This document outlines various product strategies for companies operating in the Asia Pacific region. It discusses product hierarchy, product mix decisions, product line strategies, new product development, positioning, repositioning, brand decisions, and other topics. The key strategies covered include product line extensions, new product development, positioning products using perceptual maps, and approaches to repositioning existing products.

1. Product Strategies for
the Asia Pacific
Asia-Pacific Marketing
Federation
Certified Professional Marketer
Copyright
Marketing Institute of Singapore
1

2. Outline
 Product Hierarchy
 Product-Mix Decisions
 Product-Line Strategies
 New product development in ASPAC
 Positioning & Repositioning
 Brand decisions
2

3. Introduction
 Product (or service) is the main
element of the marketing mix
 Therefore, need to determine the
Product Strategies before deciding on
the remaining marketing mix
3

4. 7-Levels of Product
Hierarchy
 Product need—to satisfy a need e.g. feet protection
 Product class—a family of products having similar
function e.g. all shoes
 Product line—a group of products with closely related
functions e.g. sports shoes
 Product type—products within a line having similar
form e.g. basket-ball shoes
 Brand—a name representing a product or line e.g.
Nike
 Item (Stock Keeping Unit)—a unit item e.g. one pair
of Nike basket-ball shoe
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5. Product-Mix Decisions
Decisions on the product mix (the number of
product lines and items in each line) that the
company may offer
 A single product
 Most firms started off as a single-product company
 Multiple products
 e.g. Creative Technology markets sound cards as
well as MP3 players
 A systems of products
 e.g. Nikon sells camera, lenses, filters & other
options
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6. Product-Line strategy
 How many product lines should we
have?
 Example: Delft Sensor Systems offer a
comprehensive range of products, including
portable and platform mounted night vision
systems and thermal imaging systems,
head- and helmet mounted displays, laser
rangefinders and fire control systems
(Source: http://www.oip.be/press/brazil.htm)
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7. Product-Line strategy
(cont’d)
 How many product items in each line?
 Example: Both Gardenia and Bonjour
launched new flavors in January 1999 to
nibble away at each other’s market
share of a loaf estimated to be worth
about $80 million
(Source: ST, Home, Jan29/99)
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8. Expanding the Product Line
1. Product line extension: add an item to
the existing product line
 Many FMCG companies introduced
various sizes of the same product
e.g.mini-packs for travelers, extra-large
size for hospital
2. Product category extension: add a new
item or line of items for a company e.g.
 P&G have Vidal Sassoon, Head &
Shoulders, Rejoice, and Panthene in the
same category 8

9. Expanding the Product Line
(cont’d)
3. Brand extension: Product category
extension that uses an existing brand
name e.g.
 Cerebos introduced Brands Essence of
Chicken with TangKwei targeting women
 Nestle extended its Bear Brand
condensed milk in Thailand by
introducing Bear Brand with Honey
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10. More on Product Line Extension
 Downward stretch by introducing lower range of
the products e.g.
 In 1989 the Shangri-La, a chain of deluxe hotels and
resorts in Asia established the Traders Hotels, a sister
brand to deliver high value, mid-range, quality
accommodation to the business traveler
 Mercedes introduced the “baby Merz” to cater to the
upper class mid-sized range of the market
 Upward stretch by entering the high end of the
market e.g.
 Toyota introduced the Lexus and Nissan introduced the
Infiniti
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11. Product Line Extension (cont’d)
 Two-way stretch by filling the whole
line e.g.
 Toyota has the Starlet at the lower end;
the Corolla in the executive range; the
Camry in the upper-management range
and the Lexus in the luxury range
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12. New Product Strategy
 New products are critical to survival
 New-product development (NPD) is
essential for companies seeking growth
 It should be an on-going, well organized
NPD process having top-management
support
 What is a new product? (see next slide)
 From a firm's perspective, a new product is
a product that it is unfamiliar in any way
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13. Definition of
Product Newness
1. Products new to the world; usually
revolutionary products resulting from
product innovation e.g
 When Creative Technology first
introduced the Sound-blaster
 When disposable cameras were first
introduced
 When Seiko introduced the Seiko
Kinetic Relay, a watch that can go into
suspended animation 13

14. Definition of Product
Newness (cont’d)
 Products new to the firm
 Improvements to existing products e.g.
 In 1960 Kao introduced shampoo liquid and in
1970 introduced Kao Merit shampoo (anti-
dandruff)
 Additions to existing lines e.g.
 In 1965 Kao introduced the Kao Tender hair
conditioner
 Costs reductions and re-positionings
14

15. Example of NPD--Logitech
“Logitech, the world's biggest maker of
computer mice, has come up with a
mouse that allows the user to feel what
is seen on the
screen. This mouse [is]
called the iFreeMouseMan”
AP (August 22, 2000)
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16. Product Convergence
First coined by Creatives’ Sim W H who
was referring to the marriage between
the PC and home entertainment
 Creative Multi-Speaker Surround
(CMSS) uses seven audio channels
Source: Computer Times, 1997
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17. Positioning
 “Positioning refers to placing a brand in
that part of the market where it will
have a favorable reception compared
to competing brands” Subash Jain
 “A product’s position is the place the
position occupies in consumers’ minds
relative to competing products.”
Philip Kotler
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18. Generic Positioning Strategies
 Our product is unique
 e.g. Raffles Hotel (oldest hotel); Westin Hotel
(tallest hotel)
 Our product is different
 e.g. Seng Choon eggs (low in cholesterol)
Listerine (kills germs)
Amex Blue credit card (6-month rate of
15.9% vs the market rate of 24%)
 Our product is similar
 e.g. Thai fragrant rice
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19. Approaches to Positioning
 By attributes
 e.g. Singapore Airlines (first class comfort)
 By benefits
 e.g. Citibank Credit Card (7/24 availability)
 By price/quality e.g. Proton
 By usage or application e.g.100Plus (fluid
replenishment in sports)
 By users e.g. Johnson Baby Shampoo; J&J
Affinity Shampoo (hair conditioner for women)
 By product class
 e.g. Camay soap (with bath oils—not just soap)
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 By competitors e.g. Avis against Hertz

