Product and Service Classification Quiz

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Questions and Answers

What defines a product in the context of marketing management?

Any offering to a market that satisfies a need or want (correct)

Only tangible items that are sold for profit

A physical item that can be touched and owned

A type of consumer goods sold by retailers

Which of the following is NOT a type of consumer product?

Industrial products (correct)

Shopping products

Specialty products

Convenience products

What is the primary purpose of companies creating and managing customer experiences with their brands?

To simplify the purchasing process for consumers

To improve company sales figures exclusively

To differentiate their offers from competitors (correct)

To lower costs and increase production efficiency

Which component is included in the three levels of product?

Physical attributes Signup and view all the answers

What distinguishes a service from a physical product?

Services involve intangibility and do not result in ownership Signup and view all the answers

Which of the following is NOT a characteristic of service industries?

Delivery of tangible goods Signup and view all the answers

What is one main goal of managing service quality?

To consistently exceed competitors' service quality Signup and view all the answers

Which of the following best defines brand equity?

The positive differential effect of knowing the brand name Signup and view all the answers

In the context of the service-profit chain, what does greater internal service relate to?

Higher levels of employee satisfaction Signup and view all the answers

What is the purpose of managing service productivity?

To increase the quantity of service potentially at the expense of quality Signup and view all the answers

What is the main reason for a company to stretch its product line upwards?

To add prestige or attract higher growth rates Signup and view all the answers

What does the term 'product mix' refer to?

All product lines and items a seller offers for sale Signup and view all the answers

In terms of product line decisions, what does stretching both ways involve?

Adding new products at both high and low price points Signup and view all the answers

What aspect of the product mix measures how closely related product lines are?

Consistency Signup and view all the answers

What defines product line length?

The number of products within each line Signup and view all the answers

Which of the following companies is a recognized example of stretching a product line upwards?

Toyota – Lexus Signup and view all the answers

Which of the following best describes product line depth?

The number of versions of each product carried Signup and view all the answers

What percentage of Canada's GDP is accounted for by services?

70% Signup and view all the answers

What is a key function of branding for buyers?

Identifying products Signup and view all the answers

Which of the following describes a responsibility of product packaging?

Hold and protect the product Signup and view all the answers

What does product line stretching involve?

Adding products priced lower than existing ones Signup and view all the answers

Which attribute is essential for assessing customer value in a product?

Quality Signup and view all the answers

What is the role of labeling in product management?

Identify and describe the product Signup and view all the answers

What is a core element of total quality management (TQM) related to product decisions?

Ensuring company-wide involvement Signup and view all the answers

Which of the following functions is NOT typically associated with effective product packaging?

Increase product costs Signup and view all the answers

What does line filling refer to in product line decisions?

Adding more items within the present price range Signup and view all the answers

Which customer service method is NOT typically used by companies for product support services?

Facial recognition technology Signup and view all the answers

What can be a consequence of poor labeling?

Customer confusion Signup and view all the answers

What is a key advantage of strong brand equity?

It helps when introducing new products. Signup and view all the answers

Which brand positioning level is considered the least effective?

Product attributes Signup and view all the answers

What is an important characteristic for effective brand names?

They should be easy to recognize and remember. Signup and view all the answers

What advantage do licensed brands offer?

They require less marketing effort. Signup and view all the answers

What defines a multibrand strategy?

Launching multiple product entries within a product category. Signup and view all the answers

What is a disadvantage of using private (store) brands?

They are costly to create and promote. Signup and view all the answers

Which of the following is NOT a component of brand development?

Market dilution Signup and view all the answers

What does effective brand management involve?

Training employees to be customer centered. Signup and view all the answers

What kind of brands tend to have higher profit margins?

Private brands Signup and view all the answers

Which core customer value does Starbucks primarily offer?

A premium coffee experience Signup and view all the answers

Study Notes

What is Product?

A product is anything offered to a market that can be acquired, consumed or used to satisfy a want or need
A service is an intangible product that consists of activities, benefits and satisfies offered for a fee, does not result in ownership of anything
Companies create and manage customer experiences with their brands and products
Companies differentiate their offerings from their competitors

Three Levels of Product

Core product: Satisfies the customer's fundamental needs, the core benefit the customer is seeking
Actual product: Physical attributes & features, packaging, styling, quality, features, brand name.
Augmented product: Additional services, such as delivery, installation, financing, warranties and customer service.

