Exam 2- Study Guide
Exam 2- Study Guide MKTG 360
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This 27 page Study Guide was uploaded by Cassidy Reid on Thursday March 5, 2015. The Study Guide belongs to MKTG 360 at Washington State University taught by Dr. Jeff Joireman in Winter2015. Since its upload, it has received 169 views. For similar materials see Principles of Marketing in Marketing at Washington State University.
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Exam 2 study guide 10292014 Marketing 360 Study Guide Exam ll BUSINESS TO BUSINESS MARKETING CHAPTER 6 SKY KING What are the key differences in business vs consumers markets 0 Number of customers 0 Multiple buyers 0 Size of purchases 0 Geographic concentration What is derived demand and give an example Derived Demand Derived directly or indirectly from consumer demand for another good or service 0 EXAMPLE raw materials Demand for education Derived demand for textbooks Derived demand for paper Derived demand for pulp Derived demand for Forestry products Differentiate between inelastic and uctuating demand Inelastic demand Changes in price have little of no effect on the amount of demand 0 Ex Electricity or water Demand might be high but people are ALWAYS going to need it aren39t Fluctuating demand 0 Small changes in consumer demand create large increases of decreases in business demand Air travel more consumers decide on air travel then that business has to buy Change in customer reaction decides the business39s air travel Boing 0 Life expectancy of the product can cause uctuating demand Heaterweather if it39s cold outside then people need heaters What is joint demand and give an example 0 Joint demand Demand occurs for two or more goods that are used to create a product 0 Examples Jack and coke gas and car ketchup and mustard cereal and milk chips and salsa What are the three big players in the total business market and give examples of each Producers interact with the raw materials shing agricultural and lumber industries 0 Examples Hotelselling the service Mill raw material D a seller Resellers wholesale distributorsretailers Organizations government including federal state county and local units 0 Also include nonpro t Understand the roles in the buvino center Initiator Recognizes that a purchase needs to be made 0 User individuals who will ultimately use the product consumer Gatekeeper controls information to others in organization ln uencer affects decision by giving advice and sharing expertise o Decider make nal purchasing decisions 0 Buyer purchasing agents who educate Know the 5 steps of the buying process and what goes on in each step business to business 1 Step 1 segmentation Step 1 Recognize the problem 0 Factors prompting recognition vary buy 0 Segmentation Step 2 Information search 0 Buying center members search formation about products and suppliers 0 Develop Step 3 Evaluate the alternatives 0 Evaluate proposals 0 Obtain and evaluate samples 0 Step 4 Select the Product and Supplier 0 Issue the purchase order Single sourcing business practice of buying a particular product from only one supplier Multiple sourcing buying from several different suppliers Reciprocity trading partnership in which two rms agree to buy from one another Outsourcing Obtaining vendors to provide goods services that might otherwise be supplied inhouse Crowdsourcing Pulling together expertise from around the globe to work on solving a problem Reverse marketing Buyers try to nd capable suppliers and quotsellquot their purchase to the suppliers 0 Step 5 Evaluate Postpurchase 0 Survey users 0 Document performance Organizational buyers assess whether the performance of the product and the supplier live up to expectations are they good enough to buy from again Metrics used by organizational buyers Satisfaction Quality Customer engagement Purchase intentions Promptness and effectiveness of problem resolution SEGMENTATION TARGETING POSITIONING CHAPTER 7 De ne Segmentation Breaking up in to smaller groups Identify amp describe market segments De ne Targeting Evaluate segments decide which to go after De ne Positioning Design goodservice to meet segment s needs 0 Creating marketing mix that leads to a competitive advantage 0 The action of getting it out there What is a segmentation variable 0 Dimensions that divide the market into fairly homogenous groups each with its own needs and wants How can we classify segmentation variableslook over Ema Ui Ef H EanaumptionEpaal J Fat Demogra hlm alga mm nder mama IEFI IHIEE lifa adulation mupaiiluni Elma Geographic imam 1 l i gEa iamagraphi a Attitudes and P saf rms Raga 7 quot f 39E aniilm quot mamas MALE of immhuamanl quot39 Baalmutual A m n sa all product a emativas mmilman and lanai of fiellaljamship What is geodemographic segmentation De nition Combination of geographic and demographic information o Creates classi cations of actual addressable map able neighborhoods where consumers live and shop 0 Looking for clusters of similar people 0 Assumes quotpeople of a feather ock togetherquot What is one commonly used geodemographic system PRIZM by Claritas 66 clusters by Zip code What is psychographic segmentation De nition of psychographic segmentation Uses psychological sociological anthropological factors to develop segments everything not factual 0 Examples 0 Motives status 0 Personality sensation seeking o CultureSubculture interdependent o Lifestyles activities interests opinions VALSZ Values Lifestyles System 0 Based on psychological characteristics that relate to consumer behavior 0 Can Identify Prevalence of 8 Types by Zip Code What types of variables fall under this approach COME BACK Ideals achievement self expression Innovatorssurvivors O O O 0 High resources High Innovation Low resources Low innovation Usage Rate Segmentation forming good strong relationships with customers to keep them loyal to brand 0 Segment based on how frequently people use a product 0 Former potential 1St time low med heavy users 0 Companies often target heavy users 0 0 8020 Principle 20 of customers 80 of demand Less costly to advertise to and more loyal Brand loyalty programs are popular 0 0 Need to know what consumers expect from their relationship with you eg personal greeting when entering Starbucks Loyal customers are great but don39t make them mad bc they will respond more negatively to a service failure Love hate I love love LOVE this product but they messed it up so now I hate it Situationspeci c segmentation Segment based on special occasions 39Whenthen39 Scripts 0 When I encounter situation X always buy Y 0 Examples 0 Christmas Valentines Mother39s Day etc Person in situation segmentation needs change based on the situation Divide market up on the basis of the bene ts certain types of individuals person desire in certain situations situation Different strokes for different folksin different situations An Examile Shoes in Two Seiments and Two Contexts Adults Another Example Old Spice What type of segmentation does the Old Spice video represent where the guy is ying through the air and changing quotpersonalitiesquot Person in Situation Segmentation 0 Likes different scents Be familiar with different types of targeting strategies able to target based on what we know about the customers Undifferentiated appeal to masses Differentiated different strokes for different folks Concentrated go after just one segment Individualized even more narrow than concentrated o OnetoOne Marketing tailored to individual build relationship 0 Microtargeting and narrowcasting eg during an election deliver tailored messages based on voters39 speci c concerns 0 Behavioral targeting eg deliver speci c ads based on the websites an individual has visited Counterseomentation 0 Over time 2 segments may merge into 1 with similar needs 0 May require adopting a broader target with the same product Realizing that you can segment to another market after awhile What are the key criteria for successful targeting Sizeable 0 Large enough to justify its own marketing mix Identi able and Measurable o If not can not determine whether it39s sustainable Stable won39t change from one year to the next 0 Easier to predict and anticipate needs 0 Products won39t be out of date too quickly Accessible 0 Must be able to reach segment with marketing mix Responsive o The segment responds differently than another segment o If not no need to develop unique marketing mix In Line with Company39s Goals and Resources 0 A company may not want to go after all segments What is a brand personality Brand Personality A distinctive image that captures a product39s or service s essence character benefits if a brand was a person what characteristics would they have 0 Pizza place Porchlight Pizza Where does my brand stand 0 Ask customers what characteristics are important 0 Measure your brand and competition on those dimensions 0 Plot and evaluate your brand39s location in a perceptual map and what are the major types of brand personality 0 Types of brand personality 0 Sincerity o Excitement o Competence o Sophistication o