New User Special Price Expires in

Let's log you in.

Sign in with Facebook


Don't have a StudySoup account? Create one here!


Create a StudySoup account

Be part of our community, it's free to join!

Sign up with Facebook


Create your account
By creating an account you agree to StudySoup's terms and conditions and privacy policy

Already have a StudySoup account? Login here

Final Exam Study Guide (Exam 3)

Star Star Star Star Star
1 review
by: Alex

Final Exam Study Guide (Exam 3) 301

Marketplace > University at Buffalo > 301 > Final Exam Study Guide Exam 3
GPA 3.0

Preview These Notes for FREE

Get a free preview of these Notes, just enter your email below.

Unlock Preview
Unlock Preview

Preview these materials now for free

Why put in your email? Get access to more of this material and other relevant free materials for your school

View Preview

About this Document

Should use notes from lectures, ublearns, videos, and textbook.
Dr. Dick
Study Guide
50 ?




Star Star Star Star Star
1 review
Star Star Star Star Star
"Can you just teach this course please? lol :)"
Shana Nader

Popular in Marketing

Popular in Department

This 13 page Study Guide was uploaded by Alex on Wednesday May 4, 2016. The Study Guide belongs to 301 at University at Buffalo taught by Dr. Dick in Spring 2016. Since its upload, it has received 160 views.


Reviews for Final Exam Study Guide (Exam 3)

Star Star Star Star Star

Can you just teach this course please? lol :)

-Shana Nader


Report this Material


What is Karma?


Karma is the currency of StudySoup.

You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!

