Implementing Market Program Part 1

Question 1

Marketing Mix theory

Answer 1

Marketing Mix is a set of Controllable Marketing Variable that the company uses to reach its targets on the market

Question 2

4 P’s

Answer 2

1. Product
2. Price
3. Place
4. Promotion

Question 3

Product range

Answer 3

Total mix of products offered to customers by a winery. Composed of different product lines

Question 4

Product line

Answer 4

Products that are perceived as homogeneous by the consumer

Question 5

Product mix (3)

Answer 5

1. Width: number of product lines
2. Depth: number of products in each line
3. Consistency: homogeneity and connection among the products

Question 6

5 Product development phases

Answer 6

1. Introduction
2. Growth
   First phases categorized by an incline (Organic/orange wines)
3. Maturity
4. Saturation
   middle phases showing the top of the bell curve (DOC/DOCG wines)
5. Decline: Table wines or revitalization

Question 7

4 types of products for the sales approach

Answer 7

1. Key products: Backbone of firm
2. Attractive products: bring in new customers
3. Aggressive Products: Reaction to competition
4. Accessory Products: Complete the line

Question 8

Economic/financial approach

Answer 8

Innovative products, key products must be self sufficient

Question 9

Most important of the 4 P’s

Answer 9

Price

Question 10

3 considerations for price

Answer 10

1. Consumer
2. Seller
3. Competitors

Question 11

4 considerations for definition of price

Answer 11

1. Demand
2. Competition
3. Price of substitute products
4. Cost to the company

Question 12

Price level considerations

Answer 12

We need to considered if the price is too low resulting in a perceived quality, too high and its seen as prohibitive compared to quality

Question 13

6 steps for determining price

Answer 13

1. Set the target
2. Estimate demand
3. Calculate costs
4. analyze competition
5. choose the method
6. Fix final price

Question 14

Price policy must respect two main principles

Answer 14

1. Internal: costs and profitability limits
2. External: Competition, distribution

Question 15

Price and demand relationships

Answer 15

Higher the price, lower demand

Question 16

Demand Elasticity

Answer 16

Measures how the demand quantity of a product reacts to the price variation.

Question 17

Elastic demand vs. inelastic demand

Answer 17

How quantity reacts to price variations, if its more than proportionally its elastic and less than proportionally its inelastic

Question 18

Elasticity equation

Answer 18

(Q2-Q1)/Q1
e = —————–
(P2-P1)/P1

Question 19

Negative line

Answer 19

elasticity of e>1

Question 20

Vertical line

Answer 20

perfectly inelastic

Question 21

Horizontal line

Answer 21

Perfectly elastic

Question 22

Essential commodities

Answer 22

inelastic demand

Question 23

Luxury Items

Answer 23

Elastic demand

Question 24

4 aspects of cost determination

Answer 24

1. Basic price: Direct Cost
2. Technical price: Fixed Cost
3. Target Price: Profit
4. Mark-up price: mark-up

Question 25

Perceived value by a consumer

Answer 25

= benefits perceived / sacrifices for consumption

Question 26

Conventional distribution channel (4)

Answer 26

1. Wine producer 2. Intermediary 3. Retailer 4. Consumer

Question 27

Vertical distribution channels

Answer 27

mega companies that control the production system, distribution of its brands, and distribution of other brands

Question 28

Supermarkets and vertical distribution

Answer 28

Vertical integration: Buying other wine retailers Horizontal Integration: controlling production and consumption

Question 29

3 Intermediaries

Answer 29

1. Market Makers: Take ownership of the product 2. Matchmakers: Do not take ownership 3. Negotiants: Paul Johnson, buys the grapes or must and blends and bottles in an appellation and then sells under his own label

Question 30

Ho.Re.Ca

Answer 30

Hotels, Restaurants, cafe/catering