Ruggedness What is a perceptual map and how is it useful 0 When determining where to position your product Classy Distinctive Conservative Practicall39Affordable PRODUCT STRATEGY CHAPTERS 89 Layers of a product 0 Core Product much more broad What do these shoes provide o All bene ts provided by product Help us run stay in shape Protect feet 0 Actual Product the shoe itself the rubber material shoelace physical 0 Physical good or service Augmented Product 0 Actual prod features supporting product eg warranty repair service after sale Qualitydimensions ReHabH y Durability Precision Safety Ease of use Versatility Types of innovations continuous knockoffs dynamically convergence discontinuous Innovann 0 Something new or different 0 Typically purchased by a few then spreads through population 0 Types 0 Continuous Modify existing product to set it apart a iphone 0 Knockoffs Copies existing product with a few changes Dynamically Continuous 0 Innovation that requires a fair amount of relearning Convergence 0 When 2 technologies come together to create gt than the sum of its parts Discontinuouslnnovation 0 New product changes way we live Consumer adoption stages 01 no U39IlgtUUN Awareness media blitz 0 Knowing that the product exists Interest start to see bene ts search info Evaluation Trial before purchasing Adoption buy product 6 Con rmation good experiences loyalty Categories of adopters innovators Ad pt when little Imma s no risk when 91ng 7 necessary or u ammm N to social pressur roduct quot Early 7 Early Late 39 Adopters Majority Majority Laggartls 39 135 34 34 16 rst 2 are innovators What impacts rate of adoption 1 Relative advantage 2 Compatibility with Other Products 3 Complexity 4 Trialability 0 reduces risk for potential buyer 0 can reveal attributes that you may not recognize are there Samsung SS talk to phone and it39ll give you an answer right away o 5 Observability 0 Everyone can see your new product if it39s on the outside Example blender bottle 0 Packaging part of the product part of the experience Product lines product line limited line strategy full line strategy extension 0 Product line dove Limited Line Strategy 0 Meet need of a smaller target segment 0 Full Line Strategy 0 Attempt to meet needs of broad consumer market 0 Strategies for Product Line Extension 0 Brand equity value associated the additional money you can get someone to purchase your brand for 10 nike shirt or 20 nike shirt EX Cannibalization Wants to target People who like coke but won39t ditch coke all together when vanilla coke is introduced Product life cyclestages Product Life Cycle Fig 95 3 initeuctien Erewth Me turiw Beeline Sellee Stage Stage Stage Rage and Prefite Nit pre39fite P refite Sellee peek Market shrinl because the increaee Sales fall cempany is and peek recevering 39 RampD mete 39 1 7 Sales Prelim Preli its fell 11 a rg ins g n a FIFD39W 7 Pimi i ll39i 2 Time 0 Introduction stage 0 No pro ts because company is recovering from RampD costs 0 Growth Stage 0 Pro ts increase and peak Maturity Stage 0 Sales peakamp pro t margin narrows Decline stage 0 Market shrinks sales fall pro ts fail FIBER ONE noticed a trend in the market quot ber is goodquot so they met that need I Found balance between good taste and amount of ber without it tasting like cardboard Brand equity 0 Name term symbol or any other unique element of product that a identi es one s product and b sets it apart from the competition 0 The value of the brand nancially 0 Ex Nike shirt without the logo vs with the logo How do consumers bondconnect with brands Connecting with Brands Fig 97 3939quotquot r I quotVI i Ir 1quot E ii Reliatmnshlpg 5 l Intense active 1 What about you and me relationships l A Performance I 7f 3 7 I rlvr1 7 I quotI39U dilln quota39 39 Salience you want the customer to think quotthis is my need and this is the brand I m thinking ofquot SERVICES AND SERVICE FAILURES CHAPTER 10 How do services differ from products 1lntangibility 0 Can39t feel taste hear touch or see in same way as typical product 0 Fewer quotsearch qualitiesquot something you can evaluate before purchasing 0 More quotexperience qualitiesquot something you can evaluate after purchasing 0 May also possess quotcredence qualitiesquot something that39s hard to evaluate even after purchase eg medical consultation 0 To market often try to link service with a tangible cue Traveler s Insurance Umbrella Lots of room for interpretation or misinterpretation not clear 2lnseparability 0 Production and consumption of services often inseparable customer