Date Created: 05/04/16
Final Exam Study Guide  Channel Strategy: o Creating Time & Place Utility:  Time Utility – Convenient & quick for customer to get product  How many retailers the company deals with; more = better/faster  Convenience  how many stores there are, their location, & placement in particular stores  Place Utility – where item is located  Convenience – lots of retailers/locations  Prestige – “something special” at a particular location o Channels of Distribution v. Physical Distribution:  Logistical Functions: moving products (methods of delivery)  Asserting – variety of products, what products they carry  Transporting  Transactional Functions: no physical movement of product  Selling – manufacturer’s agent will go to retailer to try & sell a bulk of product (wholesale)  Risk Taking – who takes the risk when consumer returns/does not like product – negotiation  Facilitating Functions: no physical movement, but facilitates movement  Financing – terms/agreements with retailers to kepp them and handle prducts  Market Research – retailers convince manufacturers to use them  *Breaking Bulk – Manufacturer wants to sell product wholesale/by the pallet, by the truckload, but consumer wants to buy individual units of product. Manufacturer will sell in bulk to retailer, who will break it down into individual units o 3 Options for Channel Coverage:  Intensive Distribution – maximize the number of retailers to sell your product; meant for products that don’t need a lot of support  Selective Distribution – a lot of retailers, but not intensive; needs some support  Exclusive Distribution – specialized product; requires a lot of support; well-trained retailer in a particular location o Channel Paths:  Direct: Manufacturer  End User  Indirect: Manufacturer  Retailer  End User (causes channel conflict)  “Typical:” Manufacturer  Wholesaler  Retailer  End User o Types of Channel Members (Intermediaries):  Wholesalers:  Merchant Wholesaler – completely independent of the manufacturer o Distributor – does everything job related o Jobber – carries inventory  Agent – independent distributer who represents multiple manufacturers o Don’t handle inventory  Manufacturer’s Sales: o Branch – similar to the distributor role, but the manufacturer owns it o Sales Office – plays similar role to agent, place to take order  Retailers:  Specialty Store – narrow selection, but deep  Department Store – more selection, less depth, good service  Power Retailer – Will come with notes from the video lecture  Discounter – lots of categories, little depth  Non-Store – catalogs/on-line stores/vending machines o Types of Channels:  Contractual – Franchising (Franchisee, franchisor, licensing agreement)  Administered – “handshake deal”  Vertically Integrated – all channel owners owned by same entity o Channel Captain – when one entity needs another more than that other entity needs it (tradeoff) o Why use the “middle man” (intermediaries)? – transaction efficiency; ensures the deal runs smoothly  Pricing Strategy: o “Administered Pricing” – the price is set in advance, there is no negotiation (not a street market – in-store price is what it is) in the consumer market  Participative Pricing – when there is negotiation, like in a street market (not a consumer market) o Purpose of Price: To capture the value of a product in the consumer’s mind. o Types of Competition:  Price-Based – “lazy way to compete;” there is minimal creativity, not sustainable unless you are the lowest cost or can outlast competitors, and does not build brand equity  Non-Price-Based – selling quality (E.g. – Apple) o Price/Quality Relationship:  Price communicates value; the higher the price, the greater the worth, the higher the quality (what population believes, but is not always the case) o Pricing Objectives:  Sales (dollar value and unit volume)  lower price = higher sales; give up profit  Profits (maximize (through fees, like Verizon) and/or satisfice (looking for a reasonable/satisfying profit))  Market Share (lower prices to gain market share)  Stability (price change over time)  Social Responsibility:  Quantity Surcharge – product @ fair price  Hidden Fees – credit cards as an example  Predatory Pricing – illegal, price product very low to drive competition out of marketplace to make yourself the only one in the market (need deep pockets) o Pricing Approaches:  Cost-Based:  Types: o Breakeven Analysis: Quantity = Fixed Cost ÷ (Price – Unit Variable Cost); can be adjusted to solve for price o Cost-Plus; Two Variants:  Price = TC + (% of TC)  Price = TC + Fixed Fee o Markup (most common): % of selling price  Price = Cost of Goods ÷ ((100 – Markup %)/100)  Profit-Based:  Target Profit Pricing: o (Total FC + Total VC + Total Profit) ÷ Total Number of Units  Target ROI Pricing: o Profit = (Total FC + Total VC + (Investment X ROI)) ÷ Standard Number of Units  Problems with Cost & Profit-Based Approaches include: internal focus, ignores demand and competition, assumes all produced is sold at the same price, and doesn’t track cost/unit changes (economies of scale)  Demand-Based:  Skimming – use with non-price elastic customers, start with a high price because those who really want it will pay more – lower price over time.  Prestige Pricing – sell at low price, raise over time; results in high market penetration, little profit, but move more product  Bundle Pricing – Multiple products sold in bundles (iPhone comes with headphones & charger)  “Demand-Minus” Pricing – (manufacturer to retailer to consumer) o Wholesale Price = Retail Price X ((100- Markup%) ÷ 100)  Chain Markup Pricing (CMP) – same as Demand- Minus, but with more players/longer chain (manufacturer, distributor, and retailer) o CMP = Retail Price X ((100 – Retail Markup %) ÷ 100) X ((100 – Distributor Markup %) ÷ 100)  Competition-Based:  Customary Pricing – customary price charged, followed by other companies setting similar prices  cannot meet and agree on prices  Leader/Follower Pricing – similar to customary pricing  Competitive Bid – seeing what other charge before setting your price  Value-Based:  Understanding use for product  Analyze product benefits  Analyze the product costs  Cost/Benefit tradeoffs o Different customers place different values on different products because of the different benefits o Critical Strategic Pricing Ratio:  Value = Total Perceived Benefit ÷ Price  Some similar products have better benefits than others o Increase value by lowering prices (not sustainable generally) o Increase value by increasing total benefits (harder for competition to replicate)  Value Use Pricing – multiple similar products, but one with better benefits in an attribute  customers should be willing to pay more for the product with the better benefits (saw blade example from lecture)  Parity Pricing – we divide the market equally  (overall rating ÷Aprice ) =A(overall rating ÷ priBe ) B  Psychology & Pricing:  Reference Pricing – people are bad at guessing prices. Internal/External judgment of what a product should cost (Internal – value to customer, compared with other products; External – seller shows what price was/should be like on a “for sale” item)  Compromise Effect – with a low, medium, and high price; high price is not placed for purchase, but rather to get consume to buy the middle-priced product – initial goal.  