Principles of Marketing Chapter 10 Product Concepts

product
everything, both favorable and unfavorable, that a person receives in an exchange
convenience product
a relatively inexpensive item that merits little shopping efforts
shopping product
a product that requires comparison shopping because it is usually more expensive than a convenience product and its found in fewer stones
specialty product
a particular item for which consumers search extensively and are very reluctant to accept substitutions
unsought product
a product unknown to the potential buyer or a known product that the buyer does not actively seek
product item
a specific version of a product that can be designated as a distinct offering among an organization’s products
product line
a group of closely related products items
product mix
all products that an organization sells
product mix width
the number of product lines an organization offers
product line depth
the number of product items in a product line
product modification
changing one or more of a product’s characteristics
planned obsolescence
the practice of modifying products so those that have already been sold become obsolete before they actually need replacement
product line extension
adding additional products to an existing product line in order to compete more broadly in the industry
brand
a name, term, symbol, design, or combination thereof that identifies a seller’s products and differentiates them from competitors’ products
brand name
that part of a brand that can be spoken, including letters, words, and numbers
brand mark
the elements of a brand that cannot be spoken
brand equity
the values of a company of brand name
global brand
a brand that obtains at least one third of its earnings from outside its home country, is recognizable outside it’s home base of customers, and has publicly available marketing and financial data
brand loyalty
consistent preference for one brand over all others
manufacurer’s brand
the brand name of a manufacturer
private brand
a brand name owned by a wholesaler or a retailer
captive brand
a brand name manufactured by a third party for an exclusive, without evidence of that retailer’s affiliation
individual branding
using different brand names for different products
family branding
marketing several different product under the same brand name
co-branding
placing two or more brand names on a product or its package
Types of co-branding
Ingredient branding identifies the brand of a part that makes up the product.

Cooperative branding occurs when two brands receive equal treatment.

Complementary branding refers to products advertised or marketed together to suggest usage.

(Co-branding is a useful strategy when a combination of brand names enhances the prestige or perceived value of a product or when it benefits brand owners and users.)

trademark
the exclusive right to use a brand or part of a brand
service mark
a trademark for a service
generic product name
identifies a product by class or type and cannot be trademarked
persuasive labeling
a type of packaging labeling that focuses on a promotional theme or logo, and consumer information is secondary
informational labling
a type of package labeling designed to help consumers make proper product selections and lower their cognitive dissonance after the purchase
universal product codes (UPCs)
a series of thick and thin vertical lines (bar codes) readable by computerized optical scanners that represent numbers use to track products
warranty
a confirmation of the quality or performance of a good or service
express warranty
a written garentee
implied warranty
an unwritten guarantee that the good or service is fit for the purpose for which it was sold
Consumer products are classified into four types:
convenience products
shopping products
specialty products
unsought products

(This approach classifies products by how much effort is used to shop for them.)

Examples of types of consumer products:
Convenience: Candy, soft drinks, deodorant, aspirin, hardware, and dry cleaning.

Shopping: Homogeneous shopping products include washers, dryers, and televisions. Heterogeneous shopping products include furniture, clothing, housing, and universities.

Specialty: Fine watches, expensive automobiles, and gourmet restaurants.

Unsought: New products, insurance, burial plots, and encyclopedias.

Benefits of Product Line:
Advertising economies: Product lines provide economies of scale in advertising.

Package uniformity: Packages in the product line may have a common look but maintain their individual identities.

Standardized components: Reductions in manufacturing and inventory costs.

Efficient sales and distribution: A product line enables a full range of choices to customers, and as a result, better distribution and retail coverage.

Equivalent quality: All products in a line are perceived as having similar quality.

Advantages of Manufacturers’ Brands
Heavy consumer ads by manufacturers

Attract new customers

Enhance dealer’s prestige

Rapid delivery, carry less inventory

If dealer carries poor quality brand, customer may simply switch brands and remain loyal to dealer

Advantages of Private Brands
Earn higher profits on own brand

Less pressure to mark down price

Manufacturer can become a direct competitor or drop a brand/reseller

Ties customer to wholesaler or retailer

Wholesalers and retailers have no control over the intensity of distribution of manufacturers’ brands

Advantages of Captive Brands
No evidence of store’s affiliation

Manufactured by third party

Sold exclusively at the chain

Can ask price similar to manufacturer’s brands

When a firm plans to enter foreign markets with an existing product, a one-brand-name strategy:

a. provides for greater identification of the product from market to market.
b. facilitates the identification of the product as a local brand.
c. makes it more difficult to coordinate promotional strategies from market to market.
d. mainly benefits companies that market a wide variety of products.

a. provides for greater identification of the product from market to market.
Which of the following is a difference between an express warranty and an implied warranty?