must be present when quotconsumingquot service 0 3Perishability 0 Services can39t be stored inventoried an empty hotel room produces no revenue Services hotel room if it39s not booked for a night it parishes the revenue is lost for that night 4Variability 0 Services more variable than products due to variability in inputs and outputs SERVQUAL approach to measuring service quality 1Reliability most important 0 Are you dependable accurate amp or consistent 2Responsiveness 0 Ability to provide fast service 3Assurance o Knowledgeable and courteous employees who earn our trust 4Tangibles 0 Physical facilities tools equipment used to provide service 5Empathy o Caring individualized attention to customer Gap model of service quality 1Gap 1 issue of management 0 Between what customers want and what management thinks they want 0 To close know customers needs satisfaction Thinks that the customers want this when they really want another thing 2Gap 2 0 Between what customers want and quality specs management develops to meet those desires 0 To close understand satisfaction with service 3Gap 3 0 Between quality specs and actual service provided 0 To close train and educate employees 4Gap 4 0 Between what customer told company provides and what companv actuallv provides 0 To close accurate communication about services that doesn39t D unrealistic expectations 5Gap 5 0 Between service customers want and actual service received 0 To close understand satisfaction with service Critical Incident Technique 0 Identify speci c service encounters that led to problems and address them Core vs supplementary service products Core Service 0 Basic bene t customer is seeking FedEx Delivering packages 0 Supplementary Service 0 Services that support or enhance core service Overnight delivery Four categories of service processes people possessions mental stimulus information 1PeopeTangibleCustomer o Directed at customer hairstyling transportation health clubs 2PossessionTangiblePossessions o Directed at customer s possessions car repair dry cleaning lawn care 3Mental Stimulus IntangibleCustomer o Directed at people39s minds entertainment sports education 4lnformationlntangiblePossessions o Directed at customer s assets banking nancial consulting Differentiate between a single deviation and a double deviation 0 Service Failures and Failed Service Recoveries 0 Deviation a gap between what you want and what you get 0 Service Failures Single Deviation When service deviates falls below expectations 0 Failed Service Recovery Double Deviation When following a service failure a company fails at the service recovery stage 2 failures 0 EXAMPLE Double Deviation amp Online Public Complaining Drilled Sneaks Guitars r a P de fen u l l Terri Ciu rsli He witnessed his guitar being threwrn by United empleyrees He cempleined fer nine menths United effered rue cempensetien Deer 1i rnil liens 39 ll li tE ll l il39euITu be ms nmmmmms a sk s nii ui u 7 u a V htte iwwwseututreeemiweten m Ef edz eeee What is the difference between dissatisfaction and betrayal both in terms of its antecedents and consequences l lSSAil llEFA l lM llETlHNI39AL I A negatiin state that I Bailliefs that a llle has intEnltiairmallllyr results From a perception of Engaged in actions that violate unfulfilliadl laxipaictauians what niawnmativa in the tantraat of their irelatitmshiipr I A firm did nft pirwide the service expected by a nuistaimair I A fliirirn intairiltiilmahir lhimlte a prtmrnisa that was lli El die trail a t i custamar I Association Wi hi alli illliilWalli ilDELEIlliili firilJistiratiairl I M i iati ll li with a ngEir I EHFIEELEIUlllill dliEIE in39 llflm tiDlli il I Harm violation O Dissatisfaction annoyance Betrayal hate What three things lead consumers to feel betrayed Pameiivad Betrayal l lissatisfaatiinin Indirect Definitiaa lmb l m lth Farms Exit Sulviria Niathing Earn il i infl L J p 9 Ha 39 aratimi II Strong mediator predictor Betrayed likely to engage in retaliation ti l alatirts i believe Eewi cg Emmi Relationahip w W What is the strength of the mnnection FHIII JFE E Service Mamie F3iurg Did the firrnfernplayeiae have good or bad intentionsquot 3 Service Prm g H EEWEW the customer fairly treated by the emplairiiingl quot magmas Was the complaint policies and stmcture lair ange 3 w Gauge 2 4 Euatimar airmail HE39S g H Retaliation stronger relationship can lead to a bigger consequence if there39s a failure 0 international justice how fair do you think the employees treat you What is the difference between procedural distributive and