Decoy Price – similar to compromise effect. It is the price you don’t expect people to pay (the higher price), but for no logical reason influences the buyers decision. o Low price = value-based purchased o Middle price = if removed becomes value v. prestige; bad deal b/c there is essentially no value o High price = prestige-based; combo of low & middle prices; gives feeling of more for your money (good deal)  “Unbundling:” Similar to value in use; it is a breakdown of the product to show its many attributes and show the value of their benefits compared to the competition. – give impression of value reduction/more for money  Advertising & Sales Promotion: o The Advertising Industry: cyclic almost; media, producers (clients), and ad agencies (creative ideas, strategy suggestions (select media ads run in), tries to bring buyers and sellers together (intermediary)) o Advertisement Objectives:  Inform customers  Persuade customer that the brand is best  Sell product ASAP, in as large amounts as possible  Reinforce the customers opinion/change it for the better by stating the idea and strengths of the products  Remind customers what the product is good for, what situations o How it works: (4 Theories):  Hierarchy of Effects: high-involvement products  Cognition (A) – create awareness & knowledge if the product and its use  Affect (B) – “liking preference;” what the product is about and why it’s important to you  Conation (C) – going to purchase the product o Low involvement products: ACB  Low Involvement – needs greater message quantity. Needing greater quality is higher involvement  Pressure Response: the more Ads, the more downward pressure on the customer – more times ads are seen, more likely to buy  Elaboration Likelihood Model – 2 routes of persuasion  High quality persuasive arguments; ad. Conveys information to the customer (what’s important), which influences the brand perceptions/beliefs, which leads to brand attitude (how you feel about the ad.), which leads to behavior (whether purchase or not)  Attitude forms towards ad., which influences attitude towards brand directly o Media Strategy – effectively delivering the advertisement to the customer (quantity v. quality) o Net Reach – “ total number of consumers in target market exposed to an ad. Campaign at least once in a given time period” o Gross Rating Points (GRP) = Reach X Frequency o Rule of Thumb – “aim for avg. frequency of 3-10 exposures” o Cost per Thousand (CPM) – total cost of insertion in particular form of media divided by the number of thousands of exposures achieved through that form of media (vehicle) – examples in packet o Media Mix – total variety of media vehicles used in an advertising campaign (TV, billboards, radio, etc.) o Types of TV Ad. Placements: TV shows create audiences for ads.  Network Television – overly aired networks with affiliated networks; all over country (E.g. – ABC, CBS, CNN)  Spot TV – networks willing to sell to spot tv market; pin- pointing particular regions (major cities)  Cable Ad – cable network; wherever cable is  Spot Cable – particular cable goes to particular regions  Syndicated – independent entrepreneur buys the rights to reshow old shows (if multiple seasons) (e.g. – Seinfeld)  Insert your own ads and ads of your choosing – sell ad space  like making your own channel o Non-TV Advertising:  Radio: problem is measuring audience size  Magazines/Newspapers: problem is there are alternate, free ways to access information  Outdoor: billboards  Online: growth of digital market (social media)  Audi Campaign example  Branded Entertainment: when a company associates its name with a product/form of entertainment (E.g. – videos of events on the RedBull YouTube channel)  Product Placement: place the product into the form of entertainment (E.g. – ChexMix in the soap opera show)  Weird New Stuff: Placing ads. Where you normally wouldn’t; tends to be relatively intrusive (E.g. – ads. As messages on phones, axe ad. At bottom of swimming pool, etc.) o Types of Sales Promotions:  Push Promotion Strategy: Manufacturer (M)  Retailer (R)  Consumer (C)  M “pushes” product on R, who pushes it on C  E.g. – Coupons, Rebates, sampling, etc.  Pull Promotion Strategy: M  R  C (Trade)  M directly aims product on consumer, which pulls them to R, which pulls them to M  E.g. – dealer contests, trade allowances, trade shows  Retailing: o Retail Functions: “How retailers add value…”  Providing assortments; people look to buy multiple products generally when they shop (location & selection are key)  Breaking Bulk – separating units of product from their initial pallets sold from wholesale in order to provide individual units to customers  Holding inventory; so customers only buy individual/a few units  Providing services; complement products (call center, employee service, customer service, cashier, etc.) o Common Types of General Merchandise Retailers:  Discount Stores: low service & price, broad selection with no depth  High breadth of selection, low value-added  E.g. – Walmart, Target, Kmart  Department Stores: moderate prices, more service, relatively broader and deeper selection  High selection, high value-added  E.g. – Macy’s, JCPenney, Sears  Specialty Stores: limited line of products, higher prices & level of service, greater depth, & rely on the image of the store  Low selection, low value-added  E.g. – GAP, Foot Locker  Power Retailers; Category Killers: low price, service varies, narrow selection with great depth  Low selection, high value-added  E.g. – Best Buy, Office Depot, Toys “R” Us o Retail Strategy:  Positioning  refer to “Common Types of General Merchandise Retailers”  Location:  Regional mall  Strip center – roads with many small stores (e.g. – Niagara Falls Blvd.)  Power Center – strip center with power retailer  Central Business District – dying business environment generally (e.g. – downtown Buffalo)  Stand-Alone Store – particular category products; boats, cars, furniture  Lifestyle Center – places/shopping centers to enjoy life, with activities, restaurants and stores o Macro Factors:  Economic Environment – income level, employment rate, size of community  Demographic/Psychographic Profile  Competition  Business Climate – property taxes, zoning regulations, etc. o Micro Factors:  Accessibility – easy to get to, easy to leave, easy to get around  Visibility – from road, signage, etc.  Traffic/Congestion (e.g. – parking)  Rent – attractive location & cost to rent  Cannibalization – removing customers from other owned stores previously existing  Image/Atmospherics:  Store layout  Merchandise display  Fixtures & signage  Lighting & color  Music & scents o Retail Productivity Measures: analyze departments within a store  Net Sales per Square Foot = Total Sales – Returns  Stockturn Rate = COGS ÷ Avg. Inventory  Avg. Inventory = (Beg. Inv. + End. Inv.) ÷ 2 o Non-Store Retailing:  Door-to-Door: Network marketing; try to get others involved in selling product (not directly to customers)  Telemarketing:  Outbound – calls made out to customers  Inbound – provide phone number for customers to call  Catalogs: part of retail mix  TV Home Shopping: “stars”/celebrities sell products  Online: rapid growth  Multi-Channel Retailing – selling through multiple channels such as online & brick-and-mortar o Issues in Retail Management:  Brand Management – maximize performance of brand  Category Management – maximize performance of category (multiple brands – like in retail stores or multiple branded companies)


