Bus169 Kotler Chapter 08

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  • Refers to objectives 1 & 2
  • Answer B. Comprises the total product as perceived by the consumer. The core is the basis of the product, augmented product supplements the core and tangible-intangible describe the components on the good-service continuum. Refers to objectives 1 & 2
  • Refers to objectives 1 & 2
  • Refers to objectives 1 & 2
  • Refers to objectives 4 & 5
  • Refers to objectives 4 & 5
  • Refers to objective 4
  • Refers to objective 4
  • Refers to objectives 5 & 6
  • Refers to objective 5
  • Refers to objective 5
  • Refers to objectives 5 & 6
  • Refers to objectives 5 & 6
  • Refers to objective 7
  • Refers to objective 7
  • Refers to objective 7
  • Refers to objective 8
  • Refers to objective 8
  • Answer B These are the most memorable components of brand. Refers to objective 8
  • Refers to objective 9
  • Refers to objective 8
  • Answer B. Two companies are combining products and brands. Refers to objective 8
  • Refers to objective 8
  • Refers to objectives 9 & 10
  • Refers to objectives 9 & 10
  • Refers to objectives 9 & 10


  • 1. Products: Goods, Services and Experiences
  • 2. Chapter Objectives (1)
    • Describe the nature of product in marketing management.
    • Explain the concept of the goods–services continuum.
    • Define the term product, including the core, actual and augmented product.
    • Explain product classifications, and contrast the differing types of consumer products and business-to-business products.
    • Explain services classifications and discuss the marketing of services.
  • 3. Chapter Objectives (2)
    • Discuss an extended notion of product that includes marketing persons, experiencing events, places, political ideas, causes, non-profit services, and fundraising endeavours.
    • Outline the range of individual product decisions marketers make, discussing the product attributes of quality, features and design.
    • Discuss branding, and contrast the differences among line extensions, brand extensions, multibrands and new brands.
  • 4. Chapter Objectives (3)
    • Illustrate product line and product mix decisions, describing stretching and filling the product line length, line modernisation, line featuring and line width.
    • List some of the considerations marketers face in making international product decisions, including whether or not to standardise or adapt product and packaging.
  • 5. What is a Product?
    • A product is anything that can be offered to a market with the objective of satisfying a consumer need or want.
    • It can include physical goods; services; people; places; organisations and ideas .
    • It is everything, both favourable and unfavourable, that the consumer receives in an exchange with the seller
  • 6. Can be viewed on 3 levels
      • The most basic level is the core product , which addresses the question:
      • - what is the buyer really buying?
      • The actual product may have as many as five elements: the quality level; the features; the styling; a brand name, and the packaging.
      • The augmented product - the additional consumer services and benefits that are built around the core and actual products
  • 7. Descriptions of a product's quality, features, style, brand name, and packaging identify the:
    • core product
    • actual product
    • augmented product
    • tangible product
    • intangible product
  • 8. The three Levels of Product
  • 9. An example of each level
  • 10. Product Classifications
    • Consumer Products are those bought by final consumers for personal consumption. Four types:
    • Convenience Products
      • Consumer goods and services that the customer usually buys frequently, immediately, and with the minimum of comparison and buying effort .
    • Shopping Products
      • Consumer goods and services that the customer, in the process of selection and purchase, compares on the basis of suitability; quality; price; and style .
  • 11. Cont’d
    • Speciality Products
      • Consumer goods and services with unique characteristics or brand identification, for which a significant group of buyers is willing to make a special purchase effort.
    • Unsought Products
      • Consumer goods and services that the consumer either doesn’t know about, or knows about but doesn’t normally think of buying.
  • 12. Table 8.2 Marketing Considerations for Consumer Products
  • 13. Business-to-Business Products
    • Business-to-business (B2B) products are bought by organisations or individuals for further processing; for use in running a business; or to on-sell to others.
    • The three groups of business products:
      • Materials and parts - industrial goods that enter the manufacturer’s product completely, including raw materials and manufactured materials and parts.
      • Capital items - industrial goods and services that enter the finished product partly, including installations and accessory equipment.
      • Supplies and services - industrial goods and services that don’t enter the finished product at all.
  • 14. Figure 8.4 Classification of Business Products
  • 15. Business / Industrial product
    • The purpose is to:
    • Manufacture other products;
    • Assist in running a firm’s business; or
    • Simply on-sell to consumers and end-users
    • A product is categorised as a ‘Consumer’ product or as a ‘Business’ product, based on the purpose for which it is purchased - the intended use
  • 16. Services products
    • Services products deliver something that is intangible: the buyer receives value from the purchase, but it does not result in the consumer owning anything that endures.
    • Continuing significant growth in the number and value of Services products, particularly in the ‘developed’ nations.
  • 17. Characteristics of Services
    • The key characteristics that differentiate Services products from physical goods:
    • Intangibility
    • Inseparability/ High personal involvement
    • Variability
    • Synchronous delivery/ consumption
    • Perishability
  • 18. Cont’d
    • Intangibility
      • Difficult to assess the suitability of the product in advance
      • Because of this, the physical elements become extra important
    • Inseparability
      • Purchase takes on extra significance
      • Buyer involvement contributes to the outcome
  • 19. Cont’d
    • Variability
      • Different level of quality in production
      • Standardisation, and use of technology can help to minimise the variation
    • Synchronous
      • Increased importance of ‘people’
      • Product is often ‘sold’ before it is produced
    • Perishability
      • Product is not produced in advance
      • Need for firm to link supply with demand
  • 20. Service Quality Measures
    • There is usually a much higher level of people involvement (both buyer and seller) with Services products than with goods.
