Product Decisions

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What does a product consist of?
The core benefit it provides, The tangible product and the augmented product (any 'extras' such as brand name, delivery and gurantees)
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What is the product life cycle?
The stages a product goes through during it's life
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What happens in the introduction stage?
The stage when the product is launched, sales grow slowly as people are unaware of the product. Usually no profit.
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What happens in the growth stage?
Sales grow rapidly, Prices may be reduced as new competitors enter market, Profits start coming
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What happens in the Maturity stage?
Sales increase slowly, Intense competition, Competitive or promotional pricing may be used, Profits may start to fall as the product enters the decline.
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What happens in the decline stage?
Sales will fall, Product loses its appeal, advertising is reduced, production may be stopped.
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What is Penetration Pricing?
When a products price is set initially low to rapidly reach a wide fraction of the market and initaite word of mouth.
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What is Dynamic Pricing?
Flexible prices are set for products based on current market demands
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BOSTON MATRIX- What is a cash cow?
Low market growth, High market share
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BOSTON MATRIX- What is a Dog?
Low market growth, Low market share
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BOSTON MATRIX- What is a Question mark?
High market growth, Low market share
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BOSTON MATRIX- What is a Star?
High market growth, High market share
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What is new product development?
Investment to modify an existing product or replace it with a new one
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What are some risks to new product development?
Many ideas don't make it to production, Many products don't sell well and have to be withdrawn
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What is a distribution channel?
The route which a product passes through in moving from the manufacturer to the consumer
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What does the traditional Distribution channel consist of?
Producer -> Wholesaler -> Retailer -> Consumer
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What does the modern distribution channel constist of?
Producer -> Retailer -> Consumer
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What does the direct distribution channel consist of?
Producer -> Consumer
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What influences distribution decisions?
The degree of coverage, The cost of different distribution strategies, Nature of the product, Degree of control desired by the business, How customers expect to access the product and what technology allows a business to deliver
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What is e-commerce?
The buying and selling of products through an electronic medium, such as the internet
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Other cards in this set

Card 2

Front

What is the product life cycle?

Back

The stages a product goes through during it's life

Card 3

Front

What happens in the introduction stage?

Back

Preview of the front of card 3

Card 4

Front

What happens in the growth stage?

Back

Preview of the front of card 4

Card 5

Front

What happens in the Maturity stage?

Back

Preview of the front of card 5
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