Page 590 - Business Principles and Management

C HAPTER 21 A SSESSMENT

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CHAPTER CONCEPTS

• Businesses think of their products as what they have to offer to
consumers. Consumers are more likely to think of products as ways
to satisfy needs.
• Businesses develop products on three levels: basic product, enhanced
product, and extended product. Also, businesses must decide whether
to offer product lines and product assortments.
• Packaging adds value by protecting the product during shipping and
storage; providing information about product composition, features,
use, and proper handling; making the product easier to use; and pro-
moting the product.

• Branding gives customers confidence in making a purchase. If they
recognize a brand name and have had good experiences with that
brand, they will be more likely to buy the brand again.
• Effective distribution gets the correct products to customers at the
right place and time and in the correct form.

• Channels of distribution can be either direct (from manufacturer di-
rectly to purchaser) or indirect (using retailers and sometimes whole-
salers to handle some of the marketing activities). Telemarketing is a
type of direct distribution.

• Distribution activities include product handling and storing, trans-
porting and tracking the product, order processing, and customer
service.

REVIEW TERMS AND CONCEPTS

Write the letter of the term that matches each definition. Some terms will
not be used.
1. Physical product in its simplest form
2. Product that includes additional features that are not part of the a. administered channel
physical product but increase its usability b. bar codes
3. Group of similar products with obvious variations in the design and c. basic product
quality to meet the needs of distinct customer groups d. brand
4. Routes products follow while moving from producer to consumer, e. channel integration
including all related activities and participating organizations f. channel members
5. Complete set of all products a business offers to a market g. channels of distribution
6. Differences between a business’s offerings and the consumer’s h. direct distribution
requirements i. distribution centers
j. economic discrepancies
7. Businesses that participate in activities that transfer goods and ser- k. extended product
vices from the producer to the user l. indirect distribution
8. Distribution in which producers sell directly to the ultimate consumer m. product assortment
9. Distribution that takes place through channel members n. product line
10. Channel in which one organization takes a leadership position to
benefit all channel members

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