for a product at a given time and under given circumstances.

Pricing Objectives
Survival = staying competitive and in the market
Profit maximization = making the most profit possible without pricing the firm out of the market
Target return on investment = attempting to earn a respectable after-tax profit on investment
Market-share goals = attempting either to maintain of to increase market share
Status-quo pricing = not making waves by inducing price wars, but playing “follow the price leader”
Jet Blue

How would you use the airplane and other physical aspects of the business to build the Jet Blue brand?
By using new airplanes you create an atmosphere were people are willing to pay for the service. New airplanes are more comfortable and quiet. They have that new feeling which is enjoyed when you step into anything new. They also have an energized new staff. The staff is dedicated to making your flight an enjoyable one
In an industry where pricing has driven many firms out of business or into bankruptcy protection, why does Jet Blue compete so successfully on the basis of price?
Jet Blue has the advantage of being able to set lower price point. They have new staff so they have not accumulated large salaries. They have new planes so they have lower maintenance cost. They have new planes so they have lower fuel cost. These advantages help Jet Blue compete on price.
How does Jet Blue use pricing to deal with demand fluctuations?
Jet Blue has a pricing structure that equalizes pricing. If you travel on Sunday night when everyone else travels you pay a higher price. If you travel on Tuesday night when the plane is empty you pay less. This does two things. It equalizes the price and distributes the passenger load. This enables Jet Blue to fly fuller planes more often.