Exam 8: Elements of Product Planning for Goods and Services

When making business buying decisions, it is important to remember that:

Consumer products which offer really new ideas that potential customers don't know about yet are new unsought products.

Business product classes are based on the way that buyers shop for and buy products, because there is much more shopping for business products compared to consumer products.

For six months Kim Wu has been working for Sunny Day Foods (SDF), a fast-growing manufacturer of organic foods. After graduating college, she worked for four years as a sales rep for a nationally known food company. But, she jumped at the chance when SDF contacted her about becoming marketing manager for its breakfast foods division, which sells dry cereals and a pancake mix. Kim spent the first few months on the job trying to better understand SDF, its product line, and marketing strategy. She reviewed the company's past marketing research, commissioned new research, and talked to both consumers and retailers. Now, the CEO of the company wants her thoughts on what the company's marketing strategy should be for the next few years. Her research indicates that among cereal customers there are at least five segments of customers who use SDF products. A.One segment, the loyalists, has a strong preference for one or two of the SDF cereals. These customers often go out of their way to visit a store with their favorite SDF cereal and buy only that product at the store. B.Another segment, the regulars, buys SDF cereals without much thought. For them it is just part of their routine and, if you ask them why they pick the cereal, they'd say it's just a habit. C. A third segment, the deal prone, sees SDF cereals as just another organic cereal. They view all organic cereals as pretty much the same and buy whichever brand seems to offer the best deal that week. D. A fourth segment, the politicos, consists of former buyers of SDF cereals. A few years ago the company took a strong stand in a presidential race-and these customers resented it. Now, they boycott all SDF foods because of that incident. E. A fifth segment, SDF who?, is made up of consumers who buy organic cereals but who don't have much awareness of particular organic brand names. In reviewing how SDF currently brands its products, Kim sees that it is using several different approaches. The Sunny Day Foods brand is used on most products the company sells. But a few years ago the company brought out an instant organic oatmeal with the Hot 'n Healthy name. SDF also makes cereal sold by a health food chain; the package for that chain uses the store's own name, Nature's Foods, as the brand name for the cereal. Which product class best describes how regulars view SDF cereals?

___________ shopping products are products that the customer sees as basically the same and wants at the lowest price.

Without promotion, unsought products will probably stay unsold.

Expense items which have had more processing than raw materials and become part of a finished product are component parts and materials.

A "Product" might involve a physical good, a service, or a combination of the two.

Packaging

If a consumer product is used regularly and usually bought frequently and routinely with little thought (although branding may be important), this product is:

Consumer product classes are based on

Mrs. Moreau was planning to have several guests at her home for a traditional Thanksgiving dinner. She had cooked Shady Brook Farms fresh turkeys in the past and had enjoyed them very much. When she went to her usual grocery store, she discovered that the store no longer carried the Shady Brook Farms brand. She called several other grocery stores and was finally able to locate Shady Brook Farms fresh turkeys at a small specialty grocery store approximately 10 miles away. She drove to the store and bought a 20-pound Shady Brook Farms turkey, even though the price per pound was higher than what she normally paid at her usual grocery store. For Mrs. Moreau, the Shady Brook Farms turkey was a(n):

Component parts usually require much processing to get them ready for assembly.

Which of the following statements is true?

Which of the following would be treated as an expense item for a children's clothing manufacturer?

Which of the following is true regarding shopping products?

A large U.S. firm produces potato chips, shortening, dishwasher detergent, laundry detergent, shampoo, disposable diapers, and facial tissues. These are the firm's

The "Product" area is concerned with what goods and services are produced, but not with decisions about installation, instructions on use, packaging, a brand name, a warranty, or after-sale service.

Which of the following is an "unsought product"?

Short-lived goods and services which are charged off as they are used-rather than depreciated over several years-are called: