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Flashcards in CH 9-10 Deck (24)
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1

an idea for a possible product that the company can see itself offering to the market

product idea

2

a detailed version of the idea stated in meaningful consumer terms

product concept

3

the way consumers perceive an actual or potential product

product image

4

testing new product concepts with groups of target consumers.

Concept testing

5

review of the sales, costs, and profit projections for a new product to find out whether they satisfy the company’s objectives.

Business analysis

6

introducing the new product into the market

commercialization

7

finding new ways to solve customer problems and create more customer-satisfying experiences

Customer-centered new product development

8

the course that a product’s sales and profits take over its lifetime

product life cycle (PLC)

9

PLC STANDS FOR

product life cycle (PLC)

10

5 PLC STAGES

1. Product development 2. Introduction 3. Growth 4. Maturity 5. Decline

11

The company finds and develops a new product idea. During product development, sales are zero, and the company’s investment costs mount

Product development:

12

A period of slow sales growth as the product is introduced in the market. Profits are nonexistent in this stage because of the heavy expenses of product introduction.

Introduction:

13

A period of rapid market acceptance and increasing profits.

Growth:

14

A period of slowdown in sales growth because the product has achieved acceptance by most potential buyers. Profits level off or decline because of increased marketing outlays to defend the product against competition.

Maturity:

15

The period when sales fall off and profits drop.

Decline:

16

COST BASED PRICING CHART

17

VALUE BASED PRICING CHART

18

involves charging higher prices
on an everyday basis but running frequent
promotions to lower prices temporarily on
selected items

High-low pricing

19

attaches
features and services to differentiate the
companies offers and thus their higher prices

Value-added pricing

20

is
setting prices
based on
competitors’
strategies,
costs, prices,
and market
offerings

Competition based
pricing

21

drop in the average cost with accumulated production experience

experience curve / learning curve

22

Adding a standard markup to the cost of the product.

cost-plus pricing (or markup pricing)

23

Setting price to break even on the costs of making and marketing a product, or setting price to make a target return.

 

break-even pricing (or a variation called target return pricing).

24

break-even volume FORMULA