AEM_240_Prelim_2_essay_answers_ - 4F AEM 240 Fall 200...

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Unformatted text preview: 4F AEM 240 Fall 200? Marketing - Prof. McLaughlin Section II Essays (10 pts. Each) Choose 2 out of 3 D I h Essay: 1} Retailers often criticize manufacturers for introducing so many needless products. a} There are a number of perspectives from which to view the “newness” of a product. Identifv two of them. [2 pts.) “NE-trill? (3mm 'Pcrj ec'E-v’t af- ‘. GEL-3“?““h'f LEI-ASUM-‘F mufi'i— Law: 2: 53.1:th vs esisjimj '3) List four possible manufacturer motivations for Introducing new products. Identify which motivation, according to class discussion, Is the most important and justify. your selection. (5 pts.) Why introduce new products? Locus 3.. 3 Manufacturer Motivations +_ I t A * Maintain interest of intermediaries at [SF F‘rj f I“: J' an, ' Take advantage of new technologies C I t - Counter competitive thrusts 6‘51 GM 5 * Transform commodity to value added J in r ‘i’a. mi] ‘5 r n C E - Ensure against high failure rates-90%? {r L 4% K Respond to changing consumersgé- M“: k”: “Ci 1: a u mac‘iw‘\ Luau—JM‘F . t c) Develop a figure that Iltustrates how new product innovations get no cc '5- . diffused through consumers. Label completer all components. (3 pts.) New Product Diffusion Process mm ...._.__.. Earlyr adopters fr" Kg 13.5% ,3 to t 3'"- k‘sx Laggsrds - nnova ors . 2.5% 5/ Ears majority Late majority \‘Y‘fi‘i‘i ; 4ff' 34% 34a. time—mu» AEM 241) Fall 200? Marketing Prof. McLaughlin Essay: 2} Branding is one of the most valued concepts in marketing and There often comes a huge payoff for a company that successfully develops a strong brand. a} Two of the reasons generally cited to justify manufacturer brands are stronger private label sales and greater retailer consolidation. Please explain these particular trends in private labels and retail consolidation. (5 pts.) Retail Consolidation 11¢.“ 53: iLOH or l'irIarkotShare-onlle1op3relsilers v _ _ . ._ . Private Label Market Share Year 5 Share crash“ (fir‘l’L‘ “It : “M‘sz 1% an 1939 11.11% 10.1.15. “3&3 '5‘ E2: _ 1995 14.9 1." Live, .. . 1999 115.1 " 211112 111.2 TI’J '1" “4L 3' 2111111 115.4 he“; rgfifildfi fiv’tr “we 1 19:11 111143 19152 1975 1111114 ass-1 1199920016 I unri- r-1L Us. use:de c fieLtL Cm Eli—“5’ kc} b} Describe two advantages of choosing a multiproduct approach to branding. (3 pts.) [gr 1 e er I) L—‘Uflfiurfierfil "lrd-ns (PD; X7: C to ell]ch deems (I... 54.” figs {15; 31‘ ' “L ~41. 4mg£F D‘E-“L ECU-kt T 1 alleges {or lesser“ Pm .1 \ HAL C \ rte-m am all 13549“ f / 141: vita-3211.115" fore-MA Pfifihflficfldg Bess—l- I? ‘3 ‘5'ng c] What common branding problem did Howard Schultz address with his “Valentine's Day memo?" {2 pts.) coon-+1! nit-int! fem: , .11".th 1.4), 3) 1.1,! semi: new: (5.) sum-3 Ft”- i Schultz's "Valentine’s Day lv'lemo" + 1' . 1- ' ~ T Inc: to Musch- ‘5” "We have had to make a series of decisions. that in retrospect. have led of (3?“4‘44 S to the watering down of the Starbucks experience, and what some might call the commodfi‘r'zallon of our brand." AEM 240 Fall zoo? Marketing Prof. McLaughlin Essay: 3) Private label branding is increasingly seen as an essential part of an effective overall branding program. a) Private label brands are offered by most retallers and can be said to perform a number of functions that benefit the retailer, and perhaps the consumer. Identify four such functions that were discussed in class. (4 pts) Private Label [corporate brands} finial” Love K.l retail functions .136 E - Sdurcfng Tool: I To Increase prom marglne I To huIld negotiating power over n-brand manutaclurprs I To use as hnrmonlzalbon and synergy tom across ton-mate Retail Marketing Tool .' I To build llowa price image I To bulld overall store [Handlidonllly I To IJIlJIFd cmlsurllor loyalty b) Imagine that you are the Director of Private Label Branding at Easy Ed’s Supermarket Company. After considerable analysis, you determine that you’d like to take on an entire line of new private label breakfast cereals for your stores. But the company owner, Easy Ed himself. is not persuaded it is a wise financial move since he prefers the honey coating of the national brand and thinks their T‘v' ads are funny. He asks you to convince him using a number of different financial measures demonstrating your case that the company will be better off with these new private label products. What measures would you choose and explain why? (6 pts) At least three different financial measUres couldr and should, be cited to convince a skeptical superior that ' a} your PL strategy may be a wise financial decision L 5 your oornpany: _ a '- Gross Margin “a W W F - Gross Margin Percent I. - Return on Investment 2 T3475 :1; mL Although not always, normally these three measures are higher with PL products than their national brand equivalents. ' Showing numerical examples is possible but not necessary. ...
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