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myreviewsheet 2.0 - Chapter #2 Exam Review 4 P's: Product,...

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Chapter #2 Exam Review 4 P’s : Product, Place, Promotion, Price Eras : Production- increase supply Sales- beat competition Marketing Dept.- coordinate and control Marketing Company- long run customer satisfaction Target Marketing : Production oriented- everyone is similar, mass marketing Marketing oriented- everyone is different, target marketing Marketing Strategies : Mass marketing- single marketing mix for entire market Segment marketing- single marketing mix for one segment of the market, if separate marketing mix for two or more segments of the market (multi-segmenting) Individual marketing- marketing mix customized for an individual or Organization Segments : Geographic- where you live Demographic- Objective: race, gender, age Psychographic- enjoyments, lifestyles Behavioral, Product Usage- particular brand use Steps : 1. Identify Bases Segmentation 2. Develop Profiles 3. Develop Measures of Attractiveness Targeting 4. Select Target Segment 5. Develop Positioning 6. Develop Marketing Mix Positioning Product Life Cycle: Introduction- yet to make a profit, skimming or penetration price, limited stores, gain awareness Growth- stress differentiation, more stores, more versions of the product Maturity- maintain brand loyalty, defend price, many stores Decline- only best sellers are sold, trying to maintain profitability, sold only in limited outlets Consumer Life Cycle : 1. Innovators 2. Early Adopters 3. Early Majority 4. Late Majority 5. Laggards Extension : Line- use of current brand to enter a new market segment in its product class (BU opens a high school) Brand - use of current brand to enter a completely different product class (BU opens a club) Branding Strategies: Multi Product Branding- one brand, many products (Sunbeam) Multi Branding- one name owning one type of product with many different brands (Anheuser- Busch makes Bud, Busch, Michelob,etc.)
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Private Branding- one name with its own brands (Nordstrom sells their own brand called B.P.) Mixed Branding- making products for your company and others (Michelin tires makes tires for themselves and Sears) Generic Branding- no name brand (green beans, peanut butter) Pricing Strategies: Penetration- price below competition, used to gain market share and attract customers Skimming- pricing above the market, used for high quality products, convenience of prestige Lining- price a small amount below the average of the market Communication Approaches: Push- train sellers to “push” the product onto the consumer Pull- train the consumer to ask for your product Degree of Operating Leverage (DOL)- change in % of EBIT Change in % of Sales Degree of Financial Leverage (DFL)- change in % of Net Income Change in % of EBIT Degree of Total Leverage (DTL)- change in % of Net Income Change in % Sales Remember that to find the change- New-Old Old Breakeven - For Revenue: = FC/ (Gross Profit/ Revenue) As the discount rate increases, Net Present Value (NPV) decreases and vice versa IRR= the discount rate at which the NPV is equal to 0. Risk Transference:
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myreviewsheet 2.0 - Chapter #2 Exam Review 4 P's: Product,...

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