marketing products & services
TRANSCRIPT
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Product and Services
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What is a Product? Goods Services Experiences Events Persons
Places Properties Organizations Information Ideas
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What Is a Product?
Products, Services, and Experiences
Product is anything that can be offered in a market for attention, acquisition, use, or consumption that might satisfy a need or want
• Soap• Toothpaste
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What Is a Product?
Product and Service Classifications
• Consumer products• Industrial products
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What Is a Product?
Product and Service Classifications
Consumer products are products and services for personal consumption
• Classified by how consumers buy them• Convenience product• Shopping products• Specialty products• Unsought products
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What Is a Product?
Product and Service Classifications
Convenience products are consumer products and services that the customer usually buys frequently, immediately, and with a minimum comparison and buying effort
• Newspapers• Candy• Fast food
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What Is a Product?
Product and Service Classifications
Shopping products are consumer products and services that the customer compares carefully on suitability, quality, price, and style
• Furniture• Cars• Appliances
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What Is a Product?
Product and Service Classifications
Specialty products are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort
• Medical services• Designer clothes• High-end electronics
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What Is a Product?
Product and Service Classifications
Unsought products are consumer products that the consumer does not know about or knows about but does not normally think of buying
• Life insurance• Funeral services• Blood donations
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What Is a Product?Product and Service Classifications
Industrial products are products purchased for further processing or for use in conducting a business
Classified by the purpose for which the product is purchased
• Raw Materials and parts• Capital• Supplies and services
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What Is a Product?
Product and Service Classifications
Materials and parts include raw materials and manufactured materials and parts usually sold directly to industrial users
• Wheat• Lumber• Iron• Cement
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What Is a Product?
Product and Service Classifications
Capital items are industrial products that aid in the buyer’s production or operations
• Buildings• Elevators• Computers
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What Is a Product?
Organization marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward an organization
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Organizations, Persons, Places, and Ideas
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What Is a Product?
Person marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular people
• Rakhi’s swayamwar
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Organizations, Persons, Places, and Ideas
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What Is a Product?
Organizations, Persons, Places, and Ideas
Place marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of target consumers toward particular places
• Tourism
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What Is a Product?
Organizations, Persons, Places, and Ideas
Social marketing is the use of commercial marketing concepts and tools in programs designed to influence individuals’ behavior to improve their well-being and that of society
• Public health campaign• Tourism
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What Is a Product?
Experiences represent what buying the product or service will do for the customer
• Treasure Land• Disney land
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Products, Services, and Experiences
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What Is a Product?
Products, Services, and Experiences
Service is a form of product that consists of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in ownership
• Doctor’s exam• Legal advice
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The Product and Product Mix
Potential customers judge product offerings according to three elements: Product features and quality Services mix and quality Value-based prices
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The Product and Product Mix
The customer value hierarchy: Core benefit Basic product Expected product Augmented product Potential product
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What Is a Product?
• Core benefits• Actual product• Augmented product
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Levels of Product and Services
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What Is a Product?Levels of Product and Services
Core benefits represent what the buyer is really buying
Actual product represents the design, brand name, and packaging that delivers the core benefit to the customer
Augmented product represents additional services or benefits of the actual product
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Product and Service Decisions
Product Mix Decisions
Product mix consists of all the products and items that a particular seller offers for sale
• Width• Length• Depth• Consistency
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The Product and Product Mix
Product mix dimensions: Width: number of product lines Length: total number of items in mix Depth: number of product variants Consistency: degree to which product
lines are related
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Product and Service Decisions
Product Line Decisions
Product line is a group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges
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Product and Service Decisions
Product Mix Decisions
Product mix width is the number of different product lines the company carries
Product mix length is the total number of items the company carries within its product lines
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Product and Service Decisions
Product Line Decisions
Product line depth is the number of versions offered of each product in the line
Consistency is how closely the various product lines are in end use, production requirements, or distribution channels
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Product and Service Decisions
Product Line Decisions
Product line length is the number of items in the product line
• Line stretching• Line filling• Line pruning
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Line stretching Down mkt stretch Up mkt stretch Two way stretch / combination line
stretching
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Product and Service Decisions
Product Line Decisions
Combination line stretching is used by companies in the middle range of the market to achieve both goals of upward and downward line stretching
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Product and Service Decisions
Product Line Decisions
Product line filling occurs when companies add more items within the present range of the line
• More profits• Satisfying dealers• Excess capacity• Plugging holes to fend off competitors
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Product and Service Decisions
Brand is the name, term, sign, or design, or a combination of these, that identifies the maker or seller of a product or service
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Individual Product and Service Decisions
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Brand Decisions The AMA definition of a brand:
“A name, term, sign, symbol, or design, or a combination of these, intended to identify the goods or services of one seller or group of sellers and to differentiate them from the competition.”
