1. B2B: Runner’s World or Esquire magazine, six-pack of apple juice, limousine service, golf course, Thai restaurant.
B2C: tech support for a communications system.
Limousine service can be classified both as B2B and B2C. If it is used for a private party, wedding, prom etc., it is a B2C service. However, if limousines are hired to transport business partners, company executives etc., it becomes a B2B service.
2. Product line represents the products, which target similar markets or possess physical similarities. Product mix is the combination of the individual goods/services and product lines, which a company offers to its private and business customers. Product mix for Burger King – the variety of all products offered in Burger King restaurants. Product line is represented by burgers only.
3. The new-product development starts with idea generation, which may be fuelled by marketing research, competitors analysis, etc. The best ideas, which are able to satisfy customers most, are screened in the second stage, in order to evaluate their compliance with company objectives, resources available etc. In the concept development and business analysis phase, ideas are assessed based on their financial prospects, strategic fit and initial customer reaction. In the fourth step, the ready product undergoes testing and customer evaluation. In some instances, the firm employs test marketing, which introduces a promotion campaign for the finished product/service and usually limits the sales to a particular location. This stage helps to predict the results of the full scale product launch and creates customer awareness. However, test marketing is often skipped due to its high cost and ineffectiveness for some products/services. Finally, new-product development is concluded with a full-scale market commercialization.
4. Manufacturer’s brand is promoted by a manufacturer , while a private brand doesn’t carry the brand of the manufacturer, but the name of the distributor, retailer or wholesaler. Family brand refers to the name, which is applied to several related products. Individual branding refers to the practice of giving a different name to each product within a product line.
5.Brand loyalty has three stages: brand recognition, brand preference, and brand insistence. The progression to the last stage shows the strengthening of customer loyalty. The more loyal customers are, the more likely they will pay premium prices, choose product over those of the competitors’, and purchase it regularly.
6. Direct distribution is the cheapest, simplest way to bring products to the consumers. It is often used with B2B customers or for relatively cheap products, which do not need to be demonstrated. Direct distribution is extensively implemented in combination with online sales.
7. Wheel of retailing refers to the process of new retailers entering the market with lower prices and less services. As they grow older, they increase their service offering, thus making room for new lower-cost entrants. Internet retailers appeared in the market in the 2000s and threatened the existence of the established stores, especially in the area of small electronics and books, by offering lower prices and fast delivery.
8. Nonstore retailers: direct-response retailing , which approaches customers via magazines, catalogues etc, and collects orders via mail, telephone; automatic merchandizing, through vending machines; direct selling by using sales representatives; and Internet retailing, which exploit Internet opportunities to reach customers and collect orders. Selling clothes items is more appropriate for direct-response retailing, quick snacks will be better sold through automatic merchandizing, direct selling fits more the products, which people do not buy without convincing, such as non-mandatory insurance plans, while Internet retailing is good for electronics and books.
9. Distribution intensity levels: intensive distribution (chocolate, yogurt), selective distribution (adidas shoes, Nespresso coffee machines) and exclusive distribution (Louis Vuitton bags, Chanel clothes) .
10. Logistics coordinates the flow of information, goods and services along the supply chain. Physical distribution is the main focus of logistics, since it aims to successfully deliver products to the customer.
References
Boone, Louis E., and David L. Kurtz. Contemporary Business. 14th ed. Hoboken, NJ: Wiley & Sons, 2010.