a. A manufacturer that promises express warranty must meet certain minimum standards, whereas a manufacturer that promises implied warranty does not have to meet any standards.
b. A manufacturer must offer full refund under the terms and conditions of an express warranty, whereas no such refund is provided for an implied warranty.
c. An express warranty is a simple statement, whereas an implied warranty consists of extensive documents written in technical language.
d. An express warranty is a written guarantee, whereas an implied warranty is an unwritten guarantee that a good or service is fit for the purpose for which it was sold.

d. An express warranty is a written guarantee, whereas an implied warranty is an unwritten guarantee that a good or service is fit for the purpose for which it was sold.
Which of the following is true of convenience products?

a. Distribution of such products is often limited to one or a very few outlets in a geographic area.
b. Consumers buy them after comparing several brands on style, price, etc.
c. Consumers are unwilling to shop extensively for such items.
d. Marketers of convenience products often use selective, status-conscious advertising.

c. Consumers are unwilling to shop extensively for such items.
From a reseller’s perspective, which of the following is a disadvantage of carrying manufacturer’s brands?

a. Manufacturers do not offer rapid delivery, requiring a dealer to carry more inventory.
b. Heavy advertising by a manufacturer negatively impacts consumer loyalties to a dealer.
c. Manufacturers can decide to drop a reseller at any time or even directly compete with dealers.
d. Customers do not remain loyal to a dealer if a manufacturer’s brand is of poor quality.

c. Manufacturers can decide to drop a reseller at any time or even directly compete with dealers.
Aleesha refuses to buy any toothpaste other than her preferred brand, Blassey, manufactured by Blassey’s Inc. If Blassey’s toothpaste is not available in the store in her neighborhood, she drives to another store rather than settle for a different brand. Based on this information, which of the following statements is true?

a. Blassey’s Inc. has benefitted from planned obsolescence.
b. Blassey’s Inc. is a private brand.
c. Aleesha has a strong brand loyalty.
d. Aleesha buys only convenience products.

c. Aleesha has a strong brand loyalty.
The Weston Candy Company is known for its inexpensive chocolates. To appeal to a more upscale market, it introduced the Theobroma line of premium chocolates. This is an example of

a. functional modification
b. product placement
c. quality modification
d. planned obsolescence

c. quality modification
Which of the following is true of packaging?

a. It impedes recycling of products and increases environmental damage.
b. It restricts manufacturers from marketing products in specific quantities, such as ounces.
c. It holds contents together and protects goods as they move through the distribution channel.
d. It groups products of similar characteristics and functions produced by different manufacturers.

c. It holds contents together and protects goods as they move through the distribution channel.
The exclusive right to use a brand or part of a brand is known as a

a. trade secret
b. hallmark
c. trademark
d. copyright

c. trademark
Which of the following is an example of a set of homogeneous shopping products?

a. different products of the same price
b. different product lines offered by the same manufacturer
c. televisions manufactured by different brands
d. products launched at the same time

c. televisions manufactured by different brands
_____ refers to changes in a product’s versatility, effectiveness, convenience, or safety.

a. Product repositioning
b. Style modification
c. Functional modification
d. Quality modification

c. Functional modification
Services and ideas are not considered products because they are intangible.
False
When a product name becomes generic, the product name is no longer recognized as the exclusive property of a firm.
True
Trademark protection and rights only last for five years.
False
Each product item in the product mix always requires a separate marketing strategy.
False
Convenience products, though inexpensive, require considerable shopping effort by buyers.
False
Due to the time required to scan them, the use of universal product codes (UPCs) is typically restricted to shopping products.
False
Product modification occurs even when changes are made to a product’s aesthetic appearance rather than its quality or functionality.
True
A one-brand-name strategy is useful when the marketer wants the brand to appear to be a local brand, or when regulations require localization.
False
An organization’s product mix includes all of the products it sells.
True
Bar codes are read by computerized optical scanners that match codes with brand names, package sizes, and prices.
True
An organization’s product mix includes all of the products it sells.
True
A service mark is the exclusive right to use a brand or part of a brand.
False
The key distinction between the consumer products and business products is their intended use.
True
A one-brand-name strategy is useful when the marketer wants the brand to appear to be a local brand, or when regulations require localization.
False
Express warranties range from simple statements to extensive documents written in technical language.
True
Washers, dryers, refrigerators, and televisions are examples of unsought products.
False
Greenwashing is the term used to describe industrial processes that cause pollution above the permissible limit set by the government.
False
Insurance, burial plots, and similar items fall under the convenience products category.
False
Each product item in the product mix may require a separate marketing strategy.
True
Scanning universal product codes (UPCs) consumes time required for preparing records of customer purchases.
False