Exam 14: Developing and Pricing Goods and Services

Products that are used in the production of other goods and services are called ________ goods.

Changes in packaging can transform the product in the minds of consumers and open larger market opportunities.

Mini-Case Gourmet Pets is an innovative competitor in the billion-dollar pet food industry. In fact, two of its products, Kitty Sirloin and McDog T-bone, each claim over a 30% share in their market segments. The company has done detailed research and discovered that, for a growing number of pet owners, the family pet serves as a baby substitute. These owners tend to pamper their pets, and are very discriminating in what they purchase. With this in mind, the company has put a great deal of effort into developing a new dog food: Prime Cuts. The new product is packaged in a resealable, microwaveable container and can be purchased in a variety of flavors (including Western BBQ, Teriyaki, Australian Outback, and Hickory Smoked). Gourmet Pets promotes the product as far superior to "average" dog foods, even though the quality of meat and nutrient content of the food are virtually identical to many other brands. The company faces no competition in this market segment so it plans to charge a high price for the product. -Gourmet Pets hopes to use its special packaging and extensive advertising to create a perception in the minds of consumers that Prime Cuts is a superior product, even though the actual quality of meat used in the product is virtually no different from competing brands. The company is attempting to develop

A skimming pricing strategy

Regardless of changes in packaging, the total product offer remains unchanged.

Miller Light Beer, Maxwell House Coffee, Jell-O brand gelatin, Kraft mayonnaise, and Marlboro Cigarettes were all at one time products of the Philip Morris Company. These products represented a part of the product line Philip Morris offered.

Price leadership is a demand-based pricing strategy.

The ________ pricing strategy maintains low prices and avoids the use of special sales.

Certain brand names, such as Kleenex and Rollerblade, fear they could become ________, because they are so commonly identified with a specific product category that consumers use these names to refer to any product in that category regardless of the manufacturer.

A traditional McDonald's and a McCafe are examples of the McDonald's Corporation product mix.

A ________ has direct responsibility for all the elements of the marketing mix for one brand or product line.

Sandy works for Epic Electronics and oversees the marketing mix for the firm's line of HDTVs. Sandy serves as a brand manager for Epic Electronics.

Some goods can be classified as either consumer goods or as industrial goods.

Dealer (private) brands are products that do not carry the manufacturer's name, but rather carry the name of a distributor or retailer.

Mini-Case Gourmet Pets is an innovative competitor in the billion-dollar pet food industry. In fact, two of its products, Kitty Sirloin and McDog T-bone, each claim over a 30% share in their market segments. The company has done detailed research and discovered that, for a growing number of pet owners, the family pet serves as a baby substitute. These owners tend to pamper their pets, and are very discriminating in what they purchase. With this in mind, the company has put a great deal of effort into developing a new dog food: Prime Cuts. The new product is packaged in a resealable, microwaveable container and can be purchased in a variety of flavors (including Western BBQ, Teriyaki, Australian Outback, and Hickory Smoked). Gourmet Pets promotes the product as far superior to "average" dog foods, even though the quality of meat and nutrient content of the food are virtually identical to many other brands. The company faces no competition in this market segment so it plans to charge a high price for the product. -Prime Cuts was the brainchild of Karen Terrier who guided all the marketing efforts of the product. She selected each element of the marketing mix such as the package, brand name, pricing, promotion, and placement decisions. Karen obviously serves in the job of

Brand managers have direct responsibility for all the elements of the marketing mix for a particular brand or product line.

The evaluation of packaging as a marketing function indicates that

Today, packaging is:

While some products remain in the introductory stage of the product life cycle for years, other products may go through the entire cycle in a few months.

According to the Making Ethical Decisions box, there is more and more confusion growing around what makes a product "natural." What is the Food and Drug Administration (FDA) considering doing to alleviate the confusion?