Buy Material

Are you sure you want to buy this material for

50 Karma

Buy Material

BOOM! Enjoy Your Free Notes!

We've added these Notes to your profile, click here to view them now.


You're already Subscribed!

Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'

Why people love StudySoup

Steve Martinelli UC Los Angeles

"There's no way I would have passed my Organic Chemistry class this semester without the notes and study guides I got from StudySoup."

Janice Dongeun University of Washington

"I used the money I made selling my notes & study guides to pay for spring break in Olympia, Washington...which was Sweet!"

Jim McGreen Ohio University

"Knowing I can count on the Elite Notetaker in my class allows me to focus on what the professor is saying instead of just scribbling notes the whole time and falling behind."


"Their 'Elite Notetakers' are making over $1,200/month in sales by creating high quality content that helps their classmates in a time of need."

Become an Elite Notetaker and start selling your notes online!

Refund Policy


All subscriptions to StudySoup are paid in full at the time of subscribing. To change your credit card information or to cancel your subscription, go to "Edit Settings". All credit card information will be available there. If you should decide to cancel your subscription, it will continue to be valid until the next payment period, as all payments for the current period were made in advance. For special circumstances, please email


StudySoup has more than 1 million course-specific study resources to help students study smarter. If you’re having trouble finding what you’re looking for, our customer support team can help you find what you need! Feel free to contact them here:

Recurring Subscriptions: If you have canceled your recurring subscription on the day of renewal and have not downloaded any documents, you may request a refund by submitting an email to

Satisfaction Guarantee: If you’re not satisfied with your subscription, you can contact us for further help. Contact must be made within 3 business days of your subscription purchase and your refund request will be subject for review.

Please Note: Refunds can never be provided more than 30 days after the initial purchase date regardless of your activity on the site.