Marketing Management, Part 2

Question 1: Define and explain product mix.

Answer 1: A company’s product mix is comprised of all the products and lines that a company sells. Product mixes are often limited to large companies or corporations because of the high costs associated with creating several products. A product mix has four levels: consistency, length, width, and depth. Consistency measures how similar certain factors are in a company’s product mix, things such as materials, price, and distribution. Length refers to how many products are in a company’s product line. Some companies have a few products; others can have several thousand. Width is the variety of different product lines a company carries, and depth refers to the number of different versions of a product in a product line. For example, while Burger King sells fast food, it sells at least 10 different types of hamburgers (its depth).

Question 2: Explain brand equity.

Answer 2: A brand conjures up positive or negative feelings in a consumer. For example, many Americans boycott Wal-Mart without ever having been in one because the company has received large amounts of negative media attention regarding how poorly they treat their workers and drive out small businesses. Fortunately for Wal-Mart, more people associate the brand with saving money and low prices. What a company means in the eyes of its consumers is called brand equity. Basically, it is the positive effect companies receive from their reputation. A good way of measuring brand equity is to see how much more a consumer would pay to have a certain brand. Customers make this trade-off in return for the quality they believe comes from that product.

Question 3: Explain different markets for services.

Answer 3: The service industry is the largest sector of the American economy, accounting for almost 80 percent of total jobs. Service industries in the country are broken down into the following areas:Government services are the largest sector of the service industry. Almost half of the employees in the United States work for some branch of the government. These are the teachers, police officers, firefighters, doctors, soldiers, postal workers, etc. While they don’t produce any goods, the country could not exist without them.Nonprofit organizations offer services to the public for a minimal cost. These businesses often seek to create enough revenue to keep their business running. These are the churches, museums, hospitals, charities, etc. Business organizations offer services to their clients and their employees in the form of banking, insurance, flights, entertainment, real estate, etc.

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