2. Copyright 2007, Prentice Hall, Inc. 7-2 Define product and the major classifications of products and services. Describe the decisions companies make regarding their individual products and services, product lines, and product mixes. Discuss branding strategy – the decisions firms make in building and managing their brands. Identify the four characteristics that affect the marketing of a service and the additional marketing considerations that services require. Discuss two additional product issues: socially responsible product decisions and international product and services marketing.
3. Copyright 2007, Prentice Hall, Inc. 7-3 Case Study FIJI Water – “The Taste of Paradise” Product Brand name: FIJI Natural Artesian Water. Product source: comes from an underground location in Fiji islands. Key benefits: ultra-clean taste, no impurities or pollutants. Brand image: “The Taste of Paradise” Promotion It’s a brand experience! Name, packaging, label, celebrity endorsers and places through which it is sold contributes to “Taste of Paradise” imagery. Ads evoke exotic origins: tropical forest, volcanoes. High price charged supports premium appeal.
4. Copyright 2007, Prentice Hall, Inc. 7-4 What Is a Product? Anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a want or need. Includes: physical objects, services, events, persons, places, organizations, ideas, or some combination thereof.
5. Copyright 2007, Prentice Hall, Inc. 7-5 What Is a Service? A form of product that consists of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in the ownership of anything. Examples: banking, hotel, airline, retail, tax preparation, home repairs.
6. Copyright 2007, Prentice Hall, Inc. 7-6 Market Offerings Continuum ranges from pure tangible goods (with no services) to pure services (with no good component) with many combinations in between. Pure good: Camay soap. Pure service: Legal representation. Combination: Restaurant meal. Creating and managing customer experiences differentiates offers.
7. Copyright 2007, Prentice Hall, Inc. 7-7 Levels of a Product Core benefit What the consumer is really buying. Actual product Includes the brand name, features, design, packaging, quality level. Augmented product Additional services and benefits such as delivery and credit, instructions, installation, warranty, service.
8. Copyright 2007, Prentice Hall, Inc. 7-8 Consumer Products Products and services bought by final consumers for personal consumption. Also includes other marketable entities. Classified by how consumers buy them.
9. Copyright 2007, Prentice Hall, Inc. 7-9 Convenience Products Purchased frequently and immediately Low priced Mass advertising Many purchase locations Examples: candy, soda, newspapers
11. Copyright 2007, Prentice Hall, Inc. 7-11 Specialty Products Special purchase efforts High price Unique characteristics Brand identification Few purchase locations Example: Lamborghini, Rolex Watch
12. Copyright 2007, Prentice Hall, Inc. 7-12 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
13. Copyright 2007, Prentice Hall, Inc. 7-13 Industrial Products Those purchased for further processing or for use in conducting business. Distinction between consumer and industrial products is based on the purpose for which an item is bought.
14. Copyright 2007, Prentice Hall, Inc. 7-14 Industrial Products Materials and parts: Raw materials, manufactured materials, and parts Capital items: Products that aid in buyer’s production or operations Supplies and services: Operating supplies, repair, and maintenance items
15. Copyright 2007, Prentice Hall, Inc. 7-15 Other Market Offerings Organizations: Profit (businesses) and nonprofit (schools and churches). Includes corporate image advertising. Persons: Politicians, entertainers, sports figures, doctors, and lawyers. Places: Create, maintain, or change attitudes or behavior toward particular places (e.g., tourism). Ideas (social marketing): Public health campaigns, environmental campaigns, family planning, or human rights.
16. Copyright 2007, Prentice Hall, Inc. 7-16 Individual Product Decisions Product attributes Branding Packaging Labeling Product support services
17. Copyright 2007, Prentice Hall, Inc. 7-17 Product & Service Attributes Product quality Performance quality Conformance quality Features Value to consumer Cost to company Style and design Influences experience
18. Copyright 2007, Prentice Hall, Inc. 7-18 Branding Creating, maintaining, protecting, and enhancing products and services. A brand is a name, term, sign, symbol, or design, or a combination of these, that identifies the maker or seller of a product or service.
