5. Individual Products: Actual Product
Features
– Characteristics, attributes of
product
– May or may not be obvious to
customer (benefit vs. feature)
– Computer
• Memory, processor
speed, technical details, etc.
• Fast
– Car
• Engine
size, ABS, airbags, cupholders, e
tc.
• What customer wants
6. Individual Products: Actual Product
Quality
– Level
• Durability, reliability,
precision, ease of operation
or repair
• Mont Blanc vs. Bic
– Consistency
• Deliver same product
experience every time
9. Individual Products: Actual Product
Branding
– Information mechanism
– Short-hand means of passing
along information, including
past experience
– Name, term, sign, symbol, desig
n, etc.
– When recognized by
customer, conveys sense of
benefits, features, quality, servic
es, price, etc.
• Brand equity
– Value of brand, how much more
customer will pay because
brand name is on there
11. Individual Products: Actual Product
Brand Sponsor
– Manufacturer's brand
• IMC help, traffic
• Enhance prestige
• Supply chain support
• Easy to replace if
poor sales
– Private-label brand
• Control
• Profit
12. Individual Products: Actual Product
Existing Line New Line
Existing Brand Line Extension Brand Extension
New Brand Multibranding New Brands
13. Individual Products: Actual Product
Line Extension
– Same product, same brand
– Improvements
– New features, sizes, flavors,
ingredients, colors, etc.
– Good fit/recognition, product
with brand
– Dannon
• 7 new flavors, fat-free
yogurt, economy-sized
yogurt
– Issues with:
• Overextension
– Coca Cola
– Crest (52 sku’s)
• Cannibalization
14. Individual Products: Actual Product
Brand Extension
– New product, same brand
– Launch new products with
established, recognized
brand name
• Kraft, Nabisco, Oscar
Mayer
– Issues with poor fit
• Bic pantyhose and
perfume, Heinz pet
food, Lifesavers gum, Clorox
laundry detergent, Harley
Davidson wine coolers
15. Individual Products: Actual Product
Multibranding
– Same product, new brand
– Launch additional brand
in existing product
category
– Different brand/price
appeals, shelf
space, flankers
• Kraft
• P&G
• Seiko/Pulsar
– Issues with spreading
resources too thin
16. Individual Products: Actual Product
New brands
– New product, new brand
– Existing names
inappropriate
• Kraft
– Again, spreading
resources too thin
17. Individual Products: Augmented Product
Ancillary services
– Not core service, but
additional
– Add-ons such as:
• Warranty
• Delivery
• Credit
• Installation
• Training
• After-sale service
• Etc.
18. Multiple Products
• Product Mix
• Product lines
– Closely related product
items
– Width: number of product
http://disney.com/
lines
– Length (depth): number of
products in product line
– Breadth: number of
product options
19. Multiple Products
Laundry Dish Care Deod Personal Hair Care
Cleansing
Downy Cascade Sure Olay Aussie
Bounce Ivory Secret Safeguard Head &
Cheer Joy Right Ivory Shoulders
Tide Dawn Guard Camay Pert
Tag Infusium 23
Ivory Noxema
Pantene
Gain Herbal
Essences Herbal
Dryel
Essences
Febreze Old Spice
Physique
Clairol
Zest
20. Multiple Products
Boston Consulting Group (BCG)
Matrix
– In first chapter “portfolio
matrix” p23
– Strategic decisions
concerning product mix
– Resource allocation
decisions
21. Product Strategy
Market Share Market Share
High Low
Market ?
Growth Rate STAR Problem
High
Child
Market
Growth Rate Cash Cow Dog
Low
22. Product Strategy
Market Share Market Share
High Low
Market STAR ?
Growth Rate Low $ In Low $ In
High $ Out High/Low $ Out
High
Market Cash Cow Dog
Growth Rate High $ In Low $ In
Low $ Out Low $ Out
Low
23. Product Strategy
Market Share Market Share
High Low
Market Cadillac
Growth Rate GMC Saturn
High Trucks Pontiac
Market Buick
Growth Rate Chevrolet Oldsmobile
Low Opel Hummer
