This document discusses product strategy and classification. It defines a product and outlines five product levels from core benefit to potential product. Products are classified based on durability, tangibility and use. Consumer goods are classified as convenience, shopping, specialty or unsought. Industrial goods are materials/parts, capital items or supplies. Companies can differentiate products through various attributes. A product hierarchy consists of need families, product families, product classes, product lines and items. Companies manage product mixes through lines, assortments, depth, length and width. Packaging serves identification, grading, description, promotion and other functions.

1. Marketing Management, 12/e A South Asian Perspective 12 Setting Product Strategy Kotler Koshy Keller Jha

2. Chapter Questions What are the characteristics of products and how can they be classified? How can companies differentiate products? How can a company build and manage its product mix and product lines? How can companies combine products to create strong co-brands or ingredient brands? How can companies use packaging, labeling, warranties, and guarantees as marketing tools?

3. Product Anything that can be offered to a market to satisfy a want or need.

4. Figure 12.2 Five Product Levels Core benefit Basic product Expected product Augmented product Potential product

5. Product Classification Schemes Durability Tangibility Use

6. Durability and Tangibility Nondurable goods Durable goods Services

7. Consumer Goods Classification Convenience Shopping Specialty Unsought

8. Industrial Goods Classification Materials and parts Capital items Supplies/business services

9. Product Differentiation Product form Features Performance Conformance Durability Reliability Reparability Style Design Ordering ease Delivery Installation Customer training Customer consulting Maintenance

10. The Product Hierarchy Need family Product family Product class Product line Product type Item

11. Product Systems and Mixes Product system Product mix Product assortment Depth Length Width Consistency

12. Product Line Analysis Core product Staples Specialties Convenience items

13. Line Stretching Down Market Stretch Up-Market Stretch Two-Way Stretch

14. Product-Mix Pricing Product-line pricing Optional-feature pricing Captive-product pricing Two-part pricing By-product pricing Product-bundling pricing

15. Packaging: The 5 th P All the activities of designing and producing the container for a product.

16. Packaging has been influenced by: Self-service Consumer affluence Company and brand image Innovation opportunity

17. Functions of Labels Identifies Grades Describes Promotes