Marketing Final Study Guide

Marketing Final Study Guide - 1 Marketing Final Study Guide...

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Marketing Final Study Guide Ch 9 1
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A “good” brand name: Creates a positive, memorable connotation Positions a product by conveying an image or personality (Ford Mustang) or by describing how it works (Weedeater) Is easy to say, spell, read, and remember Fits the target market, product benefits, customer’s culture, and legal requirements Brand equity: A brand’s value to its organization over and above the value of the generic version of the product CH 10 Services: Are acts, efforts, or performances exchanged from producer to user without ownership rights Services share several characteristics: Intangibility Perishability Variability Inseparability Search qualities: Product characteristics that the consumer can examine before purchase Experience qualities: Product characteristics that buyers can determine during or after consumption Credence qualities: Product characteristics that are difficult to evaluate even after experiencing them 2
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Ch 11 Marginal Analysis : uses cost and demand to find the price that will maximize profits Marginal cost: Increase in total costs from producing one additional unit of a product Marginal revenue: Increase in total income or revenue from selling one additional unit (decreases with each additional unit sold) Profit is maximized where marginal cost is exactly equal to marginal revenue Pricing strategies based on demand Based on estimates of the quantity a firm can sell at different prices Target costing: Identify quality and functionality customers need and price they’re willing to pay before designing product Yield management pricing: Manages capacity by charging different prices to different customers New-product pricing Skimming price: A very high premium price is charged Penetration pricing: A very low price to encourage more customers to purchase Trial pricing: Low price for a limited period of time 3
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Pricing for individual products Two-part pricing Payment pricing Pricing for multiple products Price bundling Captive pricing Discounting for channel members List price (suggested retail price) Trade or functional discounts Price given to channel members Quantity discounts Cash discounts Encourages prompt payment Seasonal discounts Available only at certain times of the year Dynamic pricing strategies are common in e-commerce: Cost of changing prices on the Internet is practically zero
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