Critics of Nike often complain that its shoes cost almost nothing to make, yet are priced so high. Identify the elements of providing and communicating value that add to Nike's cost structure and result in the high price of Nike shoes
What will be an ideal response?
Although the raw materials and manufacturing costs of a sneaker are relatively low, marketing the product to the consumer is quite expensive. Providing value includes R&D costs and the costs associated with shipping to retail locations as well as the retailers' overhead. Communicating value includes obtaining celebrity endorsement and extensive advertising. Nike must also pay for a sales force that communicates the product's value to retailers and helps ensure that products are available in retail locations convenient to end consumers.
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The major benefit of the hierarchy of effects model is that it is one method to identify the typical steps consumers and businesses take when making purchases
Indicate whether the statement is true or false
Eventually, Wallace expects that domestic production of the mousetrap will cease altogether. This would happen in the ________ stage of the product life cycle
A) new product B) maturing product C) adapted product D) standardized product