2. 11-2
L E A R N I N G O B J E C T I V E S
Describe the components of a product.
Identify the types of consumer products.
Explain the difference between a product mix’s breath and
a product line’s depth,
Identify the advantages that brands provide firms and
consumers.
Explain the various components of brand equity.
Determine the various types of branding strategies used by
firms.
Distinguish between brand extension and line extension.
Indicate the advantages of a product’s packaging and
labeling strategy.
Product, Branding,
and Packaging Decisions
LO1
LO2
LO3
LO4
LO5
LO6
LO7
LO8
5. 11-5
Product Mix and
Product Line Decisions
Source: Kellogg’s 2010 annual report, http://annualreport2010.kelloggcompany.com/innovation.htm.
Abbreviated List of BMW Product Mix
Product Lines
BMW MINI Rolls-Royce Motorrad
2 Series
3 Series
4 Series
5 Series
6 Series
7 Series
X Series
Z4 Series
M Series
BMW i
Hybrid
Clubman
Convertible
Countryman
Coupe
Hardtop
John Cooper Works
Paceman
Roadster
Ghost
Phantom
Wraith
C Series
F Series
G Series
K Series
R Series
S Series
6. 11-6
Product Mix and
Product Line Decisions
Breadth
• Number of product
lines
Depth
• Number of categories
within a product line
Courtesy Pepsi Cola Company
7. 11-7
CHECK YOURSELF
1. What is the difference between product line
breadth versus depth?
2. Why change product line breadth?
3. Why change product line depth?
9. 11-9
Value of Branding for the Customer
Facilitate Purchasing
Establish Loyalty
Protect from Competition
Are Assets
Impact Market Value
Apple wins in the
Apple vs Samsung patent lawsuit
10. 11-10
Brand Equity: Brand Awareness
Source: Interbrand’s Best Global Brands 2013 report is a look at financial performance of the brand, role of brand in the purchase decision
process, and the brand strength. Go to http://www.bestglobalbrands.com for more information. Reprinted with permission.
11. 11-11
Brand Equity: Perceived Value
How do discount
retailers like Target,
T.J. Maxx, and H&M
create value for
customers?
Photo by Peter Kramer/Getty Images
13. 11-13
Brand Equity: Brand Loyalty
Consumers are often
less sensitive to price
Marketing costs are
much lower
Firm insulated from
the competition
Copyright State Farm Mutual Automobile Insurance
Company 2005 Used by permission
14. 11-14
CHECK YOURSELF
1. How do brands create value for the customer
and the firm?
2. What are the components of brand equity?
18. 11-18
Brand Dilution
Evaluate the fit between
the product class
of the core brand
and the extension.
Evaluate consumer
perceptions of the
attributes of the core brand
and seek out extensions
with similar attributes.
Refrain from
extending the brand
name to too many
products.
Is the brand
extension distanced
enough from the
core brand?
22. 11-22
CHECK YOURSELF
1. What are the differences among manufacturer
and private-label brands?
2. What is co-branding?
3. What is the difference between brand
extension and line extension?
4. What is brand repositioning?