Reference with Kotler textbook and examples

1. Setting Product Strategy

2. We will address the following
 Characteristics of products
 How marketers classify products
 How companies differentiate products
 How company build and manage its product mix and
product lines
 How companies combine product to create strong co-
brands or ingredient brands
 How companies use packaging,labelling,warranties and
guaranties as marketing tools

3. What is a Product?
The product is any thing that
can be offered to market to
satisfy a want or a need.
Information
goods
Experience
Organization
Place
Properties
Ideas
Services
Events
Persons

6.  Ginger Hotels have set new standards of service quality
through their affordable hotels in the smart basics
category.

7. Product Classification
 Durability and Tangibility
 Consumer Goods
 Industrial Goods

8. Product Classification
Durability and tangibility
 Nondurable goods
• Tangible
• Rapidly consumed in one or a few uses.
 Durable goods
 Tangible
• Lasts a long time
 Services
• Intangible

9. Consumer Goods
 Classified by shopping habits
• Convenience goods
• Shopping goods
• Specialty goods
• Unsought goods

10. Consumer Goods
 Convenience goods :
• Staples :
Goods consumers purchase on a regular basis
(Toothpaste).
• Impulse Goods:
Purchased without any planning or search efforts
(Magazines).
• Emergency Goods:
Are purchased when a need is urgent (umbrellas
during a rainstorm).

11. Consumer Goods
 Shopping goods :
The bases are the suitability quality, price and style
• Homogeneous shopping goods:
Are similar quality but different enough
in price to justify shopping
comparisons.
• Heterogeneous shopping goods:
Differ in product features & services that
maybe more important than
Price.

12. Consumer Goods
 Speciality goods:
Have unique characteristic or for
which enough buyers are
willing to make a special purchasing
effort.
 Unsought goods:
Customers normally doesn’t know
prefer not to buy.

13. Industrial goods
 Are goods that enter the manufactures product
completely
 Materials and parts
◦ Raw materials
◦ Manufactured materials and parts
 Capital items
◦ Installations
◦ Equipments
 Supplies and business services
◦ Maintenance and Repair items
◦ Operating supplies

14. Product Differentiation
 Actually differentiating the company’s market offering from competitor so
that it achieve desire position in consumer’s mind to give more consumer
value.
Bases of Product Differentiation
Form/ Size Features

15. Customization
Performance/
Quality
Durability
Reliability
Reparability &
After sale
service
Style

16. Services Differentiation
 When the physical product cannot easily be differentiated, the
key to competitive success may lie in adding valued services
and improving their quality.
Bases of Service Differentiation
Ordering
Ease Delivery

17. Installation Customer
Training
Customer
Consulting Maintenance &
Repair
Return

18. The Product Hierarchy
Item
Produc
t Type
Product
Line
Product Class
Product Family
Need Family
The product hierarchy
stretches from basic
needs to particular items
that satisfy those needs.
We can identify six levels
of the product hierarchy.
Stretches from
basic needs to particular
items that satisfy
those needs.
A group of related goods
that are manufactured by a
single company.
Variations between
products within a class in
terms of physical
characteristics (color,
fragrance, shape) or brand
names.
A group of
related products under a
single brand sold by the
same company.
Products which fulfill a
similar need for a market
segment or market as a
whole.
Prestige Omega

19. width length
Depth Consistency
Managing
product mix
Product systems and mixes

21.  Wipro has a diversified product portfolio ranging
from software to personal care products and
engineering products, each tapping into marketing
opportunities that emerge through evolving consumer
needs.

22. Product mix pricing
There are six situation involving product mix pricing:
1) Product line pricing:
Companies normally develop product lines rather than single
products and introduce price steps.
2) Optional feature pricing:
Many companies offer optional products, features and service a
long with their main product.
3) Captive product pricing:
Some products require the use of ancillary or captive products.

