MKT study guide exam 2

Desire for product class rather than for a specific

Info icon This preview shows pages 11–15. Sign up to view the full content.

View Full Document Right Arrow Icon
—desire for product class rather than for a specific brand Selective demand —preference for a specific brand Skimming pricing strategy —high initial price to help companies recover costs of development and capitalize on price insensitivity of early buyers Penetration pricing —price low to build unit volume Growth Stage Characterized by rapid increases in sales Competitors begin to appear Profit peaks Product changes appear—new features Maturity Stage Characterized by a slowing of total industry sales or product class revenue Marginal competitors begin to leave the market Consumers are often repeat Profits decline due to pricing competition Marketing efforts directed toward holding market share through product differentiation and finding new buyers
Image of page 11

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Decline Stage Occurs when sales drop, often due to environmental changes Deletion o Dropping the product is the most drastic strategy Harvesting o When a company retains the product but reduces marketing costs Three Aspects of the Product Life Cycle Length of the Product Life Cycle o No set time: consumer products have shorter life cycles than business products Shape of the Product Life Cycle o High learning product—significant customer education is required, extended intro period o Low learning product—sales begin immediately, little learning required, market broadens quickly o Fashion product—style of the times, repeat cycle o Fad product—rapid sales on intro and then rapid decline o The Life Cycle and Consumers o Diffusion of innovation —a product spreads through the population o Some people buy early, but not all o Factors for resisting a product in the intro stage Usage barriers Value barriers
Image of page 12
Risk barriers Psychological barriers o o Innovators—venturesome, higher education o Early adopters—leaders in social settings, above avg education o Early Majority—deliberate, many social contacts o Late Majority—skeptical, below avg social status o Laggards—fear of debt BRANDING AND BRAND MANAGEMENT STRATEGY Brand Personality and Brand Equity Brand equity —the added value a brand name give to a product beyond the functional benefits provided o Provides a competitive advantage o Consumers are often willing to pay a higher price for a product with brand equity Creating Brand Equity Not easily or quickly achieved Step one: develop positive brand awareness and association of the brand in consumers minds with a product class or need Step 2: establish a brands meaning in the mind of consumers o Brand performance and imagery Step 3: elicit the proper consumer responses to a brands identity and meaning Step 4: create a consumer brand connection evident in an intense, active loyalty relationship between consumers and the brand
Image of page 13

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Valuing Brand Equity Provides a financial advantage, brand value can appreciate over time Brand licensing —a contractual agreement whereby one company (licensor) allows its brand name or trademarks to be
Image of page 14
Image of page 15
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern