Principles of Marketing – Chapters 11-15

New Product
a product new to the world, the market, the producer, the seller, or some combination of these
New-product strategy
a plan that links the new-product development process with the objectives of the marketing department, the business unit, and the corporation
Product Development
A marketing strategy that entails the creation of marketable new products; the process of converting applications for new technologies into marketable products.
brainstorming
the process of getting a group to think of unlimited ways to vary a product or solve a problem
Screening
the first filter in the product development process, which eliminates ideas that are inconsistent with the organization’s new-product strategy or are obviously inappropriate for some other reason
Concept Test
a test to evaluate a new-product idea, usually before any prototype has been created
buasiness analysis
The second stage of the screening process where preliminary figures for demand, cost, and sales, and profitability are calculated
Development
the stage in the product development process in which a prototype is developed and a marketing strategy is outlined
Simultaneous Product Development
a team-oriented approach to new-product development
Test Marketing
the limited introduction of a product and a marketing program to determine the reactions of potential customers in a market situation
Gap Model
A model identifying five gaps that can cause problems in service delivery and influence customer evaluations of service quality
Core Service
the most basic benefit the consumer is buying
Supplementary Service
a group of services that support or enhance the core service
Mass customization
a strategy that uses technology to deliver customized services on a mass basis
Internal Marketing
treating employees as customers and developing systems and benefits that satisfy their needs
Nonprofit organization
an organization that exists to achieve some goal other than the usual business goals of profit, market share, or return on investment
Nonprofit organization marketing
the effort by nonprofit organizations to bring about mutually satisfying exchanges with target markets
Public Service Advertisement (PSA)
an announcement that promotes a program of a federal, state, or local government or of a nonprofit organization
Commercialization
the decision to market a product
Innovation
a product perceived as new by a potential adopter
Product Life Cycle
a concept that provides a way to trace the stages of a product’s acceptance, from its introduction to its decline
Product Category
all brands that satisfy a particular type of need
Introductory Stage
the full-scale launch of a new product into the marketplace
Growth Stage
the second stage of the product life cycle when sales typically grow at an increasing rate, many competitors enter the market, large companies may start to acquire small pioneering firms, and profits are healthy
Maturity Stage
a period during which sales increase at a decreasing rate
Decline Stage
a long-run drop in sales
Service
the result of applying human or mechanical efforts to people or objects
intangibility
the inability of services to be touched, seen, tasted, heard, or felt in the same manner that goods can be sensed
Search quality
a characteristic that can be easily assessed before purchase
experience quality
a characteristic that can be assessed only after use
Credence Quality
a characteristic that consumers may have difficulty assessing even after purchase because they do not have the necessary knowledge or experience
inseparability
the inability of the production and consumption of a service to be separated; consumers must be present during the production
heterogeneity
The variability of the inputs and outputs of services, which causes services to tend to be less standardized and uniform than goods
perishability
the inability of services to be stored, warehoused, or inventoried
reliability
the ability to perform a service dependably, accurately, and consistently
Responsiveness
the ability to provide prompt service
Assurance
The knowledge and courtesy of employees and their ability to convey trust
Empathy
caring, individualized attention to customers
Tangibles
the physical evidence of a service, including the physical facilities, tools, and equipment used to provide the service
Marketing channel (chanel of distribution)
a set of interdependent organizations that eases the transfer of ownership as products move from producer to business user or consumer
Channel Members
all parties in the marketing channel that negotiate with one another, buy and sell products, and facilitate the change of ownership between buyer and seller in the course of moving the product from the manufacturer into the hands of the final consumer
Discrepancy of quantity
the difference between the amount of product produced and the amount an end user wants to buy
Discrepancy of assortment
the lack of all the items a customer needs to receive full satisfaction from a product or products
Temporal Discrepancy
a situation that occurs when a product is produced but a customer is not ready to buy it
Spatial Discrepancy
The difference between the location of a producer and the location of widely scattered markets
Retailer
A channel intermediary that sells mainly to consumers
Merchant Wholesaler
an institution that buys goods from manufacturers and resells them to businesses, government agencies, and other wholesalers or retailers and that receives and takes title to goods, stores them in its own warehouses, and later ships them
Agents and Brokers
wholesaling intermediaries who do not take title to a product but facilitate its sale from producer to end user by representing retailers, wholesalers, or manufacturers
Logistics
the efficient and cost-effective forward and reverse flow as well as storage of goods, services, and related information, into, through, and out of channel member companies
Direct Channel
a distribution channel in which producers sell directly to consumers
Dual Distribution
the use of two or more channels to distribute the same product to target markets
Strategic Channel Alliance
a cooperative agreement between business firms to use the other’s already established distribution channel
Intensive Distribution
a form of distribution aimed at having a product available in every outlet where target customers might want to buy it
Selective Distribution
a form of distribution achieved by screening dealers to eliminate all but a few in any single area
Exclusive Distribution
a form of distribution that establishes one or a few dealers within a given area
Arm’s – length relationship
a relationship between companies that is loose, characterized by low relational investment and trust, and usually taking the form of a series of discrete transactions with no or low expectation of future interaction or service
Cooperative Relationship
a relationship between companies that takes the form of informal partnership with moderate levels of trust and information sharing as needed to further each company’s goals
integrated Relationship
a relationship between companies that is tightly connected, with linked processes across and between firm boundaries and high levels of trust and interfirm commitment
Channel Power
the capacity of a particular marketing channel member to control or influence the behavior of other channel members
Channel Control
A situation that occurs when one marketing channel member intentionally affects another member’s behavior
Channel Leader (captain)
a member of a marketing channel that exercises authority and power over the activities of other channel members
Channel conflict
A clash of goals and methods between distribution channel members
Horizontal Conflict
a channel conflict that occurs among channel members on the same level
Vertical Conflict
a channel conflict that occurs between different levels in a marketing channel, most typically between the manufacturer and wholesaler or between the manufacturer and retailer
Channel Partnering
the joint effort of all channel members to create a channel that serves customers and creates a competitive advantage
Supply Chain
The connected chain of all of the business entities, both internal and external to the company, that perform or support the logistics function
Supply Chain Management
a management system that coordinates and integrates all of the activities performed by supply chain members into a seamless process, from the source to the point of consumption, resulting in enhanced customer and economic value
Supply Chain integration
when multiple firms in a supply chain coordinate their activities and processes so that they are seamlessly linked to one another in an effort to satisfy the customer
Business Processes
Bundles of interconnected activities that stretch across firms in the supply chain
Customer Relationship Management Process
Allows companies to prioritize their marketing focus on different customer groups according to each group’s long-term value to the company or supply chain
Customer Service Management
presents a multi-company, unified response system to the customer whenever complaints, concerns, questions, or comments are voiced
Demand Management Process
seeks to align supply and demand throughout the supply chain by anticipating customer requirements at each level and creating demand-related plans of action prior to actual customer purchasing behavior.
Manufacturing flow Management process
Concerned with ensuring that firms in the supply chain have the needed resources to manufacture with flexibility and to move products through a multi-stage production process
Supplier relationship management process
Closely related to the manufacturing flow management process and contains several characteristics that parallel the customer relationship management process
Product Development and commercialization process
includes the group of activities that facilitates the joint development and marketing of new offerings among a group of supply chain partner firms
Logistics
the process of strategically managing the efficient flow and storage of raw materials, in-process inventory, and finished goods from point of origin to point of consumption
Logistics information system
the link that connects all of the logistics functions of the supply chain
Supply Chain Team
an entire group of individuals who orchestrate the movement of goods, services, and information from the source to the consumer
Mass customization
a production method whereby products are not made until an order is placed by the customer; products are made according to customer specifications
Just-in-time production
Process that redefines and simplifies manufacturing by reducing inventory levels and delivering raw materials just when they are needed on the production line
Order Processing System
a system whereby orders are entered into the supply chain and filled
Electronic Data Interchange
A computer to computer transfer of standard business documents that allows companies to handle the purchasing process electronically, avoiding the cost and delays resulting from paper-based systems
Inventory control system
a method of developing and maintaining an adequate assortment of materials or products to meet a manufacturer’s or a customer’s demand
Distribution Resource planning
An inventory control system that manages the replenishment of goods from the manufacturer to the final consumer.
Automatic replenishment Program
a real-time inventory system that triggers shipments only when a good is sold to the end user
Material handling system
A method of moving inventory into, within, and out of the warehouse
Outsourcing
the delegation of specified work to a third party for a specified length of time, at a specified cost, and at a specified level of service
Electronic Distribution
a distribution technique that includes any kind of product or service that can be distributed electronically, whether over traditional forms such as fiber-optic cable or through satellite transmission of electronic signals