interactional fairness Procedural how fair are the procedures Distributive fairness fairness of the outcomes lnteractional fairness How fair was I treated as a person What is the quotkey cognitionquot in the process model of responses to service failures 0 More likely to think that there is a negative motive and then more likely to have a more negative reaction How can we intervene to reduce desire for revenge and increase desire for reparation following a failed service recovery 0 Compensation and apology are most effective How does compensation improve the effectiveness of apologies lstudy Showed that after double deviation if you offer combined compensation adding compensation to an apology seems more real and gets the best reaction CRM AND INTEGRATED MARKETING CHAPTERS 7 SECTION ON CRM AND 12 What is CRM what does it allow rms to do how does it manage this and how does CRM view customers 0 A systematic tracking of consumers39 preferences and behaviors over time in order to tailor the value proposition as closely as possible to each individual39s unique wants and needs Allows rms to talk to individual customers and adjust elements of marketing programs in light of how each customer reacts 0 Use computers software databases and the Internet to capture information at each quottouch pointquot between customers and companies to allow better customer care 0 CRM proposes that customers are relationship partners with each partner learning from the other every time they interact Share of customer 0 Share of customer of purchases a customer makes within a given category from a certain company vs of overall market 0 Billy buys 3 pairs of Nikes and 3 pairs of Adidas per year thus Nike has a 50 share of Billy39s athletic shoe purchases 0 Cloe buys 3 pairs of shoes per year all of them from the Brooks brand thus Brooks has 100 share of Cloe39s athletic shoe purchases Lifetime value of customer how much they39re getting out of you 0 How much are they worth to us as a rm over their lifetime Lifetime Value of Customer Potential pro t an individual customer generates over hisher lifetime Customer equities how much a customer is worth 0 Customer value treated like a nancial asset involving an investment and a return 0 Want to attract and retain customers who offer the best quotinvestmentquot To what extent is CRM quotstrategicquot in its interactions with high value and low value customers 1Know your customer in as much detail as possible 0 Characteristics needs nature and frequency of prior purchases responsiveness to previous ads problems with the rm returns etc 2Differentiate customers based on needs and value to the company 0 High value vs low value customers 0 Tailor marketing mix based on valuesneedsetc 3lnteract with customers and nd ways to improve the interactions 0 Take on role of customer and nd out how good your customer service is 0 Reach out to customers and use incoming calls as selling opportunities 0 Improve complaint handling 4Customize products to individual customers 0 Customize marketing efforts to different customers based on needs responsiveness Elements in the promotional mix 0 Advertising 0 Impersonal paid communication in which sponsor is identi ed 0 Public Relations 0 Communicating about company in order to build understanding acceptance and relations with the public 0 Can also be used to inform public about products co goals 0 Personal Selling 0 When a company rep communicates directly with a potential buyer to communicate about a good or service 0 Sales Promotion 0 Marketing activities beyond Advertising PR and Personal Selling that encourage purchase behavior What is integrated marketing communication make sure all same message so people don39t get confused Communication 0 Exchanging shared meanings through symbols 0 Goals of Marketing Communications 0 Inform persuade remind build relationships 0 Integrated Marketing Communication Theory 0 Process used to plan develop execute and evaluate coordinated brand communication programs over time to targeted audience 0 Communication Model 0 Transferring meaning from a source to a receiver 0 Integrated Marketing Communication IMC o Coordinating all aspects of marketing communication to send a single message 0 Characteristics of IMC Uni ed voice Ultimate focus is on customer not company Goal is to develop relationship with customer Communication goes both ways Meet needs of both customer and broader stakeholders Keeps communication open owing continuous Measures results OOOOOOO Be familiar with the communication model