30 Questions
Why is retargeting considered effective?
It often takes multiple brand exposures before someone buys
What is the primary benefit of segmenting an audience based on behavior?
To send timely, tailored marketing messages to each segment
What is one of the advantages of prospect targeting in behavioral targeting?
Targeting prospects who have demonstrated an interest in a product or service
How can behavioral targeting help marketers with their resources?
By making better decisions about how and where they’re directing their resources
What is one of the benefits of behavioral targeting in terms of customer experience?
It creates a more interesting and engaging experience for visitors
What does behavioral targeting teach companies about their brand?
How their target customers perceive their brand and interact with their assets
What is the main goal of a cost-plus pricing strategy?
To determine the price of a product based on its production cost
Which pricing strategy takes into account the psychological impact of prices on customers?
Psychological pricing
What is the purpose of a bundle pricing strategy?
To sell multiple products together at a single price
Which pricing strategy involves setting different prices for the same product based on the location of the buyer?
Geographic pricing
What is the main difference between a premium product and a basic product in an optional product pricing strategy?
The features and benefits of the product
Which pricing strategy sets a price based on the customer's perceived value of the product?
Value-based pricing
What is the primary goal of trading?
To make a profit
What type of business involves buying and selling products at a markup?
Buying and selling
What is the primary function of marketing?
To provide information about a product and the company
What type of service business focuses on providing financial services to customers?
Finance
What determines the type of business organization?
The nature or purpose of the business
What is a characteristic of a service business?
It provides an intangible valuable offering
Which type of cost is directly related to producing a good or service?
Direct Cost
What type of labor is considered a product cost?
Direct labor
Which of the following is an example of a period cost?
Marketing expenses
What is included in the Manufacturing Overhead Cost?
All the indirect costs incurred during manufacturing
What is the main difference between Direct Cost and Indirect Cost?
Direct Cost is related to producing a good or service while Indirect Cost is not
What are the three main components of Manufacturing Costs?
Direct Materials, Direct Labor, and Manufacturing Overhead
What is the primary goal of a premium pricing strategy?
To create a perception of high-value products
What is the main difference between a skimming pricing strategy and a competition-based pricing strategy?
The price of the product is higher at the start and then decreased
What is the primary objective of a freemium pricing strategy?
To offer a basic version of a product and hope users will upgrade
What is the result of using a competition-based pricing strategy?
A better position to win a customer's business
What is product line pricing also known as?
Price lining
What is the primary focus of a skimming pricing strategy?
The highest possible price for a new product
Study Notes
Pricing Strategies
- Optional Product Pricing: allows customers to pay a higher price for a product with additional features or a lower price for a basic version.
- Bundle Pricing Strategy: offers two or more complementary products or services together for a single price.
- Psychological Pricing Strategy: takes advantage of human psychology to boost sales, e.g., pricing at $99.99 instead of $100.
- Geographic Pricing Strategy: prices products or services differently based on geographical location or market.
- Cost-Plus Pricing Strategy: focuses on the cost of producing a product or service and adds a markup for profit.
- Value-Based Pricing Strategy: prices products or services based on what the customer is willing to pay.
Costs
- Direct Costs: can be easily traced to a product, department, or project, e.g., raw materials, labor, and distribution costs.
- Indirect Costs: cannot be easily traced to a product, department, or project, e.g., overhead expenses, rent, and marketing expenses.
- Manufacturing Costs: include direct material, direct labor, and manufacturing overhead costs.
Pricing Strategy Types
- Skimming Pricing Strategy: charges the highest possible price for a new product and lowers it over time.
- Competition-Based Pricing Strategy: focuses on the existing market rate for a product or service.
- Premium Pricing Strategy: prices products high to present a high-value, luxury, or premium image.
- Freemium Pricing Strategy: offers a basic version of a product for free, hoping users will upgrade to a paid version.
- Product Line Pricing: separates goods and services into cost categories to create perceived quality levels.
Behavioral Targeting
- allows marketers to target prospects who have demonstrated interest in a product or service.
- helps convert leads into customers with personalized messaging.
- creates a more engaging experience for visitors, increasing customer loyalty.
- enables marketers to make better resource allocation decisions.
Business Concepts
- Trading: the buying and selling of financial assets in markets to make a profit.
- Buying and Selling: purchasing products at wholesale and selling them at a higher price.
- Marketing: providing information about a product and company.
- Service Business: provides an intangible valuable offering to customers, often handled by an individual or group of people.
Types of Service Businesses
- Personal: one-on-one interaction between seller and buyer, e.g., hair salon.
- Finance: provides services concerning financing needs, e.g., banking, insurance.
- Recreational: provides service facilities for sports, entertainment, amusement parks, etc.
Types of Business Organizations
- Profit Organizations: exist to make a profit.
- Non-Profit Organizations: do not distribute profits to owners or shareholders.
Test your knowledge of fundamental business concepts, including trading, buying and selling, marketing, and aids to trade. Learn about different business models and strategies. Identify the key components of a successful business.
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