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74 Cards in this Set

  • Front
  • Back
Channel Design Decisions
Analyzing consumer needs
setting channel objective
identifying major alternative
evaluating the major alternative
3 types of VMS
Corporate
Contractual
Administered
Administered Marketing System
Vertical marketing system that coordinates successive stages of prodution and distribution not through common ownership or contractual ties but through the size and power of the parties
e.g. Walmart
Contactual VMS
independent firms at different levels of production and distribution through contracts to obtain more economies or sales impact than each could achieve alone
e.g. franchise organization
Types of franchise organization
manufactured-sponsored retail franchise
E.g. Ford & network of independent dealers
manufactured-sponsored wholesaler franchise
e.g. coca-cola licensed bottlers
service firm-sponsored retailer franchise
e.g. McDonalds
Corporate VMS
a vertical marketing system that combines successive stages of produ tion and distribution under single ownership
Types of flows
physical flow
flow of ownership
payment flow
information flow
promotion flow
inderect marketing channel
where there is intermediaries

also note that the more # of levels means less control and greater complexity
Key functions of Marketng Channel Members
Inform
Promote
Contact
Match
Negotiate
Distribute
Finace
Take risk
Marketing channel
a set of interdpendent organizations that help a product or service reach its destination
Value delivery network
company, suppliers, distributors, and ultimately customers who partner with each other to improve the performance of the entire system
Downstream partners
those who help get the product to the customer
intermediaries
distributors
upstream partners
supply the raw materials, components, parts, information, finances and expertise to create product
predatory pricing
sellling below cost with the intention of punishing a competitor or gaining long-run profits by putting competitors out of business

all intent though- hard to prove
Sherman, Clayton, and Robinson-Patman Act
makes illegal
price maintenance
price descrimination
price -fixing
predatory pricing
price maintanence
a manufactrer cannot require a retailer to sell a specific price
price descrimination
towards retailers
no matter if sears or independent retailer`
Dynamic Pricing
changing price continually to meet needs and wants of customers and situations
Geographical charging

Types
setting prices for customers located in different parts of the world

Free On Board- origin pricing
Uniform
Zone
Basing-Point
Freight-absorption
Promotional pricing
temporarily setting price lower
Reference Pricing
prices that buyer carry in their heads and refer to when they look at a given product
psychological pricing
how much are people willling to pay for this...
also reference pricing
the higher the price the more you link with quality if you don't know much about product
Segmented Pricing
selling a product or service at tow or more prices, where the differences in prices is not based on differences in costs
types of segmented pricing
customer-segmented
product form
location pricing
allowance
a way to reward retailers for promotion a product

there is trade-in and promotional
Product Bundle Pricing
bundling at lower price
by product pricing
setting a price for a by-product in order to make the main product's price more competitive

manfacturer will accept any price that cover more than the cost of storing and delivering them
captive product pricing
pricing for products that must be used along with a main product, such as blades for a razor and film for a camera

for service is fixed fee and variable usage
optional-product princin
the pricing of optinal or accessory product along with a main product

things you can buy with ipad
product line pricing
setting the price steps b/w various prodcts in a product line based on cost differences b/w the products, customer evaluation of different features, and the competitors' prices
product mix pricing strategies
product-line pricing
optional-product
captive-product
by-product
product bundle
Conditions for product penetration
market must be highly price sensative
production and distribution cost must decrease as sales increase
and low price must help keep out the competition, and pentration pricer must maintain it low-price position
market penetration pricing
setting low initial price in order to penetrate the market quickly and deeply

in order to attact large number of buyers quickl and win a large market share
market -skimming pricing
setting the highest price
then lowerng level by level to maximize profits
sale fewer but more profitable sales
new product pricing strategies
skimming
or
penetration
price elasticity
a measure of the sensitivity of demand to changes in price
inelastic
if demand hardly changes with small change in price

as P increases R increases
Elastic
demand changes greatly with small change in price

as P increases R decreases
price elasticity of demand formula
% change in Q demanded/ % change in price
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 changed.

normal case; demand and price are inversely related

higher price= lower demand
oligopolistic competition
few seller who are highly sensative to each other's pricing and marketing strategies

market is hard to enter
monopolistic competition
many seller but with different pricing

because of product differentiation
pure competition
many buyers and sellers trading at uniform commodity
no control on price
Different types of markets
pure competition
monopolistic competition
monopoly
oligopolistic competition
target costing
know what price you want to sell at and building a product and basing the cost on how much you want to sell it for
Break even point
a target profit pricing strategy
setting prices to breakeven on the cost of making and marketing a product or the desire profit
Breakeven formula
Fixed Cost/ Price- Variable cost
cost-based pricing
the simplest pricing method

adding a standard markup price
markup price formula
unit cost/ 1-desired return on sales
experience curve
theory that says that cost of production will decrease as you make a product for a longer period of time
average per-unit production cost drops
aka. learning curve
diseconomies of scale
too many workers or paperwork slowing down production
pricing power
power to escape price competition and to justify higher prices and margins without market share

if suppliers only sell on commodity there is no customer loyalty
value-added pricing
attaching value-added features and services to differentiate a company's offers and to support changing higher prices.

used to increase pricing power
good-value pricing
offering just the right conbination of quality and good service at a fair price
e.g. taco bell and mcdnald's value menues
Everyday low pricing and high low pricing
value-based pricing
setting prices based on buyer's perceptions fo value rather than on the seller's cost
Vertical marketing system types
contractual
corporate
administered
Types of intermidiaries
intensive
exclusive
selective
how to evaluate major alternatives
economic criteria
control issues
adoptive criteria
Channel Management Decisions
Select channel members
Manage and Motivate channel members
Evaluate
marketing logistics
getting the product from scratch to customer

inbound
outbound
reverse distribution
Major logistic Functions
Warehousing
inventory management
Transportation
Logistic Management
intemodal transportation
ground and air
multichannel distribution system
call, click, or visit

a distribution system in which a single firm sets up two or more marketing channels to reach one or more customer segments
integrated logistics management
theory of scm emphazing teamwork
types of retailers
based on
amount of service
price
organization
breath and depth of product line
types of retailers
specialty stores
conviniece stores
department strore
supermarkets
category killer
superstore
discount store
off-price retailers
factory outlets, independent and warhouse clubs
voluntary chainse
wholesaler-sponsored groups of independent retailers engage in bulk buying and common merchandising
promotion mix
personal selling
PR
advertising
direct marketing
sales promotion
integrated marketing communications
make sure all channels say the same thing
Retail marketing decision
3 major variables

product assortment
service mix
store's atmosphere
steps in developing effective communication
select target audience
determine comm objectives
Setting the toatl promotion budget methodes
affordable
percentage of sales
competitive-parity
objective and task method
promotion mix strategies
push and pull