Product and Service Classifications

Consumer products are bought by final consumers for personal consumption
Industrial products are bought by individuals and organizations for further processing or for use in conducting a business

Consumer Products

Convenience products: Products that are purchased frequently, conveniently and with minimal effort
Shopping products: Consumers invest significant time and effort in researching and comparing alternatives, such as clothing, furniture and appliances.
Specialty products: Products with unique characteristics or brand identification for which buyers are willing to make a special purchasing effort, such as specific cars, designer clothes, or gourmet foods.
Unsought products: Products that consumers do not know about or don't normally think of buying, such as life insurance, funeral services, and blood donations.

Individual Product and Service Decisions

The product and service attributes are the key elements that determine their appeal to customers.
Quality is a measure of how well a product performs its intended function, it's linked to customer value and satisfaction, and requires a whole company involvement (TQM - Total Quality Management)
Features are a competitive tool for differentiating a product and should be valued by the customer as determined through market research.
Style and Design contribute to the product's usefulness and aesthetics.

Branding

A brand is a name, term, sign, symbol, or design that identifies the product
Branding can add value to a product
Branding helps buyers identify products and determine quality
Branding helps sellers convey product quality, provide legal protection and segment markets.

Packaging

Packaging frequently includes primary, secondary, and shipping packages
Packaging functions include holding, protecting, promoting, and differentiating the product.

Labeling

Packaging serves to identify, describe, and promote the product
Labeling must be careful not to mislead customers, fail to describe ingredients, and include safety warnings.

Product Support Services

Companies should survey customers regularly to assess current customer service
Companies use a mix of phone, email, fax, internet, and interactive voice and data technologies to provide customer support.

Product Line Decisions

Product line: A group of products that are closely related in function, targeted at the same customer groups, market through the same channels, and fall into similar price ranges.
Product Line Length: Number of products in the line
Line stretching: Adding higher or lower priced products to the existing line
Line filling: Adding more items within the present price range

Product Mix Decisions

Product Mix (Product Portfolio): All product lines and items a particular seller offers for sale
Width: Number of product lines
Length: Number of products in each line
Depth: Number of versions of each product carried
Consistency: How closely related the product lines are.

Services Marketing

Services account for a significant portion of GDP, employment, and job creation
Service industries include business organizations, government, and private non-profit organizations

Four Service Characteristics

Intangibility: Services cannot be seen, tasted, felt, heard, or smelled before purchase
Variability: Quality depends on who provides them, when, where, and how
Inseparability: Services are produced and consumed simultaneously
Perishability: Services cannot be stored for later sale or use

Service-Profit Chain

Satisfied and productive employees lead to greater service quality
Greater service quality leads to satisfied and loyal customers
Satisfied and loyal customers lead to profits and growth

Marketing Tasks for Service Companies

Managing service differentiation: Developing a differentiated offer, delivery, and image
Managing service quality: Delivering consistently higher quality than the competitors
Managing service productivity: Training current employees or hiring new ones; increasing the quantity of service by giving up some quality; Harnessing the power of technology

Branding Strategy

Brand Equity: Positive differential effect that knowing the brand name has on customer response to the product or service
Brand Value: The total financial value of a brand
Customer Equity: The value of customer relationships that the brand creates
Brands with strong equity have competitive advantages including high consumer awareness, strong brand loyalty, helping with the introduction of new products, and less susceptibility to price competition.

Building Strong Brands

Three levels of brand positioning:
- Attributes: Least effective
- Benefits: Taps into emotions
- Beliefs and values: Highest level

Good Brand Names

Suggest something about the product or its benefits
Easy to pronounce, recognize, and remember
Distinctive
Extendible
Translate well into other languages
Legally registered and protected

Brand Positioning

Manufacturer brands: Costly to establish and promote, Higher profit margins
Private (store) brands:
Licensed brands: Name and character licensing has grown
Co-branding: Advantages and disadvantages

Brand Development

Line extensions: Minor changes to existing products or services to reach new customer segments.
Brand extensions: Successful brand names help introduce new products in new categories.
Multibrands: Multiple product entries in a product category, allows for greater market coverage and segment targeting.
New brands: New product category, entering a new market or addressing a new customer need.

Managing Brands

Communicate the brand's positioning
Manage all brand touch points
Train employees to be customer-centered
Audit the brand's strengths and weaknesses

Starbucks: Brewing a Worldwide Experience, What is the Core Customer Value?

Core customer value: A sense of community, a feeling of comfort and belonging, a "third place" outside of home and work where people can connect and socialize.
Actual product: High-quality coffee and other beverages, pastries, snacks, and merchandise.
Augmented product: A welcoming and comfortable atmosphere with a unique ambiance, Wi-Fi access, and friendly service.

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Description

Test your understanding of what constitutes a product and how it differs from a service. This quiz covers the three levels of product, including core, actual, and augmented products, as well as various classifications of products. Enhance your knowledge of marketing concepts and customer experiences.