Note to Instructor This Web link is a great example of a store that creates experiences is Jordan’s Furniture in the Boston. These furniture stores include an Imax theater, an amusement park quality motion ride, a trapeze school, and Mardi Gras parades. You can visit their stores through their Web sites.
Note to Instructor Core benefits represent what the buyer is really buying. Actual product represents the design, brand name, and packaging that delivers the core benefit to the customer. Augmented product represents additional services or benefits of the actual product. It is a good idea for the students to bring in some products so the class can discuss the levels of product and services. Products including Gatorade, toothpaste, facial moisturizer or cosmetics work well in this discussion. You can often find augmented product features on the product’s Web sites including games, features and support.
Chapter 10 Product Concepts Discussion/Team Activity: Name products and services that fall into each of the consumer product categories: Convenience: candy, soft drinks, deodorant, aspirin, hardware, dry cleaning. Shopping: Homogeneous shopping products such as washers, dryers, televisions. Decisions are based on the lowest-priced brand with the desired features. Heterogeneous shopping products are essentially different, for example furniture, clothing, housing, universities. Decisions are highly-individual and based on “finding the best product for me.” Specialty: fine watches, expensive automobiles, gourmet restaurants. Unsought: new products, insurance, burial plots, encyclopedias.
Chapter 10 Product Concepts Notes: All of Campbell’s products constitute its product mix. Each product in the product mix may require a separate marketing strategy. In some cases, product lines and mixes share some marketing strategy components. Consider Nike’s theme, “Just Do It.” An example of Campbell’s product lines and product mix is shown in Exhibit 10.2. Discussion/Team Activity: Identify a few companies with extensive product lines and product mixes. Pick one and create a matrix similar to Exhibit 10.2. Evaluate the marketing strategies in use.
Chapter 10 Product Concepts Notes: Marketing managers must decide if and when to modify products. Product modification changes one or more of a product’s characteristics: Quality modification: change in a product’s dependability or durability. Functional modification: change in a product’s versatility, effectiveness, convenience, or safety. Style modification: an aesthetic product change (like color) rather than a quality or functional change. Planned obsolescence is a style modification change to make old products “obsolete” to the consumer.
Chapter 5 Product DecisionMKT243 Fundamental Of Marketing DHD2011 1
What is product? Classification of product Level and types of product Product items, lines and mixes Branding Packaging MKT243 Fundamental Of Marketing DHD2011 2
Product is the Product “heart” ofMarketing Mix Price Promotion Place (Distribution) MKT243 Fundamental Of Marketing DHD2011 4
Product is anything that can be offered in a market for attention, acquisition, use, or consumption that might satisfy a need or want (Kotler and Gary)Product is everything, both favorable and unfavorable, that a person receives in an exchange (McDaniel/Lamb/Hair) MKT243 Fundamental Of Marketing DHD2011 5
Levels of Product and Services MKT243 Fundamental Of Marketing DHD2011 6
PRODUCTS PRODUCTS Consumer Consumer Business Business Products Products Products ProductsConvenienceConvenience Shopping Shopping Specialty Specialty Unsought Unsought Products Products Products Products Products Products Products Products MKT243 Fundamental Of Marketing DHD2011 7
Convenience A relatively inexpensive item that Product merits little shopping effort A product that requires comparison Shopping shopping, because it is usually Product more expensive and found in fewer stores A particular item for which Specialty consumers search extensively and Product are reluctant to accept substitutes A product unknown to the potential Unsought buyer or a known product that the Product buyer does not actively seek MKT243 Fundamental Of Marketing DHD2011 8
Product and Service Classifications (Business Product) Industrial products are products purchased for further processing or for use in conducting a business Classified by the purpose for which the product is purchased ◦ Materials and parts ◦ Capital ◦ Raw materials ◦ Processed materials ◦ Supplies and service MKT243 Fundamental Of Marketing DHD2011 9
A specific version of a product A specific version of a product that can be designated as a that can be designated as aProduct ItemProduct Item distinct offering among an distinct offering among an organization’s products. organization’s products. A group of closely-related A group of closely-relatedProduct LineProduct Line product items. product items. All products that an All products that anProduct MixProduct Mix organization sells. organization sells. MKT243 Fundamental Of Marketing DHD2011 10
Product Mix Width The number of Product Lines an organization offer e.g: Nestle-Drinks, confectionary, Instand noodels Product Line Depth The number of Product items in a product line e.g: Nestle, In the Product Line of Junior Foods, there are 11 Products Items+++ MKT243 Fundamental Of Marketing DHD2011 12
Advertising Economies Advertising Economies Package Uniformity Package Uniformity Standardized Standardized Components Components Efficient Sales and Efficient Sales and Distribution Distribution Equivalent Quality Equivalent Quality3 MKT243 Fundamental Of Marketing DHD2011 13
Adjustments to Adjustments to Product Items, Product Items, Lines, and Mixes Lines, and Mixes Product Line Product Line Product Product Product Product Extension or Extension orModificationModification Repositioning Repositioning Contraction Contraction MKT243 Fundamental Of Marketing DHD2011 14
Quality Modification Quality ModificationFunctional ModificationFunctional Modification Style Modification Style Modification MKT243 Fundamental Of Marketing DHD2011 15
Is the changing consumer’s perception of a brand in relation to competing brand MKT243 Fundamental Of Marketing DHD2011 16