how a message ows from the source to the receiver I5 5 a r 39I rLkIFI39i5l r 1139 39 Serum Message Medium ll eesinker i E39er gpainy l a 3 l i Medisin 5 I Magazines t r rim i ensumer windhiel usl lf i w39 gll eFuhiitrelatiens newspapers musing J l i i e Ealespmmetien i i i Teleeiisisnn l39 l I p i Selesperepn pit 39 1 Hattie l l I H uquot Eemrnunieetien 39 Eilllspenjs i a 1 E L fremtensumers l 39Eiiirett mail I i l j i tree I i i l i I all Jan rr J 55593 1 i l n Feedback 5 is 7 leF Lirthaee elite i I wF rnduttawareness 39 quot tingle l o How does the customer decodeunderstand the message Who is Clotaire Rapaille and how is he relevant to the communication model Hint check YouTube 0 1004 video to WATCH 0 In order to understand consumers you have to understand the code of the message What are different communication objectives and how are they related to promotional efforts Mailing to users i Licensed merchandise Product placement Loyaity Paintofpur chase displays l Coupons Contests 1 Samples Status appeals Sex appeals Celebrity tandersemems Knowledge Descriptive copy Brochures lnfomercials Public relations Personal selling Web site Repetitive advertising Slogans and jingle5 Publicity stunts Awameness v COM Ul i39dlllCATl CINl DIELECTW ES EXAMPLES OF PROMOTIONAL EFFORTS Awarenessljencourage loyalty What is product placement and why is it used 0 De nition The insertion of branded products or services into mass media content with the intent of in uencing consumer attitude or behavior Oversaturation of traditional advertising outlets 0 Reach a captive and involved audience 0 quotFly under the radarquot may help avoid counterarguing and enhance persuasion Today it is a 336B dollar industry and growing appearing in various media 0 TV 0 Film 0 Books 0 Video Games 0 Music and Music Videos 0 FINDINGS o Placements have direct effects on three different outcomes 0 Brand recognitionrecall cognition 0 Brand attitudes affective reaction 0 Consumer choice behavioral intentions 0 What are the trends in product placement over the past several decades 0 Took off in the 805 and 905 with recess ET 0 PRICING CHAPTER 11 ISMAIL KARABAS Be familiar with the six different steps in price planning 0 Step 1 o SalesMarket Objectives Goal reach a certain level of sales or market share 0 Pro t Objectives Critical when product is a fad 0 Competitive Effect Goal have an impact on the competition cut into sales preempt introduction of competing product 0 Customer Satisfaction Price transparency lmage Enhancement Prestige products priced higher expensive is good 0 Step 2 0 Demand Customer39s desires for a product 0 Demand Curves Graphs that show impact of price on demand 0 Normal Products As price decreases demand increases 0 Prestige Products Curvalinear n Demand increases as price increases but u If price too high demand begins to decline 0 Step 3 determining costsMath o What is a demand curve and how does a demand curve for luxury products differ from nonluxury products 0 If the product is very cheap then demand may not be that high 0 If the product is too expensive it can turn people off of the procut Non luxury items straight demand 0 Luxury items curved demand What is price elasticity and how is it calculated 0 De nition The percentage change in unit sales that results from a percentage change in price I Price Elastic ea Inelastic Demand Fig 115 The percentage change in Llnit sales that reeulte frern a percentage change in price all Ghana in Guanlity lament PrimElasticity Elmange in Place Demand up by Elaelie Demand Flriee dawn by l 39la Demand up by 1 l Place dawn by 4 What do we mean by elastic and inelastic demand 0 Elastic price change causes great change in demand Inelastic price change causes little change in demand What is crosselasticity of demandgtiPhone 6 CrossElasticity of Demand 0 When changes in price for one product affect demand for another product o If products substitutes an increased for Prodl will lead to an increased demand for Prod2 o If products complementary an increased for Prodl will lead to a decreased demand for Prod2 What is the difference between a xed cost and a variable cost for production 0 Variable Costs Production costs associated with materials parts labor 0 Vary depending on units produced 0 Fixed Costs Costs that don39t change as a function of production 0 Rent executive salaries heating 0 Average xed cost total xed costs units 0 Total Costs 0 Variable Fixed Costs 0 Production costs associated with materials parts labor 0 Vary depending on units produ 1 75 ced Wood 