1-product and branding decisions

Product, Services, and Product, Services, and Branding StrategyBranding Strategy

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What is a Product?

• Anything that can be offered to a Anything that can be offered to a market for attention, acquisition, market for attention, acquisition, use, or consumption and that might use, or consumption and that might satisfy a want or need.satisfy a want or need.– Includes: physical objects, services, Includes: physical objects, services,

events, persons, places, organizations, events, persons, places, organizations, ideas, or some combination thereof.ideas, or some combination thereof.

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What is a Product?

• Product and Service Product and Service ClassificationsClassifications– Consumer productsConsumer products– Industrial productsIndustrial products

• Materials and partsMaterials and parts

• Capital itemsCapital items

• Supplies and servicesSupplies and services

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Consumer Products

• Products and Products and services bought services bought by final by final consumers for consumers for personal personal consumption.consumption.

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Convenience Products

•Purchased frequently and immediately

• Low priced

• Mass advertising

• Many purchase locations– Examples: candy, soda, newspapers

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Shopping Products

•Bought less frequently

• Higher price

• Fewer purchase locations

• Comparison shop – Examples: furniture, clothing, cars,

appliances

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Specialty Products

•Special purchase efforts

• High price

• Unique characteristics

• Brand identification

• Few purchase locations– Examples: Lamborghini, Rolex Watch

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Unsought Products

•New innovations

•Products consumers do not want to think about

•Require much advertising and personal selling

•Examples: life insurance, cemetery plots, blood donation

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Industrial Products

• Those purchased Those purchased for further for further processing or for processing or for use in conducting use in conducting business.business.

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Supplies and Services Operating supplies, repair,

and maintenance items

Supplies and Services Operating supplies, repair,

and maintenance items

Materials and PartsRaw materials, manufactured

materials, and parts

Materials and PartsRaw materials, manufactured

materials, and parts

Capital ItemsProducts that aid in

buyer’s production or operations

Capital ItemsProducts that aid in

buyer’s production or operations

Industrial Products

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Product and Service Decisions

• Individual ProductIndividual Product

• Product Line Product Line

• Product MixProduct Mix

• Product attributesProduct attributes– Quality, features, Quality, features,

style and designstyle and design

• BrandingBranding• PackagingPackaging• LabelingLabeling• Product support Product support

servicesservices

Key Key Decisions Decisions

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• Product LineProduct Line


• Product line lengthProduct line length– Line stretching:Line stretching: adding adding

products that are products that are higher or lower priced higher or lower priced than the existing linethan the existing line

– Line filling:Line filling: adding adding more items within the more items within the present price rangepresent price range


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• Product Line Product Line


• Product line width:Product line width:– number of different number of different

product lines carried by product lines carried by companycompany

• Product line depth:Product line depth:– Number of different Number of different

versions of each versions of each product in the lineproduct in the line

• Product line Product line consistencyconsistency


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Levels of a Product

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• Product Decisions and Social Product Decisions and Social ResponsibilityResponsibility– Acquisitions and mergersAcquisitions and mergers– Legal complianceLegal compliance– Product liability issuesProduct liability issues– WarrantiesWarranties

Additional Product Considerations

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Product Mix Decisions

• Product MixProduct Mix: all of the product lines and : all of the product lines and items that a particular seller offers for items that a particular seller offers for sale.sale.

• WidthWidth: the number of different product : the number of different product lines the company carries.lines the company carries.

• DepthDepth: the number of versions offered of : the number of versions offered of each product in the line.each product in the line.

• ConsistencyConsistency: how closely related the : how closely related the various lines are.various lines are.

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Individual Product Decisions

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Packaging

•Designing and producing the Designing and producing the container or wrapper for a container or wrapper for a product.product.

•Developing a good package:Developing a good package:– Packaging conceptPackaging concept– Package elementsPackage elements– Product safetyProduct safety– Environmental concernsEnvironmental concerns

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Labeling

•Printed information appearing on Printed information appearing on or with the package.or with the package.

•Performs several functions:Performs several functions:– IdentifiesIdentifies product or brand product or brand– DescribesDescribes several things about the several things about the

productproduct– PromotesPromotes the product through the product through

attractive graphicsattractive graphics

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Branding

• Creating, maintaining, protecting, Creating, maintaining, protecting, and enhancing products and and enhancing products and services.services.

• A brand is a name, term, sign, A brand is a name, term, sign, symbol, or design, or a combination symbol, or design, or a combination of these, that identifies the maker or of these, that identifies the maker or seller of a product or service.seller of a product or service.

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Branding

• Advantages to buyers:Advantages to buyers:– Product identificationProduct identification– Product qualityProduct quality

• Advantages to sellers:Advantages to sellers:– Basis for product’s quality storyBasis for product’s quality story– Provides legal protectionProvides legal protection– Helps to segment marketsHelps to segment markets

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Branding Strategy

• Brands are powerful assets that Brands are powerful assets that must be carefully developed / must be carefully developed / managed.managed.

• Brands with strong equity have Brands with strong equity have many competitive advantages:many competitive advantages:– High consumer awareness High consumer awareness – Strong brand loyaltyStrong brand loyalty– Helps when introducing new productsHelps when introducing new products– Less susceptible to price competitionLess susceptible to price competition

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Brand Strategy

• Brand PositioningBrand Positioning

• Brand Name Brand Name Selection Selection

• Brand Brand SponsorshipSponsorship

• Brand Brand DevelopmentDevelopment

• Three levels of Three levels of positioning:positioning:– Product attributesProduct attributes

• Least effectiveLeast effective

– BenefitsBenefits– Beliefs and valuesBeliefs and values

• Taps into emotionsTaps into emotions


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Brand Strategy


• Brand Name Brand Name SelectionSelection



• Good Brand Names:Good Brand Names:– Suggest something Suggest something

about the product or its about the product or its benefitsbenefits

– Are easy to say, Are easy to say, recognize and recognize and rememberremember

– Are distinctiveAre distinctive– Are extendableAre extendable– Translate well into Translate well into

other languagesother languages– Can be registered and Can be registered and

legally protectedlegally protected


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Brand Strategy





• Manufacturer brandsManufacturer brands

• Private (store) brandsPrivate (store) brands– Costly to establish and Costly to establish and

promotepromote– Higher profit marginsHigher profit margins

• Licensed brandsLicensed brands– Name and character Name and character

licensing has grownlicensing has grown

• Co-brandingCo-branding– Advantages / Advantages /

disadvantagesdisadvantages


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Brand Strategy





• Line extensionsLine extensions– Minor changes to Minor changes to

existing productsexisting products

• Brand extensionsBrand extensions– Successful brand Successful brand

names help introduce names help introduce new productsnew products

• MultibrandsMultibrands– Multiple product entries Multiple product entries

in a product categoryin a product category

• New brandsNew brands– New product categoryNew product category


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Brand Equity

• The positive differential effect that The positive differential effect that knowing the brand name has on knowing the brand name has on customer response to the product or customer response to the product or service.service.

• Provides:Provides:– More brand awareness and loyaltyMore brand awareness and loyalty– Basis for strong, profitable customer Basis for strong, profitable customer

relationshipsrelationships

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Brand Positioning

• Can position brands at any of three levels.Can position brands at any of three levels.

Product Attributes

Product Benefits

Beliefs and Values

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Brand Name Selection

• Desirable qualities for a brand name Desirable qualities for a brand name include:include:

1.1. It should suggest product’s benefits and It should suggest product’s benefits and qualitiesqualities

2.2. It should be easy to pronounce, recognize, and It should be easy to pronounce, recognize, and rememberremember

3.3. It should be distinctiveIt should be distinctive

4.4. It should be extendableIt should be extendable

5.5. It should translate easily into foreign languagesIt should translate easily into foreign languages

6.6. It should be capable of registration and legal It should be capable of registration and legal protectionprotection

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Brand Sponsorship

Four OptionsCo-Branding PrivateBrands

Manufacturer’s Brands

Licensed Brands

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Line Extensions

Morton sells an entire line of salts and seasonings for every occasion.

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Brand Development

• Line ExtensionLine Extension: introduction of : introduction of additional items in a given product additional items in a given product category under the same brand category under the same brand name (e.g., new flavors, forms, name (e.g., new flavors, forms, colors, ingredients, or package colors, ingredients, or package sizes).sizes).

• Brand ExtensionBrand Extension: using a successful : using a successful brand name to launch a new or brand name to launch a new or modified product in a new category.modified product in a new category.

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Brand Development

• MultibrandingMultibranding: offers a way to : offers a way to establish different features and establish different features and appeal to different buying motives.appeal to different buying motives.

• New BrandsNew Brands: developed based on : developed based on belief that the power of its existing belief that the power of its existing brand is waning and a new brand brand is waning and a new brand name is needed. Also used for name is needed. Also used for products in new product category.products in new product category.

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Services Marketing

• ServicesServices– Account for 70%of India gross Account for 70%of India gross

domestic product.domestic product.– Service industries include business Service industries include business

organizations, government, and organizations, government, and private not-for-profit organizations.private not-for-profit organizations.

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Services Marketing

• Characteristics of ServicesCharacteristics of Services– IntangibilityIntangibility

• Consumers look for service quality signalsConsumers look for service quality signals

– InseparabilityInseparability• Services can’t be separated from providersServices can’t be separated from providers

– VariabilityVariability• Employees and other factors result in variabilityEmployees and other factors result in variability

– PerishabilityPerishability• Services can’t be inventoried for later saleServices can’t be inventoried for later sale

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What is a Service?

• A form of product that consists of A form of product that consists of activities, benefits, or satisfactions activities, benefits, or satisfactions offered for sale that are essentially offered for sale that are essentially intangible and do not result in the intangible and do not result in the ownership of anything.ownership of anything.– Examples: banking, hotel, airline, retail, Examples: banking, hotel, airline, retail,

tax preparation, home repairs.tax preparation, home repairs.

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The Product-Service Continuum

Sugar Restaurant College Education

Pure Tangible Good

Pure Service

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Other Market Offerings

• Organizations: Profit (businesses) and Organizations: Profit (businesses) and nonprofit (schools and churches).nonprofit (schools and churches).

• Persons: Politicians, entertainers, sports Persons: Politicians, entertainers, sports figures, doctors, and lawyers.figures, doctors, and lawyers.

• Places: create, maintain, or change Places: create, maintain, or change attitudes or behavior toward particular attitudes or behavior toward particular places (e.g., tourism).places (e.g., tourism).

• Ideas (social marketing): Public health Ideas (social marketing): Public health campaigns, environmental campaigns, campaigns, environmental campaigns, family planning, or human rights.family planning, or human rights.

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Product and Service Attributes

Quality Quality

FeaturesFeatures

Style & DesignStyle & Design

Performance and Satisfaction Includes Level & ConsistencyPerformance and Satisfaction Includes Level & Consistency

Differentiates a product from the competition; assessed based on

value and cost

Differentiates a product from the competition; assessed based on

value and cost

Style = AppearanceDesign = heart of the product

Style = AppearanceDesign = heart of the product

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Nature and Characteristics of a Service

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The Service-Profit Chain

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Major Service Marketing Tasks

• Managing Service Differentiation:Managing Service Differentiation:– Develop a differentiated offer, delivery, and Develop a differentiated offer, delivery, and

image.image.

• Managing Service Quality:Managing Service Quality:– Be customer obsessed, set high service quality Be customer obsessed, set high service quality

standards, have good service recovery, standards, have good service recovery, empower front-line employees.empower front-line employees.

• Managing Service Productivity:Managing Service Productivity:– Train current employees or hire new ones, Train current employees or hire new ones,

increase quantity and sacrifice quality, harness increase quantity and sacrifice quality, harness technology.technology.

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THANK YOUTHANK YOU

1-product and branding decisions

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