23. Product mix pricing
4) Two part pricing product:
Service firms often engage in two-part pricing consisting
of affixed fee plus variable usage fee.
5) By-product pricing:
The production of certain goods-meats, petroleum products
often results in by-products.
6) Product bundling:
Sellers often bundle products and features.

25. Product-Line Analysis
 Product line managers need to know the sales and profit items
in their lines in order to determine which items to built,
maintain, harvest and divest.
Product-Item Contributions to a Product Line's
Total Sales and Profits
0
10
20
30
40
50
60
1 2 3 4
Product Item
PercentageContribution
toSalesandProfit
Sales
Profits

26. Market Profile
 Product line managers need to look at market profile.
 The manager must review how the line is positioned against
competitor’s lines.

27. Product Line Length
A company lengthen its product line in two ways:
1. Line stretching: Involves the question of whether a particular
line should be extended or not.
Down market: It introduces a lower priced line for any three
reasons:
• The company may notice strong growth opportunities in the
down market.
• To tie up lower end competitors who might other wise try to
move up market.
• The middle market is declining.

28. - Upward stretch: Enter the high end of market for more
growth , higher margins.
- Two way stretch: The companies serving middle market can
stretch in both direction.
2- Line filling: A product line can be lengthened by adding
more items within the present rang like reaching for
incremental profits, trying to satisfy dealers.

29. Line modernizations: whether the line needs a new look .
 In rapidly changing product markets , modernization is
continuous.
 A major issue is timing improvements , so they do not
appear too early ( damaging sales of the current line ) or
too late ( after the competition has established a strong
reputation for more advanced equipment).
 Line pruning : How to delete and remove weaker items
from the line.

31. Co-Branding & Ingredient
Branding
Co-Branding:
It called dual branding or brand bundling, in which two or
more well known existing brands are combined into a joint
product or marketed together in some fashion.

32. Integrated Branding:
 Is a special case of co-branding.
 It involves creating brand equity for
materials, components or parts that
are necessarily contained within other
branded products

33. Packaging and Labeling
 Packaging :
Is all the activities of designing and producing
the container for a product

34.  Packaging includes:
• The primary package
• The secondary package
• The shipping package
• Packaging has become as marketing
tool, well designed packages can
create convenience & promotional
value.

35.  The factors that help in increasing using packaging as
a marketing tool:
 Self service: The package must perform many of the
sales tasks: attract attention, describe the product
features, create consumer confidence and make a
favorable impression.
 Consumer affluence: Consumers are willing to pay a
little more per the convenience appearance,
dependability and prestige of better packages

36.  company and brand Image: Packages contribute to
instant recognition of the company or brand.
 Innovation opportunity: Innovative packaging can
bring large benefits to consumes and profits to
producers.( easy to carry , easy to open , easy to pour
and close)

37. Testing:
After Packaging is designed it must be tested
 Engineering tests
 Visual tests
 Dealer tests
 Consumer tests

38.  Engineering Tests:
Conducted to ensure that the package stand
up under normal conditions.
 Visual Tests:
To ensure that the scrip is legible & the colors
harmonious.
 Dealer tests:
To ensure that dealers find the packages
attractive & easy to handle.
 Customer tests:
To ensure favorable consumer response

39.  The label may be a simple tag attached to the product
or an elaborately designed graphic that is part of the
package.

40. Labeling functions:
• Identifies the product or brand
• May identify product grade
• May describe the product
• May promote the product
Legal restrictions impact packaging for many products.

42. Warranties & guarantees
 Warranties: are formal statements of expected
product performance by the manufacturer.
 Guarantees are most effective in two situations:
1. The company or the product is not well know.
2. The product's quality is superior to the competition.

44. 1
 “Relationships matters”
a)Twitter b) Face book c) LinkedIn
 “Remember Everything”
a) Viadeo b) Reddit c) Ever note
 “Be together not the same”
a)Android b) Instagram c) MySpace

45. 2