1325 1 Wood 1325 I Wood 000 luau 020 f 0005 020 Neils l Paint 050 Point 050 Paint 0401 tebor 3 hours gtlt lLabor 3 hours gtlt Labor 2112 hours gtlt V 1200 per hr 51200 per hr 1200 per hrl Cost per unit 05000 Cost per unit 05000 Cost per unit 00000 I 1 Multiply by number Multiply by number Multiply by number of units 100 i of units 200 i of units 500 i L Cost for 100 units 5000 Cost for 200 units 10000 Cost for 500 units 20000 One bookcase one unit Be able to conduct a break even analysis with simple numbers no calculator neededL BreakEven Analysis How many units must we produce amp sell at a given price in order to cover our costs No loss no pro ts BreakEven Point BEP 0 When total revenues total costs 0 Above BEP pro t 0 Below BEP loss Eumputing Ereale Euen Pint BEP Totall Fi st CD505 lEP units Bon hutio Per Unit 00 Fixes Eases Eell n Fries F110 lUnit M ariab e 13050 Ftr 110110 Bumpuiting BreakEven Paint HEP 200000 BEF unite 4000 50 Eu yau need t0 praduea 74000 units ta break even Sell Emhahelf far 100 Caste ElfDU ta praduee variable met per unit 5390 Cantributian ta Fitted Gaels Per Unit 0100 a l 0 Revenue Total Revenue l and Cost 5 g Total i 6 Costs 1 O BreakEven i 1 Revenue Variable 39 400000 7 Brea kEven COStS 5 Point 6 P 200000 Fixed Costs Break Even Quantity 0 39 2000 39 4000 39 6000 Quantity Demanded o I Enmpuiting BrealeEven Paint HEP I T lall Fixed Caste lElEF39 in Variable Gt Pain Limit 1 a Price Per Ulll39llll O Enmpuiting BreakwEt en Paint HEP 2 l Bee in 1 50 1 DD V 2quot I 3 you need to BEP mi 5 r Ram alumna 1 E 395 in mvernu ta rael n B alteavan paint Be familiar with different pricing strategies and tactics Step 6 Pricing for Individual Products 0 Two Part Pricing 0 Need to pay two times yearly fee plus per use O 0 Payment Pricing Breaking overall price into smaller payments 0 Pricing for Multiple Products 0 O O 0 Price Bundling Put multiple items together in a bundle Captive Pricing Price basic product low and second complementary and necessary product at high pro t margin What is an internal reference price De nition Set price or range of prices consumers think are reasonable Psychological issued in pricing BRANDING RICHIE LIU CHAPTER 9 What is the difference between an individual and family brand strategy 0 Individual Brands 0 0 Separate and unique brand for each product Some contend this route is more clear and concise due to focused brand strategy for each product Each product under Proctor amp Gamble Family Brands 0 Also known as an umbrella brand strategy 0 Market multiple products under the same brand name iPhones iPad What is cobranding and why is it used ie what are some bene ts of this strategy CoBranding O O O 0 Bene ts partner brands in combining recognition power Ingredient branding phenomena Can attract customers to the host brand from familiarity and strong brand reputation of ingredient brand Ingredient brand can sell more of its product and obtain additional revenue from the licensing agreement in place Risk If Apple ties with a weak brand if the host weak brand fails then it could hurt Apple Difference between line and brand extension 0 Line Extension 0 Minor variants of a single product are marketed under the same brand name 0 Brand Extension 0 Extensions of the brand name to other product categories as a marketing strategy to increase brand equity 0 The new product is referred to as a spinoff Ex Virgin u If Virgin puts their name with anything they39re likely to be successful based on the reputations Ex i What is consumerbased brand equity 0 Effect of brand knowledge on consumer response of the marketing of the brand What is an associative network and how is it related to brands Associative network 0 Nike certain things come to mind 0 Bread easy to respond with the word butter 0 Concepts connected with others Can apply to brands as well Right concepts with right brandsbrand management What is the role of the self in connecting brands and consumers Cognitive self schemas Consumer Provides motive for future behaviors What is BESC Brand Engagement in the Selfconcept o Possessions can become integrated within a person39s selfconcept Belk 1988 0 Birth of the selfbrand connections research 0 Expand on this idea with their development of BESC o BESC is de ned as a consumer39s general propensity to incorporate important brands in the selfconceptSprott et al 2009 Better recall of branded possessions More attention to brands upon incidental exposure Loyalty operationalized as price and wait time
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