1. 7-1
Product Decisions
• Product is critical
element of marketing
mix; Anything that can
be offered to a market
for attention,
acquisition, use or
consumption and that
might satisfy a want or
need.
– Physical object, service,
person, place,
organization, idea

2. 7-2
Unique Characteristics of Services
and Resulting Marketing Challenges
Exhibit 7.6

3. 7-3
Product Decisions Involve…
• Product mix- total group of products offered
by company
• Product lines-group of closely related product
items
– Depth-number of items in line
• Brands-combination of name, symbol, term,
or design that identifies specific product
• Packaging and labeling
• Positioning

4. 7-4
Positioning Decision
• Positioning is the act of designing the
company’s offering and image to occupy a
distinctive place in the target market’s mind.

5. 7-5
Steps In The Positioning Process
1. Identify relevant set of competitive products serving target market
2. Identify the set of determinant attributes that define the “product
space”.
3. Collect information from a sample of customers and potential customers
about perceptions of each product on the determinants
4. Determine the product’s current positioning.
5. Determine the customers’ most preferred combination of determinant
attributes.
6. Examine the fit between preferences of market segments and current
position of products.
7. Write positioning statement to guide development of marketing
strategy.

6. 7-6
Positioning Map: Automobiles For Generation Yers
More “Edgy”
Less “Edgy”
ExpensiveInexpensive
Scion
Kia Sorrento
$13k
Cube
Civic
$20K

7. 7-7
Trout and Ries suggest a six-step
question framework for successful
positioning:
1. What position do you currently
own?
2. What position do you want to
own?
3. Whom you have to defeat to own
the position you want.
4. Do you have the resources to do
it?
5. Can you persist until you get
there?
6. Are your tactics supporting the
positioning objective you set?

8. 7-8
• How is the Ford Mustang positioned? How has Ford
achieved this positioning? Has its positioning changed
over time?

9. 7-9
• Differentiation Strategies – Create differences in
the firm’s product offering that sets it apart from
competing offerings based on
– Product features
– Advantages
– Benefits
Product Differentiation

10. 7-10
Using Product Descriptors
for Product Differentiation
Exhibit 6.7

11. 7-11
How is Venus positioned/differentiated
from other razors?

12. 7-12
Stages of the Product Life Cycle
Exhibit 7.2

13. 7-13
Marketing Strategy During
the Product Life Cycle
Exhibit 7.3

14. 7-14
• Begins when development is complete
• Ends when customers widely accept the product
• Marketing strategy goals during this stage:
– Attract customers by raising awareness and interest
– Induce customers to try and buy
– Engage in customer education activities
– Strengthen or expand channel and supply
relationships
– Build on availability and visibility
– Set pricing objectives
Introduction Stage

15. 7-15
• Be ready for sustained sales increases
• Rapid increase in profitability early in the growth
stage that decreases at the end of this stage
• Length depends on nature of product and
competitive reactions
• Two strategies:
– (1) Establish a strong, defensible marketing position
– (2) Achieve financial objectives
Growth Stage (1 of 2)

16. 7-16
• Marketing strategy goals in this stage:
– Leverage the product’s perceived differential advantages
– Establish a clear product and brand identity
– Create unique positioning
– Maintain control over product quality
– Maximize availability of the product
– Maintain or enhance the product’s profitability to partners
– Find the ideal balance between price and demand
– Keep an eye focused on the competition
Growth Stage (2 of 2)

17. 7-17
• Few, if any, new firms will enter the market
• Still an opportunity for new product features
and variations
• Typically the longest stage in the product
life cycle
Maturity Stage (1 of 2)

18. 7-18
• Four general goals in this stage:
– (1) Generate Cash Flow
– (2) Hold Market Share
– (3) Steal Market Share
– (4) Increase Share of Customer
• Four options to achieve these goals:
– (1) Develop a new product image
– (2) Find and attract new users to the product
– (3) Discover new applications for the product
– (4) Apply new technology to the product
Maturity Stage (2 of 2)

19. 7-19
• Two options:
– (1) Attempt to postpone the decline
– (2) Accept its inevitability
• Harvesting
• Divesting
• Factors to be considered during this stage:
– Market segment potential
– The market position of the product
– The firm’s price and cost structure
– The rate of market deterioration
Decline Stage