    • Services purchases usually involve people in ‘service encounters’; Services are experiential in nature, and often require special measures, such as ‘mystery shoppers’, to assess the quality of the product.
  • 21. Extending the Classification of Goods and Services
    • Event marketing
      • Combines the marketing of Services elements with the marketing of goods, particularly the experiential aspects of sporting, entertainment and other staged events.
    • Person marketing
      • People such as athletes/ sports stars need to be marketed as a ‘personality’ before being used for endorsements.
      • Politicians can be marketed in a similar manner.
    • Political marketing
      • Politicians market themselves, their political ideologies, and their political party in an attempt to gain voter support.
  • 22. Cont’d
    • Cause marketing
      • Marketing an idea or social cause such as nuclear-free living or catching public transport to and from work.
      • In cause-related marketing, a firm might position its brand on the basis that it will donate part of the value of its sales to a particular cause.
    • Not-for-profit marketing
      • Conducted by organisations who are not motivated by profit. The aim is to make a sufficient trading surplus to enable the operation to continue.
    • Experiences marketing
      • Promoting the added-value elements available through customer participation and connection with the product, and managing all related aspects of the relationship.
  • 23. The Firm’s Product Decisions
  • 24. 1. Product Attributes
    • Product Quality
      • Is the ability of a product to perform its functions.
      • Includes the product’s durability; reliability; precision; ease of use; and repairability.
      • Quality should not be viewed as a problem to be solved; it is a competitive opportunity.
  • 25. Cont’d
    • Product Features
      • May include several models of a product (e.g. cars) offering varying features. Helps to differentiate from competitors. Must relate cost of features to value.
    • Product Design
      • Process of designing a product’s style and function. Creating a product that is attractive; easy, safe and inexpensive to use and service; simple and economical to produce and distribute.
  • 26. 2. Branding
    • Branding is a major strategic decision that can add value to a product.
    • Viewed by consumers as an important part of the product.
    • Powerful brands will gain strong recognition and attract significant consumer loyalty, and can usually command a higher price
    • Brands with strong consumer loyalty are better protected against the strategies of competitors. This is high brand equity .
  • 27. Cont’d
    • The brand is the combination of functional and emotional benefits delivered by a product.
    • Consumers are looking for something they can associate with - a means of linking with a particular product that delivers ‘value’.
    • Consumers are attracted to a product that :
      • Is dependable; has high quality; is consistent over a period of time; offers ‘value-for-money’; and can deliver a positive experience each time (satisfaction).
  • 28. Cont’d
    • A brand can be:
    • A name; term; sign; symbol; or design (or a combination of these) intended to identify a firm’s product, and to help differentiate it from competing products
  • 29. The most enduring meanings of a brand are its:
    • attributes and benefits
    • values, benefits, attributes, and personality
    • personality, attributes, and benefits
    • values, culture, and personality
    • attributes, benefits, and values
  • 30. To Brand or Not to Brand
    • Branding can deliver significant benefit, so it is a major part of product marketing.
    • Some products are classified as ‘generic’. These are plainly packaged, and are less expensive versions of everyday products.
    • In Australia, the market share for generics tends to fluctuate, but major supermarkets are developing their own generic labels.
  • 31.
    • Manufacturers’ brand
      • Created and owned by the producer of the product.
    • Private brand
      • Created and owned by a reseller of the product.
    • Licensing
      • Some companies are licensed to use brand names or symbols previously created by other manufacturers.
    • Co-branding
      • The practice of using the established brand names of two different companies to promote the same product.
    Brand Sponsor Decision
  • 32. Co-branded product
  • 33. Arnott's biscuits with M&M candies in them would be an example of the use of a __________ strategy.
    • line extension
    • co-branding
    • repositioning
    • brand extension
    • line filling
  • 34. Brand repositioning
    • It may be necessary for a firm to reposition its product, due to:
      • a competitor launching a new brand that cuts into the firm’s market share.
      • a shift in consumer wants
      • Repositioning could be an easier, more beneficial option than introducing a completely new brand.
      • The firm might need to change both the product and the product image to better satisfy any new customer expectations.
  • 35. Packaging/ Labelling
    • Packaging can:
      • Promote the product
      • Protect the product
      • Enable easy storage
      • Encourage recycling
    • Labelling will:
      • Help consumes with selection
      • Provide information, e.g. how-to-use instructions
      • Highlight product features and benefits
  • 36. Product Line Decisions
    • A product line is a group of products that are closely related because they function in a similar manner; are sold to the same customer groups; are marketed through the same types of outlets; or fall within given price ranges.
    • Product line length
      • Stretching downward
      • Stretching upward
      • Stretching both ways
  • 37. Figure 8.8 Product Line Stretching Decisions
  • 38. Product Mix Decisions
    • A product mix is the set of all product lines and items that a particular seller offers for sale.
    • The product mix can be described as having: breadth; length; depth; and consistency.
      • Breadth is the number of different product lines.
      • Length is the total number of items the company offers.
      • Depth is the number of versions of each product in the line.
      • Consistency is how closely the various product lines are in terms of consumer usage; production requirements; and methods of distribution.