Exam 2 Ch 10

Front 1

What are Products and Services?

Back 1

 The essence of marketing is in developing products and services to meet buyers’ needs.

Front 2

product

Back 2

good, service, or idea consisting of a bundle of tangible and intangible attributes that satisfies consumers’ needs and is received in exchange for money or something else of value

Front 3

 Good

Back 3

has tangible attributes that a consumer’s five sense can perceive
 Example- Apple’s iPad

Front 4

o Nondurable good

Back 4

is an item consumed in one or few uses, such as food products and fuel

Front 5

o Durable good

Back 5

one that usually lasts over many uses, such as appliances, cars and mobile phones

Front 6

 Services

Back 6

- intangible activities or benefits that an organization provides to satisfy consumers’ needs in exchange for money or something else of value

Front 7

o Idea

Back 7

is a thought that leads to an action, such as a concept for a new invention or getting people out to vote

Front 8

o Product

Back 8

generally includes not only physical goods but services and ideas as well

Front 9

o Consumer products

Back 9

products purchased by the ultimate consumer

Front 10

o Business products

Back 10

products organizations buy that assist directly or indirectly in providing other products for resale (also called B2B products or industrial products)

Front 11

3 traits of Consumer Products

Back 11

(1) effort the consumer spends on the decision (2) attributes used in making the purchase decision (3) frequency of purchase

Front 12

4 types of consumer products

Back 12

1. Convienence
2. Shopping
3. Specialty
4. Unsought

Front 13

 Convenience products

Back 13

are items that the consumer purchases frequently, conveniently, and with a minimum of shopping effort

Front 14

 Shopping products

Back 14

items for which the consumer compares several alternatives on criteria such as price, quality, or style

Front 15

 Specialty products

Back 15

items that the consumer make a special effort to search out and buy

Front 16

 Unsought products

Back 16

items that the consumer does not know about or knows about but does not initially want

Front 17

Business Product- Derived Demand

Back 17

sales of business products frequently result (or are derived) fro the sale of consumer products

Front 18

• components

Back 18

are items that become part of the final product

Front 19

• support products

Back 19

items used to assist in producing other goods and services

Front 20

4 types of support products and defs

Back 20

 Installations- buildings and fixed equipment
 Accessory equipment-as tools and office equipment
 Supplies-stationery, paper clips, and brooms
 Industrial services-maintenance, repair, and legal services

Front 21

 Product item

Back 21

a specific product that has a unique brand, size, or price

Front 22

o Stock keeping unit (SKU)-

Back 22

which is a unique identification number that defines an item for ordering or inventory purposes

Front 23

 Product line

Back 23

a group of products that are closely related because they are similar in terms of consumer needs and uses, market segments, sales outlets, or prices

Front 24

 Product mix

Back 24

all the product lines offered by a company

Front 25

3 ways to Classify servies

Back 25

1. People or equipment
2. Business firms or nonprofit organizations
3. Government agencies

Front 26

Four I’s of Services

Back 26

Intangibility, inconsistency, inseparability, and inventory

Front 27

• idle production capacity

Back 27

when the service provider is available but there is no demand for the service

Front 28

 Key organizational Problems that can cause new-product disasters

Back 28

 Not really listening to the “voice of the consumer”
 Skipping stages in the “new product process”
• Skipping a stage often leads to disaster. This is why many firms have a “gate” to ensure that one step is completed satisfactorily before going on to the next step
 Pushing a poorly conceived product into the market to generate quick revenue
• Focusing too much on quarterly revenue targets, causing an overlook in the network of services needed to support the physical product
 Encountering “groupthink” in task force and committee meetings
 Not learning critical takeaway lessons from past failures
 Avoiding the NIH (not invited here) problem

Front 29

Stages of The New Product Process

Back 29

1. New-product strategy development
2. idea generation
3. Screening and evaluation
4. Business Analysis
5. Development
6. Market Testing
7. Commercialization

Front 30

• Stage 1: New Product Strategy Development

Back 30

defines the role for a new product in terms of the firm’s overall objectives
o Firms use SWOT analysis and environmental scanning to assess its strengths and weaknesses relative to the trends it identifies as opportunities of threats.
 Outcomes define the vital “protocol” for each new product idea as well as the strategic role in might serve in the firms business portfolio.

Front 31

• Stage 2: Idea Generation

Back 31

o Involves developing a pool of concepts to serve as candidates for new products, building upon the previous stage’s results.

Front 32

o open innovation

Back 32

is when an organization finds and executes creative new-product ideas by developing strategic relationships with outside individuals and organizations.
 Customer and supplier suggestions
 Employee and co-worker suggestions
 Research and development laboratories
 Competitive products
 Smaller firms, universities and inventors

Front 33

• Stage 3: Screening and Evaluation

Back 33

o Internally and externally evaluates new-product ideas to eliminate those that warrant to further effort.

Front 34

• Stage 4: Business Analysis

Back 34

o Specifies the features of the product that the marketing strategy needed to bring it to market and make financial projections
o A prototype is a full scale-operating model of the product.
o Assesses the total “business fit of the proposed new product with the company’s mission and objectives
 Whether the product can be economically developed and manufactured to the marketing strategy needed to have it succeed in the marketplace
o Requires detailed financial projections and assessments of the marketing and product synergies related to the company’s existing operations.

Front 35

• Stage 5: Development

Back 35

o Turns the idea on paper into a prototype
 Results in a demonstrable, producible product that involves not only manufacturing the product but also performing laboratory and consumer tests to ensure it meets the standards established for it in protocol
o Safety tests

Front 36

• Stage 6: Market Testing

Back 36

o Involves exposing actual products to prospective consumers under realistic purchase conditions to see if they will buy

Front 37

o Test Marketing

Back 37

 Involves offering a product for sale on a limited bases in a defined area
 Used to check elements of the marketing mix
 Sometimes skipped due to time consumption and cost

Front 38

o Simulated test markets

Back 38

 A technique that simulates a full-scale test market but in a limited fashion

Front 39

• Stage 7: Commercialization

Back 39

o The stage of the new product process that positions and launches a new product in full-scale production and sales.
o Most expensive stage for new producers

Front 40

Regional rollouts

Back 40

when a company introduces a product sequentially into geographic areas of the United States to allow production levels and marketing activities to build up gradually to minimize the risk of new-product failure.