20. 7-20
Product-Mix Width Procter & Gamble Example
Disposable
Diapers
Detergents Bar
Soap
Toothpast
e
Paper
Tissue
Pampers Ivory Snow Ivory Gleem Charmin
Luvs Dreft Kirk’s Crest Puffs
Tide Lava Banner
Cheer Camay Summit
1100’s
Oxydol Zest
Dash Safeguar
d
Bold Coast
Gain Olay
Era

21. 7-21
Product Lines and
Product Mixes at Gillette
Exhibit 7.1

22. 7-22
Product Mix Decisions
• Def.: Set of all products and items that a
particular seller offers to buyers.
• Decisions include selection of width, length,
depth, and consistency

23. 7-23
Product Line Decisions
• Line stretching
– Downward – enter on the low end
– Upward – enter on the high end
– Two-way – enter both directions
– Line-filling – add more items
• Line Modernization – update to reflect current
trends, themes
• Line-Featuring-select one or a few items in the line to
feature
• Line-Pruning – select item(s) to cut

24. 7-24
What is a Brand?
• A brand is a name, term, sign, symbol, or
design, or a combination of them intended to
identify the goods or services of one seller or
group of sellers and to differentiate them from
those of competitors.

25. 7-25

26. 7-26
The World’s Twenty-Five
Most Valuable Brands
Exhibit 7.5

27. 7-27
Branding Decisions
• Brand Name
– Individual (General Mills- Bisquick, Gold Medal, Betty Crocker;
P&G)
– Blanket family name (Heinz, Campbell)
– Separate family names (Sears-Kenmore for appliances,
Craftsman for tools)
– Company plus individual names (Kellogg Rice Krispies)

28. 7-28
Product Category
Line
Category
Existing New
Existing Line Extension –
additional items in
the same product
category under the
same brand name,
new flavors,
package sizes,
added ingredients,
e.g. Heinz Green
Ketchup
Brand Extension –
Use existing brand
name to launch
new products in
other categories,
e.g. Hondo lawn
mowers, marine
engines
New Multibrands –
Additional brand in
the same product
category, Pampers,
Luvs
New Brands –
launches new
products in new
categories, e.g.
Barbie Bedding
Branding Decisions

29. 7-29
Good Brand Names
• Distinctive
• Lack Poor Foreign Language Meanings
• Suggest Product Qualities
• Suggest Product Benefits
• Easy to Pronounce, Recognize, Remember
– Zit (Chocolate from Germany)
– Koff (Beer)

30. 7-30
Packaging Decisions
• Design, materials, size
• Critical as marketing tool
– Self-service
– Company & brand image
– Opportunity for brand innovation

31. 7-31
Factors Influencing Product
Strategy Decisions
• Classification of Products
– Convenience
– Shopping
– Specialty
– Unsought Products
• Product Life Cycle

32. 7-32
Product Classification (1 of 3)
• Consumer Product
Classifications
– Convenience Products
• Routinely purchased,
require little or not time
searching
• Make them widely available

33. 7-33
– Shopping Products
• Spend considerable time making the purchase; seek info on
price, features, service
• Product differentiation very important
• Have strategy to guarantee and reduce consumer
satisfaction

34. 7-34
–Specialty Products
• Unique, shoppers expend considerable time,
effort, money to acquire; accept no substitutes

35. 7-35
–Unsought Products
• (1) Products of which consumers are
unaware
• (2) Products that consumers do not consider
purchasing until a need or emergency
arises

36. 7-36
New Product Development
• Six strategic product development options:
– (1) New-to-the-world products (discontinuous
innovations)
– (2) New product lines
– (3) Product line extensions
– (4) Improvements or revisions of existing
products
– (5) Repositioning
– (6) Cost reductions
• Customer perception of differentiation is
critical

37. 7-37
• No sales revenue during this stage
• Components of the product concept:
– An understanding of desired uses and benefits
– A description of the product
– The potential for creating a complete product line
– An analysis of the feasibility of the product concept
• Customer needs should be discerned before
developing marketing strategy
Development Stage