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Branding Strategy: Building Strong Brands
Brand represents the consumer’s perceptions and feelings about a product and its performance. It is the company’s promise to deliver a specific set of features, benefits, services, and experiences consistently to the buyers
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Brand Decisions Brands can convey six levels of meaning:
Attributes Benefits Values Culture Personality User
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Brand Decisions Aaker identified five levels of customer
attitudes toward brands: Will change brands, especially for price. No
brand loyalty. Satisfied -- has no reason to change. Satisfied -- switching would incur costs. Values brand, sees it as a friend. Devoted to the brand.
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Brand Decisions Brand identity decisions include:
Name Logo Colors Tagline Symbol
Consumer experiences create brand bonding, brand advertising does not.
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Brand name decision Individual name – zen, esteem Blanket family name – GE,maruti,
tata Separate family names-
Pantaloons, Sears, Walmart Corporate+individual prod. Name –
Maruti800, honda city
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Branding Strategy: Building Strong Brands
Brand Name Selection
Desirable qualities • Suggests benefits and qualities• Easy to pronounce, recognize, and
remember• Distinctive• Extendable• Translatable for the global economy
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Brand Decisions Marketers should attempt to create or
facilitate awareness, acceptability, preference, and loyalty among consumers.
Valuable and powerful brands enjoy high levels of brand loyalty.
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Branding Strategy: Building Strong Brands
Brand equity is the positive differential effect that knowing the brand name has on customer response to the product or service
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Brand Decisions Brand equity refers to the positive
differential effect that a brand name has on customers.
Brand equity: is related to many factors. allows for reduced marketing costs. is a major contributor to customer equity.
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Branding Strategy:Building Strong Brands
Customer equity is the value of the customer relationships that the brand creates
Brand valuation is the process of estimating the total financial value of the brand
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Brand DecisionsKey Challenges
To brand or not Brand sponsor Brand name Brand strategy Brand repositioning
Advantages of branding:
Facilitates order processing
Trademark protection Aids in segmentation Enhances corporate
image Branded goods are
desired by retailers and distributors
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Brand DecisionsKey Challenges
To brand or not Brand sponsor Brand name Brand strategy Brand repositioning
Options include: Manufacturer
(national) brand Distributor (reseller,
store, house, private) brand
Licensing the brand name
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Brand DecisionsKey Challenges
To brand or not Brand sponsor Brand name Brand strategy Brand repositioning
Strong brand names: Suggest benefits Suggest product
qualities Are easy to say,
recognize, and remember
Are distinctive Should not carry poor
meanings in other languages
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Brand DecisionsKey Challenges
To brand or not Brand sponsor Brand name Brand strategy Brand repositioning
Varies by type of brand Functional brands – Maruti
800 ( fuel efficient) Image brands – raymond
suitings Experiential brands-barista,
disneyland Line extensions Brand extensions Multibrands New brands Co-branding
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Line ext. Brand extension
Multi-brands New Brands
Product categoryExisting New
Existing
New
Brand Name
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Branding Strategy: Building Strong Brands
Brand Development
Line extensions occur when a company extends existing brand names to new forms, colors, sizes, ingredients, or flavors of an existing product category
Brand extensions extend a brand name to a new or modified product in a new category
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Branding Strategy: Building Strong Brands
Brand Development
Multibrands are additional brands in the same category
New brands are used when existing brands are inappropriate for new products in new product categories or markets
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Branding Strategy: Building Strong Brands
Brand Development
• Line extensions e.g: surf excel, excelmatic• Brand extensions e.g:nature fresh
sunflower oil, fresh flour, honda motorcycle
• Multibrands, e.g:Maruti zen, titan sonata• New brands• Co-brands e.g:TATA-IBM, Birla –AT&T etc.
