by informing potential buyers of the availability and merits of a product Brand

By informing potential buyers of the availability and

This preview shows page 2 - 5 out of 16 pages.

by informing potential buyers of the availability and merits of a product Brand-name products may cost more, but branding gives buyers assurances of consistent quality
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Advertising and promotion are sometimes necessary, especially for marketers of products such as consumer electronics, cars, and personal care products (many brands and competitors) Without advertising, sales would decrease, and production would decrease When fewer products are manufactured, the price to manufacture each product goes up- and prices would go up Excessive Markups Critics assume that some companies mark up goods excessively o Ex: The drug industry A pill that costs 5 cents to make may cost the consumer $2 to buy o Marketers back this by saying that pharmaceutical markups must cover the costs of purchasing, promoting, and distributing existing medicines, plus the high research and development costs of formulating and testing new medicines Deceptive Practices Marketers are sometimes accused of deceptive practices that lead consumers to believe they will get more value than they actually do Deceptive practices fall into 3 groups: o 1. Pricing o 2. Promotion o 3. Packaging Deceptive pricing: includes practices such as falsely advertising “factory” or “wholesale” prices or a large price reduction from a phony high retail list price Deceptive promotion: includes practices such as misrepresenting the product’s features or performance or luring customers to the store for a bargain that is out of stock Deceptive packaging: includes exaggerating package contents through subtle design, using misleading labelling, or describing size in misleading terms
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New federal, provincial, and municipal guidelines and regulations are put in place to prevent these things from happening o Ex: in 2008, incidents of companies claiming to be “greenwashing” (companies that claim to be environmentally friendly in some way but aren’t really The toughest problem is defining what is “deceptive” o The law in Canada and the United states recognizes that some statements made in advertising are not intended to be taken literally, and are therefore not illegal High-Pressure Selling Salespeople are sometimes accused of high-pressure selling that persuades people to buy goods they had no thought of buying o Ex: Insurance, real estate, and used cars and sold, not bought Shoddy, Harmful, or Unsafe Products Another criticism concerns poor product quality or function A frequent complaint is that products are not made well, and services are not performed well Another complaint is that many products deliver little benefit, or that they might even be harmful Product problems are not usually caused by a company’s indifference or other improper behaviour- most manufacturers want to produce good quality products Companies selling poor-quality or unsafe products sick damaging their reputation, engendering product liability suits, and having to pay large awards for damages With the ubiquity of social media, once a problem is discovered it is quickly made public; if a company doesn’t take steps to respond, its reputation is at stake Planned Obsolescence
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  • Spring '15
  • Marketing,  Companies,  Marketers

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