19. Copyright 2007, Prentice Hall, Inc. 7-19 Branding Advantages to buyers: Product identification Product quality Advantages to sellers: Basis for product’s quality story Provides legal protection Helps to segment markets
20. Copyright 2007, Prentice Hall, Inc. 7-20 Packaging Designing and producing the container or wrapper for a product. Developing a good package: Market the brand Protect the elements Ensure product safety Address environmental concerns
21. Copyright 2007, Prentice Hall, Inc. 7-21 Labeling Printed information appearing on or with the package. Performs several functions: Identifies product or brand Describes several things about the product Promotes the product through attractive graphics
22. Copyright 2007, Prentice Hall, Inc. 7-22 Product Support Services Assess the value of current services and obtain ideas for new services. Assess the cost of providing the services. Put together a package of services that delights the customers and yields profits for the company.
23. Copyright 2007, Prentice Hall, Inc. 7-23 Product Line Decisions Product line length: The number of items in a product line. Adjust line length by: Stretching Downward Upward Both directions Filling
24. Copyright 2007, Prentice Hall, Inc. 7-24 Product Mix Decisions Product mix: all of the product lines and items that a particular seller offers for sale. Product mix dimensions include: Length: the number of items in a line. Width: the number of different product lines the company carries. Depth: the number of versions offered of each product in the line. Consistency: how closely related various lines are.
25. Copyright 2007, Prentice Hall, Inc. 7-25 Brand Equity The positive differential effect that knowing the brand name has on customer response to the product or service. Provides: More brand awareness and loyalty Basis for strong, profitable customer relationships
26. Copyright 2007, Prentice Hall, Inc. 7-26 Major Brand Strategy Decisions Brands are assets that must be carefully developed and managed via: Brand positioning Brand name selections Brand sponsorship Brand development
27. Copyright 2007, Prentice Hall, Inc. 7-27 Brand Positioning Can position brands at any of three levels: Product attributes Product benefits Beliefs and values
28. Copyright 2007, Prentice Hall, Inc. 7-28 Brand Name Selection Desirable qualities for a brand name include: It should suggest product’s benefits and qualities. It should be easy to pronounce, recognize, and remember. It should be distinctive. It should be extendable. It should translate easily into foreign languages. It should be capable of registration and legal protection.
29. Copyright 2007, Prentice Hall, Inc. 7-29 Brand Sponsorship Manufacturer’s brands Also called national brands Private brands Also called store or distributor brands Licensed brands Co-branding
30. Copyright 2007, Prentice Hall, Inc. 7-30 Brand Development Line extension: introduction of additional items in a given product category under the same brand name (e.g., new flavors, forms, colors, ingredients, or package sizes). Brand extension: using a successful brand name to launch a new or modified product in a new category.
31. Copyright 2007, Prentice Hall, Inc. 7-31 Brand Development Multibranding: offers a way to establish different features and appeal to different buying motives. New brands: developed based on belief that the power of its existing brand is waning and a new brand name is needed. Also used for products in new product category.
32. Copyright 2007, Prentice Hall, Inc. 7-32 Nature and Characteristics of a Service Intangibility: Services cannot be seen, tasted, felt, heard, or smelled before purchase. Inseparability: Services cannot be separated from their providers. Variability: Quality of services depends on who provides them and when, where, and how they are delivered. Perishability: Services cannot be stored for later sale or use.
33. Copyright 2007, Prentice Hall, Inc. 7-33 The Service-Profit Chain Internal service quality Satisfied and productive service employees Great service value Satisfied and loyal customers Healthy service profits and growth.
34. Copyright 2007, Prentice Hall, Inc. 7-34 Services Marketing External marketing: Traditional marketing via the 4 “P’s” Internal marketing: Effective training and motivation of customer contact employees Interactive marketing: Delivering interactions during the service encounter that are satisfying to the buyer
35. Copyright 2007, Prentice Hall, Inc. 7-35 Major Service Marketing Tasks Managing service differentiation: Develop a differentiated offer, delivery, and image. Managing service quality: Be customer obsessed, set high service quality standards, have good service recovery, empower front-line employees. Managing service productivity: Train current employees or hire new ones, increase quantity and sacrifice quality, harness technology.
36. Copyright 2007, Prentice Hall, Inc. 7-36 International Product and Services Marketing Decide which products and services to introduce. Decide how much to standardize or adapt. Packaging presents new challenges. Services marketers face special challenges. Trend toward global service companies will continue.
37. Copyright 2007, Prentice Hall, Inc. 7-37 Define product and the major classifications of products and services. Describe the decisions companies make regarding their individual products and services, product lines, and product mixes. Discuss branding strategy – the decisions firms make in building and managing their brands. Identify the four characteristics that affect the marketing of a service and the additional marketing considerations that services require. Discuss two additional product issues: socially responsible product decisions and international product and services marketing.