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Brand DecisionsKey Challenges
To brand or not Brand sponsor Brand name Brand strategy Brand repositioning
A brand report card can be used to audit a brand’s strengths and weaknesses.
Changes in preferences or the presence of a new competitor may indicate a need for brand repositioning.
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Branding Strategy: Building Strong Brands
Brand Sponsorship
• Manufacturer’s brand-Merchandise bearing a manufacturer's brand name, rather than a private label brand
• Private brand - Product brands owned by a retailer or a wholesaler rather than the manufacturer; also called house brands.
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Branding Strategy: Building Strong Brands
Private brands provide retailers with advantages
• Product mix control• Slotting fees for manufacturers’
brands• Higher margins• Exclusivity
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Brand Sponsorship
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Brand Sponsorship
• Licensed brand - A product or service using a registered brand name offered by the brand owner to a licensee for an agreed fee or royalty.
• Co-branding is a process when two companies form an alliance to work together, creating marketing synergy.
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Co-branding According to Prof.Chang there are three
levels of co-branding: Level 1 includes joining with another
company to penetrate the market Level 2 is working to extend the brand
based on the company's current market share
Level 3 tries to achieve a global strategy by combining the two brands
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Types of co-branding Ingredient co-branding – This
involves creating brand equity for materials, components or parts that are contained within other products. E.g:
Pillsbury Brownies with Nestle Chocolate, Dell Computers with Intel Processors
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Types of co-branding same-company co-branding
This is when a company with more than one product promotes their own brands together simultaneously. E.g; cosmetics, shampoo+conditioner .
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Types of co-branding Joint venture co-branding two or
more companies going for a strategic alliance to present a product to the target audience. British Airways and Citibank formed a partnership offering a credit card where the card owner will automatically become a member of the British Airway’s Executive club
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Types of co-branding multiple sponsor co-branding involves two or more companies working
together to form a strategic alliance in technology, promotions, sales, etc. e.g: Citibank/American Airlines/Visa credit card partnership
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Branding Strategy: Building Strong Brands
Managing Brands
Requires:• Continuous brand communication• Customer-centered training• Brand audits
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Product and Service Decisions
Individual Product and Service Decisions
Packaging involves designing and producing the container or wrapper for a product
Label identifies the product or brand, describes attributes, and provides promotion
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Packaging and Labeling Packaging includes:
The primary package The secondary package The shipping package
Many factors have influenced the increased use of packaging as a marketing tool.
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Packaging and Labeling Developing an effective package:
Determine the packaging concept Determine key package elements Testing:
Engineering tests Visual tests Dealer tests Consumer tests
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Packaging and Labeling 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.
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Services Marketing
Nature and Characteristics of a Service
• Intangibility• Inseparability• Variability• Perishability
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Services Marketing
Nature and Characteristics of a Service
Intangibility refers to the fact that services cannot be seen, tasted, felt, heard, or smelled before they are purchased
Inseparability refers to the fact that services cannot be separated from their providers
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Services Marketing
Nature and Characteristics of a Service
Variability refers to the fact that service quality depends on who provides it as well as when, where, and how it is provided
Perishability refers to the fact that services cannot be stored for later sale or use
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Services Marketing
Types of Service Industries
• Government• Private not-for-profit organizations• Business services
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Services MarketingMarketing Strategies for Service Firms
Managing service quality provides a competitive advantage by delivering consistently higher quality than its competitors
Service quality always varies depending on interactions between employees and customers
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Services Marketing
Marketing Strategies for Service Firms
Service recovery can turn disappointed customers into loyal customers
• Empower employees• Responsibility• Authority• Incentive
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Marketing Strategies for ServiceFirms
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Managing Service Managing Service DifferentiationDifferentiation
Develop offer, delivery and image with competitive advantages.
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Managing Service Managing Service QualityQuality
Empower employees Become “Customer obsessed”
Develop high service quality standards
Watch service performance closely
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Managing Service Managing Service ProductivityProductivity
Train current or new employees
Increase quantity by decreasing quality
Utilize technology