Abm

• Product


  Anything that is offered to a market for attention, acquisition, use or consumption that might satisfy a want or need. Broadly defined, product includes objects, services, persons, places, organizations, and ideas.
• Service


  A product that consists of activities, benefits or satisfactions that are offered for sale and are essentially intangible.
• Services do not result in the ownership of anything.
• Core product features


  • Name
  • Benefit
  • Quality
  • Features
  • Packaging
  • Brand
  • Delivery
  • Installation
  • Warranty
  • Services
• Durable product


  Products used over an extended period of time and normally made to last for many years.
• Non-durable product


  Goods that are consumed quickly and used on one or a few occasions.
• Consumer product classifications


  • Convenience products
  • Shopping products
  • Specialty products
  • Unsought products
• Industrial product


  Products bought for further processing or for use in conducting a business.
• Types of industrial products


  • Materials and parts
  • Capital items
  • Supplies and services
• The distinction between a consumer product and an industrial product is based on the purpose for which the product is purchased.
• Product decisions


  • Individual product decisions
  • Product line decisions
  • Product mix decisions
• Product attributes


  The defining benefits that the product will offer, including major quality, features, style and design.
• Branding


  A name, term, sign, symbol or design that identifies the maker or seller of a product or service.
• Branding helps buyers in many ways, such as telling them something about the product quality and allowing them to identify the same brand each time.
• Suggested retail price (SRP)

  The price that a customer product is supposed to be offered at over the counter in a supermarket or store.
• Pricing


  The process of determining the value that is received by an organization in exchange for its products or services. It is a crucial element of generating revenue for an organization.
• Pricing objectives


  • Profit-oriented objectives
  • Sales-oriented objectives
  • Status-quo-oriented objectives
• Pricing procedures


  • Determining realistic range of choice
  • Selecting a pricing strategy
  • Pricing approaches
• Cost-based pricing


  A pricing approach that figures out how much it costs to make a product or deliver a service, and then sets the price by adding a profit to the cost.
• Types of cost-based pricing


  • Cost-plus pricing
  • Target rate of return pricing
• Buyer-based pricing


  A pricing approach that deals with consumer perceptions and behavior as the basis for determining the price of a product or service.
• Types of buyer-based pricing


  • Perceived value pricing
  • Price-quality relationship pricing
  • Loss leader pricing
  • Odd-numbered pricing
  • Price lining pricing
• Competition-based pricing


  A pricing approach that refers to setting prices based on what prices are being charged by competitors.
• Types of competition-based pricing


  • Going rate pricing
  • Sealed-bid pricing
• Price lining


  The practice of selling merchandise at a limited number of predetermined price levels
• Odd pricing


  Non-rounded prices that end in a number below 5 (e.g. $4.99)
• Even pricing


  Prices that end in a 0 or 5
• Price lining pricing


  This method refers to the practice of selling merchandise at a limited number of predetermined price levels
• Competition-based pricing


  Pricing based on what prices competitors are charging
• Going rate pricing


  1. The firm adapts its price based on the competitor's price

  2. It is proactive as it uses price as a communication tool to inform the market about the value of the product
• Sealed-bid pricing


  • The firm sets its price to be a little lower than the competitors
  • Less attention is given to the firm's cost and demand
• Price adaptation strategies


  • Geographical pricing
  • Cost-based pricing
  • Competition-based pricing
  • Discriminatory pricing
• Geographical pricing


  Pricing decisions to account for the product's intended customer location and the cost of shipping
• Geographical pricing strategies


  • Point-of-production pricing
  • Uniform delivered pricing
  • Zone delivered pricing
  • Freight-absorption pricing
• Point-of-production pricing


  The seller quotes the selling price at the point of production, and the buyer selects the mode of transportation and pays all freight cost
• Uniform delivered pricing


  The seller quotes the same delivered price to all buyers regardless of their locations
• Zone delivered pricing


  The seller sets prices that differ from zone to zone
• Freight-absorption pricing


  The seller pays for some of the freight costs for more distant markets in order to penetrate those markets
• Price discounts and allowances


  • Cash discount
  • Quantity discount
  • Functional discount
  • Seasonal discount
• Cash discount


  Reduction in price to encourage buyers to pay their bills quickly