Exam 11: Product and Promotion: Creating and Communicating Value

Water Words Inc. is the leading supplier of waterproof textbooks. Wendi Storm, CEO of Water Words, is pleased to note that the company has experienced rapid growth in profits. However, she is a bit concerned because competition is increasing, as some other publishers are also starting to waterproof their texts. Wendi's observations suggest that her company's product is in the maturity stage of its product life cycle.

Most consumers seek only one source of information when buying products and services.

Publicity is unpaid media coverage that has the power to influence consumer perceptions about a product or service.

Publicity has little power to influence consumers and is extremely expensive when compared to other promotional tools such as TV, magazine, and radio advertisements.

The warranties and customer phone support a firm provides with its products are part of the actual product.

In order to successfully promote its products, a firm must be able to tightly control all of the promotional messages a consumer sees or hears about its products.

Today's smartest and most profitable firms have learned that the key to their success is to provide the highest possible level of performance in their products.

What is one reason why Apple's iPhone might have high diffusion rate?

Explain what is meant by big ideas are typically based on either a rational or an emotional premise? Provide an example of each type.

MBI's sales strategy is based on having its sales representatives take the time to make the effort to develop lasting relationships with their customers. The focus is on obtaining a thorough understanding of the needs of each customer so that the representatives can provide practical ways to meet these needs using MBI's products and services. What does this example illustrate?

According to BusinessWeek magazine, one common mistake in building a brand is to use "surround sound" promotion that engulfs customers in the brand message. The magazine observes that such an approach often overwhelms and turns off potential customers.

Marketers have more control over publicity than they do over advertising.

Company sponsorships of sporting and cultural events are one of the fastest growing types of promotion.

The Nike brand is quite elastic. We see the Nike Swoosh on athletic shoes, as well as on an assortment of athletic apparel for almost every sport. Lately, the company has begun branching out into several entirely new product categories, such as MP3 players. Which of the following strategies does Nike appear to be pursuing?

Marketers use heavy trade promotions and personal selling when trying to push a product through its distribution channel.

Great promotion has the ability to get consumers to continue buying products that they view as being inferior.

Define the terms branding and brand equity, and explain their importance to today's businesses.

Consumers are spending more of their free time entertaining themselves on the Internet and less time watching TV.

The decision by Coca-Cola to begin selling breakfast cereal under the Coca-Cola brand name would be an example of a brand extension.

In many organizations, different teams are responsible for developing different promotional tools.