Why reposition Why reposition established brands? established brands? Changes in Changes in Changing Changing Declining Sales Declining Sales Social Social Demographics Demographics Environment Environment3 MKT243 Fundamental Of Marketing DHD2011 17
Product Line Extension ADDING more product items to an existing product line Product Line Contraction DELETING product items in the product line because PL over extension-Cannibalization-harvested product that not generate much sales MKT243 Fundamental Of Marketing DHD2011 18
Symptoms of Symptoms of Product Line Product Line Overextension Overextension● Some products have low sales or cannibalize sales of other items● Resources are disproportionately allocated to slow-moving products● Items have become obsolete because of new product entries MKT243 Fundamental Of Marketing DHD2011 19
That part of a brand that can be spoken, including That part of a brand that can be spoken, including letters, words, and numbers. letters, words, and numbers.BrandBrand It’s a name, term, symbol, design or combination It’s a name, term, symbol, design or combinationName Name thereof that identifies a seller’s products and thereof that identifies a seller’s products and differentiate them from competitor differentiate them from competitorBrandBrand The elements of a brand that The elements of a brand thatMark Mark cannot be spoken. cannot be spoken.BrandBrand The value of company and brand names. The value of company and brand names.EquityEquity MKT243 Fundamental Of Marketing DHD2011 21
Source of brand name Quality, Benefits, Animals, Persons, Numbers, Things etc…Benefits having a Brand Name: Product Identification Repeat sales New product sales MKT243 Fundamental Of Marketing DHD2011 22
It refer to the value of company and brand names. High Awareness + Perceived Quality + Brand Loyalty = Brand EQUITY. A strong brand equity is a strong asset to the company. MKT243 Fundamental Of Marketing DHD2011 23
Easy to pronounce, recognize remember and short Distinctive and unique Describe the product, use and benefits Has a positive connotation Reinforce the desired product image Legally protectable in home and foreign markets of interest MKT243 Fundamental Of Marketing DHD2011 24
Trade mark Exclusive right to use a brand or part of a brand (shapes, ornamental color or design, catchy phrases, abbreviations, sounds etc). Generic Product name -Company that fail to protect their trademarks face the problem of generic product name -Consumer identifies the product by class or type and cannot be trademarked MKT243 Fundamental Of Marketing DHD2011 26
Brand Brand No Brand No Brand Manufacturer’s Manufacturer’s Private Brand Private Brand Brand BrandIndividual Individual Family Family Combi- Combi- Individual Individual Family Family Combi- Combi- Brand Brand Brand Brand nation nation Brand Brand Brand Brand nation nation MKT243 Fundamental Of Marketing DHD2011 27
Generic Product vs. Branded ProductsGeneric Product-no frills, no brand name and low cost, low qualityBranded Product-Product with name Manufacturers’ Brands vs. Private BrandsManufacturers’ Brand-Company/ Manufacturer namePrivate Brand-Wholesaler/ retailers name Individual Brands vs. Family BrandsIndividual Brand-different brand names for different productsFamily Brands-Same brand names for different products Cobranding-placing 2 or more brand names on a product or its packages MKT243 Fundamental Of Marketing DHD2011 28
Generic products – No frills, no brand name, low cost product and easy to identified by it’s product category. What is the main appeal of generic products??PRICE MKT243 Fundamental Of Marketing DHD2011 29
Manufacturer’s brand – National Brand (brand’s owner) E.g: Kodak, Pensonic, Akira etc. Private brand – Private label or store brand. E.g GIANT BRAND, FIRST CHOICE, PARKSON etc. MKT243 Fundamental Of Marketing DHD2011 30
Individual brand – Using different brand name for different products. Use only: Products vary greatly in use and performance. E.g: Colgate- Kayu Sugi, Fresh, White, Active Solution etc. Family Brand – marketing several different products under the same brand. E.g: Sony, Toshiba, NIKE, PADINI etc. MKT243 Fundamental Of Marketing DHD2011 31
Types of Cobranding Types of CobrandingIngredient Ingredient Cooperative Cooperative Complementary Complementary Branding Branding Branding Branding Branding Branding e.g: Intel e.g: Intel e.g: Air Asia and e.g: Air Asia and e.g: Nescafe and e.g: Nescafe and Citybank Citybank Creamer Creamer MKT243 Fundamental Of Marketing DHD2011 32
“The activities of designing the container or wrapper for a product”Package:Container/ wrapper MKT243 Fundamental Of Marketing DHD2011 34
1. Primary Package A product’s Immediate container2. Secondary Package A container to protect primary package3. Shipping Package A container used to store, to ship the product MKT243 Fundamental Of Marketing DHD2011 35
Contain and Protect Contain and Protect Promoting Products Promoting ProductsFacilitate Storage, Use,Facilitate Storage, Use, and Convenience and Convenience Facilitate Recycling Facilitate Recycling MKT243 Fundamental Of Marketing DHD2011 36
‘Is a printed information appearing on or with the package’ Persuasive Informational Focus on giving product info Focuses on such as ingredients, promotional theme nutritional information, net / effort weight, manufacturer’s Emphasis on attractive address, expire date, storage color, graphical and instruction, suggested price, halal sign, customer info line text service, UPC etc. Consumer information is secondary Helps make proper selections Lowers cognitive dissonance Includes use/care MKT243 Fundamental Of Marketing DHD2011 38
Universal Product Code A series of thick and thin vertical lines (bar code), readable by computerized optical scanners, that represent numbers used to track products MKT243 Fundamental Of Marketing DHD2011 40
‘A confirmation of the quality orperformance of a good or service’ -Written Guarantee -Simple statementExpressExpress e.g: 100% genuine leatherWarrantyWarranty 100% COTTON 100% ORGANICImplied ImpliedWarranty Unwritten GuaranteeWarranty MKT243 Fundamental Of Marketing DHD2011 43