Chapter 08 eco

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Product decisions

8

Principles of Marketing


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Coverage

Product classification

Individual product decision

Product mix decisions

Product line decisions, packaging and labeling

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What Is a Product?Products, Services, and Experiences

Product is anything that can be offered in amarket for attention, acquisition, use, orconsumption that might satisfy a need orwant

Soap Toothpaste

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What Is a Product?

Products, Services, and Exper iences

Service is a form of product that consists ofactivities, benefits, or satisfactions offeredfor sale that are essentially intangible and

do not result in ownership Doctors exam

Legal advice

financial services8-4


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What Is a Product?

Experiences represent what buying the productor service will do for the customer

Disney

American Girl Toys R Us

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Products, Services, and Exper iences


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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 thecustomer

Augmented product represents additional services orbenefits of the actual product

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What Is a Product?Product and Service Classif ications

Consumer products

Industrial products

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Consumer products are products andservices for personal consumption

Classified by how consumers buy them Convenience product

Shopping products Specialty products

Unsought products

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Convenience products are consumerproducts and services that the customerusually buys frequently, immediately, andwith a minimum comparison and buyingeffort

Newspapers Candy Fast food

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Shopping products are consumer productsand services that the customer comparescarefully on suitability, quality, price, andstyle

Furniture Cars

Appliances

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Specialty products are consumer products andservices with unique characteristics or brandidentification for which a significant group of buyersis willing to make a special purchase effort

Medical services Designer clothes

High-end electronics

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Unsought products are consumer productsthat the consumer does not know about orknows about but does not normally think ofbuying

Life insurance Funeral services

Blood donations

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Industrial products are products purchased for

further processing or for use in conducting abusiness

Classified by the purpose for which the product ispurchased

Materials and parts Capital Raw materials

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What Is a Product?

Product and Service Classif ications

Materials and parts include raw materialsand manufactured materials and partsusually sold directly to industrial users

Wheat

Iron Cement

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What Is a Product?

Product and Service Classif ications

Capital items are industrial products that aidin the buyers production or operations

Buildings

Elevators Computers

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Product and Service Decisions

I ndividual Product and Service Decisions

Product attributes

Branding

Packaging

Labeling Product support services

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Quality in terms of the product or service is thelack of defects

Quality in terms of the customer is the valueand satisfaction provided by the product orservice

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Product quality includes level and consistency

Quality level is the level of quality thatsupports the products positioning

Performance quality is the ability of aproduct to perform its functions

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Quality consistency is the freedom fromdefects and the delivering of a targeted levelof performance

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Product features are a competitive tool fordifferentiating a product from competitorsproducts

Product features are assessed based on thevalue to the customer versus the cost to thecompany

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Product style and design add value to

customer value

Style describes the appearance of theproduct

Design contributes to a productsusefulness as well as to its looks

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Brand is the name, term, sign, or design, ora combination of these, that identifies themaker or seller of a product or service

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Consumer benefits Quality

Consistency

Seller benefits Segmentation

Communicate product features

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Packaging involves designing and producingthe container or wrapper for a product

Label identifies the product or brand, describesattributes, and provides promotion

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Product support services augment actual products

Companies must continually:

Assess the value of current services to obtain ideasfor new ones

Assess the costs of providing these services

Develop a package of services to satisfy customersand provide profit to the company

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Gillettes Product Lines and Mix

Blades and Writingrazors Toiletries instruments

Mach 3 Series Paper MateSensor Adorn FlairTrac II ToniAtra Right GuardSwivel SilkienceDouble-Edge Soft and Dri

Lady Gillette FoamySuper Speed Dry LookTwin Injector Dry IdeaTechmatic Brush Plus

Width of the product mix

Depth

of

theproductlines


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Product Line Decisions

Product line is a group of

products that are closelyrelated because they functionin a similar manner, are soldto the same customer groups,

are marketed through thesame types of outlets, or fallwithin given price ranges

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Product linelength is the number of items

in the product line Line stretching

Line filling

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Product line stretching is when acompany lengthens its product linebeyond its current range

Downward

Upward

Combination of both

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Product L ine Decisions


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Downward product line stretching is used bycompanies at the upper end of the market to plug amarket hole or respond to a competitors attack

Upward product line stretching is by companies atthe lower end of the market to add prestige to theircurrent products

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Combination line stretching is used bycompanies in the middle range of themarket to achieve both goals of upward anddownward line stretching

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Product line filling occurs when companiesadd more items within the present range ofthe line

More profits

Satisfying dealers Excess capacity

Differentiate among the competitors

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Product Mix

Includes all the different products that acompany makes or sells.


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Product M ix Decisions

Product mix consists of all the products anditems that a particular seller offers for sale

Width

Length Depth

Consistency

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WIDTH The number of product lines carried

Product Mix

DEPTH

Variety

ofsizes,colors,modelswithin

aproductline

PRODUCT MIX


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Product Width

Oral CareBlades &Razors

PersonalCare

Batteries Appliances

Width of the Gillette Product Mix

The number of different product lines abusiness manufactures or sells.


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Product Depth

Oral Care

Blades &

Razors

Personal

Care

Batteries Appliances

The number of product items offered withineach product line.
http://www.braun.com/http://www.duracell.com/http://www.gillettevenus.com/http://www.gillettem3power.com/http://www.mach3turbo.com/http://www.oralbbrushups.com/http://www.oralbhummingbird.com/http://www.oralb.com/


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Product L ine Decisions

Product mix lengthis the total number of items thecompany carries within its product lines

Product line depthis the number of versions offered ofeach product in the line

Product mix width is the number of different product linesthe company carries

Consistency is how closely the various product lines are inend use, production requirements, or distributionchannels

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Branding Strategy:Building Strong Brands

Brandrepresents the consumers perceptions

and feelings about a product and itsperformance. It is the companys promise todeliver a specific set of features, benefits,services, and experiences consistently to the

buyers

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Services Marketing

Nature and Character istics of a Service

Intangibility refers to the fact that servicescannot be seen, tasted, felt, heard, orsmelled before they are purchased

Inseparability refers to the fact that servicescannot be separated from their providers

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Services Marketing

Nature and Character istics of a Service

Variability refers to the fact that servicequality depends on who provides it as wellas when, where, and how it is provided

Perishability refers to the fact that servicescannot be stored for later sale or use

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Packaging

Functionsof

Packaging

Contain and Protect

Promote

Facilitate Storage, Use,and Convenience

Facilitate Recycling


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Packaging

Involves designing and producing thecontainer or wrapper for a product

Innovative packaging can give a company anadvantage over competitors and boost sales.

Packages must involve sales tasks fromattracting attention, to describing the product,to making the sale.

Good packaging creates immediate consumerrecognition of a brand.

Product safety also becomes a major

packaging concern


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Labeling

Ranges from simple tags to complex graphics thatare part of the package

Label identifies the product or the brand.

Describe several things the product- who made it,where it was made, when it was made, its contents,

how it is to be used and how to use it safely. The label might help to promote the brand, support

its positioning and connect to its customers.


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Labeling

Drawbacks of Labeling

At times labeling also raises concerns:

False , misleading or deceptive labels or packageconstitute unfair competition.

Mislead customers, fail to describe important ingredients,fail to include safety warnings.

Affects of labeling Unit pricing(price per unit of standard measure)

Open dating (expected shelf life of the product)

Nutritional labeling( the nutritional values of the product)


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Labeling

Persuasive

Focuses onpromotionaltheme

Information issecondary

Informational

Helps make properselections

Lowers cognitivedissonance

Includes use/care

Documents

Chapter 08 eco