20. Product Positioning Using
Perceptual & Preference Maps
Marketing managers use a Mapping
technique to help them visualize the
competitive structure of the market
before they develop differentiation and
positioning strategies
20

21. Positioning Statement
For [a target segment], the [concept] is [the
primary claim] because [it is the single most
important factor].
Example:
For Seng Choon eggs, the low cholesterol level
is the only healthy alternative because it is
safe for frequent consumption
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22. Example of a 2D Perceptual Map
for Laptop
Brand A
Sl
ow
-s p
ee
d
Performance
Light-
weigh
t
e
Va
yl
St
lue
Brand B
Appearance
22

23. Repositioning
Why reposition?
 Competitors position next to you
 Consumer preferences changed
 New consumer preference cluster
 Original mistake
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24. Repositioning (cont’d)
 Repositioning among existing customers
 e.g. Cerebos repositioned BRAND’S from a
traditional therapeutic and recuperative tonic to
one for preventative health maintenance
 APB repositioned Tiger Beer as a beer for all time
 Repositioning among new users
 BRAND’S essence of chicken for students
 Repositioning for new uses
 Repositioning BRAND’S as a base for double-boil
cooking
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25. Product-Overlap Strategy
This strategy refers to a situation in which
a company decides to compete against
its own brand by using:
 Competing brands
 e.g. Gillette Atra, Sensor, Mach 3
 Private labeling
 e.g. Sin Sin Chilli Sauce, Watson Vitamins
 OEM
 e.g. IBM selling magneto-resistance (MR) heads
to OEM disk drive developers/manufacturers
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26. Product-Elimination
Strategy
 When a product’s performance is falling
short of expectations and continued
support is no longer justified, it’s time to
pull it out of the marketplace
 How?
 Harvesting, line-simplification, total-line
divestment
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27. Value-Marketing Strategy
 Value-marketing strategy means delivering real
product performance based on the following
promises
 Quality strategy
 Customer-service
 Time-based
 Example:
 Dell cuts the duration from order to delivery of most
of its products to the minimum
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28. Brands
 “A rose by any name smells as sweet.” True
or false?
 Would you go vacationing on Hog Island?
 Why are Coca-Cola, McDonald’s and
Kentucky Fried Chicken (KFC) successful?
 Do you think Maikenji would be half as
successful?
 Maikenji restaurant in Badaling, north of Beijing
combines the Chinese Characters used in the
names for McDonald’s and KFC and offers a
menu similar to KFC located 100 metres away
(AP 11,Jul2001)
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29. Brands (continued)
“Buildings age and become dilapidated.
Machines wear out. Cars rust. But what
lives on are brands.”
Sir Hector Laing
United Biscuits, U.K. Source: The
economist, Dec 24, 1988
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30. What is a brand?
Six levels of meaning:
 Attributes e.g. High resale value
 Benefits e.g. Safety
 Values e.g. Brand loyalty
 Culture e.g. organized and efficient
 Personality e.g. serious
 Type of users e.g. by occupation
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31. Alternative Brand
Strategies
1. No brand identity
 Small firms with unknown brands e.g.
small tailoring outfits
2. Private brands
 Retailers with established brand
names e.g. NTUC Fairprice
3. Corporate brands
 Family name e.g. This Fashion
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32. Alternative Brand Strategies
(cont’d)
4. Product line extension
 Create cost advantage e.g. Novena’s collection of
an extensive range of furniture at reasonable price
4. Specific product
 Individual brand e.g In addition to the Novena
brand, Novena Holdings also carry the Castilla
brand of Italian designed furniture
6. Combination
 e.g. Novena Holdings’ Novena Collection, Dickson
Beech Collection and the White Collection;
Seiko’s Alba and Pulsar
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33. The Branding Process
 From commodity to product
 e.g. air travel
 From product to brand
 e.g. Singapore Airlines
 From brand to experience
 e.g. Romance in the air
 From experience to the heart
 e.g. A Great Way to Fly
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34. Branding on the Web
 Profile of “Gen-N”
 How to harness the Internet for brand-
building?
 By rewarding brand loyalty and updating your
site etc.
 Decision-influence factor
 Conventional branding => image
 Online branding => customer experience
 The issue of trust in a brand
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(Source: Hi-Tech, Hi-Touch Branding by Temporal and Lee)

35. Old Brands Strategy
 Old brands survive due to emotional bond
with the consumer
 For slow moving brands either revive it with
marketing money or kill it
 Growing interest in old brands because
brand names carry value that is getting more
expensive and risky to create
 When re-promoting old brands, do not ignore
younger consumers
Source: “Selling”, Fortune, April 28, 1986
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